Form of security

Conditions

Amount of security

1

Cash

The Government will not pay any interest on security deposit, held in the form of

cash.

Amount of cash deposited in appropriate Government

treasury.

2

Promissory notes,

stock certificates of

any State Government

These securities shall be accepted at five percent below their market price as on date of submission or at their face value, whichever is less.

3

Post Office Cash Certificates,Treasury Savings Deposits, National Plan Savings

Certificates, 12 Year

National Defence

Certificates, 10 Year

National Defence

Certificates.

These certificates shall be

formally transferred to the

(President of India) and

shall be accepted with the

sanction of the Post Master

of the office of registration.

Surrender value at the time of tender.

4

Post Office Savings

Bank Pass Books.

A pass book, for a deposit made under the Post Office Savings Bank Rules may be accepted as security provided that the dealer has signed and delivered to the

Post Master a letter in the prescribed form as required by the said rules. The pass book shall be sent to the post office as soon as possible after the 15th June

of each year so that necessary entries of interest may be made therein.

Amount deposited

5

Municipal debentures or Port Trust Bonds and/or Debentures issued by the

Government or a financial corporation.

These securities shall be accepted at five per cent below the market price as on date of submission or face value whichever is less.

6

Bonds or debentures issued by corporate bodies guaranteed by the Central or any State Government as regards the payment of principal and interest or as regards principal only.

These securities shall be accepted at five per cent below the market

price or face value, whichever is less.

7

Deposit receipts of any authorised bank.

The deposit receipts shall be made in the name of the dealer but pledged to the

President of India. The Bank shall agree that on receiving a signed treasury challan from the Commissioner and withdrawal order duly signed by the Commissioner, the bank will at once remit the amount in full or in part, as may be specified in the order, into the treasury and send the receipted challan

to the Commissioner. The dealer will agree in writing to undertake the risk involved in the investment.

The amount shown on the deposit receipt.

8

Mortgage of immovable property, hypothecation or

pledge of movable property, personal surety.

Mortgage bond in writing shall be executed in favour of the President of India and registered according to

law of registration at the cost of the dealer. The property mortgaged shall be

free from all encumbrances. Personal surety shall be in the form of a personal bond with one or two guarantees acceptable to the Commissioner. This form of security shall be accepted subject to such conditions as may be laid

down from time to time by the Commissioner by a general or special order. The liability of the surety or guarantor shall be coextensive with that of the dealer for the period the contract of surety or guarantee remains in operation notwithstanding the fact that the assessment proceedings against the

dealer under Chapter VI of the Act for the period are initiated before or after the

said period. The liability of the surety or guarantor shall be enforced and executed according to the law for the recovery as arrears of land revenue referred to in section 44.

Amount stated in the relevant document as the maximum amount

recoverable under the mortgage,

hypothecation, pledge, or personal surety.

9

Bank guarantee.

The bank must be a Scheduled Bank. The bank guarantee shall be initially valid for a period of one year and shall be kept valid till such time the Commissioner may require.

The amount stated in the relevant document as the maximum amount recoverable under the bank

guarantee