Money & Banking

Government to sell confiscated gold only to RBI hereafter

Our Bureau | | Updated on: Dec 06, 2021
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Under the new guidelines, SPMCIL has been engaged for collection, transportation and conversion into standard gold bars and delivery to RBI

Finance Ministry has decided that hereafter seized or confiscated gold will be sold to the Reserve Bank of India (RBI) only. This does not include gold ornaments or jewellery.

The Ministry has amended the guidelines and the amended version says, “It has now been decided that henceforth seized/confiscated gold will be sold (other than gold ornaments/jewellery/articles) to RBI only. In this regard, the Board has consulted RBI and Security Printing and Minting Corporation of India Limited (SPMCIL) and also signed a tripartite Memorandum of Understanding (MOU) with them.”

Old guidelines prescribed gold in various forms such as bullion, jewellery, ornament, seized/ confiscated by the field formations of CBIC including the Directorate of Revenue Intelligence to be sold to the Public Sector Banks and other agencies.

Under new guidelines, SPMCIL has been engaged for collection, transportation, conversion into standard gold bars and delivery to RBI. The SPMCIL has facility to melt gold at India Government Mints (IG Mint) located at Hyderabad, Kolkata and Mumbai. These mints will be carrying out processes such as pre-melting, assaying and weighing in the presence of Customs Officer.

The process

The process will start with intimation to SPMCIL. Then it will transport bullion to India Government Mints. There it will go through preliminary assaying, melting/minting and conversion into standard gold bars. Once done, bars will be delivered to RBI. The process will end with RBI crediting the payment into Government Account.

The price of the fine gold to be purchased will be determined based on the average LBMA (London Bullion Markets Association) rate of gold for the preceding 30 days from the date of receipt of gold by the central bank at Mumbai and the same shall be converted into Rupees using the Financial Benchmarks India Private Limited (FBIL) USD: Rupee exchange rate of that day.

Published on December 06, 2021

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