The different forms of Government securities shall be transferable only in the manner hereunder-
(1) A Government promissory note or a treasury bill:-
(a) It shall be transferable by endorsement and delivery like a promissory note payable to order.
(b) No endorsement of a Government promissory note or a treasury bill shall be valid unless made by the signature of the holder or his duly constituted attorney or representative inscribed on the back of the security itself.
(c) No writing on a Government promissory note or a treasury bill is valid for the purpose of negotiation if such writing purports to transfer only a part of the amount denominated by the security.
(d) The treasury or sub-treasury, of any office of the Bank or the Public Debt Office may decline to accept a Government promissory note or a treasury bill endorsed in blank for any purpose unless the endorsement in blank is converted into that in full before presentation.
(2) Bearer bond shall be transferable by delivery. The person in possession of the bond shall be deemed to be a holder of the bond.
(3) Stock.-
(a) Stock for which a stock certificate is issued or which is held in the Subsidiary General Ledger Account shall be transferable either wholly or in part by execution of an instrument of transfer in Form II or III as the case may be.
(b) The transferor shall be deemed to be the holder of the stock to which the transfer relates until the name of the transferee is registered as a holder of the stock by the Public Debt Office.
[(3A) A Government security issued in the form of a Treasury Savings Deposit Certificate whether before or after the commencement of the Public Debt (Amendment) Rules, 1960, [or in the form of a Defence Deposit Certificate] may be transferred subject to the following conditions namely:
(a) the transfer shall be made in writing in Form IIIA:
[(aa) the transfer of a Treasury Savings Deposit Certificate or a Defence Deposit Certificate held in the names of two adults whether payable to them jointly or to either or to either or survivor, shall be made by both of them jointly and on the death of one of them by the survivor;]
(b) the transfer may relate to the whole amount for which the certificate is issued or to a part thereof;
(c) the transfer shall be made only to a person who is himself eligible to hold a Treasury Savings Deposit Certificate [or a Defence Deposit Certificate];
(d) the transfer shall not take effect until it is registered in the Public Debt Office;
(e) any transfer during the period of one year from the date of issue of the certificate may be made only to
(i) a near relative (husband, wife, lineal ascendant or descendant, brother or sister) for natural love and affection;
[(ii) any other person under either the orders of a court of law or with the approval of the Bank]:
[Provided that a transfer, under this sub-rule, of a Treasury savings Deposit Certificate or a Defence Deposit Certificate relating to a deposit by a guardian on behalf of a minor shall not be registered unless such guardian certifies in writing that the minor is alive and the transfer is for the benefit of the minor];
(3B) Notwithstanding anything contained in clause (e) of sub-rule (3A) but subject to the conditions specified in clauses (a),[(aa)], (b), (c) and (d) of that sub-rule, a Treasury Savings Deposit Certificate [or a Defence Deposit Certificate] may be transferred by way of pledge or security to,-
(a) a Gazetted Officer of Government in his official capacity;
(b) a local authority or any officer of such local authority;
(c) the Reserve Bank of India, a scheduled bank or a co-operative society including a co-operative bank; or [(d) any other corporation or a Government company as defined in section 617 of the Companies Act, 1956;
and re-transferred when the purpose of such transfer by way of pledge or security is over.
Provided that a transfer under this sub-rule of a Treasury Savings Deposit Certificate or a Defence Deposit Certificate relating to a deposit by a guardian on behalf of a minor shall not be registered unless such guardian certifies in writing that the minor is alive and the transfer is for the benefit of the minor.]
Explanation.- In this sub-rule-
(a) "Local authority" means a municipal corporation, municipal committee, district board, body of Port Commissioners or other authority legally entitled to or entrusted by the Government with the control or management of a municipal or local fund;
(b) "corporation" means a corporation established by or under any law for the time being in force but does not include a company or a foreign company as defined in the Companies Act, 1956.]
(4) Promissory notes in Form 1 issued to a [Ruler of a former Indian State] are transferable by an endorsement by the Ruler of the State for the time being. The transferee of any such note shall not be capable of negotiating or drawing interest on the same when so transferred, but shall be entitled on surrender to the Public Debt Office of the note so transferred duly receipted in Form XVI and on payment of the prescribed fee to obtain therefrom Government promissory note or notes for the nominal value of the note so transferred.
[(5) A Government security issued in the form of a Defence Certificate may be transferred subject to the following conditions, namely:
(a) the transfer shall be made in writing in Form IIID, printed on the reverse of the Certificate.
(b) the transfer shall relate to the whole amount for which the Certificate is issued and not for any part thereof, and
(c) the transfer shall not take effect until it is registered in the Public Debt Office, New Delhi.]
[7-A. Nomination in respect of a Treasury Savings Deposit Certificate or a Defence Deposit Certificate.- (1) A sole holder or a sole surviving holder of a Government security issued in the form of Treasury Savings Deposit Certificate whether before or after the commencement of the Public Debt (Amendment) Rules, 1960, [or in the form of a Defence Deposit Certificate] who is not a minor and who holds the certificate in his individual capacity and not in the capacity of the holder of an office or otherwise may nominate a person or persons who shall be entitled to the certificate and to payment thereon in the event of the death of the holder:
Provided that-
(a) the person or each of the persons nominated is himself competent to hold a certificate, and
(b) the nomination is made either before maturity of the certificate or after maturity, during the period for which the certificate earns interest.
(2) Every nomination under sub-rule (1), whether in substitution of a nomination already made or not, shall be made in Form III-B.
(3) A nomination made under this rule may on a subsequent date be cancelled in writing in Form III-C.
(4) As soon as possible after a nomination is made or a nomination already made is cancelled, the person making or cancelling the nomination shall send to the Public Debt Office the form of nomination or cancellation, as the case may be, together with the certificate to which it relates and the fee prescribed in sub-rule (5); and thereupon the Public Debt Office shall register the nomination or, as the case maybe, the cancellation in its books and return the certificate with an endorsement thereon that a nomination has been made in respect of the certificate or that the nomination already made has been cancelled.
(5) The fee for the registration of a nomination or any cancellation thereof shall be 25 nP. for every Rs.50 of the nominal value of the certificate subject to a maximum of Re.1 per certificate:
Provided that no fee shall be charged for the registration of the first nomination in respect of any certificate.
(6) No nomination or cancellation of a nomination shall take effect unless and until it has been registered in the Public Debt Office in accordance with this rule.
7-B. Effect of nomination on renewal, etc.- [(1) The rights which a nominee or nominees has or have acquired in relation to a Treasury Savings Deposit Certificate or a Defence Deposit Certificate under a nomination duly made and registered under rule 7A, shall not be affected by reason only of the renewal or sub-division of the certificate or the issue of a duplicate certificate on the ground that the original has been lost, stolen, destroyed mutilated or defaced or in the case of a Treasury Savings Deposit Certificate on its conversion on application by a person by whom it is held as pledge or by way of security for any purpose into a Defence Deposits Certificate; and the nominee or nominees shall have the same rights in relation to the renewed certificate or each of the certificates issued on sub-division or the duplicate certificate or the new certificate issued by way of conversion as he or they had in relation to the original certificate:
Provided that where a certificate is sub-divided in pursuance of a transfer (other than transferby way of pledge or security), of a part of such certificate, nothing in this sub-rule shall apply to the new certificate or certificates issued tc the transferee.]
(2) Notwithstanding anything contained in sub-rule (1) of rule 24, a Treasury Savings Deposit Certificate [or Defence Deposit Certificate] which is subject to nomination in favour of a person or persons shall not be consolidated with any other Treasury Savings Deposit Certificate [or Defence Deposit Certificate] unless the latter is also subject to nomination in favour of the same person or persons; and where two or more such certificates are consolidated, the person or persons shall have the same rights in relation to the consolidated certificate as he or they had in relation to each of the certificates so consolidated.]
[7-C. Nomination in respect of a Defence Certificate.- (1) A holder of a Government Security issued in the form of a Defence Certificate, who is not a minor and who holds the security in his individual capacity may, if the certificate has not matured for payment, nominate a person for persons who shall be entitled to the certificate and to payment thereon in the event of the death of the holder.
(2) Every nomination under sub-rule (1) whether in substitution of a nomination already made or not shall be made in Form IIIE.
(3) A nomination made under this rule may on a subsequent date be cancelled in writing in Form IIIF.
(4) As soon as possible after a nomination is made or a nomination already made is cancelled, the person making or cancelling the nomination shall send to the Public Debt Office, New Delhi, the form of nomination or cancellation, as the case may be; and thereupon the Public Debt Office shall register the nomination or cancellation, as the case may be, in its books.
(5) No nomination or cancellation of a nomination shall take effect unless it has been registered in the Public Debt Office, New Delhi, in accordance with this Rule.]