Tamil Nadu - Chennai   

Petition seeks direction to RBI

CHENNAI: A writ petition has been filed in the Madras High Court seeking a direction to the Reserve Bank of India (RBI) for framing appropriate rules to ensure title and payment of tax for gold and gold ornaments pledged in banks for obtaining loans.

In his petition, G. AnnaDurai of Ambattur stated that the RBI had decided that purity of gold alone was sufficient to mortgage the metal in banks.

It had not framed rules and regulations for advancing money against gold and gold ornaments.

Any person could mortgage any other person's gold with or without the owner's permission. Even stolen gold could be pledged. Hence, there was a need for appropriate rules.

When the matter came up, the First Bench, comprising Chief Justice M.Y. Eqbal and Justice T.S. Sivagnanam, directed the petitioner's counsel to produce the guidelines issued by RBI with regard to pledging jewels for loans.

The matter has been posted for further hearing after a week.

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