Para 4.6.6 — CAM

4.6.6 Rate of Penal Interest: i. The rate of interest to be charged is Bank Rate as prevailing (which is generally notified biannually on May 1 and November 1) plus 2% or as decided by RBI in consultation with CGA from time to time. ii. The period of delay in a transaction of ₹ 1 lakh and above shall attract delayed period Interest at Bank Rate + 2%. iii. For the transaction below Rs 1 lakh in each case, the delayed period interest shall be levied only at the Bank Rate for delays up to 5 calendar days and above 5 calendar days at the Bank Rate 2 % for the full period of delay. iv. For petty claims of delayed penal interest involving an amount of ₹500/- or below will be ignored and excluded from the purview of penal interest (CGA'S OM no S11012/3/P Intt(RP) /CGA/2007/R80/ 499 dated 06/04/2009). This limit of penal interest of Rs 500/- is for per transaction. v. In respect of Non-Tax and all other Government receipts also, for permissible time limit, calculation of delay period and delayed period interest, the above instructions shall be applicable. vi. The rate of penal interest in case of PPF/SCSS schemes of Mo Finance is mentioned in Budget Division OM No. F.17/1/2008-NS-II dated 15th May, 2008 (as amended from time to time). vii. All banks may build up their own internal control mechanism so that the preventive and corrective actions are taken by the bank for its branches well in time.