Chapter III — Central Banking Functions

Section 33: Assets of the Issue Department

Reviewed by CA Nikhil Gupta · Last reviewed 18 September 2026

Section 33 prescribes the asset backing of RBI's Issue Department and the composition/minimum framework for assets held against note liabilities.

Operative provisionOfficial sources mappedProvision-specific decode

Finin2min - Section 33 in 2 minutes

Legal effectSection 33 prescribes the asset backing of RBI's Issue Department and the composition/minimum framework for assets held against note liabilities.

Operative ruleThe provision identifies eligible classes such as gold coin/bullion, foreign securities, rupee coin and rupee securities, subject to the statutory minimum and valuation rules as amended from time to time.

Connected lawRead it with Sections 23 and 34: Section 23 separates the Issue Department and Section 34 identifies its liabilities.

File evidenceReserve-accounting work must use the current statutory valuation/minimum rules rather than historical textbook percentages that may have been amended.

Statutory structure and clause / subsection decode

This map separates the operative limbs of this provision so thresholds, powers, conditions and exceptions are not collapsed into a single summary.

33(1)

Issue Department assets must consist of permitted assets in an aggregate amount not less than total Issue Department liabilities.

33(2)

Gold coin + gold bullion + foreign securities together must be at least Rs 200 crore; gold coin + gold bullion alone must be at least Rs 115 crore.

33(3)

The remainder may be held in the rupee coin/securities and eligible notes/bills specified by the subsection.

33(4)

Gold is valued at no more than the prevailing international market price; rupee coin at face value; securities at rates not exceeding market rates.

33(5)

At least 17/20 of gold coin and bullion held as assets must be held in India, subject to the statutory custody/transit proviso.

33(6)

Specifies eligible foreign securities, institutions, maturity and related conditions; use the current official text for instrument-level classification.

Worked practical example

Facts. An analyst comparing note liabilities with RBI assets should use the Issue Department balance and Section 33 eligible-asset framework, not total RBI assets indiscriminately.

Compliance points and common mistakes

Do not decide the issue from the heading alone. Map the facts to the operative words of Section 33 and to each relevant subsection, clause, proviso or explanation shown above.
Keep the statutory question separate from the operational overlay. Read it with Sections 23 and 34: Section 23 separates the Issue Department and Section 34 identifies its liabilities.
Do not convert an exception, exemption or discretionary RBI/Government power into an automatic entitlement. Record the authority, conditions and effective date.
Where the provision is historical, omitted or repealed, state that status prominently and do not present it as a current compliance obligation.

Connected provisions and instruments

Section 33 has no universal instrument dependency in this package. Add an RBI circular or direction only when its subject, entity and effective date cover the issue being analysed.

Questions and answers

What is the purpose of Section 33?

Assets of the Issue Department: Section 33 prescribes the asset backing of RBI's Issue Department and the composition/minimum framework for assets held against note liabilities.

Which statutory limb should be checked first?

33(1) - Issue Department assets must consist of permitted assets in an aggregate amount not less than total Issue Department liabilities.

What is the next legal boundary?

33(2) - Gold coin + gold bullion + foreign securities together must be at least Rs 200 crore; gold coin + gold bullion alone must be at least Rs 115 crore.

What record should support the conclusion?

Section 33 file evidence: Reserve-accounting work must use the current statutory valuation/minimum rules rather than historical textbook percentages that may have been amended.

Primary sources

Source control for Section 33: use the official consolidated RBI Act for the statutory text and footnotes, then separately reconcile any post-Finance Act 2022 amendment, commencement notification or RBI instrument relevant to the event date.