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Sunday, January 15, 2012

IDFC Long-term Infrastructure Bonds – Tranche 2, a tax saving bond issue having benefit under Section 80 CCF of Income-Tax Act, 1961 is open for subscription till February 10, 2012

The following are the details of the bonds:

Eligibility: Resident Indian Individuals and HUFs

Application Size:
The lots for application would be 2 Bonds and in multiples of 1 Bond thereafter.

Face Value: Rs.5,000/- per bond

Lock-in period: 5 years

Form: Demat / Physical Form. However, trading will be allowed only in Demat form after lock-in period

Availability: In dematerialized form and in physical form.

Interest Rates and other details:

Particulars Option I Option II
Face Value Rs.5,000/- Rs.5,000/-
Interest frequency Annual Cumulative
Duration 10 years 10 years
Coupon Rate p.a. 8.90% 8.90%
Payment Compounded Annually Payable Annually
Buyback Amt. Rs. 5,000.00 Rs. 7,590.00
Maturity Amt. Rs. 5,000.00 Rs. 11,515.00

According to Section 80CCF of the Income Tax Act, 1961, in computing the total income of an assessee, being an individual or a Hindu undivided family, there shall be deducted, the whole of the amount, to the extent such amount does not exceed twenty thousand rupees, paid or deposited, during the previous year, as subscription to long-term infrastructure bonds as may, for the purposes of this section, be notified by the Central Government

By investing in these bonds, investors can therefore, avail deduction under Section 80CCF of upto Rs.20,000/-, which will be over and above the prevailing deduction of Rs.100,000/- for investments made under Section 80C of the Income Tax Act, 1961


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