Section 80CCF Tax Saving Bonds - SREI Infrastructure Long Term Infrastructure Bond-Tranche 1 - Indian IPO Blog

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Sunday, January 15, 2012

Section 80CCF Tax Saving Bonds - SREI Infrastructure Long Term Infrastructure Bond-Tranche 1

SREI Infrastructure Long Term Infrastructure Bond - Tranche 1, a bond issue covered by the benefit of Section 80CCF of the Income Tax Act, 1961 has been launched. The Issue will remain open till January 31, 2012

The following are the details of the bonds:

Eligibility: Resident Indian Individuals (Minors not eligible) and HUFs

Application Size:
The lot for application would be 1 Bond and multiples of 1 Bond thereafter.

Face Value: Rs.1,000/- 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 Option III Option IV
Face Value Rs.1,000/- Rs.1,000/- Rs.1,000/- Rs.1,000/-
Interest frequency Cumulative Annual Cumulative Annual
Duration 10 years 10 years 15 years 15 years
Coupon Rate p.a. 8.90% 8.90% 9.15% 9.15%
Payment Compounded Annually Payable Annually Compounded Annually Payable Annually
Buyback Amt. Rs. 1,531.68 Rs. 1,000.00 Rs. 1,549.24 Rs. 1,000.00

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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