Don't Tax Yourself With Taxes

Capital Gain Bonds
These are bonds in which the profit arising from the sale of a property or any financial asset or any other capital gain from any asset can be invested. These bonds have a lock-in period of 5 years and one can invest in these bonds upto a maximum amount of Rs. 50 lakhs. Currently, these bonds are being issued by NHAI (National Highway Authority of India), REC (Rural Electrification Corporation Limited) and Power Finance Corporation and some more which are approved by GOI from time to time
What is the taxation policy applicable on Capital Gain Bonds?
Capital Gain Tax is levied on Capital Gains received from sale of a long term capital asset. This tax levied can be saved by the seller, if the sale proceeds are further invested in Capital Gain Bonds specified under Section 54EC within 6 months of receipt. The exemption from Capital Gains is possible only if the asset is sold after being held for 3 years or more. In case the asset is sold before 3 years, them it is considered as short term capital gain and is therefore subject to applicable taxation slab. The interest earned on Capital Gain Bonds is not subject to tax exemption. The interest earned is treated as part of the annual income and is therefore subject to the taxation slab as applicable for the investor. The interest earned on these bonds is payable annually and the funds are directly credited to the bank account of the investor. Rs. 50 lakh is the aggregate maximum exemption allowed under Section 54EC irrespective of the financial year, as per Budget 2014.
Can Capital Gain Bonds be used as collateral in a loan?
Can I sell these bonds? Capital Gain Bonds are non-transferable and non-negotiable. They cannot be pledged or offered as collateral / security while applying for a loan. No you cannot sell these bonds. Capital Gain Bonds are issued for a period of 5 years and as per Section 54EC, they cannot be sold before these 5 years. These bonds are not listed on the stock exchanges.
Features |
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Safe and Secure
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All Capital Gain Bonds are AAA rated |
Tenure | Lock-in-period of 5 Years from Deemed Date of Allotment |
Coupon (%p.a.) | 5.00% p.a, payable annually |
Face Value | Rs. 10,000/- per bond. |
Minimum Investment | 1 bond of Rs. 10,000/- |
Maximum Investment | Rs. 50,00,000/- in a financial year (Subject to section 54EC of Income Tax, 1961 |
Taxability | Interest Taxable and TDS will not be deducted |
Transferability | It is non-transferable, non-negotiable and cannot be Offered as a security for any loan or advance |
Redemption/Maturity | Bonds are automatically redeemed on maturity |
Why Capital Gain (54EC) Bonds?
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Save Tax Invest your Long Term Capital Gain from sale of capital asset in these bonds within 6 months from sale of such asset to get tax exemption.
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Secure These are backed by Government making them a highly secure investment.
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Earn These bonds offer not only tax exemption, but also an assured return on the investment.
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Accessibility One can hold 54EC Capital Gain Bonds in any form, Physical or DEMAT.
Documents Required
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Self – Attested Copy of PAN Card and Address Proof
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Cancelled Cheque Copy for ECS payment of Interest & Maturity
Eligibility
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Individuals
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Hindu Undivided Families (HUF)
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Partnership Firm / LLP / Insurance Companies / Companies and Body Corporates
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Provident Funds, Superannuation Funds and Gratuity Funds
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Banks / Mutual Funds / Financial Institutions (FIs) / FPIs (Subject to existing regulations)
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RRBs / Co-operative Banks.
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NRIs/other foreign eligible investor investing out of NRO A/c on non-repatriable basis subject to applicable law
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Any other investor subject to applicable laws

Cheque / DD should be drawn in favour of

“REC Limited -54 EC Bonds” or “Rural Electrification Corporation Ltd-54EC Bonds”
RTGS Details
Bank | A/c No | IFSC Code | MICR Code | Branch |
HDFC Bank | 00030350000584 |
HDFC0000003 |
110240001 |
Surya Kiran Building, New Delhi |
ICICI Bank | 000405108563 |
ICIC0000004 |
400229002 |
Churchgate, Mumbai |
Cheque / DD should be drawn in favour of

National Highways Authority of India”
RTGS Details
Bank Name | Beneficiary Name | A/c Number | IFSC Code |
Union Bank Of India | National Highway Authority Of India | 536401010000419 | UBIN0553646 |
ICICI Bank | NHAI CG Bond Issue Account | 2471201001184 | CNRB0002471 |
IDBI Bank | National Highway Authority Of India | 998103000002561 | IBKL0000998 |
ICICI Bank | National Highways Authority Of India | 000405100716 | ICIC0000004 |
Syndicate Bank | NHAI Bond | 90622010065585 | SYNB0009062 |
HDFC Bank | National Highways Authority Of India | 00030350007025 | HDFC0000003 |
Axis Bank | NHAI 54ec Capital Gains Bond Issue | 912020019237448 | UTIB0000207 |


Cheque / DD should be drawn in favour of

“PFC Capital Gain Bonds”
RTGS Details
Bank | A/c No | IFSC Code | MICR Code | Branch |
HDFC Bank | 57500000034792 |
HDFC0000003
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110240001 |
Kasturba Gandhi Marg, Delhi
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ICICI Bank | 000405115137 |
ICIC0000004 |
400229002
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Nariman Point, Mumbai |