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NHAI 54EC Capital Gain Bonds 2020-21 (Tr-XXI)

NHAI 54EC Capital Gain Bonds 2020-21 (Tr-XXI)

NHAI 54EC Capital Gain Bonds 2020-21 (Tr-XXI)

National Highways Authority of India, a Statutory Body established under the National Highways Authority of India Act, 1988 having its Head Office at G-5 & 6, Sector-10, Dwarka, New Delhi-110075

NHAI has started taking the Application for New Series of NHAI 54EC Capital Gain Bonds 2020-21 (Tr-XXI)  w.e.f. 01st April 2020.

Important Update:

NHAI has issued a notice on 27th July 2020 regarding reduction in the Interest Rate of NHAI 54EC Capital Gain Tax Exemption Bonds Series XXI

Where application money for the NHAI 54EC bonds is credited in NHAI 54EC Bonds Collection Account on or before 31st July 2020Interest Rate
5.75%  per annum
 Where application money for the NHAI 54EC bonds is credited in NHAI 54EC Bonds Collection Account after 1st August 2020 Interest Rate
5.00%  per annum

Do you know:

Q1. Who can claim exemption under section 54EC?

Ans. Any Person

Q2. Whether Short Term Capital Asset or Long-Term Capital Asset is eligible for Exemption?

Ans. Long-Term Capital Asset.

Q3. Which specific asset is eligible for exemption?

Ans. Any Long-Term capital asset (being land or building or both)

Q4. Which asset should the taxpayer acquire to avail the benefits of section 54EC?

Ans. Following are the Tax Exemptions bonds available under section 54EC, the taxpayer can acquire any of them or any combination of them to avail the benefits of section 54EC.

  • National Highways Authority of India
  • Rural Electrification Corporation
  • Power Finance Corporation Limited (as notified)
  • Indian Railway Finance Corporation Limited (as notified)

Q5. What is the time limit for acquiring such new asset under section 54EC?

Ans. Within 6 months from the date of transfer of Long-Term capital asset but in case of compulsory acquisition from the date of receipt of compensation.

Q6. What is the quantum of Exemption u/s 54EC?

Ans. The amount of investment made in the new asset or capital gain, whichever is lower.

Q7. Can exemption claimed u/s 54EC be revoke in a subsequent year?

Ans. Yes, if the new asset is transferred or it is converted into money or a loan is taken on security of the new asset within 5 years of its acquisition.

Q8. What would be consequences if the exemption is revoked?

Ans. It is going to be taxable in the year in which the default is committed considering it as a long-term capital gain.

OBJECTS OF THE PRIVATE PLACEMENT

The proceeds of NHAI 54EC Capital Gain Bonds 2020-21 (Tr-XXI) will be used towards part financing of the various projects being implemented by the Authority under the National Highways Development Project (“NHDP”) as approved by the Government of India.

HIGHLIGHTS OF THE INSTRUMENT – NHAI 54EC

Credit rating– CARE AAA/Stable by CARE Ltd
– CRISIL AAA/Stable by CRISIL Ltd,
– IND AAA/Stable by India Rating (Fitch) &
– ICRA AAA/Stable by ICRA Ltd
Face ValueRs.10,000/- per Bond
Issue PriceRs.10,000/- per Bond
Minimum application sizeApplicant can apply for as minimum as 1 (ONE) Bond of Rs. 10,000/- (Ten Thousand)
Maximum application sizeApplicant can apply for maximum 500 bonds of Rs.10,000/- each (Rs.50,00,000) subject to fulfilment of other conditions as specified in Income Tax Act.
Size of the IssueSize of Issue (Tr-XXI) is Rs. 5,000 Crore
Mode of Subscription100% on application
Deemed Date of Allotment/Deemed DateLast day of the month during which the application amount has been cleared and get credited to NHAI’s collection account
TransferabilityThe Bonds are non-transferable, non-negotiable, and cannot be offered as a security for any loan or advance purpose.
Interest paymentAnnually on 1st bank working day of April
and the Final Interest at the time of Maturity
Coupon rate5.75% per annum
MaturityAt par, since they are non-cumulative, 5 years from the Deemed Date of Allotment
TrusteeIDBI Trusteeship Services Limited Asian Building, Ground Floor, 17, R. Kamani Marg, Ballard Estate, Mumbai – 400 001.
RegistrarM/s Beetal Financial & Computer Services Pvt Ltd 99 Beetal House, Nr. Harsukhdas Mandir, Behind Local Shopping Centre, Madangir, New Delhi – 110062 E.Mail: nhaibonds@gmail.com, spgupta123@gmail.com
Collecting BanksThe application can be submitted to all our existing bankers i.e. any branch of Union Bank of India & HDFC Bank and specified branches of Axis Bank, Canara Bank, ICICI Bank & IDBI Bank Ltd as listed in Information Memorandum dated 01 April 2020.
Closure of IssueThe issue is open on-Tap Basis and will close on March 31, 2021 at the close of the banking hours or on achieving of ceiling limit of Rs.5,000 Crore without any further notice or at a date as may be decided by NHAI at its absolute discretion.

Note:

  • NHAI reserves the right to revise the terms of the Bonds including the Coupon rate in its absolute discretion either through an issue of Information Memorandum containing revised terms and conditions or making an announcement in one or more leading newspapers or any other appropriate means subject to applicable law.
  • The revised terms shall be applicable only to Bonds allotted in respect of applications made after notification of the revised terms or issue of information memorandum containing the revised term sheet, as the case may be.
  • All applications submitted but not accepted by NHAI would be returned by NHAI to the applicant without any interest.
  • Application for Rs. 10,000/- and in multiples of one bond thereof only will be accepted.
Section 54EC

For any information or query you can visit NHAI website.

After submitting the application for the NHAI Tax Saving bond in the respective bank branch, you will get the acknowledgement receipt as shown in the image below. Keep this receipt for all the future related correspondence.

Nhai 54EC tax saving bond receipt

Allotted NHAI 54EC bonds will get directly credited to your DP account which you have mentioned in the application. Kindly recheck the phone number and email on the application so that you can receive all the future correspondence.

List of Designated Bank Branches

Change of Address Form

Change in Bank Details Form

Nomination Form

Duplicate Bond Certificate Form

Download you application.

Highlight of Issue 2020-21.

REC 54EC Capital Gain Tax Exemption bonds for FY 2020-21. Click here.

Power Finance Corporation Corporation Capital Gain Tax Exemption Bonds –Series IV for FY 2020-21. Click here.

IRFC Capital Gain Tax Exemption Bonds –Series IV For FY 2020-21

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9 COMMENTS

  1. I purchased NHAI bonds in June-2019 and the first interest was credited into my bank account on 02-Apr-2020 , now I want to know will this NHAI Bonds interest add in the income of last year (FY2019-2020) or this current year (FY2020-2021)? I will soon be filing my tax return for the FY2019-2020 so should I add this interest to my income or keep it for the next year FY20-21?

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