PFC Capital Gain Tax Exemption Bonds –Series IV
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.
PFC Capital Gain Tax Exemption Bonds Issue Highlights
PRIVATE PLACEMENT OF SECURED, NON-CONVERTIBLE, NON-CUMULATIVE, REDEEMABLE, TAXABLE BONDS IN THE NATURE OF DEBENTURES OF Rs. 10,000/- EACH FOR CASH AT PAR ON “ON TAP” BASIS WITH BENEFITS UNDER SECTION 54EC OF THE INCOME TAX ACT, 1961.
|Security Name||PFC Capital Gain Tax Exemption Bonds –Series IV|
|Rating||‘AAA/Stable’ by CRISIL, ‘AAA (Stable)’ by ICRA, & ‘AAA/Stable’ by CARE|
|Issue size||Rs 500 crore + Green Shoe option to retain oversubscription|
|Face Value||Rs. 10,000 (Rupees Ten Thousand only) per bond|
|Issue Price||At par (Rs. 10,000/- per bond)|
|Coupon Rate||5.75% per annum.|
|Issue Opening & Closing Date||Issue Opening Date: April 1, 2020 Issue Closing Date: March 31, 2021 (at the close of the banking hours) or at a date / time as may be decided by PFC in its absolute discretion|
|Minimum application size and in multiple of thereafter||Application must be for a minimum size of Rs. 20,000/- (2 bonds) and then in multiple of Rs. 10,000/- (1 bond) thereafter|
|Maximum application size||500 bonds of Rs. 10,000/- each (Rs. 50,00,000/-)|
|Mode of Issue||Private placement basis|
|Mode of Subscription||Applicants may make remittance of application money through electronic mode or cheque / draft drawn in favour of ‘PFC Capital Gain Bonds’.|
|Deemed Date of allotment||Last day of each month in which the subscription money is received and credited to PFC Capital Gain Collection Account|
|Coupon payment date||Every year on 31st July till redemption and balance along with redemption|
|Tenor||5 years from the deemed date of allotment|
|Date of Redemption||At the end of 5 years from the Deemed Date of Allotment|
|Transferability||Non-transferable, Non-Marketable, Non-negotiable and cannot be offered as a security for any loan or advance|
|Listing||The Bonds will not be listed on any stock exchange due to non-transferability during the tenure of Bonds|
|Trustees||Beacon Trusteeship Limited|
|Bankers to Issue||HDFC Bank Ltd, IndusInd Bank Ltd., ICICI Bank Ltd., Yes Bank Ltd. , Kotak Mahindra Bank Ltd. and Canara Bank (For Designated Branches please visit our website: www.pfcindia.com)|
1. Power Finance corporation ltd at its discretion has right to revise the coupon rate and/or close the issue by giving notice on its website. The investors are advised to consult PFC / Arrangers, before depositing the application with the bank.
2. If applications submitted get rejected by PFC, then this would be returned by PFC to the applicant/collection banker, without any Interest.
3. Application for minimum Rs. 20,000/- (and in multiples of Rs 10,000/- thereafter) will be accepted, any amount received in fraction will be refunded to the investor without interest.
PFC Capital Gain Tax Exemption Bonds –Series IV highlights
PFC Capital Gain Tax Exemption Bonds –Series IV Download Application Form
Apply ONLINE for PFC Capital Gain Tax Exemption Bonds –Series IV
REC 54EC Capital Gain Tax Exemption Bonds for FY 2020-21. Click here.
NHAI 54EC Capital Gain Tax Exemption Bonds for FY 2020-21. Click here.
IRFC Capital Gain Tax Exemption Bonds –Series IV
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