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IIFCL Tax Free Bonds - February 2014

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IIFCL  is launching Tax free secured redeemable non convertible Tranche – III bonds of face value of  Rs. 1,000/- each, in the nature of debentures from February 17, 2014, having benefits under section 10(15) (iv)(h) of the Income Tax Act. The issue size of the bonds is Rs. 750 Cr (Base Issue Size) with option to retain oversubscription upto the shelf limit (being Rs. 2823.79 Cr.

Highlights Of Tax Benefits:

  • In exercise of the powers conferred by item (h) of sub-clause (iv) of clause (15) of Section 10 of the Income Tax Act, 1961 (43 of 1961) the Central Government authorizes IIFCL to issue during the FY 2013-14, Tax Free, Secured, Redeemable, Non-convertible Bonds.
  • The income by way of interest on these Bonds is fully exempt from Income Tax and shall not form part of Total Income as per provisions under section 10 (15) (iv) (h) of I.T. Act, 1961.
  • There will be no deduction of tax at source from the interest, which accrues to the bondholders in these bonds irrespective of the amount of the interest or the status of the investors.
  • Wealth Tax is not levied on investment in Bond under section 2(ea) of the Wealth-tax Act, 1957

Scheme detail: 

  • Fund Opens: 17-Feb-2014
  • Fund Closes: 14-Mar-2014
  • Issue Basis: ‘First-come, First-serve’ basis

 

Particulars of Issue:

Issue Opening Date

17th February 2014

Issue Closing Date

14th March 2014

Issue Size:

Rs. 750 Cr (Base Issue Size) with option to retain oversubscription upto the shelf limit (being Rs. 2823.79 Cr)

Rating

‘ICRA AAA(SO)’ from ICRA , ‘CARE AAA’ from CARE, ‘BWR AAA(SO)’ from BRICKWORK, ‘IND AAA’ from IRRPL

Face Value of Bond

Rs.1000

Minimum Application

5 Bond in multiples of 1 Bond thereafter

Listing

Proposed to be listed in BSE

Interest on successful application

Respective coupon rates

Interest on refund

5% p.a.

Interest payment

Payable Annually Only

Issuance

Both in dematerialised form as well as in physical form as specified by the Applicant

 

Series of Bonds

For Category I, II & III

Options

Tranche-I Series IA

Tranche-I Series IIA

Tranche-I Series IIIA

Tenure (years)

10

15

20

Interest rate (%) p.a.

8.16%

8.55%

8.55%

For Category IV only

Options

Tranche-I Series IB

Tranche-I Series IIB

Tranche-I Series IIIB

Interest rate (%) p.a.

8.41%

8.80%

8.80%

Who Can Apply:

  • Category I: Public financial institutions, Scheduled commercial banks, Mutual funds registered with SEBI, Multilateral and bilateral development financial institutions, State industrial development corporations, Insurance companies registered with the Insurance Regulatory and Development to invest in Bonds.
  • Category II: Companies within the meaning of section 2(20) of the Companies Act, 2013, Limited Liability Partnerships registered under the provisions of the LLP Act, statutory Corporations, trust, partnership firms in the name of partners, cooperative banks, regional rural banks and legal entities registered under applicable laws in India and authorised to invest in Bonds.
  • Category III: The following Investors applying for an amount aggregating to more than Rs 10 lakh across all series of Bonds Resident Indian individuals; and Hindu Undivided Families through the Karta.
  • Category IV: The following Investors applying for an amount aggregating to up to and including 10 lakh across all Series of Bonds in the Issue Resident Indian individuals; and Hindu Undivided Families through the Karta.

 

 

 

For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call

 

 

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