Product all about

Issue Opening Date: April 1, 2022, Issue Closing Date: March 31, 2023


Coupon/Interest rate/Yield5.00% annually5.00% annually5.00% annually
Tax StatusTaxableTaxableTaxable
Tax BenefitSEC 54 ECSEC 54 ECSEC 54 EC
Minimum (Rs.)20,00020,00020,000
Maximum (Rs.)50 Lakhs in a Financial Year across RECL50 Lakhs in a Financial Year across all the issuers of these bonds 50 Lakhs in a Financial Year across IRFC, PFC, RECL
Tenor5 Years5 Years5 Years
Interest Date30th June31st July15th October 2022
Put/Call/Premature EncashmentBullet repayment at the time of MaturityBullet repayment at the time of MaturityBullet repayment at the time of Maturity
Mode Of InterestAnnualAnnualAnnual

Why choose this product?

  • Get tax exemption on capital gain
  • Maximum investment limit of up to Rs. 50 Lakhs in a Financial Year across the two available Bonds
  • 5.00% interest per annum
  • 100% risk free payment

Which bonds are eligible

The eligible bonds are:

  • RECL (Rural Electrification Corporation Ltd)
  • IRFC (Indian Railway Finance Corporation Ltd)
  • PFCL (Power Finance Corporation Limited)

Provisions of Section 54EC

As per provisions of Income Tax Act, 1961, any long term capital gains arising from transfer of any capital asset would be exempt from tax under section 54EC of the Act if:

  • The entire capital gain realized is invested within 6 months of the date of transfer in eligible bonds
  • Such investment is held for 5 years
  • To avail of capital gain exemption, the bonds so acquired cannot be transferred or converted into money or any loan or advance can be taken on security of such bond within 5 years from date of acquisition else, the benefit would be withdrawn
  • If the amount invested in bonds is less than the capital gains realized, only proportionate capital gains would be exempt from tax.