Bonds - exemption

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Nitesh Nanu (Querist)
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27 December 2013 Hello all, Please help me out with my below question. Lets say, I'm planning to purchase NHAI bond or SBI or RBI bond worth rs10000 on Jan'14 which are tax free bonds. In the given scenario how much can I claim as exemption for the assessment year 2013-2014?? Also kindly shed me a light on the following terms w.r.t investments n bond. Tax free Tax saving Tax exemption Prompt replies are much appreciated. Thanks heaps for your time. Thanks and Regards, Nitesh.N

Aditya Maheshwari

Aditya Maheshwari (Expert)
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27 December 2013 Tax free bonds being issued by IIFCL, HUDCO, NTPC, REC, etc. only are exempt for the purpose of taxation. There is no exemption or deduction available from total income for investment in the same.

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Nitesh Nanu

Nitesh Nanu (Querist)
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03 January 2014 Thanks Aditya sir.

is Sec 80CCF still active ? If I investment in post office saving scheme will i get exemption ?

Aditya Maheshwari

Aditya Maheshwari (Expert)
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03 January 2014 No 80CCF not active as of now.

Nitesh Nanu

Nitesh Nanu (Querist)
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03 January 2014 Thanks Aditya.

Can you please correct me if I am wrong on the below statement.

If I purchase a bond worth 10000 from IIFCL or HUDCO and receives interest worth 800 pa, then I will get 800 exempted for Tax calculation and 10000 will be exempted from taxable income.

Aditya Maheshwari

Aditya Maheshwari (Expert)
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03 January 2014 Interest on tax free bonds of Rs. 800 would not be taxable as the same being exempt. However no other deduction is available from taxable income in respect of investment made in tax free bonds.

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Nitesh Nanu

Nitesh Nanu (Querist)
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03 January 2014 Clear now and thanks heaps Aditya sir.

Really appreciate your time and patience.

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