80ccf tax saving bonds fy 2012-13

long term infrastructure bond u/s 80 ccf as may be notified by the central government shall be allowed to the extent of rs 20000/-

the tenure of the bond shall be minimum for a period of 10 years.

the minimum lock in period for investors shall be for period 5 years.

eligibility: individual,huf.

Investments in Long Term Infrastructure Bonds issued by Industrial Finance Corporation of India, LIC, Infrastructure Development Finance Company Limited or a Non-Banking Finance Company classified as an Infrastructure Finance Company by RBI with a minimum tenure of 10 years and Lock in period of 5 years. Maximum amount of deduction available is Rs. 20,000/- The deduction is over and above the combined deduction of Rs. 100,000/- available under section 80C, 80CCC and 80DDD.

The benefits under this section were extended by one year in the Budget 2011 but the same has not been done in Budget. Therefore, the deduction under this section shall not be available for AY 2013-14.

But many of Bonds issues including one coming tmrw :

Rural Electrification Corporation Ltd (REC) Tax Free Bonds

why they are called Tax Free Bonds ?

Ashish