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Power Finance Corporation Ltd (PFC) is set to issue bonds eligible for capital gains tax exemption under Section 54EC of the Income Tax Act. An official statement said, Section 54EC provides that capital gains subject to a maximum of Rs 50 lakhs arising from the transfer of a long-term capital asset shall be exempt if the assessee invests the whole or any part of capital gains in certain specified bonds within a period of six months. PFC said an investor can save up to to a maximum of Rs 10,00,000 by investing a maximum permissible amount of Rs 50 lakh in these bonds.
PFC intends to launch its maiden 54EC bond issue shortly and will be kept on tap.
Previously, only NHAI and REC were allowed to issue these bonds. However, in the Finance Act 2017, Section 54EC of the Income-tax Act was modified to include any other bond notified by the Central Government in this behalf. Based on this, Power Finance Corporation has got the government approval for issuing bonds u/s 54EC.
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