NTPC gets nod for Rs 1,750cr tax-free bond
NEW DELHI: The infrastructure bond market is in for some big
action. The Central Board of Direct Taxes (CBDT) has allowed
state-run generation utility NTPC to issue tax-free
bonds aggregating Rs 1,750 crore in the remaining part of the current fiscal.
This would be the first of the Rs 50,000 crore tax-free infrastructure bonds that the government had said in the Budget it would issue this fiscal. ToI had on July 11 first reported NTPC seeking permission for floating bonds worth Rs 2,500 crore.
The bonds would be issued with tenures of 10, 15 or 20 years. NTPC had sought the long gestation period in view of the long time it takes to build power projects, which would be funded through the proceeds. Interest income on the bonds would be tax-free throughout their tenure. Retail investors, including resident/non-resident individuals and Hindu Undivided Families, would be paid 0.25% higher interest than other categories of subscribers.
This would be the first of the Rs 50,000 crore tax-free infrastructure bonds that the government had said in the Budget it would issue this fiscal. ToI had on July 11 first reported NTPC seeking permission for floating bonds worth Rs 2,500 crore.
The bonds would be issued with tenures of 10, 15 or 20 years. NTPC had sought the long gestation period in view of the long time it takes to build power projects, which would be funded through the proceeds. Interest income on the bonds would be tax-free throughout their tenure. Retail investors, including resident/non-resident individuals and Hindu Undivided Families, would be paid 0.25% higher interest than other categories of subscribers.
JAWED EQBAL
PGDM 1 SEM
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