The Ministry of Finance, via Notification No. 56/2025-Income Tax on June 12, 2025, has officially designated a specific bond issued by the National Bank for Agriculture and Rural Development (NABARD) as a zero coupon bond under clause (48) of section 2 of the Income-tax Act, 1961. This designation grants tax exemptions for this particular bond. The bond has a life of ten years, eleven months, and thirteen days, with an issue deadline of March 31, 2027. Upon maturity or redemption, the total payout will be Rs. 19,500 crores. The discount offered on these bonds is Rs. 10,349.625 crores, with 19.50 lakh bonds slated for issuance. This notification outlines the specific characteristics that qualify the NABARD bond for its zero coupon bond status under the tax act.
MINISTRY OF FINANCE
(Department of Revenue)
(CENTRAL BOARD OF DIRECT TAXES)
Notification No. 56/2025-Income Tax | Dated: 12th June, 2025
S.O. 2576(E).—In exercise of the powers conferred by clause (48) of section 2 of the Income-tax Act, 1961 (43 of 1961), read with clause (ii), clause (iii) and clause (v) of sub-rule (3) and sub-rule (6) of rule 8B of the Income-tax Rules, 1962, the Central Government hereby specifies the bond with the following particulars as zero coupon bond for the purposes of the said clause (48) of section 2 of the said Act, namely :-
| (a) name of the bond | Zero Coupon Bond of The National Bank for Agriculture and Rural Development (NABARD) |
| (b) period of life of the bond | Ten years eleven months thirteen days |
| (c) the time schedule of the issue | To be issued on or before the 31stday of March 2027 of the bond |
| (d) the amount to be paid on maturity or redemption of the bond | Rs.19,500 crores |
| (e) the discount | Rs. 10,349.625 crores |
| (f) the number of bonds to be issued | 19.50 lakhs |
[Notification No. 56/2025/F.No.300164/4/2024-ITA-1]
MEENAKSHI SINGH, Dy. Secy.
