Ministry of Finance, Department of Revenue, through the Central Board of Direct Taxes (CBDT), has issued Notification No. 52/2025-Income Tax dated 30th May 2025. This notification, under clause (48) of Section 2 of the Income-tax Act, 1961 and relevant rules under the Income-tax Rules, 1962, specifies the issuance of a particular financial instrument as a zero coupon bond. The bond is named the “Ten Year Zero Coupon Bond of REC Ltd.” and has a life span of ten years and six months. These bonds are scheduled to be issued on or before 31st March 2027. Upon maturity, the bond will be redeemable at a value of ₹5,000 crore. The issue will be offered at a discount of ₹2,200 crore, and a total of five lakh bonds are set to be issued. The classification of this bond as a zero coupon bond has implications for taxation under the Income-tax Act, particularly in the context of capital gains and tax computation. The notification was authorized under the file number F. No. 300164/5/2024-ITA-1 and signed by Deputy Secretary Meenakshi Singh.
MINISTRY OF FINANCE
(Department of Revenue)
Central Board of Direct Taxes
(Income Tax)
Notification No. 52/2025-Income Tax |Dated: 30th May, 2025
S.O. 2447(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 – Ten Year Zero Coupon Bond of REC Ltd.
(b) period of life of the bond – Ten years six months
(c) the time schedule of the issue – To be issued on or before the 31st day of March 2027 of the bond
(d) the amount to be paid on maturity – Rs. 5,000 crores or redemption of the bond
(e) the discount – Rs. 2,200 crores
(f) the number of bonds to be issued – Five lakhs
[Notification No. 52/2025 F. No. 300164/5/2024-ITA-1]
MEENAKSHI SINGH, Dy. Secy.
