Section(s) Referred: 54E ,54E(1) ,54E(1)(c)
Statute: INCOME TAX
Date of Issue: 21/6/1983
In pursuance of sub-clause (iii) of clause (c) of Explanation 1 to sub-section (1) of section 54E of the Income-tax Act, 1961 (43 of 1961), the Central Government hereby notifies the issue of the National Rural Development Bonds (Second Issue) with effect from the 7th July, 1983.
2. Limit on investment.–Investment in the Bonds shall be made by persons to the extent of net consideration of a long-term capital asset transferred, to any additional compensation or additional consideration received, after the 28th February, 1983.
Explanation.–For the purpose of this paragraph ‘net consideration’ means the sale proceeds of the long-term capital asset as reduced by an expenditure incurred wholly and exclusively in connection with such transfer.
3. National Rural Development Bonds (Second Issue), 1983, issued at Rs. 100.00 per cent. and redeemable at par on maturity :–
(1) Price.–The issue price of the National Rural Development Bonds (Second Issue), 1983, shall be Rs. 100.00 for every Rs. 100 (nominal) ;
(2) Date of issue.–The Bonds shall be on tap with effect from the 7th July, 1980, and shall, subject to paragraph 12, be issued from the date of receipt of payment in cash or the date of realisation of cheque or draft, as the case may be ;
(3) Date of repayment.–The Bonds shall be repaid at par on the expiration of three years from the date of their issue.
4. Interest.–The Bonds shall bear, interest at the rate of seven and half per cent. per annum. Interest shall be paid annually on the completion of each period of twelve calendar months from the date of issue of the Bonds.
5. Place of Payment of interest.–Interest on the Bonds shall be remitted to the holder of the Bond by the Public Debt Offices of the Reserve Bank of India at Ahmedabad, Bangalore, Bombay (Byculla), Bhubaneswar, Calcutta, Gauhati, Hyderabad, Jaipur, Kanpur, Madras, Nagpur, New Delhi, Patna and Trivandrum.
6. Refunds of income-tax deducted at source-(1) Refunds of income-tax deducted at the time of payment of interest (at the rates specified in the annnual Finance Acts) will be obtainable by holders of the Bonds who are not liable to income-tax or who are liable to income-tax at rates lower than the rate at which income-tax was deducted.
(2) A holder of a Bond who is not liable to income-tax or who is liable to income-tax at a rate lower than the specified rate may, however, avail of the facility provided in sections 197 and 197A of the Income-tax Act, 1961 (43 of 1961).
7. Eligilibility of exemption from income-tax.–Interest on all the Bonds together with interest on other Government securities and income from approved financial assets shall qualify for exemption from income-tax under section 80L of the Income-tax Act, 1961 (43 of 1961), subject to the limit specified in the said section.
8. Eligibility for exemption from wealth-tax.–The value of the bond together with the value of other Government securities and other approved financial assets shall qualify for exemption under section 5 of the Wealth-tax Act, 1957 (27 of 1957), subject to the limit specified in the said section.
9. Form.–The Bonds shall be issued in the form specified in the notification of the Government of India in the Ministry of Finance (Department of Economic Affairs) No. G.S.R. 503(E), dated 21st June, 1983.
10. Transferability.–The Bonds shall be non-negotiable and cannot be sold, transferred, assigned or otherwise disposed of by the holder before maturity but, subject to the provision of any law for the time being in force, may pass to the legal heir or successor of the holder, as the case may be.
11. Nomination.–(1) A sole holder or a sole-surviving holder of a Bond, being an individual, may nominate in Form A annexed to this notification or as near thereto as may be, one or more persons who shall be entitled to the Bond and the payment thereon, in the event of his death.
(2) Where any amount is payable to two or more nominees and either or any of them dies before such payment becomes due, the title to the Bond shall vest in the survivor or survivors of those nominees and the amount being due thereon shall be paid accordingly.
(3) No nomination shall be made in respect of the Bonds issued in the name of minor.
(4) A nomination made by a holder of a Bond may be varied by a fresh nomination in Form A or as near thereto as may be, or may be cancelled by giving notice in writing to the Public Debt Office of the Reserve Bank of India in Form B annexed to the notification.
(5) Every nomination and every cancellation or variation shall be registered at the Public Debt Office of the Reserve Bank of India and shall be effective from the date of such registration.
(6) If the nominee is a minor, the holder of the Bond may appoint any person to receive the amount due in the event of his death during the minority of the nominee.
12. Applications for Bonds.–(1) Applications for the Bonds shall be in multiples of Rs. 100.
(2) Applications shall be received at–
(a) the offices of the Reserve Bank of India at Ahmedabad, Bangalore, Bombay (Fort and Byculla), Bhubaneswar, Calcutta, Gauhati, Hyderabad, Jaipur, Kanpur, Madras, Nagpur, New Delhi, Patna and Trivandrum ;
(b) the branches of the State Bank of India set out in Annexure 1 to this notification ; and
(c) the branches of Nationalised Bank set out in Annexure 2 to this notification.
(3) Where the applicant is an individual, lie may apply for issue of Bond in his name or jointly with another individual.
(4) Application shall be submitted in duplicate in the Form C annexed to this notification or in such other form, which may be so varied as the circumstances of each case may require.
(5) Applications shall be accompanied by the necessary payment in the form of cash or cheque or bank drafts. Cheques tendered at the office of the Reserve Bank of India or the State Bank of India or a Nationalised Bank should be drawn in favotir of the bank concerned.
13. Brokerage.–Brokerage at the rate of 10 paise per Rs. 100 nominal shall be paid to brokers registered with the Reserve Bank of India.
By orders of the President. (No. F. 4(3)-W&M/83)]
[See para. 12(2)(b))]
List of State Bank of India Branches
Andhra Pradesh : Hyderabad Main Branch, Visakapatnam, Vijayawada, Masulipatnam, Guntur, Tenali, Rajahmundry, Kakinada, Nellore, Kurnool, Adoni, Nizamabad, Eluru, Bhimavaram, Anantapur, Tirupati, Vizianagram, Proddatur, Cuddapah, Warangal.
Assam : Gauhati, Dibrugarh.
Bihar : Patna Main Branch, Dhanbad, Bokaro Steel City, Jamshedpur, Ranchi, Gaya, Bhagalpur, Muzzaffarpur, Darbhanga, Biharsharif, Monghyr, Arrah, Katihar, Chapra.
Gujarat : Ahmedabad Main Branch, Surat, Vadodara, Rajkot, Jamnagar, Bhavnagar, Nadiad, Porbandar, Junagadh, Navsari, Bharuch.
Haryana : Faridabad, Rohtak, Yamuna Nagar, Ambala Cantonment, Panipat, Karnal, Sonepat, Bhiwani, Hissar.
Himachal Pradesh : Simla.
Jammu & Kashmir : Srinagar, Jammu.
Karnataka : Bangalore, Hubli, Gadag (Betgeri), Mysore, Mangalore, Belgaum, Gulbarga, Bellary, Davangere, Shimoga, Bijapur Raichur, Tumkur, Mandya.
Kerala : Cochin, Calicut, Alleppey, Trivandrum, Quilon, Palghat.
Madhya Pradesh : Indore, Jabalpur, Bhopal Main Branch, Gwalior, Durg, Raipur, Ujjain, Saugor, Bilaspur, Ratlam, Burhanpur, Khandwa, Rewa.
Maharashtra : Bombay Main Branch, Pune, Pimpri, Nagpur, Ulhasnagar, Kalyan, Dombivli, Collectorate Thane, Bhiwandi, Sholapur, Old Agra Road, Nasik, Nasik Road, Malegaon, Kolhapur, Ichal-Karanji, Aurangabad (Deccan), Jalna Sangli, Amravati, Akola, Dhule, Nanded, Ahmednagar, Jalgaon, Bhusaval, Chandrapur, Latur, Parbhani, Gondia.
Manipur : Imphal.
Meghalaya : Shillong.
Nagaland : Kohima.
Orissa : Cuttack, Rourkela, Bhubaneshwar, Puri, Berhampore (Ganjam), Sambalpur.
Punjab : Ludhiana, Amritsar, Jullundur, Patiala, Bhatinda, Pathankot, Batala.
Rajasthan : Jaipur, Jodhpur, Ajmer, Kota, Bikaner City, Udaipur, Alwar, Bhilwara, Sriganganagar, Bharatpur, Sikar.
Sikkim : Gangtok.
Tamil Nadu : Madras Main Branch, Kancheepuram, Coimbatore, Tirupur, Valparai, Madurai, Dindigul, Tiruchirapalli, Salem, Tirunelveli, Tuticorin, Erode, Vellore, Thanjavur, Kumbakonam, Nagercoil, Cuddalore, Rajapalayam.
Tripura : Agartala.
Uttar Pradesh : Kanpur Main Branch, Lucknow, Varanasi, Agra, Firozabad, Allahabad, Meerut, Bareilly, Moradabad, Amroha, Sambhal, Aligarh, Gorakhpur, Saharanpur, Hardwar, Dehra Dun, Ghaziabad, Hapur, Jhansi, Shahjahanpur (Town Hall), Rampur, Muzaffarnagar, Mathura, Farrukhabad, Faizabad, Mirzapur, Etawah, Jaunpur, Bulandshahr, Bharaich.
West Bengal Calcutta Main Branch, Howrah, Bally, Kamarhati, Dum Dum Cantonment, Garden Reach, Batanagar, Barrackpore, Chinsurah, Serampore, Asansol, Burdwan, Durgapur, Kharagpur, Silliguri, Nabadwip, Balurghat.
Andaman & Nicobar islands : Port Blair.
Chandigarh : Chandigarh.
Delhi : Main Branch, New Delhi.
Goa, Daman and Diu : Panaji.
Pondicherry : Pondicherry.
[See Para 12(2)(c)] Branches of Nationalised Banks
——- Name of the Bank Name of City Name of Branch 1 2 3 ——- 1. Central Bank of India Bombay 1. Main Office
(Flora Fountain). 2. Grant Road, Bombay. 3. Worli, Bombay. 4. Bandra, Bombay 5. Andheri (E), Bombay
2. Bank of India Bombay 1. Main Office, M.G.Road, Bombay. 2. Zaveri Bazar, Bombay.
3. Bank of Baroda Bombay 1. Main Office, Bombay-1
4. United Commercial Bank Calcutta 1. Main Office, Calcutta. 2. New Market Branch, Calcutta.
5. Punjab National Bank Delhi 1. Parliament Street, New Delhi. 2. Nehru Place, New Delhi. 3. Chandni Chowk, Delhi.
6. Indian Bank Madras 1. Harbour Branch, Madras City. 2. Royapettah, Madras City.
7. Canara Bank Madras 1. Thousand Lights Branch, Madras. ——-
Form ‘ A ‘
(See para. 11)
NATIONAL RURAL DEVELOPMENT BONDS
FORM OF NOMINATION
1. I (Name and address) nominate the following persons who shall on my death have the right to receive payment of the amount for the time due on the Bond specified below. ——- NATIONAL RURAL DEVELOPMENT BOND
Nominee ——- Date of issue Distinguishing number Amount Rs.
——- Name Address Date of birth Relationship to the depositor ——-
——- the sole nominee 2. * As — above is a minor on this date. Nominee No.
I appoint Shri/Smt./Kumari to receive the amount for the time being due (Name & address) on the above Bond in the event of my death during the minority of the said nominee**…….
3. ***This nomination is in substitution of the nomination dated made by me and registered in your books on the which shall stand cancelled on registration of this nomination.
Place Signature/Thumb Impression of the holder.
Signature and address of witnesses………..
2. ——- *Not to be filled in, unless nominee is a minor. ** Name of the nominee. *** This paragraph may be struck out when the nomination is not in substitution of one already made.
Form ‘ B ‘
(See Para. 11)
NATIONAL RURAL DEVELOPMENT BONDS
NOTICE OF CANCELLATION OF NOMINATION
I (name and address) do hereby cancel the nomination dated made by me in respect of the following Bond and registered by the Public Debt Office on the (date).
Particulars of the Bond ——- Date of issue Distinguishing number Amount Rs. ——-
Place Signature/Thumb Impression of the holder.
Signature and addresses of witnesses :
Form ‘ C ‘
[See Para. 12(4)]
TO BE SUBMITTED IN DUPLICATE
APPLICATION FORM FOR NATIONAL RURAL DEVELOPMENT BONDS
I/ We herewith tender (Full name(s) in block letters) cash/cheque/draft for Rs. (Rupees for investment in National Rural Development Bonds (Second Issue).
2. I/We hereby declare that the amount tendered represents the whole or part of the net consideration received, on the transfer of the long-term capital asset datailed below : ——- Location type Transferee’s Date of Sale proceeds Net Consideration and other name, transfer realised, or i.e., the sale details of address and or date additional proceeds realised the capital permanent of receipt compensation as reduced by any asset Account No., additional or additional expenditure transferred if any compen- consideration incurred wholly sation received and exclusively in connection with the transfer. ——- (1) (2) (3) (4) (5) ——-
1. 2. 3. 4. ——- 3. The Bonds and annual interest thereon payable at ——— may please be sent to me/us at the (office of Reserve Bank of India/State Bank of India)* address mentioned below.
4. @ I wish to make a nomination in respect of the Bond applied for. The prescribed nomination form is enclosed. I do not wish to make a nomination in respect of the Bond applied for at present.
– (Signature of the First Applicant) (Signature of the Second Applicant)
– (Name in Full) (Name in Full) – – (Address) (Address)
– (Permanent A/C. No.) (Permanent A/c/ No.)
FOR OFFICE USE ONLY
Special Current Account credited on ——- (date)
— (Signature) P. Manager/Branch Manager (Rubber Stamp of Receiving Office) ——- REGISTERED A. D.
Forwarded to Commissioner of Income-tax ——– (Address & Place) Date-
Reserve Bank of India P. Manager.
State Bank of India———
Nationalised Bank Branch Manager.
* In places where RBI is not having an office.
@ For single holders only, delete whichever is not applicable.
(1) The application should be in multiple of Rs. 100. Cheque/draft should be drawn in favour of the Bank receiving the application and at the place at which the application is tendered.
(2) The application shall bear the signature/thumb impression of the applicant. The thumb mark should be witnessed by two respectable persons.
(a) where the declaration is an individual, by the individual himself ; where such individual is absent from India, by the individual concerned or by any other adult member of his family, or be some person duly authorised by him in this behalf ; and where the individual is mentally incapicitated from attending to his affairs, by his guardian or by any other person competent to act on his behalf ;
(b) where the declarant is a Hindu undivided family, by the KARTA and where the KARTA is absent from India or is mentally incapicitated from attending to his affairs, by any other adult member of such family ;
(c) where the declarant is a firm, by the managing partner thereof, or by an official of the company authorised in this behalf ;
(d) where the declarant is a firm, by the managing partner thereof, or where for any unavoidable reason such managing partner is not able to sign the declaration or where there is no managing partner as such, by any partner thereof not being a minor ;
(e) where the declarant is any other association, by the principal officer thereof or any other menber of the association authorised in this behalf ; and
(f) where the declarant is any other person, by that person or by some person competent to act on his behalf.
(3) The nomination may be made in Form A or as near thereto as may be. A nomination made by a holder may be varied by a nomination in Form ‘ A ‘ or may be cancelled by giving notice in writing to the Public Debt Office in Form ‘ B ‘. Every nomination and every cancellation or variation thereof shall be registered at the Public Debt Office and shall be effective from the date of such registration.
(4) The Bond in the Form prescribed in the Notification of the Government of India in the Ministry of Finance (Department of Economic Affairs) No. G. S. R. 503(E), dated 21st June, 1983, in respect of National Rural Development Bonds (Second Issue) will be issued in the name of the individual, Hindu Undivided Family as described by its name (HUF), company, firm, association or other person, as the case may be.
(5) where the applicant’s signature is by thumb mark, it should be witnessed by two respectable persons.
(6) If the application is made in the name of the registered body, the under-noted documents, if not already registered at the Public Debt Office, should be enclosed with the investment application–
(a) Certificate of Registration/Incorporation ;
(b) Memorandum and Articles of Association or certified copies of the Rules and Regulations/Bye-laws of the company/body ;
(c) Certified copy of resolution in favour of the person authorised to deal in Government securities on behalf of the company/body