RBI/2013-14/418
DGBA.CDD.No.3798/13.01.999/2013-2014

December 30, 2013

The Chairman & Managing Director
Head Office (Government Accounts Department)
State Bank of India & Associate Banks
All Nationalised Banks
ICICI Bank Ltd., HDFC Bank Ltd, Axis Bank Ltd., and
Stock Holding Corporation of India Ltd (SHCIL).

Dear Sir/Madam,

Inflation Indexed National Savings Securities- Cumulative, 2013

Please refer to our Circular DGBA.CDD.No. 3688/13.01.999/2013-2014 dated December 19, 2013 on the captioned subject.

2.  In this regard, the Government of India has decided to extend the closing date for issuance of Inflation Indexed National Savings Securities- Cumulative (IINSS-C), 2013 from December 31, 2013 to March 31, 2014. The Government of India reserves the right to close the issue earlier than March 31, 2014.

3.  The other terms and condition of the Government Notification dated December 19, 2013 and contained in our above referred circular shall remain unchanged.

Yours faithfully,

(R. K. Singh)
Deputy General Manager


Government of India
Ministry of Finance
Department of Economic Affairs
(Budget Division)

New Delhi, Dated December 30, 2013

NOTIFICATION
Inflation Indexed National Saving Securities-Cumulative, 2013

No. F. 4(16)-W&M/2012: The Government of India hereby notifies that the closing date for issuance of Inflation Indexed National Saving Securities- Cumulative has been extended from December 31, 2013 to March 31, 2014. The Government of India reserves the right to close the issue earlier than March 31, 2014. The other terms and conditions of the Notification dated December 19, 2013 shall remain unchanged.

By Order of the President of India

(Peeyush Kumar)
Director to the Government of India

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Category : Fema / RBI (3477)
Type : Notifications (15813) Notifications/Circulars (31851)
Tags : RBI Notifications (1968)

0 responses to “Inflation Indexed National Savings Securities- Cumulative, 2013 dated of Application extended to 31.03.2014”

  1. Vinay Joshi says:

    Hello Mr. Sandeep,

    I may have posted this earlier, no idea. The fact remains as under,
    even those who are not taxable will not invest, forget 10% bracket.

    The fixed rate is 1.5%.

    It makes no sense in investing in IINSS-C bonds. [inflation indexed national saving securities – cumulative].

    Taxes deflate inflation bonds. Interest will be taxable as ‘income from other sources’ not as ‘capital gains’ even if entire amount is received on maturity. [actually taxable each year unless investor opts for receipt basis.]
    Tax rate as per the investors tax slab.

    So FinMin [& CBDT] should move in to neutralize tax effect with further indexation as on maturity it will be treated as capital gains.

    If the FinMin idiotic view is ‘there can’t be -‘indexation on indexation’! wrong.

    As of now sovereign wealth funds have shunned Indian tax free bonds! In spite of all the roadshows!?
    [Bonds of IRFC, IIFCL, NHAI, PFC, HUDCO, RECL] – 8.9% coupon rate offered.

    IINSS-C bonds should be on par with other capital indexed bonds. Inflation indexed does not mean capital indexed.

    On 5,000/- investment, 10% inflation, 30% slab, post tax return will be 7.94% i.e Rs 397.32/-

    Who would venture in these bond & lock for min 3yrs? [sr.citizens 1yr]

    The fixed rate should be min 2.50% if not 3.0%.

    OK we move from inflation bonds for the time being.

    RBI’s inflation comfort rate is 5%. Argument, it achieves in a year’s time, pre tax returns on bonds will be 6.5%, will FD rates be >4%?

    No sane person will touch these bonds.

    Regards,

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