The Central Board of Direct Taxes (CBDT) has notified the income tax exemption on Ten Year Zero Coupon Bond of Indian Railway Finance Corporation Ltd (IRFC) under clause (48) of section 2 of the Income-tax Act, 1961.
As per the notification, the key features of the IRFC bond are as follows:
- Name of the Bond: Ten Year Zero Coupon Bond of Indian Railway Finance Corporation Ltd.
- Period of Life: Ten years
- Time Schedule of Issue: On or before March 31, 2027
- Maturity Amount: ₹10,000 crores
- Issue Price (Discounted Value): ₹4,916.51 crores
- Number of Bonds to be Issued: Ten lakh
Zero coupon bonds are financial instruments that do not carry periodic interest payments. Instead, they are issued at a discount and redeemed at face value upon maturity. The difference between the issue price and redemption amount represents the implied return to the bondholder.
By notifying this bond under clause (48) of section 2 of the Income-tax Act, the government has extended specific tax treatment benefits to these instruments, aiding long-term infrastructure funding, particularly in the crucial railway sector.
Notification Details
Notification No. 48 /2025
Date: 14/03/2025
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Amit Sharma is the Content Editor at JurisHour. He has been writing about the Indian legal market. He has covered tax & company litigation stories from the Supreme Court, High Courts and Various Tribunals. Amit graduated from MLSU Law College with B.A.LL.B. and also holds an LL.M. from MLSU, Udaipur, Rajasthan. An Advocate in Taxation, and practised in Tribunals as well as Rajasthan High Court and pursued Masters in Constitutional Law. He started out small with little resources but a big plan to take tax legal education to the remotest locations across India and eventually to the world. His vision is to make tax related legal developments accessible to the masses.
