Highlights of REC Tax Free Bonds

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Rural Electrification Corporation Limited opens its public issue of tax – free bonds of the face-value of 1,000 each aggregating up to a total of 3,000 crores. The income by way of interest on these Bonds is fully exempt from Income Tax under Section 10(15)(iv)(h) of the Income Tax Act, 1961 and shall not form a part of the total income. The issue has 2 investment options – 8.13% (10 Yrs) & 8.32% p.a.(15 Yrs) for investments upto 1 lakh and 7.93% (10 Yrs) & 8.12% p.a. (15 Yrs) above 1 lakh. The issue starts on March 6, 2012. Allocations will be on a first come first serve basis. The issue has been rated “CRISIL AAA/Stable” by CRISIL, “[ICRA] AAA” by ICRA and “CARE AAA” by CARE.