In the Finance Act 2006, Section 80C of Income Tax Act 1961 was amended to include deposits placed with a scheduled bank to qualify for deduction under 80C. The amount of investment up to Rs.1,00,000 under the notified deposit scheme will be eligible for deduction under Section 80 C of Income Tax Act for individuals / Hindu Undivided Families. In terms of the amendment a deposit scheme has been introduced with certain value added features for the benefit of customers.
All individuals and HUF are eligible to invest in the product. It is most suitable for income tax payers like salaried persons, higher and middle-income group, retired persons etc.
The firms, companies, trust, societies, clubs, institutions, corporate etc. are not allowed to invest under the product.
Tenure is up to 5 years
Minimum amount shall be Rs. 100/- & in multiples of Rs. 100/-
For availing Tax benefit maximum amount in a financial year - Rs. 1.5/- lac under Section 80C of Income Tax Act.
Premature withdrawal of the deposits made under the scheme shall not be allowed before completion of 5 years except in case of death of the depositor.
Interest will be computed on quarterly rest basis.
Deposit can be accepted under our RIDS/FDR scheme.
Interest on the deposit is liable to tax / TDS.
NO loan and / or any type of credit facility shall be considered against the security of the deposit. The deposit cannot be taken as collateral security also.
