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INFORMATION MEMORANDUM
tax at source under section 193 of The Income Tax Act 1961, on the interest payable on REC 54EC
Capital Gain Tax Exemption Bonds. However, this is subject to further instructions / circulars /
notification from the concerned authorities.
DEEMED DATE OF ALLOTMENT/ BOND CERTIFICATES
Deemed Date of Allotment of Bonds will be the last day of the month during which the subscription
amount has been credited to REC account. Investors are informed that Corporation would normally
process allotments pertaining to a month at the month end and it takes maximum 4 weeks from month
end to dispatch letter of advice/allotment. REC shall endeavor to make a firm allotment for all valid
applications received from eligible investors.
Subject to the completion of all legal requirements, the REC will issue the Bond Certificates
within 3 months as per the section 113 of the Companies Act, 1956 (in case of Physical option) or Bonds
shall be credited to the depository account if marked by the Applicant in the application form (in case of
Demat option).
REGISTERED BONDHOLDER
Bondholder whose name appears in the register of Bondholders maintained by the Corporation or its
Registrar (in case of investors opting for physical certificates) and beneficial owners on the record date
(in case of investors opting for demat option)
PAYMENT OF INTEREST
a) The interest will be payable annually on 30th June each year on actual/actual basis.
b) The interest payment on the Bonds shall be made to the registered bondholders.
c) 1st Interest from the date of credit to REC account in respect of the allotments made up to
31st May 2013 will be made on 30th June 2013. 1st Interest on subsequent allotment would
be made on 30 th June, 2014.
d) The interest payment for the first and last year or part thereof beginning from the date of credit and
ending with the date of redemption, respectively, shall be proportionate (on actual/actual basis)
and all interest on Bonds will cease on the date of redemption.
PAYMENT ON REDEMPTION
REC’s liability to Bondholder(s) towards all their rights including payment of face value shall cease and
stand extinguished upon redemption of the Bonds in all events. Further, REC will not be liable to pay any
interest, income or compensation of any kind after the date of such Redemption of the Bond(s).
a) The Bonds will be automatically redeemed by REC on maturity i. e. on the expiry of 3 years from the
deemed date of allotment, Physical bond certificate need not to be surrendered for redemption. The
redemption proceeds would be paid to the Registered Bondholders.
b) In case of transmission applications pending on the Record Date, the redemption proceeds will be
issued to the legal heirs after the confirmation of the adequacy and correctness of the
documentation submitted with such application till such time, the redemption proceeds will be kept
in abeyance.
MODE OF PAYMENTS
Interest/redemption payment will be made by ECS/NECS/At Par Cheque/Demand Drafts. Efforts will be
made to cover all cities where collection centers are appointed. In case the ECS/NECS facility is not
available; REC reserves the right to adopt any other suitable mode of payment. Cheque clearing charges, if
any, will have to be borne by the Bondholders.
EFFECT OF HOLIDAYS ON PAYMENTS
If the date of payment of interest or redemption or any date specified does not fall on a Working Day, the
succeeding Working Day shall be considered as the effective date. Interest and principal or other amounts, if
any, shall be paid on the succeeding Working Day. In case the date of payment of interest falls on a holiday, the
payment shall be made on the next Working Day, without any interest for the period overdue. In case the date of
redemption falls on a holiday, the payment shall be made on the next Working Day along with interest for the
period overdue.
PRIVATE & CONFIDENTIAL
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