IDFC Infrastructure Bonds - Save tax under 80CCF

What are infrastructure bonds?
In 2010, the government introduced a new section 80CCF under the Income Tax Act, 1961 (“Income Tax Act”) to provide for income tax deductions for subscription to long-term infrastructure bonds.These long term infrastructure bonds offer an additional window of tax deduction of investments up to Rs. 20,000 for the financial year 2010-11. This deduction is over and above the Rs 1 lakh deduction available under sections 80C, 80CCC and 80CCD read with section 80CCE of the Income Tax Act.

Face Value - Rs 5000 per Bond
Minimum number of Bonds per application* - Two Bonds and in multiples of one Bond thereafter.
For the purpose of fulfilling the requirement of minimum subscription of two Bonds, an Applicant may choose to apply for two Bonds of the same series or two Bonds across different series.
Interest  Rate - 8.00% p.a.
Maturity - 10 years from the Deemed Date of Allotment

Some Important Points 

1. The bonds don't attract any TDS
2. The interest accrued on the Bonds will be credited to the respective bank registered with the dematerialized account through electronic clearing service (“ECS”) on the due date for interest payments or where Bonds are held in physical form, interest accrued on the Bonds will be credited to the Bondholders whose name appear in the register of Bondholder maintained with IDFC or Registrar to the Issue through cheque, demand drafts or through ECS on the due date for interest payment
3. The Bonds will be listed on NSE and BSE and can be traded after the 5 year lock-in period
4. Investors can mortgage or pledge or hypothecate or mark lien over these bonds to avail loans only after the lock-in period.
5. Investment in the Bonds can be made in dematerialized and physical forms
6. An investor would need to provide his or her PAN card to invest in these Bonds.
7. The Bonds will be issued only to resident Indian individuals (major) and HUFs
8. An applicant may subscribe to both options but the minimum application under each option shall be one Bond i.e., Rs. 5,000
9. Interest on the Bonds shall be payable on annual or cumulative basis depending on the series selected by the Bondholders

Closing date
Issue closing date is February 04, 2011