Mode of investment as specified in sub-section (5) of section 11 of the Income-tax Act--Investment in ``Kisan Vikas Patra'' and ``Indira Vikas Patra''--Clarification regarding - Income Tax - 566/1990

Mode of investment as specified in sub-section (5) of section 11 of the Income-tax Act--Investment in ``Kisan Vikas Patra'' and ``Indira Vikas Patra''--Clarification regarding. Circular No. 566 Dated 17/7/1990 Sub-section (5) of section 11 of the Income-tax Act, 1961, specifies the forms and modes of investment or deposit of surplus money by public charitable or religious trusts and institutions as referred to in section 11(2)(b) of the Act. Clause (i) of the said sub-section (5) specifies one of the forms of investment as investment in savings certificates as defined in clause (c) of section 2 of the Government Savings Certificates Act, 1959, and any other securities or certificates issued by the Central Government under the Small Savings Scheme. 2. Representations have been received seeking clarification whether investment in "Indira Vikas Patra" and "Kisan Vikas Patra" are covered by the form or mode of investment specified in the aforesaid clause (i) of sub-section (5) of section 11. 3. Section 2(c) of the Government Savings Certificates Act, 1959, defines "savings certificates" as certificates to which that Act applies. Section 12 of the said Act empowers the Central Government to make rules to carry out the purposes of that Act. The Indira Vikas Patra Rules, 1986, and the Kisan Vikas Patra Rules, 1988, have been notified by the Central Government in exercise of the powers conferred by the aforesaid section 12 of the Government Savings Certificates Act, 1959. Thus, both these Patras are Saving Certificates to which the aforesaid Government Savings Certificates Act, 1959, applies. These are, therefore, covered by section 11(5)(i) of the Income-tax Act read with section 2(c) of the Government Savings Certificates Act. 4. It is, therefore, clarified that the investment in "Indira Vikas Patra" and "Kisan Vikas Patra" are in accordance with the norms and modes specified in section 11(5) of the Income-tax Act. (Sd.) Anand Kishore, Under Secretary to the Government of India.