[TO BE PUBLISHED IN PART II, SECTION 3,
SUB-SECTION (ii) OF THE GAZETTE OF INDIA, EXTRAORDINARY, DATED THE 23rdNovember, 2012]
Government of
India
Ministry of
Finance
Department of
Revenue
Notification
New Delhi, the
23rdNovember , 2012.
(Income-tax)
S.O. 2777(E).— In exercise
of the powers conferred by sub-section (1) of section 80CCG of the Income-tax
Act, 1961 (43 of 1961), the Central Government hereby makes the following
Scheme, namely:-
1. Short title,
commencement and application. - (1) This Scheme may be called the Rajiv
Gandhi Equity Savings Scheme, 2012.
(2) It shall
come into force on the date of its publication in the Official Gazette.
(3) This Scheme shall apply for claiming deduction in the computation of total income of the assessment year relevant to a previous year on account of investment in eligible securities under sub-section (1) of section 80CCG of the Income-tax Act, 1961.
(3) This Scheme shall apply for claiming deduction in the computation of total income of the assessment year relevant to a previous year on account of investment in eligible securities under sub-section (1) of section 80CCG of the Income-tax Act, 1961.
2.
Objective of Scheme.-The
objective of the Scheme is to encourage the savings of the small investors in
domestic capital market.
3. Definitions.- In this Scheme, unless the context otherwise requires,-
3. Definitions.- In this Scheme, unless the context otherwise requires,-
(i) “Act” means the Income-tax Act, 1961 (43 of
1961);
(ii) “demat account” means an account opened with
the depository participant in accordance with the guidelines laid down by the
Securities and Exchange Board of India established under section 3 of the
Securities and Exchange Board of India Act, 1992 (15 of 1992);
(iii) “depository” means a company as defined in
clause (e) of sub-section (1) of section 2 of the Depositories Act, 1996 (22 of
1996);
(iv) “depository participant” means a participant as
defined in clause (g) of sub-section (1) of section 2 of the Depositories Act,
1996 (22 of 1996);
(v) “eligible securities” means any of the following
:-
(a) equity shares, on the day of purchase, falling
in the list of equity declared as “BSE-100” or “ CNX-100” by the Bombay Stock
Exchange and the National Stock Exchange, as the case may be;
(b) equity shares of public sector enterprises which
are categorised as Maharatna, Navratna or Miniratna by the Central Government;
(c) Units of Exchange Traded Funds (ETFs) or Mutual
Fund (MF) schemes with Rajiv Gandhi Equity Savings Scheme (RGESS) eligible
securities as underlying, as mentioned in sub-clause (i) or sub-clause (ii)
above, provided they are listed and traded on a stock exchange and settled
through a depository mechanism;
(d) Follow on Public Offer of sub-clauses (i) and
(ii) above;
(e) New Fund Offers (NFOs) of sub-clause (iii)
above;
(f) Initial Public Offer of a public sector
undertaking wherein the government shareholding is at least fifty-one per cent.
which is scheduled for getting listed in the relevant previous year and whose
annual turnover is not less than four thousand crore rupees during each of the
preceding three years; (vi) “ financial year” means a year commencing on the
1st day of April and ending on the 31stday
of March;
(vii) “Form” means the Form appended to the Scheme;
(viii) “investment” means investment by an assessee
in any of the eligible securities in accordance with the Scheme;
(ix) “new retail investor” means the following
resident individuals:-
(a)
any individual who has not opened a demat account and has not made any
transactions in the derivative segment as on the date of notification of the
Scheme;
(b)
any individual who has opened a demat account before the notification of the
Scheme but has not made any transactions in the equity segment or the derivative
segment till the date of notification of the Scheme,
and
any individual who is not the first account holder of an existing joint demat
account shall be deemed to have not opened a demat account for the purposes of
this Scheme
(x) “Scheme” means the Rajiv Gandhi Equity Savings
Scheme;
(xi)
words and expressions used and not defined in this Scheme, but defined in the
Act, shall have the meanings respectively assigned to them in the Act.
4.
Eligibility .- The
deduction under the Scheme shall be available to a new retail investor who
complies with the conditions of the Scheme and whose gross total income for the
financial year in which the investment is made under the Scheme is less than or
equal to ten lakh rupees.
5.
Procedure at time of opening demat account.-The new retail investor shall
follow the following procedure at the time of opening or designating a demat
account :-
(a) the new
retail investor shall open a new demat account or designate his existing demat
account for the purpose of availing the benefit under the Scheme;
(b) the new
retail investor shall submit a declaration in Form A to the depository
participant who will forward the same to the depository for verifying the
status of the new retail investor;
(c)
the new retail investor shall furnish his Permanent Account Number (PAN) while
opening the demat account or designating the existing account as a Rajiv Gandhi
Equity Savings Scheme eligible account, as the case may be.
6.
Procedure for investment under Scheme.- A new retail investor shall make
investments under the Scheme in the following manner :-
(a)
the new retail investor may make investment in eligible securities in one or
more than one transactions during the year in which the deduction has to be
claimed;
(b) the new
retail investor may make any amount of investment in the demat account but the
amount eligible for deduction, under the Scheme shall not exceed fifty thousand
rupees;
(c) the eligible
securities brought into the demat account, as declared or designated by the new
retail investor, will automatically be subject to lock-in during its first
year, as per the provisions of paragraph 7, unless the new retail investor
specifies otherwise and for such specification, the new retail investor shall
submit a declaration in Form B indicating that such securities are not to be
included within the above limit of investment;
(d)
the new retail investor shall be eligible for a deduction under sub-section (1)
of section 80CCG of the Act in respect of the actual amount invested in
eligible securities , in the first financial year in respect of which a
declaration
in Form B has not been made, subject to the maximum investment limit of fifty
thousand rupees;
(e)the new retail investor who has claimed a
deduction under sub- section (1) of section 80CCG of the Act, in any assessment
year, shall not be allowed any deduction under the Scheme for any subsequent
assessment year;
(f) the new retail investor shall be permitted a
grace period of three trading days from the end of the financial year so that
the eligible securities purchased on the last trading day of the financial year
also get credited in the demat account and such securities shall be deemed to
have been purchased in the financial year itself;
(g) the new retail investor may also keep securities
other than the eligible securities covered under the Scheme in the demat
account through which benefits under the Scheme are availed;
(h) the new retail investor can make investments in
securities other than the eligible securities covered under the Scheme and such
investments shall not be subject to the conditions of the Scheme nor shall they
be counted for availing the benefit under the Scheme;
(i) the investment under the Scheme shall consist of
all eligible securities covered under the Scheme that are initially bought by
the investor under the Scheme or that are bought subsequently by the investor
as per the provisions of the Scheme;
(j) the deduction claimed shall be withdrawn if the
lock-in period requirements of the investment are not complied with or any
other condition of the Scheme is violated.
7.
Period of holding requirements. - (1) The period of holding of eligible
securities shall be three years to be counted in the manner detailed hereunder.
(2) All eligible
securities are required to be held for a period called the fixed lock-in period
which shall commence from the date of purchase of such securities in the
relevant financial year and end one year from the date of
purchase
of the last set of eligible securities (in the same financial year) on which
deduction is claimed under the Scheme.
(3) The new
retail investor shall not be permitted to sell, pledge or hypothecate any
eligible security during the fixed lock-in period.
(4) The period
of two years beginning immediately after the end of the fixed lock-in period
shall be called the flexible lock-in period.
(5) The new retail
investor shall be permitted to trade the eligible securities after the
completion of the fixed lock-in period subject to the following conditions:-
(a)
the new retail investor shall ensure that the demat account under the Scheme is
compliant for a cumulative period of a minimum of two hundred and seventy days
during each of the two years of the flexible lock-in period as laid down
hereunder:-
(A) the demat
account shall be considered compliant for the number of days where value of the
investment portfolio of eligible securities , within the flexible lock-in
period, is equal to or higher than the amount claimed as investment for the
purposes of deduction under section 80CCG of the Act;
(B) in case the
value of investment portfolio in the demat account falls due to fall in the
market rate of eligible securities in the flexible lock-in period, then
notwithstanding sub clause(A), -
(i)
the demat account shall be considered compliant from the first day of the
flexible lock-in period to the day any such eligible securities are sold during
this period;
(ii)
where the assessee sells the eligible securities mentioned in sub-clause (B)
from his demat account, he shall have to purchase eligible securities and the
said demat account shall be compliant from the day on which the value of the
investment portfolio in the account becomes -
(I)
at least equivalent to the investment claimed as eligible for deduction under
section 80CCG of the Act or;
(II)
the value of the investment portfolio under the Scheme before such sale,
whichever
is less.
(6) The new
retail investor’s demat account created under the Scheme shall, on the expiry
of the period of holding of the investment, be converted automatically into an
ordinary demat account.
(7) For the
purpose of valuation of investment during the flexible lock-in period, the
closing price as on the previous day of the date of trading, shall be
considered.
(8) While making
the initial investments upto fifty thousand rupees, the total cost of
acquisition of eligible securities shall not include brokerage charges,
Securities Transaction Tax, stamp duty, service tax and all taxes, which are
appearing in the contract note.
(9) Where the
investment of the new retail investor undergoes a change as a result of
involuntary corporate actions like demerger of companies, amalgamation, etc.
resulting in debit or credit of securities covered under the Scheme, the
deduction claimed by such investor shall not be affected.
(10) In case of
voluntary corporate actions like buy-back, etc. resulting only in debit of
securities, where new retail investor has the option to exercise his choice,
the same shall be considered as a sale transaction for the purpose of the
Scheme.
(11) The
Securities and Exchange Board of India established under section 3 of the
Securities and Exchange Board of India Act, 1992 (15 of 1992) shall notify the
corporate actions, referred to in sub-paragraph (9), allowed under the Scheme
in this regard.
8.
If
the new retail investor fails to fulfil any of the provisions of the Scheme,
the deduction originally allowed to him under sub-section (1) of section 80CCG
of the Act for any previous year, shall be deemed to be the income of the
assessee of such previous year and shall be liable to tax for the assessment
year relevant to such previous year.
9.
(1)
The depository shall certify the new retail investor status of the assessee at
the time of designating his demat account as demat account for the purpose of
the Scheme.
(2)
The depository participant shall furnish an annual statement of the eligible
securities invested in or traded through the demat account to the demat account
holder.
10.
The
depository shall provide a consolidated statement of details in the electronic
format, as specified in Form C, on all the Rajiv Gandhi Equity Savings Scheme
beneficiaries to the Director General of Income Tax (Systems) or any other
person authorised by him, within a period of thirty days from the end of the
relevant financial year.
11.
For
the purpose of paragraph 10, the Director General of Income Tax (Systems) shall
determine the procedures, formats and standards for furnishing of the report in
electronic format in Form C by the depositories.
12.
Assessees
shall be liable to submit the relevant records to the income-tax authorities
for verification, as and when required.
[ Notification No. 51 /2012 F.
No. 142/35/2012 –TPL)
(Raman Chopra)
Director (TPL-II)
Form
A
[See paragraph
5(b)]
Declaration
to be submitted by the investors to the depository participants for availing
the benefits under the Rajiv Gandhi Equity Savings Scheme.
Name
of the Investor:
(first
holder)
Address
of the investor:
Permanent
Account Number (PAN):
1. It is hereby certified that* ---
(a) I do not have a demat account and I have not
traded in any derivatives.
(b) I have demat account no _________________ in
____________________ depository participant but I have not traded in any equity
shares or derivatives in this account.
(c) I have a joint demat account no
_________________ in ____________________ depository participant but I am not
the first account holder.
2. I hereby declare that I have read and understood
all the terms and conditions of the Rajiv Gandhi Equity Savings Scheme.
3. It is hereby verified that I am an eligible new
retail investor for availing the benefits under the Rajiv Gandhi Equity Savings
Scheme.
4. I undertake to abide by all the requirements and
fulfill all obligations under the Scheme, and will comply with all the terms
and conditions of the Scheme.
5. I understand that, in case I fail to comply with
any condition specified in the Scheme, the benefits availed there under will be
withdrawn and the tax shall be payable by me accordingly.
Signature of the
Investor
Place:
Date:
*
Tick which ever is appropriate.
Form
B
[See paragraph
6(c) and (d)]
Declaration
to be submitted by the new retail investor to the depository participant on
purchase of eligible securities.
To
Depository
participant
Address
It is hereby
informed that I have demat account no _________________ in ____________________
depository participant and the following securities
(a)
(b)
(c)
(d)
(e)
purchased in the aforesaid demat account on ______________are not to be
included as investment for the purpose of the Rajiv Gandhi Equity Savings
Scheme.
Signature
Name
of the Investor:
(first
holder)
Address
of the investor:
Permanent
Account Number (PAN):
Form
C
[See paragraphs
10 and 11]
Annual
report to be submitted by the depository to the Income Tax Department in
Electronic Format before 30th April.
(For
80 CCG benefits of Financial Year 2012-13) 2012-13
Report
to be furnished by 30thApril 2013
|
2013-14
Report
to be furnished by 30thApril 2014
|
2014-15
Report
to be furnished by 30thApril 2015
|
2015-16
Report
to be furnished by 30th
April
2016
|
|||||||||||
Name
|
PAN
|
DEMAT
A/c No.
|
Date
of opening A/c
|
Date
of investment for the Purpose of lock-in (date of making the last investment
in RGESS# eligible scrip)
|
Amount
of Investment
|
Scrips
locked in RGESS#
|
Whether
A/c eligible under the RGESS# Scheme
|
Whether
A/c compliant with RGESS# with respect to fixed lock-in*
|
Whether
A/c compliant with RGESS# with respect to 270 days period*
|
Whether
A/c compliant with RGESS# with respect to 270 days period*
|
||||
