Income-tax (Fifth Amendment) Rules, 2012 - Insertion of rule 2F
Notification No. 16/2012 was published on 30 April 2012. Its subject is Income-tax (Fifth Amendment) Rules, 2012 - Insertion of rule 2F.
This amends the Income-tax Rules. What it changes is the Rules, not the Act — and a rule can never take away what the section gives.
By the Income-tax (5th Amendment) Rules, 2012, made under clause (47) of section 10 read with section 295 of the Income-tax Act, 1961, the Central Board of Direct Taxes inserts rule 2F in the Income-tax Rules, 1962, after rule 2E. Rule 2F lays down the guidelines for setting up an Infrastructure Debt Fund for the purpose of exemption under section 10(47). The Fund must be set up as a Non-Banking Financial Company conforming to the Reserve Bank's Infrastructure-Development Fund - Non-Banking Financial Companies (Reserve Bank) Directions, 2011; its funds may be invested only in Public Private Partnership Infrastructure Projects and in Post-Commencement Operation Date Infrastructure Projects that have completed at least one year of satisfactory commercial operation, with a tripartite agreement with the concessionaire and the project authority for compulsory buy out and termination payment; it may issue rupee denominated or foreign currency bonds in accordance with Reserve Bank directions and the Foreign Exchange Management (Transfer or issue of security by a person resident outside India) Regulations, 2000; investment in an individual project or in a project belonging to a group may not at any time exceed twenty per cent of the corpus; no investment may be made in a project in which the sponsor, the associate enterprise or the group of the sponsor has a substantial interest; and the Fund must file its return of income under sub-section (4C) of section 139 on or before the due date.
The rule is framed to prescribe the guidelines on which an Infrastructure Debt Fund may be set up for the purpose of the exemption in clause (47) of section 10 of the Act.
Income-tax (Fifth Amendment) Rules, 2012 - Insertion of rule 2F
Notification No. 16/2012 [F. No. 149/72/2011-SO (TPL)]/942(E), dated 30-4-2012
In exercise of the powers conferred by clause (47) of section 10 read with section 295 of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend the Income-tax Rules, 1962, namely:-
1. (1) These rules may be called the Income-tax (5th Amendment) Rules, 2012.
(2) They shall come into force from the date of their publication in the Official Gazette.
2. In the Income-tax Rules, 1962, after rule 2E, the following rule shall be inserted, namely:-
"Guidelines for setting up an Infrastructure Debt Fund for the purpose of exemption under clause (47) of section 10.
2F. (1) The Infrastructure Debt Fund shall be set up as a Non-Banking Financial Company conforming to and satisfying the conditions provided by the Reserve Bank of India in the Infrastructure-Development Fund - Non-Banking Financial Companies (Reserve Bank) Directions, 2011, vide notification No. DNBS.233/CGM (US)-2011, dated 21st November, 2011.
(2) The funds of Infrastructure Debt Fund shall be invested only in the Public Private Partnership Infrastructure Projects and Post - Commencement Operation Date Infrastructure Projects which have completed at least one year of satisfactory commercial operation and such Infrastructure Debt Fund is a party to tripartite agreement with the concessionaire and the project authority for ensuring compulsory buy out and termination payment.
(3) The Infrastructure Debt Fund shall issue rupee denominated bonds or foreign currency bonds in accordance with the directions of Reserve Bank of India (RBI) and the relevant regulations under the Foreign Exchange Management (Transfer or issue of security by a person resident outside India) Regulations, 2000, as amended from time to time.
(4) The terms and conditions of any bond issued by the Infrastructure Debt Fund shall be in accordance with the said directions of the Reserve Bank of India and the regulations referred to in sub-rule (3).
(5) In case of an investor in the aforesaid bond being a non-resident the original or initial maturity of bond, at time of first investment by such non-resident investor, shall not be less than a period of five years.
Provided that the investment made by a non-resident investor in such bonds shall be subject to a lock-in period of not less than three years, but the non-resident investor may transfer the bond to another non-resident investor within such lock-in period.
(6) The investment made by the Infrastructure Debt Fund in an individual project or project belonging to a group at any time, shall not exceed twenty per cent, of the corpus of the fund.
(7) No investment shall be made by the Infrastructure Debt Fund in any project where its sponsor or the associate enterprise or the group of such sponsor has a substantial interest.
(8) The Infrastructure Debt Fund shall file its return of income as required by sub-section (4C) of section 139 on or before the due date.
(9) In case the Infrastructure Debt Fund does not fulfil any of the conditions provided in this rule or directions of the Reserve Bank of India, all provisions of the Act shall apply as if it is not an Infrastructure Debt Fund referred to in clause (47) of section 10 of the Act.
Explanation. - For the purpose of this rule,-
(i) "associate enterprise" shall have the same meaning as assigned to it in section 92A of the Act;
(ii) "concern" shall have the same meaning as in clause (a) of Explanation 3 of sub-section (22) of section 2 of the Act;
(iii) "concessionaire", "tripartite agreement" and "project authority" respectively shall have the same meaning as assigned to them in the Infrastructure Debt Fund-Non-Banking Financial Company (Reserve Bank) Directions, 2011;
(iv) "corpus" means the total funds of the Infrastructure Debt Fund raised for the purpose of investment;
(v) "group" means a group as defined in clause (mm) of section 2 of Securities and Exchange Board of India (Mutual Funds) Regulations, 1996.
(vi) a person shall be deemed to have substantial interest in -
(a) a company if he is the beneficial owner (including beneficial ownership held by one or more of his relatives, in case the person is an individual) of shares (not being the shares entitled to a fixed rate of dividend whether with or without a right to participate in profits) holding not less than 10 per cent of the voting power; or
(b) a concern other than a company if he is, at any time during the previous year, beneficially entitled to not less than 20 per cent of the income of such concern.
(vii) "relative", in relation to an individual, means—
(a) spouse of the individual;
(b) brother or sister of the individual;
(c) brother or sister of the spouse of the individual;
(d) brother or sister of either of the parents of the individual;
(e) any lineal ascendant or descendant of the individual;
(f) any lineal ascendant or descendant of the spouse of the individual;
(g) spouse of the persons referred to in sub-clauses (b) to (f); or
(h) any lineal descendant of a brother or sister of either the individual or of the spouse of the individual.
(viii) "sponsor" means a non-banking financial company, or a bank which is allowed to act as sponsor of Infrastructure Debt Fund in accordance with the directions of Reserve Bank of India."
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| Rule of the 1962 Rules | Now, in the 2026 Rules |
|---|---|
| Rule 2F | rule 288 |
| Rule 2E | no counterpart recorded |
the date of publication in the Official Gazette.
In the return of income a Fund files under section 139(4C) and in any examination of its claim that its income is exempt under section 10(47).
A Fund with a corpus of Rs. 1,000 crore may hold no more than Rs. 200 crore at any time in a single project, and the same ceiling of twenty per cent applies to all projects belonging to one group taken together. A bond first subscribed by a non-resident must run for at least five years from that first investment and cannot be transferred for three years except to another non-resident.
Rules it names. Rule 2E, 2F of the Income-tax Rules, 1962. The 1962 Rules were replaced by the Income-tax Rules, 2026, which renumbered nearly everything: a rule number quoted here almost never means the same rule today.
Source: the Income Tax Department’s own published text — its page for this instrument.