Karnataka Bank Empanelled as Arranger for HUDCO Capital Gain Bonds

MANGALURU — Karnataka Bank has announced that it has been officially empanelled as an Arranger and Collector for HUDCO Capital Gain Bonds.

According to a media statement issued by the bank, this appointment places Karnataka Bank among a select group of arrangers that facilitate investments in government-backed Capital Gain Bonds. These bonds are issued by major public sector undertakings, including the Housing and Urban Development Corporation Limited (HUDCO), Rural Electrification Corporation (REC), Power Finance Corporation (PFC), and Indian Railway Finance Corporation (IRFC).

The transactions are facilitated under Section 85 of the Income Tax Act, 2025, which was formerly known as Section 54EC of the Income Tax Act, 1961.

Bank representatives stated that the addition of HUDCO Capital Gain Bonds expands its current suite of investment offerings. The institution noted that the inclusion reflects its focus on providing financial products designed to meet the requirements of both retail and institutional customers.

Customers seeking to utilize these investment options have been advised by the bank to visit their nearest branch. Bank branches will provide detailed information regarding eligibility criteria, investment limits, the subscription process, and other applicable terms and conditions associated with the bonds.

"The empanelment of regional and commercial banks as arrangers for government-backed capital gain bonds is a strategic move that enhances accessibility for investors seeking tax-saving avenues. By broadening their product suites to include instruments from institutions like HUDCO, REC, PFC, and IRFC, banks can better serve both retail and institutional clients looking for secure, regulated investment channels under the Income Tax Act. This development highlights the ongoing integration of traditional banking networks with statutory financial instruments." — Dr. Shishir Gupta, Founder & CEO, StartupLanes