Mumbai : IDBI Mutual Fund today announced the launch of IDBI Tax Saving Fund, an open ended equity linked savings scheme (ELSS) offering income tax benefits under section 80 C of the IT Act, 1961. The product is designed keeping in mind investors who are seeking capital appreciation as well as saving income tax through their investment. Investors not desiring tax benefits can also invest in the scheme as a medium to long term equity investment.

The New Fund Offer (NFO) will open for subscription on August 20, 2013 and close on September 03, 2013. The units will be available at par (Rs.10/-) during the NFO and at NAV related prices thereafter. The scheme will re-open for continuous sale from September 17, 2013.

The investment objective of the scheme is to provide investors with an opportunity for capital appreciation and income along with the benefit of income-tax deduction (under section 80C of the IT Act, 1961) on their investments. Investments in this scheme would be subject to a statutory lock-in period of 3 years from the date of allotment to be eligible for income-tax benefits under section section 80C.

Speaking on the occasion, Mr. Debasish Mallick, MD & Chief Executive Officer, IDBI Asset Management Ltd said “We are happy to announce the launch of IDBI Tax Saving Fund. Investments, upto Rs 1 lakh, made in the scheme will be eligible for benefits u/s 80C of the Income Tax Act, with the maximum benefit upto Rs 30,900/- in the highest tax bracket. We are launching the issue in August so as to enable investors to choose for lumpsum investment during NFO, when units will be allotted at par, or alternatively plan their investment by way of SIP, in a phased manner, till March so as to enjoy full tax benefits. Apart from upfront Income Tax benefits, capital gains and dividend returns are also tax free under the IDBI Tax Saving Fund.”

Source : Sachin Murdeshwar