Consider the following statements:
Statement-I: Interest income from the deposits in Infrastructure Investment Trusts (InvITs) distributed to their investors is exempted from tax, but the dividend is taxable.
Statement-II: InvITs are recognized as borrowers under the 'Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002'.
Which one of the following is correct in respect of the above statements?
The correct answer is (D) Statement-I is incorrect but Statement-II is correct.
Explanation:
Statement 1 is incorrect: Infrastructure Investment Trusts (InvITs) are investment vehicles that pool funds from investors to finance infrastructure projects. They function as pass-through entities, meaning their income and expenses are directly passed on to unitholders. Under the Union Budget 2023-24, all forms of income distributed by InvITs—including interest income, dividend income, and rental income—are now taxable in the hands of unitholders. Previously, only dividend income from InvITs was taxable, while other income streams enjoyed tax exemptions. This change aims to broaden the tax base and ensure uniform taxation across all income sources from InvITs, thereby promoting tax equity among investors. It's important to note that this taxation revision applies only to InvITs and does not impact other trust-based investment structures like Real Estate Investment Trusts (REITs). Key Tax Changes for InvITs (Budget 2023-24): Interest income from deposits – Taxed at the investor’s marginal tax rate. Dividend income – Taxed at 15% under the Dividend Distribution Tax (DDT). Rental income – Taxed at the investor’s marginal tax rate. Given these updates, the original statement is incorrect. Statement 2 is correct: InvITs are classified as borrowers under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act). This Act provides a legal framework for the securitization of financial assets and facilitates the enforcement of security interests in case of loan defaults.
हिंदी में प्रश्न एवं आदर्श उत्तर
निम्नलिखित कथनों पर विचार कीजिए :
कथन-I : आधारिक संरचना निवेश न्यासों (InvITs) में जमा (डिपॉजिट) से हुई ब्याज की आय, जो उनके निवेशकों में वितरित की जाती है, कर से छूट प्राप्त है, किन्तु लाभांश करयोग्य है।
कथन-II : 'वित्तीय परिसंपत्तियों का प्रतिभूतिकरण और पुनर्गठन तथा प्रतिभूति हित का प्रवर्तन अधिनियम, 2002' के अधीन InvITs को ऋणी के रूप में मान्यता प्राप्त है।
उपर्युक्त कथनों के बारे में, निम्नलिखित में से कौन-सा एक सही है?
सही उत्तर (D) Statement-I is incorrect but Statement-II is correct है।
व्याख्या:
Statement 1 is incorrect: Infrastructure Investment Trusts (InvITs) are investment vehicles that pool funds from investors to finance infrastructure projects. They function as pass-through entities, meaning their income and expenses are directly passed on to unitholders. Under the Union Budget 2023-24, all forms of income distributed by InvITs—including interest income, dividend income, and rental income—are now taxable in the hands of unitholders. Previously, only dividend income from InvITs was taxable, while other income streams enjoyed tax exemptions. This change aims to broaden the tax base and ensure uniform taxation across all income sources from InvITs, thereby promoting tax equity among investors. It's important to note that this taxation revision applies only to InvITs and does not impact other trust-based investment structures like Real Estate Investment Trusts (REITs). Key Tax Changes for InvITs (Budget 2023-24): Interest income from deposits – Taxed at the investor’s marginal tax rate. Dividend income – Taxed at 15% under the Dividend Distribution Tax (DDT). Rental income – Taxed at the investor’s marginal tax rate. Given these updates, the original statement is incorrect. Statement 2 is correct: InvITs are classified as borrowers under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act). This Act provides a legal framework for the securitization of financial assets and facilitates the enforcement of security interests in case of loan defaults.