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Rajiv Gandhi Equity Savings Scheme, 2012 (RGESS) Title

By Legal & Compliance Dept.

 ONE TIME 50% deduction under section 80CCG of Income Tax Act.  Only new retail Investors whose Gross Total Income is less than or equal to Rs 10 lakhs are eligible for deduction in the 1st A. 25 K can be claimed).g.Y.  Non fulfillment of conditions will result in withdrawal of Tax benefit. if amount invested is Rs. (i.Y in which benefit is claimed. THE PRODUCT – OBJECTIVE &FEATURES L&C .  Deduction u/s 80CCG is over & above the Section 80C limit of Rs 100. 50 K income tax benefit of Rs. However .e.000/. 50.(e.benefits can be availed only for the investments made in 1st F. income from all sources). Announced in Union Budget of 2012-13 and notified on 23 Nov. 1961 for a maximum investment amount of Rs. 2012.  SEBI circular dated 6th December 2012.000/ Investment can be made in installments.  To promote an ‘equity culture’ in India and encourage savings of small investors in domestic capital market.

10 lakhs  Only New Retails Investors are permitted to claim deduction: New Retail Investor means:  Individuals who do not have a demat account and who have not traded in derivatives segment as on November 23. ▼ PAN card is mandatory for account opening .  Gross total Income < = Rs. 2012.. not eligible). 2012. P’ship etc.WHO CAN INVEST?  Only Individual (HUF. L&C . Hence investors residing in the state of Sikkim are not eligible.  Individuals having demat acoount where he/she is not the first holder.  Individuals having demat account have not invested in equity &/derivative segment as on November 23.

5.htm http://www.LIST OF ELIGIBLE SECURITIES 7. Maharatnas.htm http://www. Follow on Public Officer (FPO) of (1) & (2) above New Fund offers (NFOs) of (3) above IPOs of PSU whose turnover is > Rs. The link for RGESS eligible securities are given below: http://www. 4.nseindia. Navratna & Miniratna as categaorised by Central Government. Equity Shares falling in the list of equity declared as “BSE-100” or “CNX100” by BSE & 3. Exchange Traded Funds (ETFs) invested in (1) to (5) Note : list of securities will be available on Exchange website and with depositories.cdslindia.4000cr during preceding three years Mutual Funds invested in (1) to (5). 2.jsp L&C .

and ends one year from the date of purchase of last set of eligible securities in the same F. pledge or hypothecate securities L&C . It is to be noted that if the investment is made in installments the lock-in would be more than one year.02.000 mark) is made on 28.e when the account hits Rs 50.04. For Eg if the first investment is made on 01.02.2015.Y.Y for which deduction is claimed.2014 then the lock-in period would end one year after 28.e on 27.2014 i.2013 and the last investment (i. Flexible Lock in period Investor permitted to trade during flexible lock in period provided the Demat account is compliant with the following during two hundred and seventy days during each of the remaining two years:  Portfolio value is equal to or higher than the amount claimed as deduction  Trading permissible only in eligible securities Not permitted to sell.LOCK IN PERIOD The scheme is subject to lock in period of 3 years divided in fixed and flexible lock in: Fixed Lock in period Commences from the date of purchase of eligible securities in the relevant F.02.


etc. Demat account to be converted to ordinary demat account on completion of period of holding. This form is to be submitted within one month from the date of credit of securities to the DP.     L&C .2012 wherein investor provides undertaking about his eligibility for the scheme and claims to have read and understood the Terms & Conditions of RGESS. In case the investor wishes to exclude certain securities within the above limit of investment. Change in investment amount in view of voluntary corporate actions like buyback where investor has an option to exercise choice. Submit declaration in Form A as per the format prescribed in SEBI Circular dated 6th Dec. the deduction claimed shall not be affected. the same shall be considered as sale transaction. demerger . he can do so by specifying such securities in Form B as per the format prescribed in SEBI Circular dated 6th Dec. In case of change in investment amount in view of involuntary corporate actions like merger.DOCUMENTATION   Investor to open a Trading & Demat account. 2012 in the circular.

PROCESS CHANGES REQUIRED AT ANGEL      Product needs to be internalise & marketed. KYC. Feedback. A new tag is required to be created in the back office system (Trading as well as DP) for RGESS monitoring. Beside declaration from Client we need to do PAN verification at the time of UCC upload and KRA Verification. We need to extend BSDA facility to the investors under RGESS. L&C . Operation and Sales team needs to be educated about the Product in order to enable them to explain the same to clients.

25.  Only one time exemption allowed and that too only 50% of the Investment made. L&C .  The structure of lock in period is very complex and hence difficult for common investor to understand and invest for a meager deduction of Rs. keeping track of different lock-in dates is very cumbersome.Challenges  Limited choice of stocks  Maintenance of the initial value of the investment for at least 270 days in year two and year three.000/ Since investment made in installments.

com Thank You L&C .For any clarification please write to compliance@angelbroking.