CBDT Notifies Amendment in Rule 2F for Setting Up of Infrastructure Debt Fund as NBFC

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  • Last Updated on 11 February, 2025

Infrastructure Debt Fund (IDF)

Notification F. No.370142/9/2024-TPL, dated 07-02-2025

The Central Board of Direct Taxes (CBDT) has amended Rule 2F, which provides that an Infrastructure Debt Fund (IDF) shall be set up as a Non-Banking Financial Company (NBFC). The IDF shall conform to and satisfy the conditions laid down in the regulatory framework provided by the Reserve Bank of India (RBI).

The amended rule provides that the funds of the Infrastructure Debt Fund shall be invested only in:

a) post-commencement operation date infrastructure projects which have completed at least one year of satisfactory commercial operations; or

b) toll-operate-transfer projects as the direct lender.

‘Toll-operate-transfer projects’ is the new addition made by Rule 2F.

In respect of raising funds, the Infrastructure Debt Fund (IDF) can now raise funds through loans under External Commercial Borrowings (ECB).

For external commercial borrowings by the Infrastructure Debt Fund, the tenure must be at least five years, and such borrowings cannot be obtained from foreign branches of Indian banks.

The new rule also updates investment restrictions for Infrastructure Debt Funds (IDFs) by replacing the term “sponsor” with “specified shareholder.” This means IDFs can no longer invest in projects where a specified shareholder, its associated enterprise, or its group has a substantial interest, instead of the earlier restriction based on sponsorship.

Click Here To Read The Full Notification

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Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied