Section 269TT: Mode of Repayment of Special Bearer Bonds, 1991

Text of Section 269TT - Mode of repayment of Special Bearer Bonds, 1991

Notwithstanding anything contained in any other law for the time being in force, the amount payable on redemption of Special Bearer Bonds, 1991, shall be paid only by an account payee cheque or account payee bank draft drawn in the name of the person to whom such payment is to be made.

Legislative note: Section 269TT was inserted by Act 38 of 1981, section 3, with effect from 19 September 1981, as noted in the source text.

What does Section 269TT require?

The section specifies how redemption money must be paid. The amount payable on redemption of Special Bearer Bonds, 1991, is to be paid only through an account payee cheque or an account payee bank draft drawn in the name of the entitled recipient. The section uses the words notwithstanding anything contained in any other law, indicating that this specific payment requirement prevails over inconsistent general provisions, subject to applicable legislative interpretation.

The provision does not, by itself, determine who owns a bond, whether a claim is timely, the amount payable, or whether a particular bond remains redeemable. Those matters require examination of the governing bond legislation, scheme terms and records.

What payment methods are specified?

• Account payee cheque: A cheque marked for credit to the named payee's account rather than for cash payment over the counter.
• Account payee bank draft: A bank-issued payment instrument restricted to the named payee.

The quoted statutory language does not itself list cash, bearer cheque, direct cash disbursement or electronic transfer as alternative redemption methods. Any later legislative change or specific legal direction must be independently verified before applying a different method.

Key expressions explained

Special Bearer Bonds, 1991

The expression identifies the special bearer bonds governed by the historic scheme associated with the Special Bearer Bonds (Immunities and Exemptions) Act, 1981. The year in the bond name should not be confused with the enactment date of Section 269TT.

Redemption

Redemption is the discharge of a bond obligation through payment of the amount payable under its governing terms. Section 269TT regulates the mode of that payment.

Person to whom payment is to be made

This is the recipient legally entitled to the redemption payment. Section 269TT requires the instrument to be drawn in that person's name; it does not independently resolve questions about title or entitlement.

Legislative background and present relevance

The provision originated in 1981 and relates to a specific historic financial instrument. It is not a generally applicable rule for current investment products. A reader examining an old redemption, disputed payment or archival tax matter should consult the version of the statute applicable to the relevant date and the original bond legislation.

For current-year taxation or payments, do not assume that the historical scheme remains open merely because Section 269TT appears in a compilation of the Income-tax Act, 1961. Separately verify the applicable law and any transition provisions, including those under later income-tax legislation.

Difference between Sections 269TT, 269T and 269ST

These provisions regulate different transactions and should not be treated as interchangeable.

Frequently asked questions

Can the redemption amount be paid in cash?

The text of Section 269TT specifies payment only by account payee cheque or account payee bank draft in the name of the entitled person. It does not provide a cash-payment option.

Does Section 269TT apply to ordinary bank fixed deposits?

No. It expressly addresses Special Bearer Bonds, 1991. Repayment of covered loans and deposits is separately addressed by Section 269T.

Does Section 269TT itself establish the right to redeem an old bond?

No. It regulates the payment method; entitlement and redemption conditions must be determined under the relevant bond legislation and terms.

Official legal references

For the authoritative legislative text and amendments, consult India Code and the Income Tax Department's Acts collection. Search these official resources for the Income-tax Act, 1961 and the Special Bearer Bonds (Immunities and Exemptions) Act, 1981. Related reading: Section 269T and Section 269ST.