Retirement funds stuck in approval bottleneck

NEW DELHI: The mutual fund industry is peeved that the Central Board of Direct Taxes is taking too long to approve tax benefits under Section 80C for new schemes. At least eight retirement mutual funds are stuck at the approval stage, some of them for the past 15-18 months.

Though Sebi wants fund houses to launch retirement plans, only two retirement mutual funds have been launched in the past one year. The Reliance Retirement Fund was launched in February last year and HDFC Retirement Savings Fund was launched this week. Others are awaiting approval from the CBDT.

According to a report in the Financial Chronicle, the industry body Association of Mutual Funds in India (Amfi) has written to the Finance Ministry to let Sebi approve the schemes instead of waiting for a nod from the CBDT. “Permission should be given to Sebi to approve the offer documents instead of CBDT,” the report quotes C.V.R. Rajendran, chief executive of Amfi. In its budget wish submitted to the Finance Ministry, Amfi has also sought additional tax breaks for retirement mutual funds under Section 80CCD, similar to those extended to the National Pension System (NPS) in last year’s Budget.

Fund name	Pending since
SBI Retirement Benefit Fund	Aug 2014
Axis Retirement Planning Fund	Nov 2014
DSP BlackRock Retirement Benefit Pension Fund	Dec 2014
Birla Sun Life Retirement Fund	Feb 2015
IDBI Retirement Saving Fund	Apr 2015
LIC Nomura MF Retirement Benefit Fund	Apr 2015
Canara Robeco Retirement & Pension Solution	Jul 2015
ICICI Prudential Retirement Income Fund	Jan 2016

Source: Sebi