Deduction is available for interest received from specified entities and since HDFC Limited does not fall in these categories, you cannot claim this deduction
I am a senior citizen and have made fixed deposit with HDFC LTD (NOT HDFC BANK). Please let me know whether the interest income received from HDFC Limited is eligible for exemption within Rs. 50000 or not.
As per Section 80TTB a person, who has completed 60 years and who is a resident of India for income tax purposes, is entitled to claim a deduction of Rs. 50,000/- in respect of interest earned by him from Post office, Bank and Cooperative Societies during the year.
This deduction is available in respect of interest received from deposits of any nature made with these entities. So one can claim this deduction in respect of saving bank interest, interest on fixed deposits, interest on recurring deposits. Even you can claim this deduction for interest earned on deposits made under Senior Citizen Saving Scheme under this Section within this overall limit of Rs. 50,000/-.
Since this deduction is available for interest received from specified entities and since HDFC Limited does not fall in these categories, you cannot claim this deduction. Had the deposits been with HDFC bank and not HDFC limited, you would have been entitled to this deduction under Section 80TTB for interest received from HDFC bank. Since interest under Section 80TTB is exempt upto Rs. 50,000 is exempt, the resident senior citizens enjoy a higher limit of Rs. 50,000/- for the purpose of TDS on interest under Section 194A.
Balwant Jain is a tax and investment expert and can be reached at firstname.lastname@example.org and @jainbalwant on his twitter handle.