Context:
National Highways Infra Trust (NHIT), the InvIT set up by NHAI in 2020, has successfully concluded fourth round of fund-raising
Infrastructure Investment Trust (InvITs):
- An investment vehicle, like a mutual fund or Real Estate Investment Trusts (REITs).
- Allows both individual and institutional investors to make direct investment towards infrastructure investment and receive a portion of the income as returns.
- Investments can be made directly or through SPV (Special Purpose Vehicle)/Holding Company by the InvIT.
- InvITs earn income through tolls, rents, interest or dividends from their investments. The interest, dividend, and rental income are taxable in the hand of the unitholder.
- Regulated by – Securities and Exchange Board of India (SEBI)
- SEBI requires InvITs to distribute at least 90% of their income to investors.
- InvITs are recognized as borrowers under the ‘Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002’.
National Highways Authority of India (NHAI):
- Established in – 1988
- Administrative control – Ministry of Road Transport and Highways.
- Statutory Body – National Highways Authority of India Act.
- Responsivities – develop, maintain and manage the National Highways.
- Consists of – A full time Chairman, and not more than 5 full time Members and 4 part time Members.
- Members are appointed by – Central Government.
- Has Technical, Finance, Administrative and Vigilance Wings.
Source: PIB
Previous year question
Consider the following statements:
Statement-I: Interest income from the deposits in Infrastructure Investment Trusts (InvITs) distributed to their investors is exempted from tax, but the dividend is taxable.
Statement-II: InviTs are recognized as borrowers under the ‘Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002’.
Which one of the following is correct in respect of the above statements?
[ UPSC Civil Service Exam – 2023 Prelims]
(a) Both Statement-I and Statement-II are correct, and Statement-II is the correct explanation for Statement-1
(b) Both Statement-I and Statement-II are correct, and Statement-II is not the correct explanation for Statement-1
(c) Statement-1 is correct but Statement-II is incorrect
(d) Statement-I is incorrect Statement-II is correct
Answer: (d)