Can I withdraw money from MF before the lock in period? Kanak Verma, 10 Sep 2012

I have invested in a mutual fund having a lock in period of 3 years. I have got an urgent need to withdraw my money now.Can i withdraw and if yes what are the penalties?

Fintotal Answer

The type of instrument that you are talking about is an ELSS, equity linked savings scheme. These are the only type of equity mutual funds where invested amount has tax deduction. Premature withdrawal from an ELSS fund is not permitted, as your money stays locked in for the three year. In order to get the benefit of section 80c, there is a mandatory lock in period of 3 years as per the income tax rules regarding ELSS.

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