1.Taxable Securities
Interest payable by bonds or debentures that are liable to tax either at the issuer or the investor's end are known as taxable securities. Examples of taxable securities are debentures issued by ECL Finance Ltd., SREI Infrastructure, Shriram Transport Finance etc.
2.Tax Free Securities
These securities pay interest which is tax free in the hands of investors. No tax is to be paid on the interest either at the issuer or investor's end. Examples of the tax free securities are bonds issued by public sector undertaking like IFCI, IIFCL, IRFC, HUDCO etc.