Gist of the Government Savings Promotion General Rules, 2018
Rule 1: Short title and commencement
These rules are called the Government Savings Promotion General Rules, 2018. They came into force on October 5, 2018, the date of their publication in the Official Gazette.
Rule 2: Applicability
These rules apply to the schemes listed in the Schedule appended to the Government Savings Promotion Act, 1873.
Rule 3: Definitions
This rule defines key terms used throughout the document. Some of the definitions are:
• Accounts Office: An office of a Government Savings Bank authorized to open an account.
• Eligible Balance: The account balance, including accrued interest, after any loan recoveries have been made.
• Form: A form appended to these rules.
• Joint Account: An account opened in the names of two to four individuals.
• Matured account: An account that has completed its term or extended term and is due for payment.
• Non-resident Indian (NRI): An Indian citizen or person of Indian origin who is not a 'resident' as defined by the Income Tax Act, 1961.
• Officially Valid Document: Includes a passport, driving license, Voter's Identity Card, NREGA job card, and National Population Register letter.
• Passbook: A physical or electronic document issued by an Accounts Office with depositor and transaction details.
• Single Account: An account in the name of one individual.
• Transfer: Transferring a depositor's account from one Accounts Office to another.
• Words and expressions not defined in these rules have the same meaning as in the Act.
Rule 4: Eligibility to open an account
Any adult resident citizen of India can open an account. An account can also be opened by a guardian on behalf of a minor or a person of unsound mind, provided both are resident citizens of India. A minor who is at least ten years old can open and operate an account themselves.
If a depositor becomes an NRI, the account can continue until maturity, but benefits are on a non-repatriation basis, and the account cannot be extended. No interest is payable after the date of maturity for such accounts. If a depositor ceases to be an Indian citizen, the account will be closed on the last day of the month before they ceased to be a citizen.
Rule 5: Opening of an account
An account can be opened in person at an Accounts Office or through electronic modes approved by the Reserve Bank of India. An application must be made in
Form 1 with a photograph and a deposit. Specific documents are required for accounts opened on behalf of a minor or a person of unsound mind.
An illiterate, blind, or visually challenged person must personally visit the Accounts Office for signature or thumb impression authentication. The thumb impression of an illiterate depositor must be witnessed on each occasion of withdrawal. Individuals with certain disabilities like autism, cerebral palsy, or mental retardation may open an account through a guardian and must provide a medical certificate at the time of opening.
Rule 6: Identification of depositor
In addition to the documents in Rule 5, an individual must provide their Aadhaar number and PAN or Form 60. If an Aadhaar number hasn't been assigned, proof of enrolment application is required. A depositor without a PAN must submit it within six months of opening the account, or the account will become non-operational. If a PAN or Aadhaar does not have the current address, an officially valid document with the present address must be submitted.
Rule 7: Mode of deposit
Deposits can be made in cash, by cheque, demand draft, pay order, or by electronic transfer. The date of deposit for a cheque is the date it is realized. Deposits, except online ones, must be accompanied by a deposit form. Outstation cheques may incur collection charges.
Rule 8: Types of accounts
Accounts can be either a Single Account or a Joint Account. Joint accounts are categorized as
Joint 'A' type (operated jointly by all depositors) or Joint 'B' type (operated by any depositor severally). A single account cannot be converted to a joint account or vice versa. A depositor may hold both a single and a joint account under the same scheme, subject to scheme-specific limits.
Rule 9: Payment of interest
Interest rates are notified by the Central Government. No interest is payable on accounts opened in contravention of the rules. If a depositor becomes an NRI, the account earns interest until maturity, but no interest is payable afterward. If a depositor ceases to be a citizen of India, interest is paid at the Post Office Savings Account rate until the account is closed. An eligible balance in a matured but unclosed account will continue to earn interest at the Post Office Savings Account rate.
Rule 10: Operation of an account opened in the name of a minor
An account opened for a minor is operated by the guardian if opened by them, or by the minor if they opened it themselves. When a minor who had an account opened by a guardian attains majority, they must submit a revised application and documents to operate the account. The eligible balance upon the death of a minor or person of unsound mind is paid to the nominee.
Rule 11: Operation of an account by depositors suffering from physical infirmity or by differently-abled persons
A depositor with a physical infirmity that prevents them from operating their account can authorize a literate individual to operate it on their behalf by providing a written authorization with the person's specimen signature and photograph.
Rule 12: Withdrawal from an account
At the time of withdrawal, the depositor's signature or thumb impression must be authenticated by the authorized officer. For a minor's account, the guardian must certify that the amount is for the minor's use and that the minor is alive.
Rule 13: Transfer of an account
An account can be transferred between Accounts Offices anywhere in India. The depositor must submit an application in
Form-5 with the prescribed fee and the passbook or savings certificate.
Rule 14: Nomination
A depositor can nominate up to four individuals to receive the eligible balance upon their death. Nomination must be made at the time of opening the account using Form 10. A new application in Form 10 can be used to vary a nomination before the account's maturity. Nomination is not allowed for accounts of minors or persons with unsound minds opened before April 1, 2018. A nomination is cancelled if all nominees die or the account is transferred as security.
Rule 15: Payment on the death of depositor
If a nomination is in force, the nominee(s) can apply for the balance using
Form 11. If there are multiple nominees, the balance is paid in the proportion specified by the depositor. If there is no nomination and the amount is less than or equal to ₹5 lakh, the Accounts Office may pay it to a rightful claimant on submission of an application in
Form 11 and other documents like an affidavit in Form 13 and a bond of indemnity in Form 15. If the amount exceeds ₹5 lakh, a 'Succession Certificate' is required.
Rule 16: Pledging of an account
An account can be pledged as security if the scheme allows it, using
Form 7 and an acceptance letter from the pledgee. Pledging to certain entities like the President of India or a Scheduled Bank is permitted. An endorsement is made on the account record. The transferee is considered the depositor until the account is re-transferred.
Rule 17: Payment of the eligible balance in an account held by Army, Air Force and Navy personnel
In the case of a depositor serving in the Army, Air Force, or Navy who dies or deserts, the Commanding Officer may request payment of the balance to the Commanding Officer or Committee of Adjustment, overriding any existing nomination.
Rule 18: Issue of Passbook
Upon opening an account, a passbook, deposit receipt, or statement of account is issued with all relevant details. A duplicate can be issued if the original is lost or stolen, on payment of a fee.
Rule 19: Closure of account
An account is closed upon maturity. Premature closure is only permitted if the specific savings scheme allows it and is subject to its conditions. Payment can be made by transfer to a savings bank account, a crossed cheque, or cash (if below the limit prescribed by the Income Tax Act).
Rule 20: Loans and partial withdrawal
Loans and partial withdrawals are allowed only if the scheme permits them. For accounts of a minor or a person with an unsound mind, the guardian must certify that the withdrawal is for the welfare of the individual.
Rule 21: Recovery of excess amount paid
Any amount paid in error to a depositor, guardian, or nominee is recoverable by the Government in the same manner as arrears of land revenue.
Rule 22: Forms for operation
The forms prescribed for opening and operating accounts are listed in Schedule I.
Rule 23: Fee for services
Fees for various services are specified in Schedule II. Examples include fees for a duplicate passbook, cancellation of a nomination, and account transfers.
Rule 24: Responsibility of Accounts Office
The Accounts Office is responsible for opening and closing accounts, accepting deposits, and making payments. They must maintain records and provide data to the Central Government when required. The Accounts Office is also responsible for creating the technological infrastructure to promote digital transactions. The concerned Government Savings Bank is liable for any loss caused by non-implementation or wrong implementation of the rules. However, the Accounts Office is not liable for fraudulent withdrawals if due diligence was applied, for acts of an authorized agent, or for actions taken in good faith.
Rule 25: Applicability of old rules
For any matter related to a savings scheme prior to these rules, the provisions of the Post Office Savings Bank General Rules, 1981, apply.
Rule 26: Repeal and savings
The Post Office Savings Bank General Rules, 1981, and the Post Office Savings Certificates Rules, 1960, are repealed. However, any action taken under the repealed rules is deemed to have been taken under the corresponding provisions of these new rules.
Rule 27: Interpretation
The Department of Economic Affairs, Ministry of Finance, is the competent authority for interpreting these rules, and its interpretation is final and binding.
Rule 28: Power to relax
The Central Government may relax the rules if their operation causes undue hardship to a depositor, provided the relaxation is consistent with the Act and the reasons are recorded in writing.
Schedule I: Forms
Schedule I of the rules lists all the forms that must be used for various transactions and operations related to the savings schemes. Each form is identified by a unique number and a description of its purpose.
• Form 1: Application for opening a new account.
• Form 2: Application for making a deposit or for the purchase of certificates.
• Form 3: Application for withdrawal.
• Form 4: Application for closure of a savings account.
• Form 5: Application for transfer of an account from one Accounts Office to another.
• Form 6: Application for extension of a certificate.
• Form 7: Application for pledging a savings account or certificate.
• Form 8: Application for change of a registered name.
• Form 9: Application for issue of a duplicate passbook or certificate.
• Form 10: Application for nomination, cancellation, or variation of a nomination.
• Form 11: Application for payment of the eligible balance to a deceased depositor's nominee(s) or legal heirs.
• Form 12: Certificate for the death of a depositor.
• Form 13: Affidavit for legal heirs or claimants of a deceased depositor.
• Form 14: Sanction for payment to a legal heir or claimant.
• Form 15: Indemnity Bond.
• Form 16: Agreement for the operation of a savings account of a person with a physical infirmity by an authorized person.
• Form 17: Declaration for a minor who has attained majority.
Schedule II: Fees
Schedule II specifies the fees and charges for various services provided by the Accounts Office. The fee amounts are subject to change by a subsequent notification from the Ministry of Finance.
• Duplicate passbook or statement of account: ₹20.
• Transfer of an account: ₹100 for each account.
• Pledging an account: ₹20 for each account.
• Issue of a new passbook in exchange for a used one: No fee.
• Change or cancellation of a nomination: ₹50 for each nomination.
• Duplicate savings certificate: ₹20 per certificate.
• Issue of a deceased claim statement: ₹10.
• Issue of an unclaimed amount statement: ₹10.
• Change of a guardian: ₹50.
• Payment on maturity for a certificate not presented on time: ₹50.
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