SB Order No. 11/2016 : Modification in Public Provident Fund (PPF) Scheme Rules, 2016 regarding premature closure of PPF Account.

Sb Order 11/2016 : Modification in Public Provident Fund (PPF) Scheme Rules,  2016  regarding premature closure of PPF Account.

SB ORDER NO. 11/2016

F. No. 32-01/2016-SB

Government of India

Ministry of Communication 

Department of Posts

(F.S. Division)

Dak Bhawan, New Delhi

Dated:  04 /11/2016

To

All Heads of Circles

Addl. Director General, APS, New Delhi

         Subject:- Modification in Public Provident Fund (PPF) Scheme Rules,  2016  regarding  premature closure of PPF Account.

Sir/Madam,

            The undersigned is directed to say that vide its O.M No.1/4/2016-NS-II dated 20^thJune,2016, Govt. of India, Ministry Of Finance, Department of economic Affairs (Budget Division) has notified the amendment to the Public Provident Fund Scheme, Rules 1968 as per the notification dated 18.06.2016 (Copy enclosed).

02.       As a result of this amendment, a subscriber shall be allowed premature closure of his account or the account of a minor of whom he/she is the guardian, on a written application to the Account Office, on any one of the following grounds:-

(i)         the amount is required for the treatment of serious ailments or life threatening disease to the account holder, spouse or dependent children or parents, on production of supporting documents from competent authority;

(ii)        the amount is required for higher education of the account holder or the minor account holder, on production of documents and fee bill in confirmation of admission in a recognized institute of higher education in India or abroad:

03.       However, such premature closure shall be allowed only after the account has completed five financial years and such premature closure shall be subject to deduction of such amount which shall be equivalent to one percent less interest on the interest rates as applicable from time to time in the table payable on the deposits held in the account from the date of opening of the account till the date of such premature closure. This calculation has to be done in accordance with the sample calculation as shown in the table attached in the notification dated 18.06.2016. Post offices should follow the following procedure while handling such cases:-

(a) All requests for premature closure of PPF Account supported by Medical Certificate from SMO or CMO of a Government Hospital/Dispensary/Health Centre (in case of Para 02(i) above) and Admission Letter as well as Fee Bill from a recognized Education Institute in India or abroad (in case of Para 02(ii) above) along with Passbook, should be sent to Divisional Head by post offices after verification of PPF Account details with the CBS system on the application of premature closure. In case account stands at SO, SPM will also take Account Closure Form (in duplicate) from the subscriber and send one copy to Divisional Office along with other documents. Second copy of Account Closure Form should be retained.

(b) Divisional Head, after satisfying the genuineness of the documents, should issue sanction, for premature closure of account and original documents along with Passbook should be sent to Head Postmaster of the HPO concerned.

(c) Head Postmaster should get the recalculation of interest done from SBCO (till software is amended) and close the account as Exceptional Closure in Finacle CBS Application and closure proceed should be credited into office account 0340. All such payments should be made only by crossed Cheque for the amount calculated by SBCO (not as shown by Finacle). Closure Amount calculated by SBCO (after re-calculation of interest) should be accounted in HPO LOT and Consolidation after manual correction for which entry in HO Error Book should be made. Copy of error entry should be attached with closure voucher. Sanction of Divisional Head and supporting documents should also be attached to the account closure voucher.

(d) In case account stands at any SO, HPO should first transfer the account from SO to HPO, close the account as mentioned above. Particulars of payment for which cheque is issued as mentioned in Para(c) above, should be mentioned on the Account Closure Form (already received from SO through Divisional Office) by HPO. This amount should be accounted in HPO itself as it would appear in LOT and Consolidation of HPO.

(e) HPO should send cheque to SO duly entered in SO Slip and SO, on receipt of cheque, will handover the cheque to the depositor after taking receipt on the Account Closure Form retained by SO as mentioned in para 3(a) above.  This Account Closure Form shall be sent to HPO for onward transfer to SBCO. SBCO will attach this Account Closure Form with the copy of Account Closure Form received from HPO.

04.       This may kindly be circulated to all CBS and   non-CBS Post Offices for information and necessary guidance for staff and customers. Post Offices on Sanchaya Post will close the account by using the option Claim Closure and follow the rest of the procedure as mentioned for CBS Offices.

05.       This issues with approval of competent authority.  

                                                                                                            (Babu Lal Barolia)

Assistant  Director (SB-II)

Copy to:- 

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