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NATIONAL SAVINGS (MONTHLY INCOME ACCOUNT) RULES, 1987

 

GSR 701 (E):-  In exercise of the powers conferred by section-15 of the Government Savings Banks  Act, 1873 (5 of 1873), the Central Government hereby makes the following rules, namely:-

 

1.                    Short title and commencement:- (1) These rules may be called the National Savings (Monthly Income Account) Rules, 1987.

            (Vide GSR No. 52 (E) dated 18.01.2017)

(2)     They shall come into force on the 15th day of August, 1987.


2.      Definitions:- In these rules, unless the context otherwise requires:-

(a)        ‘Account’ means a savings account opened by a depositor in accordance with the provisions of these rules;

(b)        Act’ means the Government Savings Banks Act, 1873 (5 of 1873);

(ba) “Bank” means any branch of a public sector or private sector commercial bank authorised by the Government to open an account under these rules;”

(Vide GSR No. 52 (E) dated 18.01.2017)

 (c)        ‘Deposit’ means the money deposited by the depositor in an account under the rules.

(ca)   ‘Depositor’ means an individual who-     

(i) on his own behalf, or

(ii) on behalf of a minor or a person of unsound mind of whom he is the guardian.

deposits money in an account under the rules.

(d)        ‘Post Office’ means any post office in India doing savings bank work and authorised to open an account under these rules;

  (e)        Words and expressions used herein and not defined but defined in the Post Office Savings Bank General Rules, 1981 shall have the meanings respectively assigned to them in those rules.

 

3.      Application of the Post Office Savings Bank General Rules, 1981 and the Post Office Savings Account Rules, 1981:- The provisions of the Post Office Savings Bank General Rules, 1981and the Post Office Savings Account Rules, 1981, so far as may be, apply in relation to matters for which no provision has been made in these rules.

 

4.      Opening of account:- A depositor may operate more than one account under these rules subject to the conditions that deposits in all accounts taken together shall not exceed rupees Four lakh Fifty thousands in single account and rupees nine lakh in joint account.

(Min. of Finance, (DEA) Has amended Rule 4 and Rule 5(1) of Post Office Monthly Income Account Rules 1987 vide its notification dated 1.8.2007 issued vide File No. 2/10/2007-NS-II.)

“Provided that the account under these rules shall be opened in post office or bank.”

(Vide GSR No. 52 (E) dated 18.01.2017)

  Note:- For the purpose of maximum balance, the depositor’s share in the balance of a joint account shall be taken as one half or one third of such balance according as the account is held by two adults or three adults.

 

5.      Deposits and Withdrawals:- (1) There shall be only one deposit in the account in multiple of one hundred rupees not exceeding rupees four lakh fifty thousands in case of single account and rupees nine lakh in case of joint account.

(Vide GSR No. 1239 (E) dated 3.10.2017)

(SB Order No. 10.2014 issued vie DG Posts Letter number 110-01/2007-SB dated 19.9.2014)

The matter was referred to Min. of Finance and it has now been decided by the Min. of Finance vide OM No. 1/2/2011-NS-II(Pt-I) dated 11th September,2014 to regularize all  those MIS accounts which have been opened  in the multiples of Rs 1000/- instead of Rs 1500/-,in contravention of  POMIS Rules,1987. On notice of irregularity, the balance of amount in multiples of Rs 1500/- be kept in the account and the remaining amount in the account be refunded to the account holder along with POSB rate of interest. The other terms and conditions in respect of POMIS accounts will remain as per POMIS Rules,1987. Such accounts may only be regularized after taking necessary action against erring officials.

Explanatory Note from Author:-

Limit of minimum deposit from Rs.1000/- to Rs.1500/- and maximum limit from Rs.3 Lakh (single) /Rs.6 lakh (joint) to Rs.4.5 lakh (single)/Rs.9 lakh (joint) was revised from 1.8.2007 vide MOF(DEA) F.No.2/10/2010-NS-II.         

(2)     Except as provided  in Rule 10, no withdrawal shall be permitted under these rules before the expiry of a period of five years* from the date of opening of an account.

  *period revised from 6 years to 5 years for the accounts opened on or after 1.12.2011.

 

6.      Omitted vide GSR No. 223(E) dated 13th March 2014.

 

7.      Nomination:- (1) The depositor may at the time of opening the account under these rules, nominate a person or persons who, in the event of death of the depositor, shall become entitled to payment due on the account.        

(2)     If such nomination is not made at the time of opening the account, it may be made by the depositor at any time after the opening of the account but before its closure by means of an application, accompanied by the passbook to the Postmaster of the post office.

 

8.      Interest of deposit:- (1) The deposit made under these rules shall bear interest at the rate of:-

(a)   12 percent per annum in respect or deposits made on or after the 15th day of August, 1987 but before the 24th day of April, 1992.

(b)   14 percent per annum in respect or deposits made on or after the 24th day of April, 1992 but before the 2nd day of September, 1993.

(c)   13 percent per annum in respect or deposits made on or after the 2nd day of September, 1993 but before the 1st day of January, 1999.

(d)   12 percent per annum in respect or deposits made on or after the 1st day of January, 1999 but before the 15th day of January, 2000.

(e)   11 percent per annum in respect or deposits made on or after the 15th day of January, 2000 but before the 1st day of March, 2001.

(f)     9.5 percent per annum in respect or deposits made on or after the 1st day of March, 2001 but before the 1st day of March, 2002.

(g)   9 percent per annum in respect or deposits made on or after the 1st day of March, 2002 but before the 1st day of March, 2003.

(h)   8 percent per annum in respect or deposits made on or after the 1st day of March, 2003 but before the 1st day of December, 2011.

(i)     8.2 percent per annum in respect or deposits made on or after the 1stday of December, 2011.

(j) 8.5 per cent.per annum in respect of deposits made on or after the 1stday of April, 2012.”.

(k) 8.4 per cent.per annum in respect of deposits made on or after the 1stday of April, 2013.”.

 (2)     The interest shall be payable monthly to the depositor on completion of a month from the date of deposit.

 (3)     If so authorised, interest payable monthly shall be deposited by the post office in the savings account of the depositor held at the post office where deposit is held subject to the condition that by so depositing the interest, maximum limit of balance in savings account is not exceeded.

 provided that in case the account stands at the post office working on Core Banking platform and If so authorised, interest payable monthly shall be credited by the post office in the savings account of the depositor standing at any such post office or any branch of a bank.

 (4) If the interest payable every month is not claimed by a depositorsuch interest will not earn any additional interest.

 (5)     Interest shall be rounded off to nearest multiple of rupee one and for this purpose any amount of 50 paise or more shall be treated as rupee one and any amount less than 50 paise shall be ignored.

 (6)     The post office shall, as soon as it come to its notice that a deposit made under rule-4 by a depositor exceeds the prescribed ceilings specified therein, shall request the depositor to withdraw the excess deposit immediately.

  Explanation – “Post Office” includes a Head or Sub-Post Office.

 (7)     The excess amount referred to in sub-rule (6) shall carry an interest at the rate applicable from time to time to the Post Office Savings Account and shall be payable to such depositor on such amount.

 (8)     The interest referred to in sub-rule (7) shall be admissible from the date of deposit of the excess amount till the end of the month preceding the month in which the depositor has been requested to withdraw such excess amount in the account.

 

9.      Closure of Account:- (1) The deposit made at the time of opening of account shall be paid by the post office at which the account stands to depositor on or after expiry of six years from the date of the opening the account alongwith bonus equal to 10 per cent of the amount deposited, on production of the passbook accompanied by a written application (withdrawal form).

 Provided that no bonus shall be paid on the deposits made in the accounts opened on or after the 13th day of February, 2006.

Provided that bonus equal to 5 per cent of the amount deposited shall be paid on the deposits made on or after 8.12.2007.

 Explanatory Note From Author:- Vide Min. of Finance (DEA) Notification No. 2/2/2006-NS-II dated 8.12.2007 vide which another proviso after the existing proviso of sub-rule (1) of Rule 9 of MIA Rules 1987 has been inserted with the provision of admissibility of 5% bonus on maturity amount of MIS accounts opened on or after 8.12.2007.

 “Provided also that in respect of deposits made, at the time of opening of account on or after the first day of December, 2011, shall be paid by the post office at which the account stands to depositor on or after expiry of five years from the date of the opening of the account.:

 Provided also that no bonus shall be paid on the deposits made in the accounts opened on or after the 1st day of December, 2011.”

       (2)     In case of death of a depositor before maturity, account may be closed and deposit refunded alongwith interest upto the month preceding the month in which refund is made.

 

9A.   Post-maturity Interest:- Where repayment of the amount, inclusive of bonus under rule-9 has become due but has not been made, interest shall be allowed on the amount due from the date of maturity to the date of repayment of the amount subject to the following conditions, namely:-

 (a)        The interest shall be simple and shall be calculated at the rate applicable from time to time to savings accounts of the type of single or joint account.

(b)        For the purpose of payment of interest, any part of the period which is less than one month shall be ignored.

 (c)        The interest shall be paid to the depositor in lump sum at the time of repayment of amount due.

 

10.    Premature closure of Account:- Notwithstanding anything contained in sub-rule (2) of rule-5, on an application made by the depositor in this regard, he may be permitted to withdraw the deposit and close the account any time after expiry of a period of one year from the date of opening of such account, subject to the condition that:-

 (i) If the account is closed on or before expiry of three years of opening of such account, an amount equal to two per cent of the deposit shall be deducted and remainder paid to him, and

 (ii) If the account is closed after expiry of three years from the date of opening of such account, an amount equal to one per cent of the deposit shall be deducted and remainder paid to him.

 

11.    Pass Book:- (1) On opening an account, the depositor shall be given a passbook bearing the date of opening of account, the number of his account, his name and address and the amount deposited and also the monthly interest payable along with the date on which the deposit will be due for final payment.  

(2)     The passbook shall be presented to the post office at the time of collecting interest every month and also at the time of closing the account.

(3)     The depositor availing facility of deposit of interest in his savings account under sub-rule (3) of rule-8 shall present the passbook to the post office at least once in six months for completion of entries.

 

12.       Power to relax:- Where the Central Government is satisfied that the operation of any of the provisions of these rules causes undue hardship to the depositor, it may, by order, for reasons to be recorded in writing, relax the requirements of that provision in a manner not inconsistent with the provisions of the Act.

 
 
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