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GOVERNMENT SAVINGS CERTIFICATES ACT, 1959
46 of 1959
18th September, 1959
STATEMENT OF OBJECTS AND REASONS "The Post Office National Savings Certificates Ordinance, 1944 (42 of 1944), issued under
Section 72of the Ninth Schedule to the Government of India Act, 1935, as originally enacted and continued in force by virtue of the provisions of the India and Burma (Emergency Provisions) Act, 1940(3 and 4 Geo. 6, Ch. 33) regulates the sale and discharge of National Savings Certificates issued through the Post Office. Suggestions have been made from time lo time that as the production of legal proof of succession involves considerable delay and expense, the holders of savings certificates may be allowed the right to nominate one or more persons to receive the amounts due in respect of such certificates in the event of their death without the production of succession certificate or other proof of title. In seeking to amend that Ordinance for the above purpose, opportunity is taken to replace it by an Act of Parliament. 2. The certificates to which the Ordinance applies are at present being issued and discharged only through Post Office. It is however, becoming increasingly necessary that facilities should be provided for the sale of the certificates through agencies other than the Post Offices as well. The Bill as framed will now enable the Government to prescribe suitable authorities for the sale or discharge of the certificates." -Gaz. of Ind., Extra, 27-8-1959, Pt. II,Section 2, page 873.
An Act to make certain provisions in respect of Government Savings Certificates. BE it enacted by Parliament in the Tenth Year of the Republic of India as follows :- The Act has now been extended to the Union territories of- (1) Dadra and Nagar Haveli by Regn. 6 of 1963 (w.e.f. 1-7-1965); (2) Pondicherry by Regn. 7 of 1963 (w.e.f. 1-10-1963); (3) Laccadive, Minicoy and Amindivi Islands (Now called Lakshadweep) by Regn. 8 of 1965; (4) Goa, Daman and Diu, see S. 0. 2734 of 1962, Gaz. of Ind., 1962, Pt. II,
Section 3 (ii), Ext., page 1991.
SECTION 01: SHORT TITLE, COMMENCEMENT AND APPLICATION
(1) This Act may be called The Government Savings Certificates Act, 1959.
(2) It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint1
SECTION 02: DEFINITIONS
- In this Act, unless the context otherwise requires,-
(a) "minor" means a person who is not deemed to have attained his majority under the Indian Majority Act, 1875;
(b) "prescribed" means prescribed by rules made under this Act;
(c) "savings certificate" means a savings certificate to which this Act applies;
(d) "transfer'' means a transfer inter vivos, and does not include a transfer by operation of law.
SECTION 03: RESTRICTIONS ON TRANSFER OF SAVINGS CERTIFICATES
Notwithstanding anything contained in any law for the time being in force, no transfer, of a savings certificate, whether made before or after the commencement of this Act, shall be valid unless it has beep made with the previous consent in writing of prescribed authority.
SECTION 04: HOLDINGS BY OR ON BEHALF OF MINORS
- Notwithstanding any provision in any law for the time being in force,-
(a) a minor may apply for and hold savings certificates and any other person may apply for and, hold savings certificates on behalf of a minor;
(b) where any savings certificate is held by or on behalf of a minor, the minor shall, whether the savings certificate was applied for and issued before or after the commencement of this Act, be bound by the provisions of this Act and of any rules made thereunder applicable to such savings certificates and by the terms of any declaration made by the applicant for the savings certificate in pursuance of the said rules.
SECTION 05: PAYMENT WHERE CERTIFICATE IS HELD BY OR ON BEHALF OF A MINOR
- Payment of the sum for the time being due on a savings certificate held by or on behalf of a minor may be made -
(a) to him personally, if he himself applied, for the savings certificate, or
(b) for the use of the minor, if the application for the savings certificate was made by any person other than the minor,-
(i) to any such person, being a parent of the minor or guardian of his property, as may be specified in that behalf in the form of application;
(ii) if no such person has been specified, to any guardian of the property of the
minor appointed by a competent court, or where no such guardian has been so
appointed, t6 either parent of the minor, or where neither parent is alive, to any other guardian of the minor.
SECTION 06: NOMINATION BY HOLDERS OF SAVINGS CERTIFICATES
(1) Notwithstanding anything Contained in any law for the time being in force, or in any disposition, testamentary or otherwise in respect of any savings certificate, where a nomination made in the prescribed manner purports to confer on any person the right to receive payment of the sum for the time being due on the savings certificate on the death of the holder thereof and before the maturity of the certificate, or before the certificate having reached maturity has been discharged, the nominee shall, on the death of the holder of the savings certificate, become entitled to the savings certificate and to be paid the sum due thereon to the exclusion of all other persons, unless the nomination is varied or cancelled in the prescribed manner.
(2) Any nomination referred to in sub -section (1) shall become void if the nominee predeceases, or where there are two or more nominees all the nominees predecease, the holder of the savings certificate making the nomination.
(3) Where the nominee is a minor, it shall be lawful for the holder of the savings certificate making the nomination to appoint in the prescribed manner any person to receive the sum due thereon in the event of his death during the minority of the nominee.
(4) A transfer of a savings certificate made in the prescribed manner shall automatically cancel a nomination previously made: Provided that where a savings certificate is held by or on behalf of any person as a pledgee or by way of security for any purpose, such holding shall not have the effect of cancelling a nomination but the right of the nominee shall be subject to the right of the person so holding it.
SECTION 07: PAYMENT ON DEATH OF HOLDER
(1) If the holder of a savings certificate dies and there is in force at the time of his death a nomination in favour of any person, payment of the Sum due thereon shall be made to the nominee.
(2) Where the nominee is a minor, payment of the sum due thereon shall be made-
(a) in any case where a person has been appointed to receive it under subsection (3) of section 6-, to that person, and
(b) where there is no such person, to any guardian of the property of the minor appointed by a competent court, or where on such guardian has been so appointed, to either parent of the minor, or where neither parent is alive, to any other guardian of the minor.
(3) Where the sum due on a savings certificate is payable to two or more nominees, and either or any of them dies, the sum shall be paid to the surviving nominee or nominees.
(4) If a person dies and is at the time of his death the holder of a savings certificate and there is no nomination in force at the time of his death and probate of his will or letters of administration of his estate or a succession certificate granted under the Indian Succession Act, 1925-, is not within three months of the death of the holder produced to the prescribed authority, then, if the sum due on the savings certificate does not exceed3 [such limit as may be prescribed], the prescribed authority may pay the same to any person appearing to it to be entitled to receive the sum or to administer the estate of the deceased.
(5) Nothing contained in this section shall be deemed to require any person to receive payment of the sum due on a savings certificate before it has reached maturity or otherwise than in accordance with the terms of the savings certificate.
SECTION 08: PAYMENT TO BE A FULL DISCHARGE
(1) Any payment made in accordance with the foregoing provisions of this Act to a minor or to his parent or guardian or to a nominee or to any other person shall be a full discharge from all further liability in respect of the sum so paid.
(2) Nothing in sub-section (1) shall be deemed to preclude any executor or administrator or other representative of a deceased holder of a savings certificate from recovering from the person receiving the same under section 7-the amount remaining in his hands after deducting the amount of all debts or other demands lawfully paid or discharged by him in due course of administration.
(3) Any creditor or claimant against the estate of a holder of a savings certificate may recover his debt or claim out of the sum paid under this Act to any person and remaining in his hands unadministered in the same manner and to the same extent as if the latter had obtained letters of administration to the estate of the deceased.
SECTION 09: SECURITY FOR DUE ADMINISTRATION
The prescribed authority may take such security as it thinks necessary from any person to whom any money is paid under sub-section (4) of section 7-for the due administration of the money so paid and may assign the said security to any person interested in such administration.
SECTION 10: POWER TO ADMINISTER OATH
(1) For the purpose of ascertaining the right of a person claiming to be entitled to payment under sub-section (4) of section 7-, the prescribed authority may take evidence on oath or affirmation according to the law for the time being in force relating to oaths and affirmations.
(2) Any person who upon such oath or affirmation makes any statement which is false and which he either knows or believes to be false or does not believe to be true shall be deemed guilty of an offence under section 193 of the Indian Penal Code-.
SECTION 11: PROTECTION OF ACTION TAKEN IN GOOD FAITH
No suit or other legal proceeding shall lie against any officer of the Government or any prescribed authority in respect of anything which is in good faith done or intended to be done under this Act.
SECTION 12: POWER TO MAKE RULES
(1) The Central Government may, by notification in the Official Gazette, make rules5to carry out the purposes of this Act.
(2) In particular and without prejudice to the generality of the foregoing power, such rules may provide for-
(a) the form of application for savings certificates and the issue and discharge of such certificates;
(b) the maximum limits of holdings;
(c) the conditions as to payment of interest or discount relating to any class of savings certificates and the recovery of any interest paid on any amount held in excess of the maximum limits in the same manner as an arrear of land revenue or in any other manner;
(d) the transfer and conversion of savings certificates and the fees to be levied in respect thereof;
(e) the replacement of savings certificates mutilated, lost or destroyed and the fees payable in respect thereof;
(f) the form of nominations, the manner in which and the conditions subject to which nominations may be made and the registration of nominations;
(g) the manner in which any person may be appointed for the purposes of subsection (3) of section 6-;
(h) the variation or cancellation of nominations and the registration of such variations or cancellations;
(i) the fees that may be levied for registration, variation or cancellation of nominations;
4 [(ia) the limit under sub-section (4) of section 7-;]
(j) any other matter which has to be, or may be, prescribed.
(3) Every rule made under this section shall be laid as soon as may be after it is made before each House of Parliament while it is in session for a total period of thirty days which may be comprised in one session or in two successive sessions, and if before the expiry of the session in which it is so laid or the session immediately following, both Houses agree in making any modification in the rule or both Houses agree that the rule should not be made, the rule shall thereafter have effect only in such modified form or be of no effect, as the case may be, so however that any such modification or annulment shall be without prejudice to the validity of anything previously done under that rule.
SECTION 13: REPEAL AND SAVINGS
(1) The Post Office National Savings Certificates Ordinance, 1944, is hereby repealed.
(2) Notwithstanding the repeal of the said Ordinance, any rules made or deemed to have been made or anything done or any action taken in exercise of any of the powers conferred by or under the said Ordinance shall be deemed to have been made, done or taken in exercise of the powers conferred by or under this Act, as if this Act were in force on the day on which such rules were made such thing was, done or such action was taken.
Footnotes:
1. 1st August, 1960 is the day so appointed - see Gaz. of Ind., 1960, Pt. II, Section 3 (i), page 968.
2. The Act has been applied to 12 years' Defence Savings Certificates by G.S.R. 1457, Gaz. of Ind,. 1962, Pt. II, Section 3(i). Extra, page 553; to National Savings Certificates (First Issue) - See Gaz. of Ind., 1965, Pt. II, S. 3(i), Ext., p. 129.
3. Substituted for the words "five thousand rupees" by the Government Savings Laws (Amendment) Act (56 of 1985), S. 3 (4-9-85).
4. Inserted by the Government Savings Laws (Amendment) Act (56 of 1985), S. 3, (4-9-1985).
5. For Government Savings Certificates Rules 1965, see Gaz. of Ind., 1965, Pt. II, Sec. 3(i), Ext., p. 645. For National Savings Certificates (First Issue) Rules, 1965, see the Government Savings Laws (Amendment) Act (56 of 1985), S. 3, (4-9-1985), page 132, for the Government Savings Certificates (Fixed Deposit) Rules, 1968, see Gaz. of Ind., 1968, Pt. II, Section 3(i), Ext. p. 195; for Post Office Savings Certificates Rules 1960, see Gaz. ofind., 1960, Pt. II, Section 3(i), p. 968; Indira Vikas Patra Rules, 1986 - See Gaz. ofind., 5-11-1986, Pt. II, S. 3(i), Ext., p. 2 (No. 513); Kisan Vikas Patra Rules, 1988 - See Gaz. of Ind., 23-3-1988, Pt. II, S. 3(i), Ext., p. 5 (No: 139).
NATIONAL SAVINGS CERTIFICATES (VIII ISSUE) RULES, 1989
In exercise of the powers conferred by
section 12 of the Government Savings Certificates Act, 1959 (46 of 1959), the Central Government hereby makes the following rules, namely:-
RULE 1 SHORT TITLE AND COMMENCEMENT
(1) These rules may be called the National Savings Certificates (VIII Issue) Rules, 1989.
(2) They shall come into force on the 8th May, 1989.
RULE 2 DEFINITIONS
In these rules, unless the context otherwise requires:-
(i) "Act" means the Government Savings Certificates Act, 1959 (46 of 1959); 1 [(ii) * * *]
(iii) "cash" means cash in Indian currency;
(iv) "certificate" means the National Savings Certificates (VIII Issue);
2 [(v) * * *]
(vi) "corporation" means a corporation established by or under any law for the time being in force;
3 [(vii) * * *]
(viii) "form" means a form appended to these rules and also includes forms as prescribed by the Department of Posts;
(ix) "Government company" means a company as defined in section 617 of the Companies Act, 1956 (1 of 1956);
(x) "local authority" means a municipal corporation, municipal committee, district board, Body of Port Commissioners or other authority legally entitled to or entrusted by the Government with the control or management of municipal or local fund;
(xi) "old certificate" means a certificate issued under the Post Office Savings Certificates Rules, 1960, or the National Savings Certificates (First Issue) Rules, 1965, or the National Savings Certificates (IV Issue) Rules, 1970, or the National SavingsCertificates (V Issue) Rules, 1973, or a bond issued under the National Development Bonds Rules, 1977, or the National Savings Certificates (VI Issue) Rules, 1981, or the National Savings Certificates (VII Issue) Rules, 1981, or the Social Security Certificates Rules, 1982, or the Kisan Vikas Patra Rules, 1988;
(xii) "Post Office" means any departmental post office in India doing savings bank work and such other post office as is authorised by the Department of Posts;
(xiii) "Scheduled Bank" means a bank for the time being included in the Second Schedule to the Reserve Bank of India Act, 1934 (2 of 1934);
(xiv) "trust" means a trust registered under any law for the time being in force.
RULE 3 DENOMINATIONS IN WHICH CERTIFICATES SHALL BE ISSUED
The National Savings Certificates (VIII Issue) shall be issued in denominations of Rs. 100, Rs. 500, Rs. 1,000, Rs. 5,000, Rs. 10,000 and such other denominations as may be notified by the Central Government from time to time.
RULE 4 TYPES OF CERTIFICATES AND ISSUE THEREOF
4 "(3) Non-Resident Indians (NRIs) are not eligible to purchase the National Savings Certificates :
Provided that if a resident who subsequently becomes NR1 during the currency of maturity period, shall be allowed to avail the benefits of the certificates on maturity on a non-repatriation basis.".
RULE 5 PURCHASE OF CERTIFICATES
Certificates may be purchased for any amount.
RULE 6 PROCEDURE FOR PURCHASE OF CERTIFICATES
Any person or body specified inrule 4, desiring to purchase a certificate, shall present at a post office an application in Form 1, either in person or through an authorised agent of the small savings schemes.
RULE 7 LEGAL TENDER
Payment for the purchase of a certificate may be made to a post office in any of the following modes, namely:-
(i) cash;
(ii) a locally executed cheque, pay order or demand draft drawn in favour of the postmaster;
(iii) by presenting a duly signed withdrawal form together with the pass book for withdrawal from the post office savings bank account;
(iv) surrender of a matured old certificate duly discharged as follows.-"Received payment through issue of fresh certificate, vide application attached".
RULE 8 ISSUE OF CERTIFICATES
(1) On payment being made underrule 7, except where payment is made by a cheque, pay order or demand draft, a certificate shall normally be issued immediately, and the -date of such certificate shall be the date of payment.
(2) Where payment for the purchase of the certificate is made by a cheque, pay order or demand draft, the certificate shall not be issued before the proceeds of the cheque, pay order or demand draft, as the case may be, are realised and the date of such certificate shall be the date of encashment of the cheque, pay order or demand draft, as the case may be.
(3) If for any reason a certificate cannot be issued immediately, a provisional receipt shall be given to the purchaser which may later be exchanged for a certificate and the date of such certificate shall be as specified in sub-rule (1) or sub-rule (2), as the case may be.
RULE 9 CERTIFICATE IN LIEU OF PROCEEDS OF OLD CERTIFICATE
A holder of an old certificate entitled to encash that certificate may make an application in Form 1 for the grant of a certificate under these rules; on receipt of such an application, there shall be issued to the applicant a certificate under these rules, the date of issue being the date on which the old certificate duly discharged is presented.
RULE 10 TRANSFER FROM ONE POST OFFICE TO ANOTHER
(1) A certificate may be transferred from a post office at which it stands registered, to any other post office on the holder or holders making an application in the prescribed form, at either of the two post offices.
(2) Every such application shall be signed by the holder or holders of the certificate: Provided that in the case of a joint 'A' type certificate or a joint 'B' type certificate, the application may be signed by one of the joint holders if the other is dead.
RULE 11 TRANSFER OF CERTIFICATE FROM ONE PERSON TO ANOTHER
(1) A certificate may be transferred with the previous consent in writing of an officer of the post office as specified below (hereinafter referred to in these rules as authorised postmaster).Cases in which transfer can be sanctioned Designation of the officer competent to grant permission for transfer
(a) (i) From the name of a deceased holder to his heir (ii) From a holder to a court of law or Postmaster of the post oilice to any other person under the orders where the certificate stands of a court of law. registered. (iii) From a single holder to the names of joint holders of whom the transteree shall be one. (iv) From joint holders to the name of one of the joint holders. (b) All other cases. Head postmaster.
(2) An authorised postmaster as referred to in sub-rule (1) shall give his consent to the transfer of a certificate only if the following conditions are satisfied, namely:-
(a) the transferee is eligible under these rules to purchase certificates;
(b) the transfer is made after the expiry of a period of at least one year from the
date of the certificate or where the transfer is sought before the expiry of such period, the transfer falls under any of the following categories, namely.-
(i) transfer to a near relative out of natural love and affection. Explanation.-For the
purpose of this rule, "near relative" means husband, wife, lineal ascendant or descendant, brother or sister;
(ii) transfer in the name of the heir of the deceased holder;
(iii) transfer from a holder to a court of law or to any other person under the orders of a court of law;
(iv) transfer in accordance withrule 12;
(v) transfer in the name of the survivor in the event of death of one of the joint holders.
(c) An application for transfer is made in the prescribed form and is signed by the holder or holders of the certificate: Provided that in the case of a joint 'A' type certificate or a joint 'B' type certificate, the application may be signed by one of the holders, if the other is dead.
(3) Without prejudice to the provisions of sub-rule (2), an authorised postmaster shall give his consent to the transfer of a certificate held on behalf of a minor only if at the time of the proposed transfer, a parent or the guardian referred to in subclause (i) or, as the case may be, sub-clause (ii) of clause (b) ofsection 5of the Act, certifies in writing that the minor is alive and that such transfer is in his interest.
(4) In every case of transfer, other than a transfer underrule 12, the original certificate shall be duly discharged and the new certificate bearing the same date as that of the original certificate surrendered shall be issued in the name of the transferee.
RULE 12 PLEDGING OF CERTIFICATE
(1) On an application being made in the prescribed form, by the transferor and the transferee, the postmaster of the office of registration may, at any time, permit the transfer of any certificate as security to-
(a) the President of India or Governor of a State in his official capacity;
(b) the Reserve Bank of India or a scheduled bank or a co-operative society including a co-operative bank;
(c) a corporation or a Government company;7[* * *]
8 [(d) a local authority; and
(e) a housing finance company approved by the National Housing Bank
and9notified by the Central Government]: Provided that the transfer of a certificate purchased on behalf of a minor shall not be permitted under this
sub-rule Unless the parent or the guardian of the minor referred to in sub-
clause (i) or, as the case may be, sub-clause (ii) of clause (b) ofsection 5of the
Act certifies in writing that the minor is alive and that the transfer is for the benefit of the minor.
(2) When any certificate is transferred as security under sub-rule (1), the postmaster of the office of registration shall make the following endorsement on the certificate, namely:- "Transferred as security to ..."
(3) Except as otherwise provided in these rules, the transferee of a certificate under this rule shall, until it is re-transferred under sub-rule (4), be deemed to be the holder of the certificate.
(4) A certificate transferred under sub-rule (2) may, on the written authority of the pledgee, be re-transferred with the previous sanction in writing of the authorised postmaster and when any such re-transfer is made, the postmaster of the office of registration shall make the following endorsement on the certificate, namely:- "Re-transferred to . . ." Note 1.-A Gazetted Officer of the Government accepting the certificate as security under sub-rule (1) or releasing the pledge under sub- rule (4) on behalf of the President or the Governor of a State, shall certify under his dated signature and seal of office that he is duly authorised to execute such instruments or deeds on behalf of the President of India or Governor of a State, giving the particulars of the number and date of the notification of the Government authorising him in this behalf.Note 2.-An officer of the Reserve Bank of India or a scheduled bank or a cooperative society including a co-operative bank, a corporation or a Government company or a local authority, as the case may be, accepting the certificate as security under sub-rule (1) or releasing the pledge under sub-rule (4) on behalf of the respective institution, shall certify under his dated signature and seal of office that he is duly authorised under the articles of the said institution, to execute such instruments or deeds on its behalf.
(5) Where as a result of several endorsements made under sub-rules (2) and (4) on a certificate, no space is left for making further endorsements of a like character on that certificate, a fresh certificate may be issued by the postmaster of the office of registration in lieu of such certificate.
(6) A fresh certificate issued under sub-rule (5) shall be treated as equivalent to the certificate in lieu of which it has been issued for all purposes of these rules.
RULE 13 REPLACEMENT OF LOST OR DESTROYED CERTIFICATE
(1) If a certificate is lost, stolen, destroyed, mutilated or defaced, the person entitled thereto may apply for the issue of a duplicate certificate to the post office where the certificate is registered or to any other post office in which case the application will be forwarded to the post office of registration.
(2) Every such application shall be accompanied by a statement showing particulars, such as number, amount and date of the certificate and the circumstance attending such loss, theft, destruction, mutilation or defacement.
(3) If the officer-in-charge of the post office of registration is satisfied of the loss, theft, destruction, mutilation or defacement of the certificate, he shall issue a duplicate certificate on the applicant furnishing an indemnity bond in the prescribed form with one or more approved sureties or with a bank guarantee: Provided that where the face value or the aggregate face value of the certificate or certificates lost, stolen, destroyed, mutilated or delaced is Rs. 500 or less, a duplicate certificate or certificates may be issued on the applicant furnishing an indemnity bond without any such surety or guarantee: Provided further that where such application is made with respect to a certificate mutilated or defaced, or whatever face value, a duplicate certificate may be issued without any such indemnity bon
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