personal finance

How nominees can claim money from small savings schemes like PPF, NSC


To make the process of claiming money from the various post office small savings schemes such as Post Office Monthly Income Scheme (PO-MIS), Public Provident Fund (PPF), National Savings Certificate (NSC) etc., the government has made certain amendments in the process. The process has been streamlined via a circular dated August 28, 2020.

Here’s a look at what the circular states.

Basis for settlement of death claim

As per the circular, the settlement of death claim can be made either based on nomination, legal evidence or without the production of legal evidence at the discretion of the concerned authority for the maximum claim amount of Rs 5 lakh at present. If no legal evidence is present and claim amount exceeds Rs 5 lakh, then claimant will have to produce succession certificate from the court.

The limit of Rs 5 lakh will be applicable to each account/registration number in case of separate certificate.

How the death claim settlement will work

As mentioned above, the settlement will be made whether the nomination is registered or not, or any legal evidence is provided by the claimant or not. Here is a look at each case.

  • Where nomination is registered

As per the circular, in small savings schemes held with post office where nomination is registered with the same post office and in force at the time of death of individual, then the concerned post office will pay the amount to the nominee/nominees irrespective of the amount and without the production of any legal evidence.

The nominee/s will be required to make an application to the post office along with the death certificate of the depositor in original and concerned passbooks and/or certificates. In case claimant is unable to provide original death certificate or any other proof of death, then photocopy can be accepted by the concerned post office. The authority will compare the photocopy with the original one before accepting the copy.

The claimant will be required to submit the application to the post office where account/certificate stands. If the claim is submitted at any other post office, the other post office should accept the claim application form along with documents and after accepting witnesses, forward the case along with all documents to the post office where account stands by service insured post on the day of its receipt.

The government via a circular dated September 16, 2020 has further clarified that physical presence of the witnesses is not required, if the self-attested photocopy of the ID and address proof of the witnesses are produced along with the other documents. ID proof includes Aadhaar card, PAN Card, passport etc. and address proof includes Aadhaar card, passport, electricity bill (not more than two months old), bank passbook etc.

If there are more than one nominee and one of them has died, then claimant will be required to provide the death certificate of that nominee as well. Further, his/her specified share in the eligible balance shall be distributed among the surviving nominees in the same proportion as their specified shares.

Remember, in case of more than one nominee, the post office will pay the amount in the proportion or share specified by the depositor. If share is not mentioned, then the amount will be paid in equal proportion to all the surviving nominees.

What if all the nominees have died

The circular clarifies that in case of death of the last surviving nominee or the sole nominee, the claim in respect of the account will be settled in favour of the legal heir of the last deceased nominee and not in favour of the LEGAL heir of the deceased depositor.

What if original passbook/certificates have been lost?

If the nominee(s) has lost the original passbook/certificates, then he/she would be required to apply for the issue of passbook/certificate in his/her own name after his claim has been admitted by the concerned authority.

  • Claims supported by legal evidence

In case no nomination is registered then the claim must be supported by a legal evidence such as succession certificate, probate of will, letter of administration etc. The claimant will be required to provide original death certificate along with the application form and other required documents.

  • Claims without any nomination/legal evidence

In case of death claims, where no nomination is registered or claimant is unable to provide any legal evidence and the final claim amount does not exceed Rs 5 lakh, then the legal heir can submit a claim after the six month of the death of the depositor.

The claimant will be required to provide the following documents to the concerned postal authority:

a) Death certificate or proof of death in original

b) Passbook/certificate of deposit receipt/statement of account in original

c) Affidavit in Form -13

d) Letter of disclaimer in Form -14

e) Bond of Indemnity in Form-15

Claims of holders not heard for 7 years

The deposit holders who have not been heard of for more than 7 years will be treated as dead and the claims in respect of their holdings settled in accordance with the foregoing sub- rules of the rule, provided the disappearance of the holder of the account/certificate has been established and the claimant is prepared to indemnify the government against any adverse claim.

Settlement of claims where the claimants or near relatives are residing abroad

If the claimant is residing abroad, then to make the settlement, the circular says as follows: “Where the claimant or a near relative named in the claim resides in a foreign country, the procedure as applicable to other claims is to be followed except that the claim from a person residing in a foreign country, letter of disclaimer from a person residing in a foreign country, death certificate issued in a foreign country and the power of attorney executed in a foreign country, if any, should have the authentication by the Indian Consular Office in that country, if reciprocal arrangements under Section 14 of the Notaries Act, 1952 and HAGUE APOSTITLE CONVENTION do not exist between India and that country. Authentication means that the authenticating official has assured himself of the person who has signed the instrument, as well as the fact of execution. In case India has no consular relations with the country and no other foreign nation has been entrusted with the task of looking after the interest of lndia or of the people of Indian origin there, the authentication should be done by a Magistrate of that country. Submission of above documents along with claim application duly authenticated by the Indian Consular office is the duty of the claimant.”





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