Senior Citizen Welfare fund

By | March 4, 2015
Chapter VIII of the Finance Bill, 2015 provides for the establishment of Senior Citizens Welfare Fund.  Clause 143 to Clause 154 of the Bill deals with the provisions of the Fund.    The Senior Citizen Welfare Fund is alike to the Investor Education and Protection Fund to be constituted under the Companies Act, 2013.

Chapter VIII of the Bill is applicable to the whole of India.  This chapter shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint.

Establishment and source of Fund

The Central Government is to establish the Senior Citizen Welfare Fund.  The sources for the fund are as follows:

Any credit balance in any of the accounts under the following schemes remaining unclaimed for a period of seven years from the date of its declaration as an inoperative account (Clause 144 (6) defines the term ‘in operative account’ as an account under Clause 145(2) of the Bill and not operated upon for a period of three years, if operation on regular basis, or if there is a date of maturity, from the date of maturity, as the case may be) shall be transferred by the respective institution (Clause 144 (1) defines the term ‘institution’ as any bank, post office or any other institution notified by the Central Government which is holding the inoperative accounts having unclaimed accounts) holding them in the fund:
Small savings and other Savings Schemes of the Central Government with Post Offices and Banks authorized to operate such schemes;
Accounts of Public Provident Fund under the Public Provided Fund Scheme, 1968 maintained by institution; and
Such other accounts, in any accounts or schemes as may be prescribed.
Object

The object of this fund to utilize for providing welfare of senior citizens and for such other purposes as may be prescribed.

Interest

The Central Government shall, from time to time, notify the eligible rate of interest for money lying in the fund.

Administration of Fund

For the administration of the fund the Central Government shall constitute, by notification, an Inter-Ministerial Committee consisting of a Chairperson and such other number of members as the Central Government may appoint.  The manner of administration of the Fund, holding of meetings of the Committee, shall be in accordance with such rules as may be prescribed.  It shall be competent for the Committee to spend money out of the Fund for carrying out the objects of the Fund.

Payment of claims

The unclaimed amount transferred to the Fund may be claimed by any person claiming to be entitled to the respective institution with the amount due was originally lying or deposited at any time before the right to the amount is extinguished.  The person making the application shall bear the onus of establishing his right to receive the amount to which the application relates.   The Institution shall consider the application received from the applicant and making payment along with the eligible interest, in any case, within sixty days of the receipt of the application.

Any payment made shall discharge the institution from liability in respect of the amount credited to the Fund.   The interest payable, if any, on the money transferred to the Fund shall be determined and notified by the Central Government.

Obligation of the Institutions

The institutions shall publish such information as is necessary and sufficient to give reasonable notice of the existence of the unclaimed amounts before crediting to the unclaimed amount to the fund.  The Central Government may prescribe the method by which such information shall be published.

Escheat to the Central Government

If no claim is received within a period of twenty five years from the date of the credit of the unclaimed amount into the Fund, then, notwithstanding anything contrary contained in any other law for the time being in force, unless a Court otherwise orders, it shall escheat to the Central Government.  The right of any person claiming to have an entitlement to the unclaimed amount shall subsist till twenty years and after that period the right shall extinguish.

If the Central Government is satisfied that there were genuine reasons which precluded a person from making a claim for refund in time, the Government may, on the recommendations of the Committee based on examination of facts, refund the money escheated to him.   The Central Government may keep such escheated amount with the Fund for the purposes of the Fund

Accounts and Audit

The Fund shall prepare in such form and at such time for each financial year as may be prescribed, its annual report giving a full account of its activities during the financial year and forward a copy thereof to the Central Government.   The Accounts of the fund shall be audited by the Comptroller and Auditor General of India at such intervals as may be specified by him and such audited accounts together with the audit report thereon shall be forwarded annually by the institution to the Central Government.  The Central Government shall cause the annual report and the audit report given by the Comptroller and Auditor General of India to be laid before each House of Parliament.

Power of Central Government

The Central Government is given power to make rules for carrying out the provisions of this Chapter.  The Rules to be framed by the Central Government may provide for-

Such other amounts to be maintained;
The utilization of the fund;
The composition of the committee for managing the fund;
The manner of administration of the fund;
The procedure relating to holding of the meetings;
Any other matter which is required to be, or may be prescribed.
The Central Government may, for reasons to be recorded in writing, exempt any unclaimed amount or institution or class of unclaimed amounts or institutions from any or all of the provisions of this Chapter, either generally or for such period as may be specified.

If any difficulty arises in giving effect to the provisions of this Chapter, the Central Government may by order, do anything not in consistent with the provisions of this Chapter, for the purpose of removing such difficulty.   No such order shall be made under this section after the expiry two years from the commencement of this Chapter.  Every order under this section shall be laid, as soon as may be after it is made, before each house of Parliament.

By: Mr. M. GOVINDARAJAN – March 4, 2015

Leave a Reply

Your email address will not be published. Required fields are marked *