THE EMPLOYEE’S DEPOSIT LINKED INSURANCE SCHEME, 1976
THE EMPLOYEE’SDEPOSIT-LINKED INSURANCE SCHEME,
1976 G.S.R. 488(E). – In
exercise of the powers conferred by Section 6C of the Employees’
Provident Funds and Miscellaneous Provisions Act, 1952 (19 of
1952), the Central Government hereby makes the following Scheme,
namely:
CHAPTER I
PRELIMINARY
1. Short title, commencement
and application. –
(1) The Scheme may be called the Employees’ Deposit-Linked
Insurance Scheme, 1976.
(2) The provisions of this Scheme
shall come into force on the 1st day of August,
1976.
(3) Subject to the provisions
of sub-section (2) of section 16 and section 17(2A) of the
Employees’ Provident Funds and Miscellaneous Provisions Act,
1952, this Scheme shall apply to the employees of all factories
and other establishments to which the said Act applies:
Provided that the provisions of
this Scheme shall not apply to tea factories in the State
of Assam.
2. Definitions. – In this
Scheme, unless the context otherwise requires, –
(a)“Act” means the Employees’ Provident Funds and Miscellaneous Provisions
Act, 1952 (19 of 1952).
(b)“Assurance benefit” means a payment linked to the average balance in the
Provident Fund Account of an employee, payable to a person
belonging to his family or otherwise entitled to it in the
event of death of the employee while being a member of the
Fund.
(c) All other words
and expressions used herein but not defined shall have the
meaning respectively assigned to them in the Act or Employees’
Provident Funds Scheme, 1952.
3.Administration of the Scheme.
– This Scheme shall be administered by the Central Board constituted
under section 5A of the Act.
4. Regional
Committee. – The Regional Committee set up under paragraph
4 of the Employees’ Provident Funds Scheme, 1952 shall advise
the Central Board on such matters, in relation to the administration
of this Scheme, as the Central Board may refer to it from
time to time and in particular, on: -
(a)Progress of recovery of contributions, under this Scheme, both from factories
and establishments exempted under Section 17 of the Act and
other factories and establishments covered under the Act;
and
(b)Expeditious disposal of prosecutions.
5. Delegation of power by the
Central Board – (1) The Central Board may, by a resolution,
empower its Chairman or the Commissioner or both, to sanction
expenditure, subject to such limits as may be specified in
the resolution, on contingencies, supplies and purchases of
articles required for administering the Insurance Fund subject
to financial provision in the budget, where such expenditure
is beyond the limits upto which the Chairman or the Commissioner
is authorized to sanction expenditure on any single item.
(2) The Central Board may also by a resolution empower
its Chairman or the Commissioner or both, to appoint such
officers and employees other than those mentioned in sub-sections
(2) and (3) of section 5D of the Act, as the Chairman or the
Commissioner may consider necessary for the efficient administration
of this Scheme.
6.
Administrative and financial powers of the Commissioner.
– The Commissioner may, without reference to the Central
Board, sanction expenditure on contingencies, supplies and
services and purchase of articles required for administering
the Insurance Fund, subject to financial provision in the
budget and subject to the limits upto which he may be authorized
to sanction expenditure on any single item from time to time
by the Central Board.
7.
Contribution. – (1) The contribution payable by the employer
and the Central Government under sub-section(2) and sub-section(3)
of section 6C of the Act, shall be calculated on the basis
of the basic wages, dearness allowance (including the cash
value of any food concession) and retaining allowance, if
any, actually drawn during the whole month whether paid on
daily, weekly, fortnightly or monthly basis:
Provided
that where the monthly pay of an employee exceeds five thousand
rupees, the contribution payable in respect of him by the
employer and the Central Government shall be limited to the
amounts payable on a monthly pay of five thousand rupees including
dearness allowance, retaining allowance if any and cash value
of food concession.
(2)
Each contribution shall be calculated to the 3 nearest rupee,
50 paise or more to be counted as the next higher rupee and
fraction of a rupee less than 50 paise to be ignored.
8.
Mode of payment of contribution. – (1) The contribution
by the employer shall be remitted by him together with administrative
charges at such rate as the Central Government may fix from
time to time under sub-section 4 of Section 6C of the Act,
to the Insurance Fund within fifteen days of the close of
every month by a separate bank draft or cheque or by remittance
in cash in such manner as may be specified in this behalf
by the Commissioner. The cost of remittance if any, shall
be borne by the employer.
(2)
It shall be the responsibility of the employer to pay the
contribution payable by himself in respect of the employees
directly employed by him and also in respect of the employees
employed by or through a contractor.
(3)
The Central Government shall credit its contribution to the
Insurance Fund as soon as possible after the close of every
financial year.
(4) The Commissioner shall deposit
the bank draft or cheque received from the employers in the
State Bank of India or any Bank specified in the First Schedule
to the Banking Companies (Acquisition and Transfer of Undertakings)
Act, 1970 (5 of 1970).
8-A. Recovery of damages for default
in payment of any contribution: - (1) Where an employer
makes default in the payment of any contribution to the Insurance
Fund, or in the payment of any charges payable under any other
provision of the Act or of the Scheme, the Central Provident
Fund Commissioner or such officer as may be authorized by
the Central Government, by notification in the Official
Gazette, in this behalf, may recover from the employer by
way of penalty, damages at the rates given below: -
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Period of default
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Rate of damages
(Percentage of arrears per annum).
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(a) Less than two months.
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Seventeen.
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(b) Two months and above but less than four months.
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Twenty-two.
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(c) Four months and above but less than six months.
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Twenty-seven.
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(d) Six months and above.
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Thirty-seven.
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(2) The damages shall
be calculated to the nearest rupee, 50 paise or more to be
counted as the nearest higher rupee and fraction of a rupee
less than 50 paise to be ignored.
8-B. Terms and conditions
for reduction or waiver of damages. – The Central Board
may reduce or waive the damages levied under section 14B of
the Act in relation to an establishment specified in the second
proviso to section 14B, subject to the following terms and
conditions, namely: -
(a) in case of a change
of management including transfer of the undertaking to workers’
co-operative and in case of merger or amalgamation of the
sick industrial company with any other industrial company,
complete waiver of damages may be allowed;
(b) in cases, where the Board
for Industrial and Financial Reconstruction, for reasons to
be recorded in its scheme, in this behalf recommends, waiver
of damages upto 100 per cent may be allowed;
(c) in other cases, depending
on merits, reduction of damages upto 50 per cent may be allowed.
9. Employer’s contribution
not to be deducted from the wages of the employees. –
Notwithstanding any contract to the contrary, the employer
shall not be entitled to deduct the employer’s contribution
payable by him under this Scheme from the wages of the employees
or to recover it from them in any other manner.
10. Duties of employers. – (1)
Every employer shall send to the Commissioner, within fifteen
days of the commencement of the Scheme, a consolidated return
in such form as he may specify, of the employees who are entitled
and required to become members of the Insurance Scheme showing
inter-alia, the Insurance Scheme Number, name, accumulations
in the Insurance Scheme as at the end of the financial or
accounting year preceding the date on which this Scheme comes
into force together with certified copies of nomination executed
by each employee under the rules of the Provident Fund of
the establishment.
(1A). Every employer
shall send to the Commissioner within fifteen days of the
close of each month, a return in Form 5 of the Employees’
Provident Fund Scheme of the employees,
(a)
qualifying to become members of the Insurance Fund,
for the first time during the preceding month together with
the certified copies of nomination made by each such qualifying
employee, and
(b)
leaving service of the employer during the preceding
month
Provided that if there is no
employee qualifying to become a member of the Insurance Fund
for the first time or there is no employee leaving the service
of the employer, during the preceding month, the employer
shall send a ‘NIL’ return;
(1B) Every employer shall send
to the Commissioner, within twenty-five days of the close
of the month, in such form as he may specify, a monthly abstract
showing, inter-alia, the aggregate amount of wages of all
the members on which contributions are payable and the employer’s
contribution in respect of all such members for the month.
(2) Every employer shall maintain
such accounts in relation to the amounts contributed to the
Insurance Fund by him as the Central Board may, from time
to time, direct, and it shall be the duty of every employer
to assist the Central Board in making such payment from the
Insurance Fund as are sanctioned by or under the authority
of the Central Board.
11.
Inspection of records and registers by the
Commissioner or Inspector. – Every employer shall, whenever
the Commissioner or any other officer authorized by him in
this behalf or an inspector so requires, produce before him
the records and other registers then in his possession, for
inspection.
12.
Supply of forms to employers. – The Commissioner
shall supply to employers free of charge, on demand, forms
referred to in this Scheme to the extent absolutely necessary.
13.
Administration Account – The contributions
received from the employers and the Central Government under
sub-section 4 of section 6C of the Act shall be credited to
a separate account called “The Insurance Fund Central Administration
Account” and all expenses in connection with the administration
of this Scheme, other than the cost of benefits provided by
or under this Scheme, shall be met out of this account.
14. Deposit-Linked Insurance
Fund Account. – The amount received as the employer’s
contribution and also the Central Government’s contribution
to the Insurance Fund under sub-section 2 and 3 of section
6C shall be credited to an account called the “Deposit-Linked
Insurance Fund Account”, and all expenses towards the cost
of any benefits provided by or under the Scheme shall be
met out of this account.
15. Investment of
moneys belonging to the Insurance Fund. – (1) All moneys
standing to the credit of the Insurance Fund as on 31st
March, 1997 shall be kept in deposit with the Central Government
in the Public Account, and the Central Government shall allow
interest at a rate not less than 8-1/2 per cent per annum.
(2) The moneys credited
as contributions to the Insurance Fund on and from the 1st
day of April, 1997 shall be invested as per the investment
pattern notified under paragraph 52 of the Employees’ Provident
Funds Scheme, 1952.
16. Interest. – All interest,
rent and other income realized and net profits or losses,
if any, from the sale of investments, not including therein
the transaction of Insurance Fund Central Administration Account,
shall be credited or debited as the case may be to the Insurance
Fund.
17. Disposal of the Insurance
Fund. – (1) Subject to the provisions of the Act and of
this Scheme, the Insurance Fund, not including therein the
Insurance Fund Central Administration Account, shall not,
except with the previous sanction of the Central Board, be
expended for any purpose other than the payment of the benefits
in accordance with the provisions of this Scheme.
(2)
The Insurance Fund shall be operated upon by such
officers as may be authorized in this behalf by the Central
Board.
18. Expenses of Administration.
– All expenses relating to the administration of this Scheme
including the expenses incurred on Regional Committee shall
be met from the “Insurance Fund Central Administration Account”.
19. Forms and manner of
maintenance of accounts. – The Central Board shall maintain
the accounts of its income and expenditure including its administrative
account in Form 1 and Form 2 and the balance sheet in Form
3. The accounts shall be prepared for the financial year
and the books shall be balanced on the thirty-first March
each year.
20. Audit. – (1) The accounts
of the Insurance Fund, including the Insurance Fund Central
Administration Account, shall be audited in accordance with
the instructions issued by the Central Government in consultation
with the Comptroller and Auditor General of India.
(2) The charges on account of audit shall
be paid out of the Insurance Fund Central Administration Account.
21. Budget. – (1) The Commissioner
shall place before the Central Board each year before the
first fortnight of February a budget showing separately the
probable receipts from the contributions and from the levy
of administrative charges and the expenditure which is proposed
to be incurred during the following financial year. The budget
as approved by the Central Board shall be submitted for sanction
to the Central Government within a month of its being placed
before the Central Board.
(2)
The Central Government may make such modification
the budget as it considers desirable before sanctioning it.
(3)
The Commissioner may at any time during the year,
make budgetary reappropriation of funds sanctioned in the
budget, by the Central Government provided that.
(i)
the total amount sanctioned in the budget by the Central
Government is not exceeded;
(ii)
it is made only for meeting such expenses of administration
as are to be met from the Insurance Fund Central Administration
Account in accordance with paragraph 18; and
(iii)
every reappropriation so made shall be reported by
him to the Central Board at its next meeting.
(4)
The Commissioner shall place before the Central Board a supplementary
budget for a financial year, giving detailed estimates and
reasons of inescapable expenditure which is likely to be incurred
during the year for which no provision has been made in the
sanctioned budget and which cannot be covered under the provisions
of sub-paragraph 3. The supplementary budget as approved
by the Central Board shall be submitted for sanction to the
Central Government within a month of its being placed before
the Central Board.
(5) Any expenditure
incurred by the Commissioner over and above the sanctioned
budget of the financial year and not covered under the provisions
of sub-paragraphs 3 and 4, shall be reported to the Central
Board at the earliest practicable moment after the excess
is established for its consideration and for obtaining sanction
of the Central Government.
22. Scales of assurance benefit
and the minimum average balance to be maintained by an employee.
– (1) On the death of an employee, who is a member of the
Fund or of a provident fund exempted under section 17 of the
Act, as the case may be, the persons entitled to receive the
provident fund accumulations of the deceased shall, in addition
to such accumulations be paid an amount, equal to the average
balance in the account of the deceased in the Fund or of a
Provident Fund exempted under Section 17 of the Act, as the
case may be, during preceding twelve months or during the
period of his membership, whichever is less, except where
the average balance exceeds rupees twenty-five thousand, the
amount payable shall be rupees twenty-five thousand plus 25%
of the amount in excess of rupees twenty-five thousand subject
to a ceiling of rupees thirty-five thousand.
Explanation
1. – For the purpose of determining the average balance
in the Fund or in the provident fund exempted under section
17 of the Act, as the case may be, in relation to any employee,
the sum total of contributions by the employee and the employer,
due for and upto the relevant period, whether paid or unpaid
in the Fund or in the Fund or in the provident fund exempted
under section 17 of the Act, as the case may be, together
with interest thereon, shall be included.
Explanation 2.
– The period of twelve months for calculation of benefits
under this Scheme shall be computed backwards from the month
preceding the month in which death of the member occurs.
(2) In the case
of a part-time employee who was a member of the Fund or of
a provident fund exempted under section 17 of the Act, as
the case may be, while serving in more than one factory or
establishment the quantum of benefit under this Scheme shall
be determined with reference to the average of the aggregate
balance in all his accounts in the Fund or of a provident
fund exempted under section 17 of the Act, as the case may
be, during the preceding twelve months.
23. Assurance benefit to whom
payable. – (1) The nomination made by an employee under
Employees’ Provident Funds Scheme, 1952, or under the provident
fund exempted under section 17 of the Act, as the case may
be, shall be treated as nominations under this Scheme and
the assurance amount shall become payable to such nominee
or nominees.
(2) If no nomination subsists
or if the nomination relates only to part of the amount standing
to his credit in the Fund or of a provident fund exempted
under section 17 of the Act, as the case may be, the whole
amount or the part thereof to which the nomination does not
relate, as the case may be, shall become payable to the members
of his family in equal shares:
Provided that no share shall be payable
to –
(a) sons
who have attained majority;
(b) sons
of a deceased son who have attained majority;
(c) married
daughters whose husbands are alive;
(d) married
daughters of a deceased son whose husbands are alive;
if there is any member of the
family other than those specified in clauses (a), (b), (c)
and (d):
Provided further that the widow
or widows, and the child or children of a deceased son shall
receive between them in equal parts only the share which that
son would have received if he had survived the employee and
had not attained the age of majority at the time of his death.
(3) In any case to which the provisions
of sub-paragraphs 1 and 2 do not apply the whold amount shall
be payable to the person legally entitled to it.
(4) If a person who is eligible
to receive assurance Scheme benefit of the deceased member
in terms of sub-paragraph 1,2 or 3 is charged with the offence
of murdering the member or for abetting in the commission
of such an offence, his claim to receive assurance benefit
shall remain suspended till the conclusion of the criminal
proceedings instituted against him. If on the conclusion
of the criminal proceedings, the person concerned is : -
(a)
convicted for the murder or abetting the murder of the member,
he shall be debarred from receiving his share of deposit linked
assurance benefit which shall be payable to other eligible
members of any of the family; or
(b)
acquitted of the charge of murdering or abetting in the murder
of the member, his share shall be payable to him.
Explanation. – For
the purpose of this paragraph an employee’s posthumous child,
if born alive, shall be treated in the same way as a surviving
child born before his death.
24. Assurance amount – how to be
paid. – (1) The nominee or nominees or other claimants
shall send a written application to the Commissioner through
the employer in such form as the Commissioner may specify,
to claim payment under this Scheme.
(2) If the person
to whom any amount is to be paid under this Scheme is a minor
or a lunatic, the payment shall be made in accordance with
the provisions in the Employees’ Provident Funds Scheme, 1952
relating to payment to such persons.
(3) The payment
may be made, at the option of the person to whom payment is
to be made,
(i)
by postal money order, or
(ii)
by deposit in the payee’s bank account in any Scheduled
Bank or any Co-operative Bank (including the Urban Co-operative
Bank) or any post office, or;
(iii)
by deposit in the payee’s name (the whole or part
of the amount) in the form of annuity term deposits scheme
in any Nationalised Bank, or
(iv)
through the employer.
(4) The claims, complete
in all respects submitted along with the requisite documents
shall be settled and benefit amount paid to the beneficiaries
within thirty days from the date of its receipt by the Commissioner.
If there is any deficiency in the claim, the same shall be
recorded in writing and communicated to the applicant within
thirty days from the date of receipt of such application.
In case the Commissioner fails without sufficient cause to
settle a claim complete in all respect within thirty days,
the Commissioner shall be liable for the delay beyond the
set period and penal interest 12% per annum may be charged
on the benefit amount and the same may be deducted from the
salary of the Commissioner.
25. Registers, Records
etc. – The Commissioner may with the approval of the Central
Board specify the registers and records to be maintained in
respect of the employees, the form or design of any identity
card, token or disc for the purpose of identifying any employee
or his nominee or nominees or a member of his family entitled
to receive the benefit under this Scheme and such other formalities
as have to be completed in connection with the payment of
the said benefit, subject to such periodical verification
as may be considered necessary.
26. Annual Report
on the working of this scheme. – The Central Board shall
approve before the 10th of December and submit
to the Central Government before the 20th of December
each year, a report on the working of this Scheme during
the previous financial year.
27.
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28.
Special provisions relating to establishments in
respect of which applications are received for exemption from
the provisions of this Scheme. – (1) (i) A Commissioner
may be order and subject to such conditions as may be specified
in this order exempt from the operation of all or any of the
provisions of this Scheme an employee to whom this Scheme
applies on receipt of application from such an employee:
Provided that such
an employee is without making any separate contribution or
payment of premium, in enjoyment of benefits in the nature
of life assurance, whether linked to their deposits in provident
funds or not, according to the rules of the factory or other
establishment and such benefits are more favourable than the
benefits provided under this Scheme.
(ii) Where an employee is
exempted, as aforesaid, the employer shall in respect of such
employee maintain such accounts, submit such returns, provide
such facilities for inspection as the Commissioner may direct
and pay such inspection charges and make such investments
as the Central Government may direct.
(2)
An employee exempted under sub-paragraph 1 may, by
an application to the Commissioner, make a request that the
benefits of this Scheme be extended to him.
(3)
No employee shall be granted exemption or permitted
to apply out of exemption more than once on each account.
(4)
(i) The Central Provident Fund Commissioner may
by order and subject to such conditions as may be specified
in the order exempt from the operation of all or any of the
provisions of this Scheme any class of employees to whom this
Scheme applies, on receipt of an application therefore, in
such form as the Commissioner may specify:
Provided that such class of
employees is, without making any separate contribution on
payment of premium, in enjoyment of benefits in the nature
of life assurance, whether linked to their deposits in provident
fund or not, according to the rules of the factory or other
establishment and such benefits are more favourable than the
benefits provided under this Scheme.
(ii) Where any class of employees
is exempted as aforesaid, the employer shall in respect of
such class of employees maintain such accounts, submit such
returns, provide such facilities for inspection, pay such
inspection charges and make investments in such manner as
the Central Government may direct.
(5)
A class of employees exempted under sub-paragraph
4 or the majority of employees constituting such class may,
by an application to the Commissioner, make a request that
the benefits of this Scheme be extended to them.
(6)
No class of employees or the majority of employees
constituting such class shall be granted exemption or permitted
to apply out of exemption more than once on each account.
(7)
Notwithstanding anything contained in this Scheme
the Commissioner may in relation to a factory or other establishment
in respect of which an application for exemption under section
17 (2A) of the Act has been received, relax pending the disposal
of the application, the provisions of this Scheme in such
manner as he may direct.
29. Punishment for failure to submit
returns etc. – If any person, --
(a) deducts
or attempts to deduct from the wages or other remuneration
of a member the whole or any part of the employer’s contribution,
or,
(b) fails or
refuses to submit any return, statement or other documents
required by this Scheme or submits a false return, statement
or other documents, or makes a false declaration, or
(c) obstructs
any Inspector or other official appointed under the Act or
this Scheme in the discharge of his duties or fails to produce
any record for inspection by such Inspector or other official,
or
(d) is guilty
of contravention of or non-compliance with any other requirements
of this Scheme,
(e) he shall
be punishable with imprisonment which may extend to one year
or with fine which may extend to four thousand rupees, or
with both.
EMPLOYEES’
PENSION SCHEME – 1995
Employees' Pension Scheme-95 came
into effect from 16.11.95. The Employees' Pension Scheme-95
has been conceived as a Benefit defined Social Insurance
Scheme formulated following actuarial principles for
ensuring long term financial sustenance. The new Employees’
Pension Scheme-95, repealed and replaced the erstwhile
Family Pension Scheme, 1971. The assets and liabilities
of the erstwhile Pension Fund were transferred and merged
with the new Pension Fund. The benefits and entitlements
to the members under the old scheme remain protected
and continued under the new Employees’ Pension Scheme-95.
APPLICATION
AND COVERAGE
The Scheme was notified on 16.11.95 and
made effective from that date with the provision for
retrospective application from 1.4.93 in selective cases.
The Scheme on its introduction applied on compulsory
basis to all the new members of Provident Fund and the
existing members who were contributing to the Employees'
Family Pension Scheme-1971. The existing members (as
on 16.11.95) of the Provident Fund who did not opt for
joining the erstwhile Employees' Family Pension Scheme-1971
and the beneficiaries under the erstwhile Employees'
Family Pension Scheme-1971 in case of death/exit occurring
between 1.4.93 and 15.11.95 have option to join the
new scheme.
CONTRIBUTION
No separate contribution is payable additionally
by the member for the Pension Scheme benefits.
The new Pension Scheme, alike the old Employees' Family
Pension Scheme, 1971 derives its financial resource
by partial diversion from the Provident Fund contribution,
the rate being 8.33% in lieu of 2.33% against the old
ceased Family Pension Scheme-1971.The Central Government
continues contributing at the rate of 1.16% as before,
on wages at the end of the year.
BENEFITS
Newly introduced Employees' Pension Scheme-95
provides for following benefit package:
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Pension for life to the member, on superannuation/retirement
and invalidation.
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To the members of the family upon death
of the member:
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Pension to Widow/Widower for life
or till re-marriage.
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To children/orphan, two at a time
additionally upto 25 years of age simultaneously
with widow/widower pension.
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Children/orphan with total and permanent
disability shall be entitled to payment of children
pension or orphan pension as the case may be irrespective
of age and number of children in the family.
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Facility for payment of pension to
nominee in the event of member who is unmarried
or without any eligible family member to receive
pension, and
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Facility for payment of pension to
dependent father/mother in the event the member
dies leaving behind no eligible family members
and no nomination by such deceased member exist.
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Facility for capital return (corpus
accretion) on option formula basis
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Commutation of pension up to 1/3rd
of pension amount
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Scheme Certificate to retain membership
of the Scheme till attaining the age of 58 years.
Superannuation/retirement pension under
the new scheme will be payable on fulfilling:-
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Minimum 10 years eligible service
and
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Attaining age of 58 years.
On ceasing employment earlier than 58 years,
pension may be availed of by a member at his option,
before attaining the age of 58 years but not below 50
years. Such early pension will be subject to discounting
factor. However, no such age restriction or eligibility
requirement shall apply for pension entitlement on disablement
or pension payable to the family members on death of
the member. Membership with one contribution is enough
in such cases.
VALUATION
OF PENSION FUND
The Pension Fund is evaluated by an Actuary
on an annual basis. Based on valuation recommendations,
Central Government determines the amount of relief on
pensions to existing pensioners.
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