Instructions have been issued vide this Department’s OM No. 3/6/2021-P&PW(F) dated 11.10.2022 for strict implementation of the above amended provisions of the General Provident Fund (Central Services), Rules, 1960 .
The government has taken a big decision for the 6th-7th pay commission government employees. Along with this, under the instructions of the government, the maximum amount limit has also been fixed with the condition of depositing 6 percent amount in the GPF account. With this, now government employees will not be able to deposit more than Rs 5 lakh in GPF in any way.
After this decision of the government, the employees’ union alleges that this step has been taken as an attempt to snatch more benefits from the workers. Under the rule till now, any employee could deposit 6 fees of his total wages in this fund. The interest earned on deposits was generally higher than that of banks. However, the government has made preparations to curb this.
Under the new order, as per the General Provident Fund (Central Services), Rules, 1960, the amount of GPF subscription in respect of a subscriber should not be less than and not more than 6% of the total emoluments of the subscriber. Rule 7, 8 and 10 of the General Provident Fund (Central Services) Rules, 1960 vide notification No. G.S.R. 96 dated 15.06.2022. As referred to in sub-section (i) of clause (C) of the Explanation below sub-rule (2) of rule 9D of the Income-tax Rules, 1962 [as referred to in the notification No. G.S.R. 604 (E) dated 31.08.2021 Ministry of Finance, Department of Revenue (Central Board of Direct Taxes) vide the said notification dated 15.06.2022, by a subscriber under GPF during a financial year along with the amount of monthly subscription deposited in that financial year done. The amount of outstanding subscription should not exceed the ceiling limit (currently Rs 5 lakh).
Further, instructions have been issued vide this Department’s OM No. 3/6/2021-P&PW(F) dated 11.10.2022 for strict implementation of the above amended provisions of the General Provident Fund (Central Services), Rules, 1960. have been done.
References have been received in this Department seeking advice on how to regulate GPF contribution in the case of Government servants in whom the total membership of GPF in the current financial year (i.e. 2022-23) has already been exceeded. Five lakh rupees limit or likely to exceed this limit even with a minimum subscription of 6% of the emoluments prescribed under the General Provident Fund (Central Services), Rules, 1960.
The amendment notification capping the maximum annual GPF subscription was issued on 15.06.2022. The limit of annual total contribution in the current financial year exceeding Rs.5 lakh would not have arisen if appropriate steps were taken immediately after the issue of the above amendment notification. Keeping in view the difficulties being faced by the Ministries/Departments, the matter has been examined and the following directions have been issued in this regard:
In case of government employees whose GPF membership during the current financial year (i.e. 2022-23) has already exceeded the limit limit of Rs. 5 lakh, no further deduction of GPF membership can be made from their salary in the current financial year. In those cases, the provision of minimum monthly subscription of 6% of the emoluments shall be deemed to have been relaxed.
In the case of Government servants whose GPF contribution during the current financial year (i.e. 2022-23) has so far exceeded Rs. 5 lakh, further deduction for GPF subscription during the current financial year can be done away with in such a way that the total subscription during the current financial year does not exceed Rs.5 lakh. In cases where the total contribution is likely to exceed Rs.
5 lakhs even with a minimum monthly subscription of 6% of the emoluments, the total contribution in the current financial year is Rs. 5 lakhs. In such cases also, the provision of minimum monthly contribution of 6% of the emoluments shall be deemed to have been relaxed. All Ministries/Departments are requested to bring the above instructions to the notice of all concerned for strict compliance.
