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INDIAN BARE ACTS

THE GOVERNMENT SAVINGS CERTIFICATES ACT, 1959 ACT No. 46 OF 1959

THE GOVERNMENT SAVINGS CERTIFICATES ACT, 1959

ACT No. 46 OF 1959

1

An Act to make certain provisions in respect of Government

Savings Certificates.

[18

th

September, 1959.]

BE it enacted by Parliament in the Tenth Year of the Republic of India

as follows:

1. (1) This Act may be called the Government Savings Certificates Act,

1959.

(2) It shall come into force on such date

2

as the Central Government may,

by notification in the Official Gazette, appoint.

(3) It applies to such class of savings certificates as the Central Government

may, by notification

3

in the Official Gazette, specify in this behalf.

2. In this Act, unless the context otherwise requires,-

(a)”holder”, in relation to a savings certificate, means—

(i) a person who holds the savings certificate issued in accordance

with the provisions of this Act and of any rules made thereunder at

any time before the date on which the Finance Bill, 2005 receives

the assent of the President; and

(ii) an individual who holds the savings certificate issued in

accordance with the provisions of this Act and of any rules made

thereunder at any time on of after the date on which the Finance

Bill, 2005 receives the assent of the President;

(aa) “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;

1

. Extended to the Union Territory of Goa, Daman and Diu (w.e.f. 1-9-1962):  vide

Notification No. S.O. 2734,  see Gazette of India, Extraordinary, Pt. II, Sec. 3(ii), p.

1991.

Extended to and brought into force in Dadra and Nagar Haveli (w.e.f. 1.7.1965) by

Reg. 6 of 1963, s. 2 & Sch.

This Act came into force in Pondicherry on 1-10-1963: vide Reg. 7 of 1963, s. 3 and

Sch. I.

2

. Ist August, 1960: vide Notification No. G.S.R. 709, dated 25

th

June, 1960, Gazette of

India, 1960, Pt. II Sec. 3(i), p. 968.

3

. For such notification see Notification No. G.S.R. 710, dated 25

th

June, 1960, p. 968,

ibid.

Short title,

commencement

and application.

Definitions.

9 of 1875.(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.

3.   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 been made with the

previous consent in writing of the prescribed authority.

4.   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 there under applicable to

such savings certificate and by the terms of any declaration made by

the applicant for the savings certificate in pursuance of the said rules.

5.  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, to

either parent of the minor,  or where neither parent is

alive, to any other guardian of the minor.

6.   (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

Restrictions on

transfer of

savings

certificates.

Holdings by or on

behalf of minors.

Payment where

certificate is held

by or on behalf

of a minor.

Nomination by

holders of savings

certificates. 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.

7.   (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

sub-section (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 no 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

Payment on

death of holder.

39 of 1925. 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 exceed

1

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.

8.   (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.

9.   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.

10.   (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.

1

. Sub. by Act 56 of 1985, S. 3.

Payment to be a

full discharge.

Security for due

administration.

Power to

administer oath. (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.

11.   No suit or other legal proceeding shall lie against any officer of the

Government or any prescribed authority  in respect of any thing which is in

good faith done or intended to be done under this Act.

12.   (1) The Central Government may, by notification in the Official Gazette,

make rules

1

to 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 sub-section (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;

3

(ia) the limit under sub-section (4) of section 7;

1

. For the Post Office Savings Certificates Rules, 1960, see Gazette of India, 1960, Pt. II,

Sec. 3 (i), pp. 968-983.

45 of 1860.

Protection of

action taken.

In good faith.

Power to make

rules. (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

2

in two or

more successive sessions, and if, before the expiry of the session immediately

following the session or the successive sessions aforesaid, 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.

13.  (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.

This is for public information:

“This document is a copy of the notification.  The accuracy of conversion to the

electronic medium is subject to usual constraints.  Hence, nothing in the above

2

. Sub. by Act 20 of 1983, S.2. & Sch. (w.e.f. 15-3-1984).

3

. Ins. by Act 56 of 1985, S.3.

42 of 1944

Repeal and

savings. document may be construed as an authority.  For legal purposes the original

notification may be referred to.”

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