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Master Circular No. 61 - Commutation of Pension
Master Circular No. 61
Circularstaff-establishment
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| Circular number | Master Circular No. 61 |
|---|---|
| Type | Establishment Master Circular |
| Topic | staff-establishment |
| Archive source | pbtvc.in |
Summary
Commutation of Pension. Master Circular compilation sourced from the PBTVC Personnel website; check subsequent Railway Board amendments before use.
Text of the circular
MASTER CIRCULAR Master Circular No. 61 Commutation of Pension In continuation of Master Circular No. 4, Master Circular No. 5 which brings out provisions on the above subject is enclosed with this letter.
2. The circular is in two parts namely Part I and Part II. Part I deals with the extant provisions on commutation of pension and Part II gives brief details of the orders issued from time to time on the above subject.
3. The instructions referred to in the circular are both old and those current on the subject. For dealing with the old cases, instructions in force at the relevant time be referred to.
4. If any order current on the subject has been omitted the same should nevertheless be treated as valid and operative.
PART - I COMMUTATION OF PENSION A railway servant shall be entitled to commute for a lumpsum payment a fraction not exceeding one third of his pension and shall indicate fraction of pension which he desires to commute and may either indicate maximum limit of one third or such lower limit as he may desire to commute.
(Letter No. E 48 CPC/208 dated 08.07.1950) ##{The upper limit for commutation of one-third of pension has been raised to 40% of the pension w.e.f. 1.1.1996 in the case of Railway servants who retired/retiring from service on or after 1.1.1996.} [Letter No. F(E)III/97/PN 1/22 dated 05.11.1997 (RBE 142/1997)]
2. If a fraction of pension to be commuted results in fraction of rupee, such fraction of a rupee shall be ignored for the purpose of commutation.
(Letter No. F(E)III 82 PN 1/3 dated 04.02.1986)
3. Personal pension sanctioned in the case of those retired on or after 05.05.1985 but before 01.01.1986 will not be taken into account for the purpose of determining commuted value of pension and relief on pension.
[Letter No. PC-IV/87/Imp/PN/1 dated 15.04.1987 (RBE 90/1987)]
4. Commutation of pension to become absolute
4.1 The commutation of pension will be admissible in respect of the following types of pensions:- i.
Superannuation pension ii.
Retiring pension iii.
Pension on absorption in or under a corporation or company and who elects to receive monthly pension and retirement gratuity.
iv.
Compensation pension on abolition of permanent post.
v.
Pension in whole or in part on the finalisation of departmental or judicial proceedings and issue of final orders thereon.
Provided that
a. In the case of applicant who is drawing his pension from a treasury or Accounts Officer, the reduction in the amount of pension on account of commutation shall be operative from the date of receipt of the commuted value of pension or at the end of three months after issue of authority by the Accounts Officer for the payment of commuted value of pension whichever is earlier.
b. In the case of applicant who is drawing pension from a branch of a nationalised bank, the reduction in the amount of pension on account of commutation shall be operative from the date on which the commuted value of pension is credited by the Bank to the applicants account to which pension is credited.
c. In the case of an applicant in whose case the commuted value becomes payable on the day following the date of his retirement, the reduction in the amount of pension on account of commutation shall be operative from its inception. Where however, the payment of commuted value of pension could not be made within the first month from the date of retirement, the difference of monthly pension for the period between the day following the day of retirement and the date preceding the date on which the commuted value of pension is deemed to have been paid shall be authorised by the Accounts Officer.
4.2 In the case of applicant referred under item (v) of para 4.1 above, reduction in the amount of pension shall be made from respective dates of payment as laid down under provisos (a) & (b) of that para.
4.3 The date on which the commuted value of pension was made to the applicant or the commuted value was credited to the applicants accoun
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