What changed
The Government of India amended the Public Provident Fund Scheme, 1968, effective May 13, 2005. Key changes include omitting sub-paragraph (2) of paragraph 3, removing the Note in paragraph 12(1), and revising Form A to delete references to Hindu Undivided Family (HUF) and association of persons. Specific entries in Form A, including S.Nos. 3 and 4 and sub-paragraphs (b) and (c) of paragraph (iv), were omitted.
What it means for you
Banks must stop opening new PPF accounts for HUFs and associations of persons, as these entities are no longer eligible. Existing PPF accounts for such entities may need review, though the circular does not specify transition rules. Banks should update their account opening forms and procedures to reflect the revised Form A and ensure compliance.
What you must do
- Update PPF account opening forms to remove HUF and association of persons options.
- Issue instructions to all designated branches to implement the amendments immediately.
- Display the amendments on notice boards and inform existing PPF account holders.
- Review and revise internal procedures for PPF account maintenance to align with the new rules.
Who it affects
State Bank of India and associate banks, Allahabad Bank, Bank of Baroda, Bank of India, Bank of Maharashtra, Canara Bank, Central Bank of India, Corporation Bank, Dena Bank, Indian Bank, Indian Overseas Bank, Punjab National Bank, Syndicate Bank, UCO Bank, Union Bank of India, United Bank of India, Designated branches authorized to operate PPF Scheme, PPF account holders (especially HUFs and associations)
Are existing PPF accounts for HUFs or associations affected?
The circular does not explicitly address existing accounts. Banks should seek further clarification from RBI or the government on whether these accounts can continue or must be closed.
When did these amendments take effect?
The amendments came into force on May 13, 2005, as per the notification.
What changes were made to Form A?
The heading was changed to remove 'HUF/ASSOCIATION', and references to HUF or association of persons in various paragraphs and entries were omitted.