National Savings Certificate(NSC)

National savings certificate (NSC) is a popular post office scheme.

Features of NSC
  • Available in denominations of Rs 100, 500, 1,000, 5000 and 10,000. Minimum investment is Rs 100/- and no there is no upper limit.

  • Interest rate on investment NSC VIII issue is 7.6% (Jan - March 2018) compounded 6 monthly with maturity period of 60 months (5 years).

  • NSC can be purchased by an adult for himself or behalf of a minor.

  • Trust and HUF cannot invest in NSC.

  • Deposits in NSC upto 1,50,000 /- qualify for tax exemption under section 80C of Income Tax Act.

  • Annual interest from NSC is reinvested and qualifies for exemption under section 80C. 

  • Payment for certificate can be made through cash, cheque, demand draft, pay order or surrender of matured certificate.

  • NSC can pledged as security for loan.

  • Transfer of certificates from one person to another can be done only once from date of issue to date of maturity.

Premature Withdrawal of NSC

1.Premature withdrawal is allowed only in below listed cases

  • death of holder.

  • when ordered by court of law.

  • on forfeiture by a pledgee being a Gazetted Government Officer when the pledge is in conformity with these rules.

 

2.If certificate prematurely encashed due to above reasons then redemption value will be as listed below

  • One year from date of certificate then only face value is payable.

  • After one year but three years from date of certificate then face value plus simple interest will be payable.

  • After three years from date of certificate then face value plus accured interest will be payable after adjustment of discount.

How to get duplicate NSC certificate is lost, stolen or damaged?
  • An application must be made to a post office or bank.

  • Statement should be attached along with application indicating particulars like amount, number, date of certificate and circumstances under which the certificate was lost, stolen or damaged.

  • If Post master of the post office or the bank officer of the branch where the certificate was issued is satisfied with application then you will be issued a duplicate certificate.

  • Applicants who have lost, stolen or damaged certificate beyond identification will have to furnish an indemnity bond with two sureties or with a bank’s guarantee.

  • No bond, surety or bank guarantee will be applicable if damaged certificate is surrendered.

  •  Duplicate certificate can be only encashed at post office or branch where it was issued.