Rule 18 — NPS Rules
Original Rule Text
18. An invalidated or discharged subscriber may give fresh option however, if fresh option is not given, then the option already given will be operative. In case of death of a subscriber while in service the last option exercised is final. If no option is available in case of subscriber dying while in service or those disabled or invalidated, who are unable to exercise the option and if death and/or invalidation/discharge happens before completion of 15 years of service or within 3 years of this notification (Upto Mar 2024) then the subscriber is granted family pension/invalid pension as per CCS(P) Rules and the disabled subscriber will be granted EOP as per CCS(EO) Pension Rules, 1939, as default option. In all other cases, where no option was exercised the claims will be regulated as per PFRDA (Exits and Withdrawals under NPS) Regulation, 2015 as default option. Further, in cases of a deceased subscriber when the option has been exercised, but there is no eligible member of the family then the option becomes infructuous and the option would be deemed to have become invalid. In such cases, the benefits will be admissible and shall be granted to the legal heirs of the subscriber as per NPS Regulation, 2015;
What This Means
The rules address several edge cases around option-giving. An employee who is invalided out or discharged may submit a fresh option after recovery. If they fail to give a fresh option, the last option on record continues. When a subscriber dies in service, the last option they exercised is treated as final.
If no option was recorded (because the subscriber never submitted Form-1) and death or invalidation happens before 15 years of service, or within 3 years of the 2021 Rules notification (i.e., up to March 2024), the rules prescribe a safety net: family pension and invalid pension default to CCS (Pension) Rules, 1972, and extraordinary pension defaults to CCS (EOP) Rules, 1939. In all other no-option cases, the PFRDA (Exits and Withdrawals) Regulations, 2015 apply as the default. Additionally, if an option was given but there is no eligible family member left at the time of the subscriber's death, the option becomes void and benefits pass to the legal heirs under NPS Regulations, 2015.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1Invalidated/discharged employees can give a fresh option; if they don't, the previous option continues.
- 2The last option exercised by a subscriber who dies in service is final.
- 3No-option default (death or invalidation before 15 years or within 3 years of 2021 Rules): family pension/invalid pension under CCS (Pension) Rules, extraordinary pension under CCS (EOP) Rules.
- 4No-option default (all other cases): PFRDA (Exits and Withdrawals) Regulations, 2015.
- 5If option was exercised but no eligible family member exists: option is void; benefits go to legal heirs under NPS Regulations, 2015.
Practical Example
Arun Kumar was invalided out in 2022 after an accident with only 10 years of service and had never submitted Form-1. Since his invalidation happened before completing 15 years and within 3 years of the 2021 Rules, the default rule applies: he receives an invalid pension computed under CCS (Pension) Rules, 1972, and extraordinary pension if applicable under CCS (EOP) Rules, 1939.
In a different scenario, Meena Sharma had submitted Form-1 choosing NPS Rules, but she passed away childless and her husband had predeceased her. With no eligible family member, her option became void. Her legal heirs (siblings, parents) receive the NPS corpus as per PFRDA Regulations, 2015.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
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This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.