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How is the ceiling on senior citizens reckoned?

On the subject in The Hindu dated October 17, 2005 under the title `Ceiling on senior citizens' deposit scheme', there is a rejoinder from Senior Postmaster, Hubli, to the following effect:

This refers to column Tax Forum: Question and Answer dated October 17, 2005 about Senior Citizen.

There is no provision in the senior citizen savings scheme for joint accounts just like savings bank accounts opened in post office.

The limit of Rs. 15 lakh is fixed taking into consideration non-availability of provision for single and joint schemes.

But the senior citizen can open an account jointly with his spouse only. This facility is to operate the account jointly as a matter of life partner who shares equal right with her husband. This joint facility with spouse does not lead to enhancement of limits as the limit is fixed to the maximum extent at the beginning only in one lump commonly for both single/ joint accounts.

The intention of the Government is not to make compartments in the limits of single/ joint account but facility to share right of husband is encouraged, as the spouse is the next legal heir.

Savings scheme differs from each other for savings bank account the limit for single/ joint account is Rs. 1 lakh and Rs. 2 lakh respectively, whereas for senior citizen saving scheme the limit for single/ joint is fixed at Rs. 15 lakh.

In view of the above facts it is not correct to demand for Rs. 30 lakh jointly that too with spouse. However, husband and wife separately can invest Rs. 15 lakh each. The brochure containing senior citizen savings scheme is enclosed.

The answer to the query in these columns was in the context, where both wife and husband are senior citizens with wife having her own resources. The query was, whether it is possible for them to have the amounts in joint names to the extent of Rs. 30 lakh. The answer was that it may not be technically necessary, that it should stand in separate names of Rs. 15 lakh each, so as to avail of the limit to which each is entitled, because the rules permit a senior citizen to open an account jointly with his spouse. The clarification by the postmaster is right that the joint facility does not enhance the limit. It certainly does not. It is for this reason, it was indicated that it is better to have two separate accounts for easier explanation.

The apprehended objection from a technical point of view in having one account does give rise to doubts and misgivings on grounds often mistaken. Rejoinder is probably because of the sub-title to the answer by the editorial department to read: "A depositor can operate more than one account but altogether the amount should not exceed Rs. 15 lakh". This has to be read in the context of the query raised relating to wife also being a senior citizen. The Postmaster's comment on the assumption that mere permissibility of joint account does not enhance the limit, where the spouse is not a senior citizen, is unquestionable. If any reader had misunderstood the answer as permitting a higher limit, where the spouse is not a senior citizen, such a wrong inference should stand corrected.

S. RAJARATNAM

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