A subscriber registered under the National Pension System shall not exit there from, and no withdrawal from the accumulated pension wealth in the Tier-1 of the Permanent Retirement Account of such subscriber shall be permitted, except in the manner so specified under regulations 3,4, 5 and 8 and further as mentioned in these provisions, namely:- 16 Substituted by PFRDA (Exits and Withdrawals under the National Pension System) (First Amendment) Regulations, 2017 w.e.f. 10.08.2017. Prior to the substitution, it read as “ Conditions to apply for exit and withdrawal.- A subscriber registered under the National Pension System shall not exit therefrom, and no withdrawal from the accumulated pension wealth in the Tier-1 of the Permanent Retirement Account of such subscriber shall be permitted, except as specified hereunder, namely:-“ 20 20
(a) no pension or accumulated pension wealth in Tier-I account of the Permanent Retirement Account of the subscriber under the National Pension System on account of past or present services, shall be liable to seizure, attachment or sequestration by process of any court at the instance of a creditor, for any demand against the subscriber, or in the satisfaction of a decree or order of any such Courtexcept where the National Pension System Trust or its authorised representative has accorded prior sanction forassignment of the pension wealth accumulated in the pension account of the subscriber, which shall be restricted to such limit as prescribed in Regulation8
(b) any assignment, pledge, contract, order, sale or security of any kind made by any subscriber of the National Pension System,with respect to any benefit receivable by him or her under the National Pension System, or in respect of any money payable at or on account of any such benefitto such subscriber under the National Pension System, or for giving or assigning any future interest therein shall be null and voidexcept where the National Pension System Trust or its authorized representative hasaccorded prior permission for such assignmentof the pension wealthaccumulated in the pension account of the subscriber and which shall be restricted to such limit as prescribed in Regulation 8 to which the assignment was agreed or approvedby the National Pension System Trust or its authorised representative;
(c) 17 the President of India or the Governor of a State, as the case may be, if so provided in the service rules, governing the employment of the subscriber, reserves the right of 17 Substituted by PFRDA (Exits and Withdrawals under the National Pension System) (Fourth Amendment) Regulations, 2018 w.e.f. 18.05.2018.Prior to the substitution, it read as“the President of India or the Governor of a State, as the case may be, if so provided in the service rules, governing the employment of the subscriber, reserves the right of withholding the part of pension wealth, accumulated through co-contributions made by the Central Government or the State Government, as employer to the Tier-I account of the National Pension System account of the subscriber and the investment income accruing thereon, for the purpose of recovery of the whole or part of any pecuniary loss caused to the Central Government or the State Government, provided such loss is established, in any departmental or judicial proceedings, initiated against such subscriber by the employer concerned.
Such right of withholding shall have to be exercised prior to the date of superannuation of the subscriber, pursuant to a notice to be given to the National Pension System Trust or an entity to whom such authorization has been given, and seeking to withhold the said pension wealth of such subscriber. Upon such right of withholding being validly exercised:-
(i) the pension wealth which are payable under the National Pension System shall not be paid to such subscriber until the conclusion of the departmental or judicial proceedings, as the case may be and subject to the final orders, passed in such proceedings.;
(ii) the amount withheld as specified in sub-clause (i) shall remain subscribed to the scheme in the mode and manner in which it was held prior to resorting to such action by the concerned Government and the final settlement of the withheld amount shall be made by the National Pension System Trust, or any intermediary or other entity, authorized for this purpose by the Authority, normally within ninety days of the receipt of an appropriate order from the concerned Government;
(iii) the amount withheld becomes payable to the subscriber on the final settlement, as certified by the concerned Government department which has sought withholding of such benefits, and shall be paid to the subscriber as soon as possible and in no case beyond ninety days of receipt of the final order by the National Pension System Trust or any other entity or person, authorized for the purpose by the Authority;” 21 21 withholding the part of pension wealth, accumulated throughco-contributions made by the Central Government or the State Government, as employer to the Tier-I account of the National Pension System account of the subscriberand the investment income accruing thereon, for the purpose of recovery of the whole or part of any pecuniary loss caused to the Central Government or the State Government, provided such loss is established, in any departmental or judicial proceedings, initiated against suchsubscriber by the employer concerned.
Such right of withholdingshall have to be exercised prior tothe date of superannuation of the subscriber,pursuant to a notice to be given to the National Pension System Trust or an entity to whom such authorization has been given,and seeking to withhold the said pension wealth of such subscriber. Upon such right of withholding being validly exercised:-
(i) the pension wealth which arepayable under the National Pension System shall not be paid to such subscriber until the conclusion of the departmental or judicial proceedings, as the case may be and subject to the final orders, passed in such proceedings.;
(ii) the amount withheld as specified in sub-clause (i) shall remain subscribed to the scheme in the mode and manner in which it was held prior to resorting tosuch action by the concerned Government and the final settlement of the withheld amount shall be made by the National Pension System Trust, orany intermediary or other entity, authorized for this purpose by the Authority, normally within ninety daysof the receipt of an appropriate order from the concerned Government;
(iii) the amount withheld becomes payable to the subscriberon the final settlement,as certified by the concerned Government department which has sought withholding of such benefits, and shall be paid to the subscriberas soon as possible and in no case beyond ninety days of receipt of the final order by the National Pension System Trust or any other entity or person, authorized for the purpose by the Authority;
(e) 18 If the subscriber or the family members of the deceased subscriber, upon his death, avails the option of additional relief on death or disability provided by the Government or employer, 18 Substituted by PFRDA (Exits and Withdrawals under the National Pension System) (First Amendment) Regulations, 2017 w.e.f. 10.08.2017. Prior to the substitution, it read as “If the subscriber or the family members of the deceased subscriber, upon his death, avails the option of additional relief on death or disability provided by the Government, the Government shall have right to adjust or seek transferof the entire accumulated pension wealth of the subscriber to itself. The subscriber or familymembers of the subscriber availing such benefit shall specifically and 22 22 the Government or employer shall have the right to adjust or seek transfer of the entire accumulated pension wealth of the subscriber to itself. The subscriber or family members of the subscriber availing such benefit shall specifically and unconditionally agree and undertake to transfer the entire accumulated pension wealth to the Government or employer, in lieu of enjoying or obtaining such additional reliefs likefamily pension or disability pension or any other pensionary benefit from such Government or employer. With the release of such family pension to the eligible family members of the deceased subscriber, the right to claim any benefits under the National Pension System, by any person shall extinguish thereupon including the rights of the nominee as recorded for the purpose of receiving benefits under National Pension System.
(g) all benefits receivable, including the purchase of annuity as specified under these regulations, shall be arranged to be paid by the National Pension System Trust or the central recordkeepingagency or any other entity authorized for the purpose by the Authority after processing the withdrawal applications in accordance with the provisions of these regulations, or any guidelines, orderor notification, as may be issued by the Authority, from time to time;
(h) 19 Upon exit of a subscriber from tier-I of the National Pension System, the tier-II account of the subscriber shall also be simultaneously closed and amounts under the said account shall be paid to the subscriber or his nominees or legal heirs as the case may be.
(i) 20 With respect to subscribers who have not submitted the withdrawal application as is required under regulation 7 and within one month from the date of attainment of the age of sixty years or the age of normal superannuation as the case may be, for withdrawal of benefits upon exit from national pension system, the accumulated pension wealth in the account of such subscriber (both under tier I and tier II) would be monetized and kept separately as per the guidelines or directions issued by the Authority for the said purpose. The income earned from such safe keeping of the monetized accumulated pension wealth of the subscriber shall unconditionally agree and undertake to transfer the entire accumulated pension wealth to the Government, in lieu of enjoying or obtaining such additional reliefs like family pension or disability pension or any other pensionary benefit from such Government authority;” 19 Substituted by PFRDA (Exits and Withdrawals under the National Pension System) (First Amendment) Regulations, 2017 w.e.f. 10.08.2017. Prior to the substitution, it read as “for a subscriber, exiting from Tier-I account under the National Pension System, the amounts lying in the Tier-II account shall also be monetized and closed simultaneously upon payment of the eligible benefit;” 20 Inserted by PFRDA (Exits and Withdrawals under the National Pension System) (First Amendment) Regulations, 2017 w.e.f. 10.08.2017 23 23 form partof the benefits that the subscriber is entitled under the National Pension System.
This provision shall apply in respect of such subscribers who have deferred the withdrawal of benefits or have partly withdrawn the benefits and have not taken the steps to completely withdraw the benefits as is required under the regulations and or in the guidelines or directions issued by the Authority for the purpose.
(j) 21 With respect to settlement of claims arising out of the accumulated pension corpus of deceased subscribers, where no valid nomination as specified in these regulations exist on the date of death, the Authority may issue suitable directions in the interest of subscribers for settlement of such claims in favour of the family members of the deceased subscriber, upto a specified limit, by requiring such heirs to submit such documents as may be specified.
CHAPTER III WITHDRAWALS, PURPOSE, FREQUENCY AND LIMITS UNDER NATIONAL PENSION SYSTEM