What is Penal Interest and How to Calculate?
Amounts defrauded from
S.B. Accounts to Departmental Officials and not accounted for in the books of
the Department.
58(1) After satisfying
himself about the bonafides of the claim of the depositors in respect of
defrauded amount, the Head of Circle/Regional Director/ Divisional
Superintendent will approach CEPT Team to check whether defrauded amount can be
restored in the accounts. In cases where CEPT approves restoration, the
competent authority should issue sanction for the restoration of the defrauded
amount with interest thereon up to the end of the year preceding the year in
which the amount is restored to the account. The amount of interest to be
restored to the account will be calculated by the Head Post Office and checked
by the S.B. Control Organisation. In cases where restoration is not admissible,
sanction will be issued for directly paying the defrauded amount to the
claimant by Cheque. Accounts standing in CBS application should be closed in
such cases in closure proceed paid to the depositors as per laid down rules.
Note :- The
Head of Division(irrespective of status of the division) and Group 'A'
Postmasters can sanction the claims upto Rs. 5000/- in each case regardless of
the aspect of recovery of the loss subject to the condition that sanctioning
authority has to ensure that there has not been any negligence on the part of
the defrauded person in contributing to the fraud and also that settlement of
claim will not cause any hindrance in concluding the enquiry, fixing
responsibility and taking appropriate action against the officials at fault.
These powers will be exercised personally by the Divisional Heads/Group 'A'
Postmasters. Regional Directors are vested with powers to sanction claims
without any limit. (DG Posts Letter NO. 8-5/2003-Inv(Pt) dated 5.6.2003)
(2) Immediately
on receipt of the sanction for restoration of amount, the Head Postmaster
should credit the amount in the respective account (principal) and Interest
should be credited by using HIARM menu by Supervisor SBCO. The net loss
sustained by the department in respect of principal amount (arrived at after
taking into consideration the deposits and withdrawals not accounted for by the
departmental official) and interest thereon should be entered in the schedule
of unclassified payment(UCP) by per contra entry as deposit (Total amount) in
the list of transactions. Complete details of the charge should be given in the
remarks field of the account and in column 3 of the schedule of unclassified
payment to enable the Postal Accounts Office to classify the amounts properly.
(3) When
the amounts defrauded are to be recovered from the officials at fault, penal
interest should be calculated in the manner prescribed in Rule 156(2) of the
Central Government Compilation of General Financial rules, extract given below,
on the amount outstanding from time to time for the actual number of days such
amounts remain outside the custody of Government.
Rule 156 (2):- “A loan
shall bear the interest for the day of payment but not for the day of
repayment. Interest for any period shorter than a complete half year
shall be calculated as :-
|
Number
of day x yearly rate of interest
|
|
365
|
unless any other method
of calculation is prescribed in any particular case or class of cases.”
(4) The
penal interest will be recovered at the rate of 2 ½ % per annum (compound) over
and above the rate of interest fixed from time to time for the various types of
accounts and savings certificates for the period during which the amount was
defrauded. The amount of penal interest will be calculated by the Head office
and intimated to the punishing authority after check by the Control
Organisation.
(5) The
interest may be recovered from the depositor/investor on the amount paid in
excess for the actual period (total number of days) for which the amount excess
paid is retained by him if the period is less than a complete half year. This
will be done in the manner prescribed in sub para (3) above.
(6) The
normal rate of interest payable on each type of account or certificate and not
the post-maturity interest rate will be applicable.
(7) If
the period is more than a year, the interest will be recovered at the compound
rate of interest.
Note:- In case of
recovery of interest from the members of the public to whom double or excess
payment on account of discharge value of savings certificate or in any type of
account due to negligence of the departmental officials and the amount over
paid was retained by the depositor/investor for the considerable period till
its refund at the instance of the department, the interest at normal rate only
should be recovered from the depositor on the amount paid excess and for the
period the amount was retained by him. The term “normal rate” means the rate of
interest which was paid to the depositor/investor on his account/certificates,
as the case may be. In case it is proved on enquiry that the member of the
public defrauded the department by taking double payment deliberately, the
desirability of instituting a criminal case may also be kept in view.
Fox Eg. SB scheme
|
Normal
Int rate = 4.0 %
|
Penal
Int rate = 2.5 %
|
Total
= 6.5 %
|
|
Account No
|
Date of Suppression
|
Date of Credit
|
Defrauded
Amount
|
No. of Days
|
Normal Interest
|
Penal Interest
|
Total
6.5 %
|
|
|
1
|
100000001
|
12-01-2019
|
22-08-2019
|
10000
|
223
|
562.08
|
152.74
|
714.82
|
|
2
|
do
|
31-01-2019
|
22-08-2019
|
5000
|
204
|
111.78
|
69.86
|
181.64
|
|
3
|
100000036
|
19-02-2019
|
31-08-2019
|
7500
|
194
|
159.45
|
99.66
|
259.11
|
|
4
|
do
|
25-02-2019
|
31-08-2019
|
15000
|
188
|
309.04
|
193.15
|
502.19
|
|
5
|
do
|
01-03-2019
|
31-08-2019
|
2000
|
184
|
40.33
|
25.21
|
65.33
|
|
39500
|
1182.68
|
540.62
|
1723.30
|
|
Defrauded Amount
|
Rs. 39500
|
|
Total Interest (
Rounded off)
|
Rs 1723
|
|
Total Recovery
|
Rs 41223
|
** The penal interest will
be recovered at the rate of 2 ½ % per annum (compound) over and above the rate
of interest fixed from time to time for the various types of accounts and
savings certificates for the period during which the amount was defrauded.
Source : SB Order 5/2018 (CBS Manual), Page No. 61, 62
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