Regulation of Retirement Gratuity and Death Gratuity: CHAPTER V-CCS (Payment of Gratuity under NPS) Rules, 2021

22. Retirement gratuity or death gratuity. – (1) A Government servant, who has completed five years’ qualifying service and who, –

(i) retires on attaining the age of superannuation, or on invalidation, or

(ii) retires or is retired, in advance of the age of superannuation in accordance with rule 56 of the Fundamental Rules, 1922 or rule 12 of the Central Civil Services (Implementation of National Pension System) Rules, 2021; or

(iii) on being declared surplus to the establishment in which he was serving, opts for Special Voluntary Retirement Scheme relating to voluntary retirement of surplus employees; or

(iv) on has been permitted to be absorbed in a service or post in or under a Corporation or Company wholly or substantially owned or controlled by the Central Government or a State Government or in or under a body controlled or financed by the Central Government or a State Government, shall, on his retirement, be granted retirement gratuity equal to one-fourth of his emoluments for each completed six monthly period of qualifying service, subject to a maximum of 16½ times the emoluments.

(2) Where a Government servant dies while in service, the death gratuity shall be payable to his family in the manner indicated in sub-rule (1) of rule 24 at the rates given in the following Table, namely : –

TABLE

Provided that the amount of retirement gratuity or death gratuity payable under this rule shall in no case exceed twenty lakh rupees:

Provided further that where the amount of retirement or death gratuity as finally calculated contains a fraction of a rupee, it shall be rounded off to the next higher rupee.

(3) The emoluments for the purpose of gratuity admissible under this rule, shall be reckoned in accordance with rule 6:

Provided that if the emoluments of a Government servant have been reduced during the last ten months of his service otherwise than as a penalty, average emoluments as referred to in rule 7 shall be treated as emoluments:

Provided further that the dearness allowance admissible on the date of retirement or death, as the case may be, shall also be treated as emoluments for the purpose of this rule.

(4) Where a Government servant, who has become eligible for retirement gratuity dies within five years from the date of his retirement from service including compulsory retirement as a penalty and the sums actually received by him at the time of death on account of such annuity under National Pension System, if any, together with the retirement gratuity admissible under sub –rule (1) are less that the amount equal to twelve times of his emoluments, a residuary gratuity equal to the deficiency may be granted to his family in the manner indicated in sub-rule (1) of rule 24.

(5) For the purposes of this rule and rules 23, 24, 25 and 26, ‘family’, in relation to a Government servant, means, –

(i) wife or wives including judicially separated wife or wives in the case of a male Government servant;

(ii) husband, including judicially separated husband in the case of a female Government servant;

(iii) sons including stepsons and adopted sons;

(iv) unmarried daughters including stepdaughters and adopted daughters;

(v) widowed or divorced daughters including stepdaughters and adopted daughters;

(vi) father, including adoptive parents in the case of individuals whose personal law permits adoption;

(vii) mother, including adoptive parents in the case of individuals whose personal law permits adoption;

(viii) brothers below the age of eighteen years including stepbrothers;

(ix) unmarried sisters and widowed sisters including stepsisters;

(x) married daughters, and

(xi) children of a pre-deceased son.

Explanation. – (1) In calculating the length of qualifying service, fraction of a year equal to three months and above shall be treated as a completed one half-year and reckoned as qualifying service. (2) Death gratuity shall also be admissible in the case of a Government servant who commits suicide.

23. Nominations. – (1) A Government servant shall, on his initial confirmation in a service or post, make a nomination in Form 2, conferring on one or more persons the right to receive the retirement gratuity or death gratuity payable under rule 22 :

Provided that if at the time of making the nomination, –

(i) the Government servant has a family, the nomination shall not be made in favour of any person or persons other than the members of his family ;

or

(ii) the Government servant has no family, the nomination may be made in favour of a person or persons, or a body of individuals, whether incorporated or not.

(2) Where a Government servant nominates more than one person under sub-rule (1), he shall specify in the nomination the amount of share payable to each of the nominees, in such manner as to cover the entire amount of gratuity.

(3) A Government servant may provide in the nomination, –

(i) that in respect of any specified nominee who predeceases the Government servant, or who dies after the death of the Government servant but before receiving the payment of gratuity, the right conferred on that nominee shall pass to such other person as may be specified in the nomination : Provided that if at the time of making the nomination the Government servant has a family consisting of more than one member, the person so specified shall not be a person other than a member of his family :

Provided further that where a Government servant has only one member in his family, and a nomination has been made in his favour, it is open to the Government servant to nominate alternate nominee or nominees in favour of any person or a body of individuals, whether incorporated or not ;

(ii) that the nomination shall become invalid in the event of the happening of the contingency provided therein.

(4) The nomination made by a Government servant who has no family at the time of making it, or the nomination made by a Government servant under the second proviso to clause (i) of sub-rule (3) where he has only one member in his family shall become invalid in the event of the Government servant subsequently acquiring a family, or an additional member in the family, as the case may be.

(5) A Government servant may, at any time, cancel a nomination by sending a notice in writing to the Head of Office :

Provided that he shall, along with such notice, send a fresh nomination made in accordance with this rule.

(6) Immediately on the death of a nominee in respect of whom no special provision has been made in the nomination under clause (i) of sub-rule (3) or on the occurrence of any event by reason of which the nomination becomes invalid in pursuance of clause (ii) of sub-rule (3), the Government servant shall send to the Head of Office a notice in writing cancelling the nomination together with a fresh nomination made in accordance with this rule.

(7) (a) Every nomination made including every notice of cancellation, if any, given by a Government servant under this rule, shall be sent to the Head of Office.

(b) The Head of Office shall, immediately on receipt of such nomination, verify that the nomination made by the Government servant is in accordance with the provisions of this rule and, if the Government servant has a family, the nomination made is in favour of one or more members of the family as referred to in sub-rule (5) of rule 22 and the Head of Office shall, thereafter, countersign the nomination indicating the date of receipt and keep it under his custody :

Provided that the Head of Office may authorise his subordinate Gazetted Officers to countersign nomination forms of non-Gazetted Government servants.

(c) Suitable entry regarding receipt of nomination shall be made in the service book of the Government servant concerned.

(8) Every nomination made, and every notice of cancellation given, by a Government servant shall, to the extent that it is valid, take effect from the date on which it is received by the Head of Office.

24. Persons to whom gratuity is payable.- (1) (a) The gratuity payable under rule 22 shall be paid to the person or persons on whom the right to receive the gratuity is conferred by means of a nomination under rule 23;

(b) If there is no such nomination or if the nomination made does not subsist, the gratuity shall be paid in the following manner, namely : –

(A) if there are one or more surviving members of the family as specified in clauses (i), (ii), (iii), (iv) and (v) of sub-rule (5) of rule 22, to all such members in equal shares;

(B) if there are no such surviving members of the family as specified in sub-clause (A), but there are one or more members as specified in clauses (vi), (vii), (viii), (ix), (x) and (xi) of sub-rule (5) of rule 22, to all such members in equal shares.

(2) If a Government servant dies after retirement without receiving the gratuity admissible under sub-rule (1) of rule 22 the gratuity shall be disbursed to the family in the manner provided in sub-rule (1).

(3) The right of a female member of the family, or that of a brother, of a Government servant who dies while in service or after retirement, to receive the share of gratuity shall not be affected if the female member marries or re-marries, or the brother attains the age of eighteen years, after the death of the Government servant and before receiving her or his share of the gratuity.

(4) Where gratuity is granted under rule 22 to a minor member of the family of the deceased Government servant, it shall be payable to the guardian on behalf of the minor.

Explanation.- (1) Payment of the minor’s share of gratuity shall be made to the natural guardian of the minor, if any and in the absence of a natural guardian, the payment of minor’s share of gratuity shall be made to the person who furnishes a certificate of guardianship.

(2) In the absence of a natural guardian, the payment of twenty per cent. of minor’s share of gratuity may be made to the guardian without the production of a guardianship certificate but on production of an indemnity bond in Proforma A and the balance amount of minor’s share of gratuity may be paid to the guardian on production of the certificate of guardianship.

(3) The share of the gratuity payable to a member of the family who has died or become disqualified before receiving actual payment, shall be distributed equally among the remaining members of the family in accordance with clause (b) of sub-rule (1) of rule 24.

(4) Disbursing authorities shall ascertain, before making actual payment of a death or retirement gratuity whether all the member of the family in whose favour the sanction was issued have continued to be qualified. If not, and also if any of them is dead, the fact shall be reported immediately to the sanctioning authority for the issue of a revised sanction in favour of the remaining members of the family.

25. Debarring a person from receiving gratuity. – (1) Where a person who in the event of death of a Government servant while in service is eligible to receive gratuity in terms of rule 24, is charged with the offence of murdering the Government servant or for abetting in the commission of such an offence, his claim to receive his share of gratuity shall remain suspended till the conclusion of the criminal proceedings instituted against him.

(2) Where on the conclusion of the criminal proceedings referred to in sub-rule (1), the person concerned, –

(a) is convicted for the murder or abetting in the murder of the Government servant, he shall be debarred from receiving his share of gratuity which shall be payable to other eligible members of the family, if any;

(b) is acquitted of the charge of murdering or abetting in the murder of the Government servant, his share of gratuity shall be payable to him.

(3) The provisions of sub-rule (1) and sub-rule (2) shall also apply to the undisbursed gratuity referred to in sub-rule (2) of rule 24.

26. Lapse of retirement gratuity or death gratuity. – Where a Government servant dies while in service or after retirement without receiving the amount of gratuity and leaves behind no family, and, – (a) has made no nomination; or

(b) the nomination made by him does not subsist,

the amount of retirement gratuity or death gratuity payable in respect of such Government servant under rule 22 shall lapse to the Government :

Provided that the amount of death gratuity or retirement gratuity shall be payable to the person in whose favour a Succession Certificate in respect of the gratuity in question has been granted by a Court of Law.

27. Superannuation gratuity. – A superannuation gratuity shall be granted in accordance with rule 22 to a Government servant who is retired on his attaining the age of superannuation or, if the service of the Government servant has been extended beyond superannuation, on expiry of such period of extension of service beyond the age of superannuation.

28. Invalid gratuity. – An Invalid Gratuity shall be granted in accordance with rule 22 to a Government servant who retires from the service on account of any bodily or mental infirmity which permanently incapacitates him for the service in accordance with rule 16 of the Central Civil Services ( Implementation of National Pension System) Rules, 2021 and who had exercised option or in whose case the default option under rule 10 of that rules, is for availing benefits under National Pension System:

Provided that where a Government servant, who had exercised option or in whose case the default option under rule 10 of the Central Civil Services (Implementation of National Pension System) Rules, 2021 is for availing benefits under the Central Civil Services (Pension) Rules, 1972 or the Central Civil Services (Extraordinary Pension) Rules, 1939 and in whose case the provision of section 20 of the Rights of Persons with Disabilities Act, 2016 (49 of 2016) are not applicable, retires on account of any bodily or mental infirmity which permanently incapacitates him for the service, further action will be taken by the Head of Office for disbursement of benefits in accordance with the Central Civil Services (Pension) Rules, 1972 or the Central Civil Services (Extraordinary Pension) Rules,1939 as the case may be.

29. Retiring gratuity. – A Government servant who retires or is retired, in advance of the age of superannuation in accordance with rule 56 of the Fundamental Rules, 1922 or rule 12 of the Central Civil Services ( Implementation of National Pension System) Rules, 2021 on being declared surplus to the establishment in which he was serving, opts for Special Voluntary Retirement Scheme for surplus employees notified by the Department of Personnel and Training vide Office Memorandum No. 25013/6/2001-Estt. (A), dated the 28th February, 2002 as amended from time to time, shall be entitled to gratuity admissible under rule 22.

30. Gratuity on compulsory retirement.- (1) A Government servant compulsorily retired from service as a penalty may be granted, by the authority competent to impose such penalty, gratuity at a rate not less than two-thirds of gratuity admissible to him on the date of his compulsory retirement. (2) Whenever in the case of a Government servant the President passes an order (whether original, appellate or in exercise of power of review) awarding a gratuity less than the full gratuity admissible under these rules, the Union Public Service Commission shall be consulted before such order is passed.

31. Effect of dismissal or removal. – A Government servant who is dismissed or removed from service shall forfeit his gratuity :

Provided that the authority competent to dismiss or remove him from service may, if the case is deserving of special consideration, sanction a compassionate gratuity not exceeding two – thirds of retirement gratuity calculated at the rates mentioned in sub-rule (1) of rule 22.

32. Benefit on absorption in or under a corporation, company or body. – (1) A Government servant who has been permitted to be absorbed in a service or post in or under a corporation or company wholly or substantially owned or controlled by the Central Government or a State Government or in or under a body controlled or financed by the Central Government or a State Government, shall be deemed to have retired from service from the date of such absorption and, subject to sub-rule (4), he shall be eligible, on such absorption, to receive retirement gratuity on the basis of the qualifying service and emoluments on the date of absorption in accordance with rule 22 :

Provided that on retirement from such corporation or company or body, the total amount of gratuity in respect of the service rendered under the Government and the service rendered in such corporation or company or body shall not exceed the amount that would have been admissible had the Government servant continued in Government service and retired on the same pay which he drew on retirement from that corporation or company or body.

(2) The provisions of sub-rule (1) shall also apply to Central Government servants who are permitted to be absorbed in joint sector undertakings, wholly under the joint control of the Central Government and State Governments or Union territory Administrations or under the joint control of two or more State Governments or Union territory Administrations.

(3) (a) where a Government employee joins a corporation or company or body on immediate absorption basis, the relieving order shall be issued in the Form 3 and the relieving order shall indicate the period within which the Government servant shall join the corporation or company or body :

Provided that this period may be extended by the relieving authority for reasons beyond the control of the Government servant, which shall be recorded in writing.

(b) The period between the date of relief and the date of joining in the corporation or company or body may be regularised by grant of leave due and if no such leave is due, the period may be regularised by grant of extraordinary leave.

(c) The relieving authority, before processing the case for sanction of retirement benefits, shall ascertain the date of joining by the Government servant in the corporation or company or body and accept the resignation of the Government servant from the date preceding the date of joining.

(d) No lien of the Government servant shall be retained in the relieving Department and all his connections with the Government shall stand severed on his absorption in the corporation or company or body.

(4) Where a gratuity scheme similar to the gratuity scheme under these rules exists in a body controlled or financed by the Central Government or a State Government in which a Government servant is absorbed, he shall be entitled to exercise option either, –

(a) to receive retirement benefits for the service rendered under the Central Government in accordance with sub-rule (1); or

(b) to count the service rendered under the Central Government in that body for pension.

(5) Where a Government servant is absorbed in a body controlled or financed by the Central Government or a State Government and exercises an option under clause (b) of sub-rule (4), the Government shall discharge its gratuity liability by paying in lump sum as a one time payment and the gratuity liability shall be the capitalised value of retirement gratuity for the service up to the date of absorption in that body.

(6) The date of absorption shall be determined in accordance with the provisions of rule 15 of the Central Civil Services (Implementation of National Pension System) Rules, 2021.

Explanation. – For the purpose of this rule, the expression ‘body’ means an autonomous body or a statutory body.

33. Payment of gratuity in the case of missing Government servant. – (1) Where a Government servant is missing, the family shall lodge a complaint with the concerned police station and obtain report from the police, that the Government servant has not been traced despite all efforts made by the police and the report may be the First Information Report or any other report such as Daily Diary or General Diary Entry.

(2) The family after six months of lodging police complaint may apply in Form 4 for the grant of retirement gratuity to the Head of Office of the organisation where the Government servant had last served.

(3) The retirement gratuity may be sanctioned by the concerned Ministry or Department after observing the following formalities, namely:-

(i) ensure that the complaint lodged with the police and non traceable report given by the police with regard to Government servant is correct.

(ii) an Indemnity bond in Proforma- B shall be taken from the nominee or dependents of the Government servant that the retirement gratuity shall be adjusted against the payment due to the Government servant in case he appears on the scene and makes any claim.

(4) (a) The Head of Office shall process the case in Form 5 for grant of retirement gratuity.

(b) The retirement gratuity shall be paid to the family within three months of the date of application and in case of any delay, the interest shall be paid at the applicable Public Provident Fund rates and responsibility for delay shall be fixed in accordance with rule 44.

(c) The difference between the death gratuity and retirement gratuity shall be payable after the death of the employee is conclusively established or on the expiry of the period of seven years from the date of the police report.

(5) The Head of Office shall assess all the Government dues outstanding against the Government servant and effect their recovery in accordance with rule 45 before sanctioning the payment of gratuity.