Allaying investors’ fear, the government on Wednesday brought an amendment to the Finance Bill 2018-19 ensuring continued immunity to deposits under the Public Provident Fund (PPF) from attachment under any decree or order of court for recovery of debt or liability of the depositor. Investors’ were in a tizzy after the government proposed to repeal the Public Provident Fund Act, 1968 in the Finance Bill to bring the small savings scheme under the ambit of the Government Savings Banks Act, 1873, which does not provide any protection from attachment. Deposits in the Employees’ Provident Fund (EPF) is also immune from attachment. “The amount standing to the credit of any depositor in the Public Provident Fund Scheme shall not be liable to attachment under any decree or order of any court in respect of any debt or liability incurred by the depositors,” the government said in an amendment to the Finance Bill, passed by voice vote in the Lok Sabha on Wednesday.
The government also proposed to merge Government Savings Certificates Act, 1959 with the Government Savings Banks Act, 1873, with the aim of bringing uniformity in the provisions of different small savings schemes currently governed by these Acts. In an official statement, issued last month, the government had said existing and future depositors of PPF will continue to enjoy protection from the attachment under the amended umbrella Act as well. A debt-oriented asset class, deposits under PPF at present fetches 7.6% return. The government revises the interest rate every quarter.