The maximum limit ol deposit in Monthly Income Scheme has been enhanced lo Rs. 4.50 lakh in single account and Rs. 9.00 lakh in joint account with effect from 1st August, 2007. Apart from Monthly Income Scheme, the maximum limit of deposit/balance is applicable only to
(i) Post Office Savings Accounts
(ii) Public Provident Fund and
(iii) Senior Citizens Savings Scheme. There is no upqer limit of deposit in respect of any other small savings scheme.
Proposals for increasing the maximum limit of balance in Post Office Savings Account and Public Provident Fund were recently considered by the Government. Interest on Post Office Savings Account is exempt from the income-tax. This exemption was provided in the context of similar deduction under Section 80Lof Income Tax Act, 1961 for interest from savings account with a bank, which has been withdrawn from the assessment year 2006-07. Therefore, enhancement of deposit veiling for the Post Office Savings Accounts was not found feasible as it would have widened the disparity between the two and led to higher revenue loss.
Similarly, as the interest accruing on deposits in Public Provident Fund accounts is exempt from the income-tax, enhancement in the maximum deposit limit was not found feasible for the reason that it would result in revenue loss.
The Senior Citizens Savings Scheme was launched on 2nd August 2004. The maximum limit of deposit under the Scheme is Rs. 15 lakh in single/joint account, which is considered adequate.
This information was given by the Minister of State for Finance Shri Pawan Kumar Bansal in a written reply to a question in the Rajya Sabha today.
