NSC means National Saving Certificate. NSC India is an avenue by which an individual can invest his disposable income for attaining growth for his savings. This facility is a saving scheme introduced by the Govt of India with an aim to mobilize the funds required for the Governmental project, at the same time give a secured and safe returns to the individuals opting the scheme .This also enables an individual to avail tax benefit under Section 80C of Income Tax Act. The post Offices which are the approved Government agency are authorized to publish and release the certificates.
NSC India provides a cumulated half yearly rate of 8.40% (increased from 8.00% to 8.40% wef Dec 2011) and it is one of the most popular and much sought after investment schemes offered by the Post Offices.
The conditions to hold a NSC certificate are:
- Should to be an Indian Resident.
- Can be a trust or an individual.
Only after the above two conditions are met with, can one request for the NSC at the nearest Indian Post office. NSC can be bought individually, jointly or in a minor’s name .
Salient features of NSC India:
NSC can be bought for a minimum value of Rs 100 with no upper limit.
- It can be purchased and redeemed at all Post Offices.
- The minimum lock-in period for the NSC is 3 yrs.
- However, for the full amount to be redeemed, the maturity period is 5 yrs (reduced wef Dec 2011 from 6 years to 5 years for new investments).
- On payment of a nominal fee, the title of the NSC can be transferred from one individual to another and from one branch to another.
- According to the Wealth Tax of 1957, the deposits will not be considered as assets, so the interest derived out of NSC is not taxable, therefore no tax is deducted at source.
- The maturity value of the NSC can be easily calculated using the NSC calculator. The parameters essential for calculating the maturity value are principal amount invested, period for which invested and the rate of interest.
- On maturity, the amount can be further reinvested.
- If on maturity, the minor in whose name the NSC was bought becomes a major, then these certificates would be signed by the holder himself.
- The NSC can be pledged with a bank just in case the owner would need to take a loan.
In the event of the NSC being lost, stolen or destroyed, the owner should file an FIR, giving all the relevant details of the NSC with the Police Station. Simultaneously, the owner of the NSC may render a request application along with the copy of the FIR to Post Master of the Post Office where the certificate is registered, for issuance of a duplicate certificate. The new NSC would be issued on payment of a nominal fee. The application should be accompanied by submitting all relevant details such as the date, amount and number of the NSC and also the circumstances leading to the loss, destruction or theft. An indemnity bond is required to be furnished by the owner in the prescribed form with sureties or with bank’s guarantee.