EPFO Delays Retiree’s Rs 14.06 Lakh PF Claim by 35 Days Over Missing Document
A consumer court in Mumbai has ordered the Employees’ Provident Fund Organisation (EPFO) to pay a retired employee 6% annual interest on a provident fund claim due to a 35-day delay in settlement. The claim, amounting to over Rs 14 lakh, was not processed within the stipulated 20-day period, leading to the court’s ruling. The EPFO has been given 45 days to comply with the order.
Details of the Delay Case
The Mumbai Suburban District Consumer Disputes Redressal Commission found the EPFO responsible for a deficiency in service. The complainant, a former employee of Fleet Maritime Services (India) Pvt Ltd, submitted his PF claim on October 19, 2016. He argued that the EPFO failed to process the claim in a timely manner.
The EPFO contended that the claim was incomplete because it lacked a required joint declaration and was returned on November 7, 2016. They claimed to have received the complete documents only on December 2, 2016, and settled the claim within 20 days thereafter. However, the commission rejected this explanation, noting the absence of any written communication from the EPFO regarding the alleged deficiencies in the original submission.
Changes to Partial Withdrawal Framework
In a separate development, the EPFO has revised its framework for partial PF withdrawals. The new structure consolidates 13 provisions into three categories: Essential Needs, Housing Needs, and Special Circumstances. Members can now withdraw up to 100% of their eligible PF balance, with increased limits for education and marriage withdrawals. The minimum service requirement for these withdrawals has been reduced to 12 months.
Additionally, members can now request withdrawals under the ‘Special Circumstances’ category without needing to provide a reason. This reform aims to facilitate 100% auto-settlement of eligible claims while retaining 25% of the PF balance for retirement.
Upcoming UPI and ATM Withdrawal Options
Labour Minister Mansukh Mandaviya announced that EPFO subscribers may soon access their provident fund money through a UPI payment gateway. This facility, which has successfully undergone testing, will allow members to transfer withdrawn amounts directly into their bank accounts.
Under the proposed system, a portion of the provident fund corpus will remain frozen while another portion will be available for withdrawal. Members will be able to see their eligible balance and complete transactions using their UPI PIN. The EPFO is also working on enabling ATM withdrawals from PF balances.
Auto-Settlement System for Withdrawals
Currently, members must submit withdrawal applications, which can be time-consuming. The new auto-settlement system will process eligible claims electronically, allowing subscribers to receive funds within three days of application submission. The ceiling for auto-settlement has been raised to Rs 5 lakh from the previous limit of Rs 1 lakh, facilitating quicker access to funds for various needs, including marriage, education, illness, and housing.
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