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POSTED BY ON September 28, 2012 9:12 pm COMMENTS (3)
Hi All,
My father got the voluntary retirement on May 2011 from southern Railways. Detailed statement abt the final settlement is given. My father took a loan from the railways for buidling a house(6 yrs back). In that it is mentioned till dec 2011 principal component is over. after that as it is voluntary retirement they have deducted the remaining interest component.
1. In geneally central govt loans will Principle be debited first and then interest deducted ?
One of the railway employees say yes . Experts your take. This seems to be reversal of the normal loan from the banks.
2. My auditor says to get the Form 16 to avoid the confusion.(He did not want to take a risk with the amount given in the Final settlement sheet) if i ask railway offcials they are saying for pensioners they are not generating Form 16?
or I asked them in a separate letter pad stating this much interest is deducted and this much principle is deducted. this is also denied by them.
3.Is it really central government dont have the practise of giving Form 16 to the pensioners? As already in the fY(2012-2013) one real estate transaction is done . So Auditor asking me to avoid unnecessary confusions on this issue and ask me to pay the tax and close the issue.
tax amount is 25000/= .
Please help me whether is there any possibility like RTI to get the FORM 16. I dont want to pay this much tax after genuinely having all the proof from my side.
regards
Vignesh
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Dear Vignesh, I know this OD account thing & in banking language it’s called Loan against securities. Following securities are eligible –
Listed Stocks (shares)
Gold ETF Units
Units of MFs (except ELSS funds)
Insurance policies which do have some surrender value
NSC
BONDs
The ROI varies from bank to bank & normally it’s in the range of 12-18%.
On the other hand, if the money is kept in bank FDs & then this OD is availed, the ROI ‘is very less. It’s +1% or +1.5% of your FD ROI.
BNow you decide, which is far benififial to you in terms of interest payment on the OD account?
Thanks
Ashal
Dear ashal,
I will update you on this.
One more doubt:
In the forum We generally advice to have an emergency for the six or three months of expenses in liquid fund, or savings acc or ultra short term fund.
I have recently read one article on ET wealth regarding the emergency funds. Pls throw some more light on that.
they are suggesting to buy the Mutual fund units for our Emergency Fund amount. and pledge that in any bank . they give an account (overdraft acc! name may be wrong) where the money will be there(according to our units) and Once we withdraw the money interest is started. Till that you will have the accessibility of the Funds and growth is also there for our emergency money.
This seems to be a bit effcient way.
What is your take on this? Any link can you share regarding the above.
Regards
Vignesh
Dear Vignesh, just before the VRS, last Pay slip of your father should contain the details of this loan. Princiapl remaining, Interest accrued.
Try to refer that pay slip & if you get any info from it, please post these details here
Thanks
Ashal