Panjab University (PU) has urged the Centre to ratify the issue of overpayment of Rs 4.49 crore to its employees, adhering to higher rates of interest to general provident fund (GPF) and contributory provident fund(CPF), as one time exception.
“However, in future, ie from 2015-16 onwards, the university shall adhere to the rate of interest notified by the government from time to time,” writes the varsity to ministry of human resource and development (MHRD).
The varsity is also of the opinion that it caused no loss to the government exchequer as the syndicate had earlier approved the rate of interest to the subscribers of the PF on the basis of interest.
The PU reply would come for approval in the senate meeting to be held on September 27.
CAG HAD FLAGGED THE ISSUE LAST YEAR
Violating the guidelines of ministry of human resource and development and University Grants Commission (UGC), the varsity had paid higher rates of interest to GPF and CPF, resulting into overpayment of Rs 4.49 crore.
The irregularity had been highlighted in the Comptroller and Auditor General (CAG) report tabled in Parliament on November 28, 2014.
In February 2004, the MHRD, after consulting the union ministry of finance, issued directions that all autonomous organisations under its jurisdiction should not pay interest on GPF/CPF at a rate higher than that notified by the government.
However, lesser rate of interest than the rate notified could be paid depending on the financial position of the organisation. The instructions were reiterated by the UGC in April 2004.
The audit pointed out that the university had paid interest on GPF/CPF accumulations at the rate of 9% against the notified interest rate of 8% from April 2011 to November 2011.
From December 2011 to March 2012, the subscribers were paid interest at the rate of 8.6%.
In its reply submitted in March 2013, the university stated that the CPF/GPF was maintained by the university and the rate of interest on it was determined by the syndicate on the basis of interest earned on the deposits of the GPF/CPF balances as per its regulations approved by the central government.
The income generated from fund balances were used only for the payment of interest to GPF/CPF subscribers.
The CAG report pointed out that the reply of the university was not in consonance with the ministry of human resource and development /UGC instructions of 2004, which places restriction on all autonomous organisations on payment of rates of interest.