Upon deceased acquiring family, GPF nomination in favour of mother became invalid and in absence of fresh nomination, mother and spouse had equal claim – SC
In a recent judgment, the Hon’ble Supreme Court has held that upon the deceased acquiring family his earlier GPF nomination in favour of mother became invalid and in absence of fresh nomination GPF amount had to be released in equal shares to all members of the family
ABCAUS Case Law Citation:
4909 (2025) (12) abcaus.in SC
In the instant case, when the deceased joined service, as per the applicable rules, he nominated his mother as recipient of GPF, Central Government Employees Group Insurance (CGEGIS) and Death cum Retirement Gratuity (DCRG). Later, the deceased married the appellant and nominated her as recipient for CGEIS and DCRG only.
Rule 5(5)(b) of General Provident Fund (Central Service) Rules, 1960 provides that the nomination shall become invalid in the event of the happening of a contingency which is specified by the subscriber. In the present case, the deceased had specified such contingency as “on acquiring family”.
When the appellant applied for the funds accumulated in the GPF to be released, they were refused on account of mother of the deceased being the nominee on record.
The appellant agitated the issue before the Central Administrative Tribunal (CAT) held that although initially, the nomination of mother was valid, due to Rule 5(5)(b) it subsequently became invalid on the deceased marrying the appellant but was not changed accordingly by the deceased and thus had to be declared invalid. Since no nomination persisted at the time of death, it was held that the amount had to be released in equal shares to all members of the family. As such it was directed that the wife and mother of the deceased both would receive half of the total amount.
The mother of the deceased challenged the order of the CAT before the High Court which set aside findings of the CAT.
The Hon’ble High Court observed that combined reading of Rules 5(5) and 5(6) does not contemplate or provide for auto cancellation of the nomination in the given event of the deceased marrying. The Deceased had neither sent a notice in writing cancelling the mother’s nomination nor fresh nomination was made in favour of the spouse in accordance with Rule 5 for GPF amount. Therefore, it will not result in auto-cancellation of mother’s nomination on deceased acquiring family by virtue of getting married.
The Hon’ble High Court held that the amount of GPF will have to be paid to the mother alone as per rules and the spouse of the deceased may then claim her share in appropriate proceedings as provided under the law.
Not satisfied with the order of the Hon’ble High Court, the spouse of the deceased (the appellant) filed an appeal before the Hon’ble Supreme Court.
The Hon’ble Supreme Court observed that the Rules do provide that when a nomination becomes invalid, the amount is to be distributed/divided amongst all eligible members, but it was equally to be noted that between the gap of long eighteen years between marriage and death of the deceased, as per Rules, there was an opportunity available to the deceased to alter the nomination for the GPF which he did not.
The Hon’ble Supreme Court further observed that the Authorities were not obligated to ask a GPF subscriber to alter or cancel the nominations and it is the duty of the subscriber to do so. In such situations where a subscriber neglects to or fails to make such changes, Rules have been prescribed, laying down how the money is to be distributed amongst survivors.
The Hon’ble Supreme Court opined that as held by the Hon’ble High Court though the Rules do not provide for auto cancellation but it is also that they stipulate a mandate that, upon acquiring family the nomination will become invalid. That being the case, even in view of the fact that the deceased had not made changes to the nomination for GPF, the earlier nomination cannot be held to be valid.
The Hon’ble Supreme Court stated that the position stated by it is no longer under any manner of doubt. Granted that the nomination was in favour of mother, however, the condition stipulated in the nomination form rendered such nomination, at the time of death, void. In other words, the nomination itself would not give mother a better claim over the total GPF amount than the wife of the deceased.
As a result, the Hon’ble Supreme Court allowed the appeal, impugned judgment was set aside and the order of the CAT was upheld.
It was directed that the GPF of the deceased shall be distributed between the mother and the wife.
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