Commutation Of Pension : Rules for Defence Pensioners

commutation of defence pension

ELIGIBILITY FOR COMMUTATION OF PENSION

All Armed Forces retirees who are retiring with any kind of pension is entitled to commute for a lump sum payment a fraction not exceeding 50% of his/her pension, which is sanctioned for life.

In the cases where Commutation of Pension if applied after one year of retirement/invalidment is to be submitted through pension disbursing authority. In such cases, commutation is to be done after medical examination only.

CALCULATION OF COMMUTED VALUE OF PENSION

The commutation of pension is calculated as under: –

Portion of monthly pension to be commuted x 12 x purchase value applicable to the age next birthday.

Note: The table of commutation of pension is given in GOI, MOD Letter No.17(4)/2008(2)/D(Pen/Pol) dated 12.11.2008

RESTORATION OF COMMUTATION PORTION OF PENSION

The pensioners who have commuted a portion of their pension as on 1.4.1985 or thereafter have completed 15 years or will complete 15 years from the respective dates of retirement or from the date on which reduction in pension on account of commutation becomes effective will have their commuted portion restored.

RESTORATION OF COMMUTED PORTION OF PENSION CASE OF ABSORPTION

The officers who had drawn 100% lump-sum payment on absorption and have become entitled to restoration of 43% commuted portion of pension shall, apart from payment of revised restored amount of 43% commuted portion of pension, be also entitled to dearness relief on notionally revised full pension from the date of restoration instead of dearness relief on the revised restored amount of 43% commuted portion.

Know more about pension of Army Navy Air Force- Click here.

 

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