interest on PF after retirement

hello freinds

my father is retired from IOCL on August'06. but he was not withdraw his Providend Fund from the company.

so company is giving interest on that @ 9.5 % also after retirement

my question is what is the treatment of Interest on Providend Fund received after retirement. for retirement period i.e. august'06 to March'07 as per act.

is it exempt up to 8.5 % or it is taxable under the head Income from Other sources

pls give reply with.