after the passage of Finance Act 2011 it is apparent that the Govt. contribution to NPS will qualify for Tax deduction outside the limit of 1 lakh (please refer to CBDT Circular no 5 in 2011 (published most likely in august 2011)).
So now the employee's contribution falls under 80CCD(1) and is subject to the 1 lakh saving limit and the Govt.'s contribution falls under 80CCD(2) and is outside the 1 lakh saving limit.
EG: Total salary = 500000. NPS by Govt. 50000 and NPS by employee 50000 Then under 80CCD(1) a saving of 50000 can be deducted (along with 80C and 80CCC) and under 80CCD(2) another 50000 can be deducted.

This has been my understanding. If it is wrong please correct me.

Now the question and the point of this new thread of discussion is that how do I fill up the SAHAJ form as it has only one entry for 80CCD ?
Nothing is there as 80CCD(1)/(2).

Please clarify this urgently since date of return filing is approaching.