Superannuated soldiers won’t get I-T relief on disability pension

CHNADIGARH: The Union Budget delivered a shock to defence personnel receiving disability pension on superannuation — they will no longer be entitled to income tax exemption, reports Ajay Sura.

Only armed forces personnel who were “invalidated” out of service on account of bodily disability will only be entitled to the exemption now.




It has been proposed to provide a specific exemption for disability pension granted to members of the armed forces, including paramilitary personnel, covering both the service element and the disability element, where the individual has been invalided out of service on account of a bodily disability attributable to, or aggravated by, military, naval or air force service, and to exclude cases of retirement on superannuation or otherwise,” says the Budget document.

The move will have huge ramifications on disabled defence pensioners, as those superannuated far outnumber those invalidated out of service. So far, the entire disability pension received by defence personnel was exempt from income tax. In June 2019, Central Board of Direct Taxes (CBDT) had issued a circular (No. 13/2019), limiting tax exemption only to armed forces personnel who were “invalided” from service. The circular was stayed by Supreme Court. The Budget has brought it full circle.

Veterans are outraged. Lt Gen Vijay Oberoi (retd), former Army vice-chief, said there cannot be two classes of disabled pensioner soldiers for the purpose of extending any kind of exemption in income tax as a soldier suffers disability while serving the country. Gen Oberoi lost his right leg in the 1965 Indo-Pak War, but chose to serve in the Army.

War veteran Brigadier Baljit Singh Gill (retd), a Vir Chakra recipient and president of The War Decorated India (TWDI), said it is unfair to differentiate between soldiers for the purpose of tax exemption.

“Because of shortage of manpower, soldiers who become disabled during military service are retained in service by being given sheltered appointments for administration work. They cannot be excluded by govt for the purpose of tax exemption, especially when the court has also given a favourable judgment in such matters,” Brig Gill added.
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