Gratuity Limit increased to 10 Lakh as per Income Tax Act and Gratuity Act in Rajya Sabha

Parliament on Wednesday approved enhancing the gratuity limit for employees from Rs3.5 lakh to Rs. 10 lakh as also the exemption threshold from income tax on it.

Parliament on Wednesday approved enhancing the gratuity limit for employees from Rs. 3.5 lakh to Rs. 10 lakh as also the exemption threshold from income tax on it.

While the Lok Sabha had passed the Payment of Gratuity (Amendment) Bill 2010 on Monday, the Rajya Sabha put its stamp of approval on it on Wednesday.

Labour minister Mallikarjun Kharge, replying to a brief debate on the bill said the legislative measure also provides that the income tax exemption limit has commensurately been increased to Rs 10lakh from Rs3.5 lakh earlier.

On demands for giving a retrospective effect to the measure, Kharge said, “We want to give a lot, but there should be a capacity (of the employer) to pay and it should reach the beneficiaries.”

He gave the same reason for not accepting demands from the members to improve the formula for calculation of gratuity.

The bill was brought following demands from trade unions and others to remove the ceiling or increase the maximum payable amount, which was fixed in 1997.

Earlier participating in the debate, Congress member and veteran trade unionist G Sanjeeva Reddy said payment of gratuity should be done with retrospective effect.

CPI(M) member T K Rangarajan said seasonal workers are not getting benefit and therefore their interests should also be protected.

Download Payment of Gratuity Amendment Bill 2010

Related Post:-

1. Cabinet approved amendment to the Gratuity Act to raise the ceiling from Rs 3.5 lakh to Rs 10 lakh

2. Lok Sabha passes bill to hike gratuity ceiling to Rs. 10 lakh from Rs. 3.50 Lakh

3. Gratuity Limit increased to 10 Lakh as per Income Tax Act and Gratuity Act in Rajya Sabha

4. Payment of Gratuity (Amendment) Act, 2009 – Amendment in section 2 and insertion of section 13A, Change in defination of employee

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  • Harish Gupta200

    I retired in 31/12/2009from SBI but get Gratutity Rs 3.5 lac though Govt of India raised Gratutity in their departments from Rs3.5 lac to Rs ten lacs WEF 01/11/2007 .

  • Harish Gupta200

    I RETIRED IN DEC 2009 FROM STATE BANK OF INDIA BUT GET GRATUITY RS 3.5 LAC INSTEATD OF RS TEN LAC AS GOVT OF INDIA RAISED GRATUITY FROM RS 3.5 LAC TO RSTEN LAC WEF NOV 2007