Exemption of service element and disability element of disability pension granted to disabled personnel of armed forces who have been invalided on account of disability attributable to or aggravated by such service.
Circular No. 13/2019-Income Tax
F. No. 173/250/2019-ITA-1
Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
North Block, New Delhi
Dated: 24th June, 2019
Subject: Exemption of service element and disability element of disability pension granted to disabled personnel of armed forces who have been invalided on account of disability attributable to or aggravated by such service–reg.
Under the existing provisions of clause (i) of sub-section 2 of section 297 of the Income tax Act, 1961 (‘Act’) any notification issued under sub-section (1) of section 60 or section 60A of the Indian Income-Tax Act, 1922 (now repealed) and in force immediately before the commencement of the Act shall continue to be in force to the extent to which no provision has been made under the Act. Previously, in exercise of powers conferred under section 60 of the Indian Income-Tax Act, 1922, vide Notification no. 878 F dated 21.03.1922, it was ordered at para 19 that “pensions granted to members of His Majesty’s naval, military or air forces who have been invalided for naval, military or air force service on account of bodily disability attributable to or aggravated by such service would be exempt from tax under the Indian Income Tax Act, 1922″.
2. In furtherance to the above, instruction 136/1970 dated 14.01.1970 in F.No. 34/3/68 IT(AI) and instruction no. 2/2001 dated 02.07.2001 in F.No. 200/51/99-ITA-1 have been issued to clarify that the entire disability pension, i.e. “disability clement” and “service clement” of a disabled officer of the Indian Armed Forces continues to be exempt from income tax under the Income-tax Act, 1961.
3. Representations have been received, requesting to clarify whether the exemption is applicable only to the disabled officers of Armed Forces or all disabled Armed Forces Personnel (i.e. including officers and Jawans). Representations have also been received to clarify as to whether the Income Tax exemption would be limited to only such disabled Armed Forces Personnel who arc invalided out of service due to disability attributable to or aggravated by military service condition or to even those who retire after full service with some disability.
4. The matter has been examined in the The notification no. 878-F dated 21.03.1922, provides income tax exemption to all members of Armed Forces who have been invalided for naval, military or air force service on account of bodily disability attributable to or aggravated by such service. Thus, income-tax exemption under above clause would be available to all armed forces personnel (irrespective of rank) who have been invalided for such service on account of bodily disability attributable to or aggravated by such service.
5. Further, such tax exemption will be available only to armed forces personnel who have been invalided from service on account of bodily disability attributable to or aggravated by such service and not to personnel who have been retired on superannuation or otherwise.
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(Rajarajeswari R.)
Under Secretary to the Government of India
Take the case of a fighter pilot who ejects and acquires disability but he is retained in ground duty branch till superannuation. Such a case also falls under the category of invalidment because he has been rendered unfit for flying duties. Hence he is entitled to tax exemption.
Please do remember that it is the defence forces which are willing to take molten lead on their living flesh in defence of our country
I retired after superannuation COMPLETION OF 28 YEARS and getting two pensions i.e. regular service pension and disability Element pension due to during last six month of service tenure in Leh and laddhakh my heart bi pass surgery was made.
I would like to ARE BOTH THE PENSIONS ARE EXEMPTED FROM INCOME TAX. or WHICH PENSION IS EXAMPTED FROM INCOME TAX.
Vijay Kumar JI,
Disability element has no mean now. If personnel retired on superannuation or otherwise, exemption is not available.
if personnel have been invalided from service on account of bodily disability attributable to or aggravated by such service , Pension is fully exempt irrespective of disability or other element.
Thank You!
SIR tell me exemption under which section
What about tax on Income other than pension if a disabled veteran is employed again
I get 30% disability pension at the time of discharge in 2009 for long life, my disability pension will be exempted from income tax or not
Nice article. Since 10 years Bank used to deduct TDS on disability pension and we used to file the return. Please let me know how to claim TDS back from department for previous 10 years.
Are those personnel who had acquired injury acquired or attributed to service had acquired in service but let the def pers continued to serve till supernuation. The case in point is Wing Cdr Abhinandan will he be allowed to continue to serve or invalid out for the disability.
My interpretation of the letter is that “Income tax exemption is entitled to all those who have been invalided out from service and also to those whose disability has been caused or aggravated due to service conditions during service when being superannuated/retired.” IT Exemption is not entitled to Defence Personnel who have been superannuated or Retired.