Defence ministry to look into issue of tax on disability pension

Amid ruckus in the Lok Sabha over the issue of tax on disability pension for military personnel, Defence Minister Rajnath Singh Thursday said he will look into the matter and asserted that the interests of the armed forces personnel is the NDA government's topmost priority.

As soon as Congress leader Adhir Ranjan Chowdhury raised the issue during the Zero Hour of the Lok Sabha, Congress members rushed to the well and raised slogans, such as 'Sena ko nayay do' (give justice to army) and 'sena ke naam pe vote mangana bandh karo' (stop seeking votes in the name of army).

With Congress members creating ruckus in the House, Speaker Om Birla said they were disturbing new MPs which is not right.

 

Chowdhury said the Central Board of Direct Taxes (CBDT) has come out with a circular which stated that disability pension for military personnel will be taxable. This, he said, is very sad.

In his response, Singh said, "I will look into the issue. The ministry is gathering information and will get back to the House with details. Defence preparedness and the interests of armed forces personnel are the top most priorities of the NDA government."

The CBDT, in its circular dated June 24, said disability pension will be taxable for military personnel who superannuated after completing the full term of their service. The pension will be non-taxable only for those who have retired due to any kind of disability, they had said.

Citing a Finance Ministry circular, dated June 24, a source had said, "Tax exemption will be available to armed forces personnel who have been invalidated from the service on account of bodily disability attributable to or aggravated by such service and not to personnel who have been retired or superannuated or otherwise."

Armed forces personnel who suffer any kind of disability due to their service receive separate disability pension. The amount depends on their rank and the kind of disability.

The defence minister also said in the last 40 years people were kept in the dark as far as 'One Rank One Pension' (OROP) is concerned and were misled, "but our government brought it into force".