Please tell me that "IF THERE IS ANY PROPOSAL FOR THE AMENDMENT IN GRATUITY ACT IN THIS BUDGET SESSION, 2011 THAT IMPLICATION OF GRATUITY LIMIT FROM 3.5 LAKHS TO 10 LAKHS WILL BE FROM 1/01/2006 INSTEAD OF 23/05/2010" ???
Thanks in advance.
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Gratuity
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Notification No. 43/2010 [F.No.200/33/2009-ITA.I], dated 11-6-2010
In exercise of the powers conferred by sub-clause (iii) of clause (10) of section 10 of the Income-tax Act, 1961 (43 of 1961), and in supersession of Ministry of Finance, Department of Revenue, notification no. S.O. 287 dated the 20th January, 1999 the Central Government, having regard to the maximum amount of any gratuity payable to its employees, hereby specifies ten lakh rupees as the limit for the purpose of the said sub-clause in relation to the employees who retire or become incapacitated prior to such retirement or die on or after the 24th day of May, 2010 or whose employment is terminated on or after the said date.
This is set Back for PSU employee who was retired between 01.06.2006 to 23.05.2010 and getting Enhanced Limit of Gratuity 10 lakh as per Recommendation of Sixth pay commission .As they are getting 10 Lakh rs from 01.01.2006 or 01.01.2007 as the case may be but now new exemption limit is available for PSU employess who has retired after 24.05.2010.So person retired between 01.01.2006 to 23.05.2010 have to pay tax on gratuity received more than 3.5 Lach Rupees. Section 10(10)(iii) of the Income-tax Act, 1961 - Gratuity - Gratuity exemption limit raised to Rs.10 lakhs
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