Leave encashment

exempted subject to limits

if u were employee in govt hospital it is fully exempt otherwise leave accumulation for max 30 days for every financial year or 10 months average salary or actual leave encashment received whichever is lower subject to max of Rs.300000 is allowed as exemotion

No tax exemption is available for earned leave encashed during the service period. The amount of earned leave you encash will be taxable as salary income in your hands. The encashment of earned leave at the time of retirement is exempt from tax, subject to certain conditions and up to a maximum amount of Rs 3 lakh