Addressing the Issue of Income Tax Deduction from Pension of Gallantry Awardees
The Central Pension Accounting Office, under the Ministry of Finance, Government of India, has issued an Office Memorandum (OM) on August 22, 2023, regarding the non-compliance of pension disbursing banks with guidelines related to income tax deduction for Gallantry Awardees’ pension. Referring to a previous OM dated May 12, 2021, it was emphasized that pension disbursing banks must refrain from deducting income tax at source from the pension of Gallantry Awardees, in accordance with Section 10 clause 18(i) of the Income Tax Act and CBDT Notification from November 24, 2000. However, instances of non-compliance have been identified, leading to grievances over income tax deductions from Gallantry Awardees’ pensions.
GOVERNMENT OF INDIA
MINISTRY OF FINANCE
DEPARTMENT OF EXPENDITURE
CENTRAL PENSION ACCOUNTING OFFICE
TRIKOOT-II, BHIKAJI CAMA PLACE,
NEW DELHI-110066
PHONES : 261 74596, 26174456, 26174438
CPAO/IT&Tech/ Misc. Corres/35 (Vol-II) (PF)/10370/2023-24/ 109 – 22.08.2023
OFFICE MEMORANDUM
Attention is invited to this office OM No. CPAO/IT & Tech/Gallantry Award/26/2020-21/06 dated 12.05.2021 wherein it was stated that all the Pension disbursing banks are required to ensure that Income Tax at source is not be deducted from pension in respect of Gallantry Awardees, as per the Provisions of Section 10 clause 18(i) of the IT Act, CBDT Notification dated 24th November, 2000.
2. It is observed that the banks are not complying with the instructions as this office has been receiving grievances regarding deduction of income tax from pension of Gallantry Awardees.
3. In view of the above, Heads of CPPCs/GBDs of all Authorized banks are requested to follow the instructions issued by the Income Tax department, on the subject, without fail.
This issues with the approval of the Chief Controller (Pensions).
(Shailesh Bhathagar)
Sr. Accounts Officer (IT Tech)
Source Document PDF