• Exemption to Gratuity under Section 10(10)(i) of the Income Tax Act

I retired on superannuation in July, 2019 as Assistant Commissioner of Customs. During the Financial year 2019-20, I received total salary of Rs.7,00,000/- for the period from April,19 to July,19. In August, 2019 while making the payment of sanctioned death-cum-retirement gratuity of Rs.19,00,000/- under the CCS (Pension) Rules, my employer recovered Rs.5,00,000/- from the gratuity on account of excess paid salary during the previous years i.e. March,2012 to June,2019. While issuing the Form-16, the employer allowed exemption of gratuity under Section 10(10)(i) of the Income tax Act to the tune of Rs.14,00,000/-(Rs.19,00,000/- minus Rs.5,00,000/-). I am contesting that this exemption should be for Rs.19,00,000/- i.e. for the whole amount sanctioned under the CCS Pension Rules because deduction made from the gratuity was for recovery of excess paid salary during the previous years. Secondly Section 10(10)(i) says that whole amount of Gratuity received under the CCS Pension Rules is exempted. [Emphasis is on the underlined words].	While issuing Form-16, my employer has shown a total of amounts paid against gratuity and GPF in column 2(b) of Part-B of Form-16. Similarly, the employer has shown a total of amounts of Central Govt. Employees Group Insurance Scheme (CGEGIS) and uniform Allowance in Column 2(g) of Part-B of Form-16. My contention is that since different retiral benefits like Gratuity, GPF, Commutation of Pension, Leave Encashment and CGEGIS being exempted under different Sections of Income Tax Act, 1961, each of these should be shown in its specified column. If there is no specified column, a total of such unspecified amount be shown in column 2(f) of Part-B of Form-16 which is a general column. Further as per instructions given in Column 2(f) of Part-B of Form-16, consolidated amount shown in column 2(f) should be shown separately in the Table given in the end of Form-16 and should be duly verified by the employer. Expert opinion is solicited.