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Wednesday, May 24, 2017

Pension Must Be Updated AND Made Tax Free

An Open Appeal To Finance Minister of India 

Presently “Pension” is taxable under the head salaries in Income Tax Return. Pension is fully taxable as salary which is not justified at all.

After putting several years of service and paying income tax which is deducted at source, an employee retires and receives a monthly pension.PENSION is not Salary; it is something like sustenance a person gets in his sunset years. 

Whatever he buys with this sustenance money has a tax component which is loaded on the consumer.  Pension is also deemed to provide some financial security for the old people. Since life expectancy has gone up considerably, it becomes more and more difficult to make ends meet at later stages of life.

Therefore it is not  fair to tax Pension money. And hence I request for completely exemption of  “Pension” from Income Tax.

This will ease the life of several Senior and Super Senior citizens who are presently struggling with the burden of filing Income Tax returns and also help the Income Tax department to focus on real income earning class.

Further I request you to look into long drawn demands of retirees and pensioners of Public sector bank for periodical updation of Pension in line with central government employees. After all , bank employees are citizen of India and they too deserve same treatment as it is available to central government employees . Uniformity of law must be maintained.

Bankers should also get 100% DA neutralisation for which they have been making follow up for years and decades. Family pension should be improved in the same way. 

Here I would like to point out that varies High courts of the country has also given verdict in favour of retired bank employees. But , unfortunately management of Banks under the Banner of Indian Bank Association (IBA) has been spending crores of rupees on advocates in contesting case after case in various courts. Government should make endeavour to stop perpetuating legal proceedings. Some Cases are also pending  in Supreme Court of India. 

It is important to mention here that it is not easy for retired pensioners to meet the cost of litigation whereas bank officials may spend crores of rupees ;from bank’s fund to deprive pensioners their legitimate right of updation of pension , family pension and 100% DA neutralisation. Government must look into this genuine demand of senior citizen and resolve it at the earliest.

In brief , I like to summarise as below
  • There should be no Income tax on pensioners  
  • There should be no tax on interest earned on their PF, Gratuity and other terminal benefits 
  • Pension /Family Pension should be updated from time to time 
  • Legal proceedings should be stopped and money which is spent in courts should be saved in the larger interest of pensioners as also bankers and courts in India.


The Chairman,
Indian Banks Association,
Mumbai.
Dear Sir,
We draw your kind attention to the Supreme Court Judgement delivered on 01.07.2015 in Civil Appeal No. 1123 of 2015 (Arising out of SLP (c) No. 321 of 2015). The judgement has recognized that revision of pension and revision of pay scales are inseparable. It has also reiterated that on revision, the basic pension cannot be less than 50% of the basic pension in the minimum of the pay band in revised scale corresponding to the pre-revised scale. When pension is upheld to be a right and not a bounty, as a corollary to above, upgradation of pension is also a right and not a bounty. Because of the pre-enumerated on the abovejudgement and also those in the case laws like D.S. Nakara and others, the demand of upgradation of pension of retired employees in the banking industry should immediately be reconsidered by the IBA and Govt. of India.
We hope to hear from you at the earliest.
Thanking you,
Yours sincerely,
( S. R. SEN GUPTA )
GENERAL SECRETARY
 Unquote
(Source : AIBPARC  website)


Copy of messages sent by Mr Jayaprakash to PM Mr Narendra Modi is also given below. Following verdict of Apex court is adequate for a government to modify pension rules and impress upon other concerned like Banks to follow the verdict in true spirit. This will not only save money lost in contesting a case, but also will reduce the burden of courts which courts have to waste on hundreds of similar cases .

Government should either amend laws forthwith or else provide adequate judges and infrastructure to judiciary so that all cases pending in various courts are decided in three months maximum. This will do a great justice to many who are suffering only due to weak and inefficient judicial system.


Supreme Court decision in Civil Appeal No.1123/2015.

It is surprising that a land mark judgement delivered by the Supreme Court of India on 01.07.2015 in Civil Appeal no. 1123 of 2015 has not been brought to your knowledge by MOF or IBA despite its much importance & opportunity to tackle in one go the subsisting issues of lakhs of Bank Retirees/ Pensioners & why no union/ association has taken any steps in this regard. 

The salient features of the judgement is as under:
1. The bench has authoritatively ruled that Pension is a right and the payment of it does not depend upon the discretion of the Government. Pension is governed by rules and a Government Servant coming within those rules is entitled to claim pension.
2.The judgement has recognised that the revision of pension and revision of pay scales are INSEPARABLE.
3.The bench has reiterated that revision the Basic pension cannot be less than 50% of the Basic Pension in the minimum of the Pay Band in the revised scale corresponding to the pre-revised scale.
4.The government CANNOT take a plea of financial burden to deny legitimate dues of the pensioners.
5.The Government SHOULD AVOID unwarranted litigation and not to encourage any litigation for the sake of litigation.
6. When pension is upheld to be a right and NOT A BOUNTY, as a corollary to the averment that revision of pension and revision of pay scales are INSEPARABLE, upgradation of pension is also a RIGHT AND NOT A BOUNTY.

THE JUDGEMENT IS BASED ON THE DECISION ON D S NAKARA CASE.

The judgement is very clear and wonder how such an important aspects have not brought to the knowledge of the PM/FM particularly by IBA which is responsible for allowing multiple litigation for the sake of litigation. Why UFBU or Bank Retd Associations have not reacted to the judgement so far is also surprising and perplexing.

While continueing agitations on the issue, why can't UFBU or Retd Associations take recourse to Supreme Court citing its own land mark judgments in various cases right from Nakara case to instant Civil Appeal No. 1123/2015. One ruling by SC that govt can't deny pension & it's periodical updation is a unchallenged verdict and failure to abide by it attracts Contempt of Court.

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