India - Income Tax Act 2010 - Saarc

S. 10(10) I.T. ACT, 1961 1.50(9) the income of any member of the family of any such individual as isreferred to in clause (8) 30 [or clause (8A) or, as the case may be, clause(8B)] accompanying him to India, which accrues or arises outsideIndia, and is not deemed to accrue or arise in India, in respect of whichsuch member is required to pay any income or social security tax tothe Government of that foreign State 30 [or, as the case may be,country of origin of such member];31[ 32 (10) 33 (i) any death-cum-retirement gratuity received under the revisedPension Rules of the Central Government or, as the case may be, theCentral Civil Services (Pension) Rules, 1972, or under any similarscheme applicable to the members of the civil services of the Unionor holders of posts connected with defence or of civil posts under theUnion (such members or holders being persons not governed bythe said Rules) or to the members of the all-India services or to themembers of the civil services of a State or holders of civil posts undera State or to the employees of a local authority or any payment ofretiring gratuity received under the Pension Code or Regulationsapplicable to the members of the defence services ;(ii) any gratuity received under the Payment of Gratuity Act, 1972 (39of 1972), to the extent it does not exceed an amount calculated inaccordance with the provisions of sub-sections (2) and (3) of section4 34 of that Act ;(iii) any other gratuity received by an employee on his retirement oron his becoming incapacitated prior to such retirement or on terminationof his employment, or any gratuity received by his widow,children or dependants on his death, to the extent it does not, in eithercase, exceed one-half month’s salary for each year of completedservice 35 , 36 [calculated on the basis of the average salary for the tenmonths immediately preceding the month in which any such event30. Inserted by the Finance (No. 2) Act, 1991, w.e.f. 1-4-1991.31. Substituted by the Finance Act, 1974, w.e.f. 1-4-1975. Original clause was amended firstby the Finance Act, 1972, w.e.f. 1-4-1973 and then by the Finance Act, 1974, w.r.e.f.1-6-1972/1-4-1962.32. See also Letter F. No. 1(179)-62/TPL, dated 13-12-1962 and Letter F. No. 194/6/73-IT(A-I), dated 19-6-1973. For details, see Taxmann’s Master Guide to Income-tax Act.33. For relevant case laws, see Taxmann’s Master Guide to Income-tax Act.34. For text of sub-sections (2) and (3) of section 4 of the Payment of Gratuity Act, 1972, seeAppendix.The limit laid down under section 4(3) of the Payment of Gratuity Act, 1972 [as amendedby the Payment of Gratuity (Amendment) Act, 1998, w.r.e.f. 24-9-1997] is Rs. 3,50,000.Payment of Gratuity (Amendment) Bill, 2010, has proposed to increase the limit toRs. 10,00,000.35. For the meaning of the expression “each year of completed service”, see Taxmann’s DirectTaxes Manual, Vol. 3.36. Substituted for “calculated on the basis of the average salary for the three yearsimmediately preceding the year in which the gratuity is paid, subject to a maximum of*thirty-six thousand rupees or twenty months’ salary so calculated, whichever is less” bythe Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989.*Substituted for “thirty thousand rupees” by the Finance Act, 1983, w.r.e.f. 1-4-1982.