Defence minister Rajnath Singh said on Monday the government is rethinking its notification about taking away tax benefits from veterans, who have disability pension but have served their full term, that has become a contentious issue.
The defence minister also told the Rajya Sabha that “no soldier with a disability will be inconvenienced”.
“A clarification has been sought from the Central Board of Direct Taxes (CBDT) and the issue is being re-examined by the ministry,” the defence minister said while answering a question raised in the Upper House.
The government had announced last month through CBDT that disability pension will be taxed if the soldier had served his full term with the three services – Indian Navy, Indian Army and Indian Air Force. The CBDT notification had said that only those who were “invalidated” from service because of disabilities during their service will continue to get tax benefits.
Tax-free disability pension was brought in 1922 by the British.
The government’s order, allegedly to stop misuse of disability pension, has annoyed the veterans as well as the serving soldiers. There are nearly 25 lakh veterans.
Answering a separate question on whether there was an intelligence failure that led to the suicide attack in Kashmir’s Pulwama on February 14, Singh told the House that the probe by the National Investigative Agency (NIA) is “still on.” The Union home ministry will inform the house once the investigation is over into the attack in which 40 troopers of the Central Reserve Police Force (CRPF) were killed.
The minister also defended the government’s decision to disinvest stakes in Bharat Earth Movers Limited (BEML) – a Defence Public Sector Unit (DPSU). He said the strategic investment will bring more “professional competency.”