Make disability pension tax-free: Service chiefs to govt

NEW DELHI: Disability pension for military personnel should be exempt from income tax only up to a certain limit, while officers of the rank of Major General and above must get their “medical boards” done before retirement from only command hospitals instead of just any military hospital.
These are part of the recommendations sent to the defence ministry for approval by the Army, Navy and IAF chiefs to curb the misuse of disability pensions, with as many as 20% of retiring officers claiming and getting it.
“We are trying to have a mechanism to ensure only the deserving get disability pensions,” said the Army’s outgoing adjutant general Lt-General Ashwani Kumar, before he retired on Thursday.
The NDA government has faced a lot of flak for the finance ministry’s order in June that the disability pension of all military personnel will now be taxed unless they have been forced or “invalidated” out of service prematurely, as was reported by TOI earlier.
The Army headquarters, on its part, initiated the move because “broad banding and higher compensation awarded for disability with tax exemption” has led to a significant rise in personnel seeking it even for life-style diseases. There, for instance, have been a few cases of top military officers getting disability certificates just days before their retirement to get higher pensions.
But faced with a backlash that the misuse of the system by a few personnel should not be used to target all genuine disability cases, the defence ministry is now reviewing the decision to tax disability pensions for all.
The Army, too, is punishing those officers “involved in impropriety in maintaining their medical profiles” as a strong deterrent, said Lt-Gen Kumar. “Around 35% of officers who retire are not found to be in the `Shape-1’ category but lower medical categories. Out of these 35%, around 50-60% ultimately get disability pensions,” he said.