The government today notified doubling of the limit of tax-free gratuity to Rs 20 lakh in private sector.
The notification follows changes in the Payment of Gratuity Act which had empowered the government to fix the ceiling of the retirement benefit through an executive order.
The amendment bill approved by Parliament earlier in the month had also empowered the government to fix the period of maternity leave.
Accordingly, the central government has fixed the total period of maternity leave in the case of a female employee to 26 weeks.
After implementation of the 7th Central Pay Commission, the ceiling of tax-free gratuity amount for the central government employees was increased from Rs 10 lakh to Rs 20 lakh. The unions have been demanding for inclusion of the change in the Payment of Gratuity Act.
So far, formal sector workers with five or more years of service are eligible for Rs 10 lakh tax-free gratuity after leaving job or at time of superannuation.
penalties
• An employer contravening the provisions of Sec.4(1) or (2).
• Fine upto Rs.500 for first offence and for every subsequent offence fine Rs.1000.
• If any person – • Required to furnish any information or return –
• Refuses or neglects to furnish such information or return, or
• Furnishes or causes to be furnished any information or return which he knows to be false, or
• Refuses to answer, or gives a false answer to any question necessary for obtaining any information required to be furnished under section 5; or
• Impedes the right of access to relevant records or documents or the right of entry conferred by section 6; he shall be punishable for the first offence with fine upto Rs.250 and for every subsequent offence with fine upto Rs.250 and for every subsequent offence with fine upto Rs.500.
• Fine upto Rs.500 for first offence and for every subsequent offence fine Rs.1000.
• If any person – • Required to furnish any information or return –
• Refuses or neglects to furnish such information or return, or
• Furnishes or causes to be furnished any information or return which he knows to be false, or
• Refuses to answer, or gives a false answer to any question necessary for obtaining any information required to be furnished under section 5; or
• Impedes the right of access to relevant records or documents or the right of entry conferred by section 6; he shall be punishable for the first offence with fine upto Rs.250 and for every subsequent offence with fine upto Rs.250 and for every subsequent offence with fine upto Rs.500.
