Enhancement of Income Tax exemption limit in the case of Running Staff in Railways
National Federation of Indian Railwaymen
3, CHELMSFORD ROAD, NEW DELHI – 110 055
Indian National Trade Union Congress (INTUC)
International Transport Workers’ Federation (ITF)
No. II/58/Part II
The Secretary (E),
Sub: Enhancement of Income Tax exemption limit in the case of Running Staff in Railways-reg.
Ref: (i) NFIR’s PNM item no. 39/2012.
(ii) Railway Board’s O.M. No. F(X)I-2014/23/4 dated 23/05/2014 & 08/05/2015.
(iii) Ministry of Finance, Department of Revenue, CBDT (TPL Division)’s O.M No. 149/21/2013 TPL dated 23/07/2015 addressed to Railway Board.
On perusal of contents of O.M. dated 23/07/2015, (addressed to the Railway Board by Department of Revenue, CBDT TPL Division), copy handed over to the NFIR during the PNM meeting held on 819`” October 2015, Federation felt disappointed that the view of CBDT is unconvincing as the points raised by the Federation in the PNM agenda Item No, 39/2012 have not been taken into consideration. As a matter of fact, the CBDT has generalized the issue ignoring the Federation’s demand seeking revision of tax exemption to the specific category of Running Staff of Railways.
2. Federation however re-iterates below the key points for making proper reference by the Railway Ministry to the MoF/CBDT:-
- In para 1507 of IREC-Vol II (sixth Edition 1987/2″ Reprint Edition 2005), it has been stipulated that the Running Allowance is granted to the Running Staff for the performance of duty directly connected with charge of moving trains and includes “kilometerage allowance” or “allowance in lieu of kilometerage” and is paid on the kilometerage basis.
- The argument of CBDT that the exemption limit was raised from Rs. 6000 to 10,000 p.m. which takes care of progressive requirement of employees working in the different transport sector including Railway employees is not relevant as the revision of exemption sought pertains to Running Staff. Federation’s demand is that when the rates of kilometerage allowance of Running Staff on Indian Railways have been enhanced on DA reaching 50% of pay w.e.f. 01/01/2011 and again on reaching 100% as on 01/01/2014, the exemption limit of Income Tax correspondingly needs to be enhanced retrospectively as there is T.A. component in the kilometerage amount. Therefore, the present exempteq. amount of Rs. 10,000/- is grossly insufficient particularly in the context of upward revision of the rates of T.A which are not taxable.
- The CBDT’s view that moderation of tax rates by way of increase in the basic exemption limits and widening of tax slabs has raised every individual’s exemption limit is not relevant to the issue raised by NFIR seeking revision of exemption limit in the case of Running staff in Railways.
NFIR, therefore, requests the Railway Board to write back to MoF/CBDT duly highlighting that “kilometerage amount paid to Running staff includes T.A. component towards out of pocket expenses” and urging for approval for upward revision of tax exemption limit from the existing Rs. 10,000/- to Rs. 20,000/-
(Dr. M. Raghavaiah)