I have worked in a Public Sector Undertaking for 30 years and retired from 31/5/17. While calculating the leave encashment, I received an exemption of Rs 3 lakh from my employer out of the total encashment of Rs. 12 lakh at the time of superannuation. The remaining balance i.e (Rs. 9 lakh) was taken as income for Income tax purpose.
My question is, since Public sector Undertaking is practically government of India, should'nt the entire encashment at the time of retirement be exempt income?
Jan. 12, 2018