Finance Minister Nirmala Sitharaman’s office on Wednesday put out a statement from the Army that said disability pensions of armed forces personnel have been taxed due to the rise in those seeking disability, even for lifestyle diseases, and that this has led to exploitation of the mechanism in place. The statement added that the interests of soldiers was its top priority.

Some Twitter users have noted that the Army’s statement was not released by the defence ministry, but the finance ministry. Nirmala Sitharaman was defence minister till May, when the ruling Bharatiya Janata Party was re-elected.

“The broad banding and higher compensation awarded for disability with tax exemption has over the years led to personnel seeking disability, even for life style diseases,” the Army’s statement said. “The trend if not checked at this stage, is a cause for worry, as Army cannot have large number of personnel with medical disabilities in the rank and file, when the security challenge to the Nation are on the rise.”

Armed forces personnel who suffer any kind of disability due to their service receive a separate disability pension. On June 24, however, the Central Board of Direct Taxes came out with a circular that mentioned that disability pension will be taxable. The circular stated that the tax exemption would continue to be available to those who are “invalidated” out of service on the account of a bodily disability that happened due to or aggravated by their term of service. But it said the tax exemption will not be available to personnel with a disability who retire after a full term of service.

The matter gained more attention when Major General Ian Cardozo, who had lost his legs in the 1971 war and continued in service, expressed his resentment at the circular. “The General officer inspite of his disability, has never in his service career in the Army sought shelter for disability and continued to serve in the Army with complete dedication and rose to the rank of Major General,” the Army said. It said Cardozo was provided with all the required assistance and is supported by the Army even after retirement.

“Unfortunately, some veterans feel that the courage and valour displayed by soldiers wounded in battle, should be compensated for their courage by mere financial remuneration,” the circular added. “Such remuneration alone cannot compensate for their disabilities.”

“This aspect is being exploited by those unscrupulous personnel, who have gained from disability benefits provided by the Govt to disabled soldiers,” the circular added. “The Army is concerned about all the personnel who because of their disability are boarded out of service and therefore need additional financial support.”

“At the same time, those who have found the leverages in the existing system for seeking financial gains through their disabilities, need to be scrutinised and taken to task, where ever necessitated,” it said in its conclusion.

On June 28, the Opposition had discussed the matter in the Lok Sabha. Defence Minister Rajnath Singh said that the government would look into the new made changes in disability pension.

Armed forces veterans have said that the move took place on the recommendations of the Army, Indian Air Force and Navy, according to The Economic Times.

“There is a lot of acrimony about the withdrawal of IT [income tax] Exemption for disabled personnel,” Commodore Sudheer Parakala (retired) told The Economic Times. “I came back from London and checked with the FM [finance minister] whether it was done by her ministry. It is clarified that it was done on the recommendations of Service HQs [headquarters] and not initiated by her ministry”.