Delay in disbursement of revised Salary, Salary Arrears and relief under section 89(1) of Income Tax Act

Ref. No: AIJKBOF/2021- 01                                                         

The President,

HRD Division,

Corporate Headquarters,

M.A.Road, Srinagar, Kashmir.

January 11, 2021

Subject:  Delay in disbursement of revised Salary, Salary Arrears and relief under section 89(1) of     

              Income Tax Act.

Sir,

As you are quite aware that final round of discussions successfully concluded between IBA and different National level Officers Associations under the banner of UFBU on 11^th November, 2020, on Salary Revision for officers and accordingly an increase of 15% on the wage bill as on 31.03.2017 was agreed. The workforce of the banks is as such is entitled for arrears in salary from 01.11.2017 till the revised salary in accordance with the above reffered to agreement is disbursed. 

Based on the said agreement plus internal agreements reached between the Managements and Assocaitions, banks have already disbursed the revised salary to its workforce together with arrears due w.e.f 01.11.2017 and we were also expecting disbursement of revised salary from the Month of November, 2020 but we regret in informing you that inexplicable delay has been caused in disbursing the revised salary to the workforce of our bank which has resulted in confusion and dissatisfaction, we believe that non-satisfaction of workforce will have a bearing effect on the production. It is an accepted fact that human capital of our bank has always done miracles in  hard, harsh and adverse circumstances, be it Hartals and curfews, demonetization, incessant customer serves during pandemic together with exceptionally hard work for growth and turnaround of the bank. Strenuous efforts in all areas have been time and again appreciated by none other than the Chairman and MD of our bank. Therefore, the Management should equally reciprocate the arduous efforts of the workforce and prioritized the issue and ensured early disbursement of the revised salary.

We are hopeful that serious efforts will be made in this regard and salary for the current month will be disbursed on revised terms and conditions. Meanwhile, it is reminded that to save any additional burden of tax due to delay in receiving salary in arrears, the tax laws allow a relief under section 89(1) of Income Tax Act, which in simple words mean that a person do not have to pay more taxes if there was a delay in payment to him/her and he/she was in a lower tax bracket for the year he/she received the money. You are requested to kindly take cognizance of the said relief clause of Income Tax Act while disbursing arrears to workforce.

Apart from above, it is to bring your kind notice that while circulating the agreed items of the 11^th Bipartite Settlement reached between IBA and UFBU, Specific mention with regard to retrospective effect i.e. from the calendar year 2020 in respect of extension of benefit of newly introduced Annual Encashment of Privilege Leave be made in the circular. The said clause of the agreement reads as under;

“From the Calendar year 2020, Privilege leave Encashment shall be permitted at the rate of 5 days for each calendar year at the time of any festival of the employee’s choice. Employees who have completed 55 years of age as on 01.01.2020 and above shall be entitled to encash at the rate 7 days for each calendar year, till retirement as a one-time measure.”  

Prompt action for disbursement of revised salary, salary arrears is solicited.

Yours Sincerely

 (Syed Jameel Qadri)

 Secretary, AIJKBOF        

Copy to

1. Vice-President HRDD, Corporate Headquarters, M. A.  Road, Srinagar Kashmir for kind information.
2. Industrial Relations Officer, Corporate Headquarters, M. A.  Road, Srinagar Kashmir.

(Syed Jameel Qadri)

 Secretary, AIJKBOF