Excluding ISDA for Tax calculation

To

The Chief Secretary,

Andaman and Nicobar Administration,

Port Blair.

Sir,

As you may kindly be aware, the Island Special Duty Allowance has been included in the taxable income while calculating income tax for the government employees working in Andaman and Nicobar Islands. Some kind of confusion prevails among the DDOs and employees about the nature of this allowance for the purpose of excluding it from the taxable income.

The Island Special Duty Allowance is also being granted to the employees working in the Lakshadweep. Recently, we have received a copy of the Circular/Corrigendum dated 13^th November, 2009 issued by the Accounts Officer, Finance & Accounts Department, Secretariat, Administration of the UT of Lakshadweep by which it has been clarified that the ISDA is an exempted allowance under section 10 (14) for the purpose of deduction of income tax from salaries during the year 2009-2010 (a copy enclosed herewith for kind reference).

I would, therefore, request you kindly to examine this matter and issue a clarification, on the lines of clarification issued by the Lakshadweep Administration, so that ISDA can be exempted from the taxable income which will of immense relief to thousands of government employees working in these islands.

Yours faithfully,

Encl: As above.

(D. Ayyappan)

General Secretary