Gratuity limit under section 10(10)(iii) specified to govern tax-exempt gratuity for eligible retirees and terminated employees. Central Government specifies a capped gratuity amount for the purposes of section 10(10)(iii) of the Income-tax Act, fixing a monetary ceiling to determine the exempt portion of gratuity paid to employees who retire, become incapacitated prior to retirement, die on or after the effective date, or whose employment is terminated on or after that effective date.