The Centre has raised the income tax exemption limit on gratuity from Rs 3.5 lakh to Rs 10 lakh with effect from May 24.According to a release issued by Finance Ministry in New Delhi on Friday, employees who become incapacitated, terminated, or who die on or after May 24, 2010, will get I-T exemption for gratuity up to Rs 10 lakh. The Finance Ministry notified a rule in this regard. Earlier, Parliament had approved raising the limit of gratuity to be exempted from income tax. The Payment of Gratuity (Amendment) Bill, 2010, was passed by Parliament in this regard in the Budget Session.While the Sixth Pay Commission had raised the limit for Central Government employees, the Cabinet later enhanced the ceiling for the private sector workforce as well.