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10) Union of India has filed its affidavit giving justification for the aforesaid course of action. In this regard, it is submitted that vide Finance Act (No.2), 1998, Section 80DD was substituted for Sections 80DD and 80DDA. The earlier Section 80DD provided for a deduction of Rs.15,000/- to an individual or HUF on account of any expenditure incurred for the medical treatment (including nursing), training and rehabilitation of a dependant relative of an individual or member of HUF. The substitution was done to provide for composite Section in respect of deduction for expenditure on medical treatment, rehabilitation etc. and for payment made under a scheme of LIC or any other insurer for the dependant disabled person. Submission is that in effect Section 80DD amalgamates the provisions of the two sections, namely, 80DD and 80DDA. Thus, both erstwhile Section 80DDA and present Section 80DD provide that the annuity or lump sum amount for the benefit of the dependant who is a person with disability will be disbursed only after the death of the subscriber. Jeevan Aadhar scheme of LIC has been designed keeping in mind the tax benefits under Section 80DDA/80DD of the Act.

"Rationalisation of benefits available to parents and guardian of physically handicapped and disabled dependant.

Under the existing provisions of section 80DD, a deduction of Rs.15,000/- is allowed to an individual or Hindu Undivided Family in respect of expenditure incurred on medical treatment of a handicapped dependant. Section 80DDA allows for a separate deduction to a parent or guardian in respect of deposits upto Rs.20,000/- made specified schemes of Life Insurance Corporation or Unit Trust of India. It has been felt that the parents or guardian of handicapped dependants may not have to incur expenditure on medical treatment of a handicapped dependant every year. However, the parent or the guardian would always feel the need to provide for the future maintenance of the disabled dependant. The existing provisions do not take such situations into account. In order to allow a choice to the parent or the guardian to spend either on the medical treatment of or for the future need of the handicapped dependant, as the case may be, the Bill seeks to provide a new section 80DD. With this provision, the parent or the guardian could claim a deduction upto Rs.40,000/- for the medical treatment and for future needs of the handicapped dependant in the manner most suited to his needs. The existing sections 80DD and 80DDA would get consequentially merged with increase in overall limit of deduction from Rs.35,000 to Rs.40,000/-.”

15) At the outset, it may be observed that Section 80DD of the Act is a provision made by the Parliament under the Act in order to give incentive to the persons whose dependants are persons with disability. Incentive is to give such persons concessions in income tax by allowing deductions of the amount specified in Section 80DD of the Act in case such parents/guardians of dependants with disability take insurance policies of the nature specified in this provision. Purpose is to encourage these parents/guardians to make regular payments for the benefit of dependants with disability. In that sense, the Legislature, in its wisdom thought it appropriate to allow deductions in respect of such contribution made by the parent/guardian in the form of premium paid in respect of such insurance policies. Of course, this deduction is admissible only when conditions stipulated therein are satisfied.

18) Further, such a benefit of deduction from income for the purposes of tax is admissible subject to the conditions mentioned in Section 80DD of the Act. The Legislature has provided the condition that amount/annuity under the policy is to be released only after the death of the person assured. This is the legislative mandate. There is no challenge to this provision. The prayer is that Section 80DD of the Act be suitably amended. This Court cannot give a direction to the Parliament to amend or make a statutory provision in a specified manner. The Court can only determine, in exercise of its power of judicial review, as to whether such a provision passes the muster of the Constitutional Scheme. Though, there is no specific prayer in this behalf, but in the body of writ petition, argument of discrimination is raised. Here, we find that the respondents have been able to successfully demonstrate that the main provision is based on reasonable classification, which as a valid rational behind it and there is a specific objective sought to be achieved thereby.