Why to pay tax on income of PF & other funds after retirement ?

Your concern is genuine and therefore certain exemption in form of tax slab has been given by the Income Tax Act. Senior citizen are not liable to tax upto Rs 240000.00 etc However a person having income more than a minimum amount not liable to tax must give tax on excess income. There is nothing wrong in it. Furher govt is making rule to exempt person having salary/pension income earner from depositing even income tax return if their income is less than Rs 5 lacs. As a good citizen we must abide the rule at present.