Yes, the pension is taxable under the head income from other sources subject to some exemption.
Pension received by a family member taxed under income from other sources in their Income Tax Return. If this pension is commuted or is a lump sum payment then it is not taxable.
However, if the total income exceeds the maximum exemption limit then she is required to file IT return. The maximum exemption limit for an individual below 60 is Rs. 2,50,000; for senior citizens between the age of 60 and 80 years it is Rs. 3,00,000 and for 80 years or above it is Rs. 5,00,000.
Uncommuted pension received by a family member is exempt up to Rs 15,000 or 1/3rd of the uncommuted pension received; whichever is lower. Pension received by family members of the Armed Forces is also exempt.