Payment of Dearness Allowance/ DR w.e.f. 01/01/2020, 01/07/2020 and 01/01/2021 with arrears

Payment of Dearness Allowance/ DR w.e.f. 01/01/2020, 01/07/2020 and 01/01/2021 with arrears: Shiva Gopal Mishra writes to Cabinet Secretary

No. NC-JCM-2021/CS/PM/(DA)

July 17, 2021

The Cabinet Secretary,
Government of India,
&
Chairman,
National Council JCM

Sub:- Payment of Dearness Allowance/ DR w.e.f. 01/01/2020, 01/07/2020 and 01/01/2021 with arrears

Dear Sir,

At the outset we are grateful to the Government that after considering the repeated representations made by the Staff Side including in the National Council – JCM meeting held under your Chairmanship on 26/06/2021, the Government have now decided to release the DA/DR to Central Government Employees and Pensioners w.e.f 1/07/2021. Accordingly the DA / DR has been increased to 28% representing an increase of 11% over the existing rate of 17% of Basic Pay / Pension. The increased DA / DR is actually due from 1/1/2020, 01/07/2020 and 01/01/2021, however it is regretted to note that the Government has decided that the rate of Dearness allowance / DR for the period 01/01/2020 to 30/06/2021 shall remain at 17%. This is not at all justified, since the DA/DR is a part of the wages of the employees and pension of the pensioners and any arbitrary recovery of the same will amount to illegal recovery of wages and pension. It is also pertinent to mention here that the employees who retired from service between 01/01/2020 and 30/06/2021 are subjected to huge financial loss in their gratuity and leave encashment for no fault of theirs since they are all denied the benefit of DA due to them. In the last National Council – JCM meeting the Staff Side demanded for payment of the three installments of DA / DR due to the employees/ Pensioners with arrears w.e.f 01/01/2020. The staff Side also proposed that the Staff Side is prepared to discuss about the mode of arrears payment.

Here we would like invite to your kind attention to the Judgment of the Hon’ble Supreme Court of India delivered on 08/02/2021 in Civil Appeal No. 399 of 2021 (Arising out of SLP (C) No. 12553 of 2020. The Hon’ble Supreme Court has decided that salaries and pension constitutes the right full entitlement of the employees and are payable in accordance with law. The relevant portion of the Judgment is given below for your kind ready reference

“14. The direction for the payment of the deferred portions of the salaries and pensions is unexceptionable. Salaries are due to the employees of the State for services rendered. Salaries in other words constitute the rightful entitlement of the employees and are payable in accordance with law. Likewise, it is well settled that the payment of pension is for years of past service rendered by the pensioners to the State. Pensions are hence a matter of a rightful entitlement recognized by the applicable rules and regulations which govern the service of the employees of the State. The State Government has complied with the directions of this Court for the payment of the outstanding dues in two tranches. Insofar as the interest is concerned, we are of the view that the rate of 12% per annum which has been fixed by the High Court should be suitably scaled down. While learned counsel for the respondents submits that the award of interest was on account of the action of the Government which was contrary to law, we are of the view that the payment of interest cannot be used as a means to penalize the State Government. There can be no gainsaying the fact that the Government which has delayed the payment of salaries and pensions should be directed to pay interest at an appropriate rate.

15. We accordingly order and direct that in substitution of the interest rate of 12% per annum which has been awarded by the High Court, the Government of Andhra Pradesh shall pay simple interest computed at the rate of 6% per annum on account of deferred salaries and pensions within a period of thirty days from today. This direction shall, however in the facts and circumstances, be confined to categories 3, 4, 5 and 6 of GOMs No 26 dated 31 March 2020. We clarify that interest shall be paid to all pensioners of the State at the rate of 6% per annum on the deferred portion, for the period of delay. Having regard to the prevailing bank interest, the rate of 12% per annum which has been fixed by the High Court, would need to be and is accordingly reduced.”

In view of the above judgment of the Hon’ble Supreme Court the law is now established that Government cannot permanently freeze the salary and the pension. Therefore the frozen three installment of DA/DR due from 01/01/2020, 01/07/2020 and 01/01/2021 i.e. additional 4% from 01/01/2020, 7% from 01/07/2021 and 11% from 01/01/2021 may please be paid as arrears to the employees and pensioners. You will also appreciate that the arrears amount will increase the cash inflow in the market which will ultimately benefit the economy of the country. A copy of the Hon’ble Supreme Court Judgment dated 08/02/2021 is enclosed with this letter for your kind perusal.

Shiv Gopal Mishra

Secretary Staff Side

JCM National Council

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