Del HC | Central Govt. empowered to postpone payment of Dearness Allowance: Challenge to Union’s decision of postponing payment of DA rejected

Delhi High Court: A Division Bench of Vipin Sanghi and Rajnish Bhatnagar, JJ. held that it is well within the domain of the Central Government to decide as to when to disburse the Dearness Allowance (“DA”) and Dearness Relief (“DR”).

The Bench was hearing a writ petition filed in public interest which challenged the Office Memorandum (“OM”) dated 23rd April 2020 issued by the Ministry of Finance, Government of India. Vide the said OM, the Government of India had decided to freeze the DA to Central Government employees and DR to Central Government pensioners at current rates till July 2021. The said OM, in effect, conveys the decision of the Central Government that DA due to the Central Government employees and DR due to the Central Government pensioners from 1-1-2020 shall not be paid. It also states that additional instalment of the DA and DR due from 1-7-2020 and 1-1-2021 shall also not be paid. Pertinently, DA and DR at the current rates would continue to be paid. The said OM further states that as and when the decision to release future instalment of DA and DR due from 1-7-2021 is taken by the Government, rates of the DA and DR as effective from 1-1-2020, 1-7-2020 and 1-7-2021 will be restored prospectively, and will be subsumed in the cumulative revised rate effective from 1-7-2020. No arrears from the period 1-1-2020 till 30-6-2021 shall be paid.

Subsequently, an order dated 24th April 2020 was passed by the Government of NCT of Delhi whereby it followed suit in terms of the Central Government’s OM dated 23rd April. This order was also challenged in the present writ petition.

Dr Pradeep Sharma and Harsh, Advocates, appeared for the petitioner. While, the Union Ministry of Finance was represented by Jasmeet Singh, CGSC, and the Delhi Government was represented by Shobhana Takiar, ASC.

Examining the submissions, the High Court referred to the All India Services (Dearness Allowance) Rules, 1972 which govern the payment of DA and DR to Central Government servants and pensioners. Referring to Rule 3 thereof, the Court noted that:

… firstly, there is no statutory rule which obliges the Central Government to continue to enhance the Dearness Allowance or Dearness Relief at regular intervals i.e. to revise the same upwards from time to time. Consequently, there is no vested right in the Central Government Employees, or Central Government Pensioners to receive higher Dearness Allowance or Dearness Relief on regular intervals.     

It was also noted that, by the impugned OM, the Central Government has frozen – and not withdrawn, the DA and DR being paid to Central Government employees and pensioners at the time of issuance of the said OM. So far as the increase of 4% DA or DR with effect from 1-1-2020 is concerned, the impugned OM does not seek to take it away. All that it does is to postpone its payment till after 1-7-2021. That power resides with the Central Government by virtue of Rule 3 of the 1972 Rules.

In view of such reasons, the Court did not find any merit in the petition and accordingly dismissed it. [Hitesh Bhardwaj v. Union of India, WP (C) No. 3308 of 2020, dated 1-6-2020]

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