Holding that dearness allowance cannot be withheld on the plea of financial constraints, the Punjab and Haryana High Court has directed Punjab to release all pending instalments of revised pension, DA arrears and related dues to pensioners of the state government, boards and corporations by April 30 along with 6 per cent interest on delayed payments.
The direction came after Justice Harpreet Singh Brar’s bench, among other things, was told that more than 35,000 pensioners had died since January 1, 2016, awaiting the release of arrears of revised pension. The court clarified that the judgment would operate in rem, meaning its benefit would extend to all similarly situated pensioners across the state, irrespective of whether they had approached the court.
Allowing five connected petitions, Justice Brar directed Chief Secretary to ensure the release of all admissible benefits to eligible pensioners of the state government, boards, corporations and other statutory bodies, before filing a compliance affidavit through a responsible officer within three months from receiving the order. The court further observed that any deviation from the directions would entitle the pensioners to approach the high court for initiation of contempt proceedings
Pensioners’ hardship
The bench was told that the petitioners, in their “sunset years”, were retired employees drawing pension from boards and corporations, with some having retired from Punjab State Power Corporation Limited. The court noted that the state’s reply did not dispute their entitlement to revised pension and arrears of revised DA.
Going into the background of the matter, Justice Brar observed the state constituted the Sixth Pay Commission on December 24, 2016, to examine the revision of salaries and pensions. The panel submitted its report on May 30, 2021, following which the state notified the 2021 Rules on July 5, 2021, providing for payment of arrears from January 1, 2016, to June 30, 2021. The rules were subsequently amended through a notification issued on September 20, 2021.
Justice Brar asserted that more than four years had passed since the notification of the 2021 Rules and more than a year since the Cabinet approved the payment schedule, yet the benefits had not been released in accordance with the schedule.
As such, the dispute did not concern the existence of the right, as the entitlement to revised pension and arrears of DA was not disputed by the state. The issue, it observed, was whether the government could indefinitely defer implementation of statutory and policy decisions despite acceptance of the Pay Commission recommendations and Cabinet approval of the payment schedule.
Cabinet decisions cannot remain in ‘suspended animation’
Justice Brar asserted that the Rules of Business governing the Cabinet decisions required the Chief Secretary forward the decision to the department concerned for prompt implementation, once the Council of Ministers approved it.
Keeping a Cabinet decision “in a state of suspended animation for an inordinately long period”, was not merely a procedural irregularity but contrary to public interest and the statutory scheme of governance. “If decisions taken by the highest executive body are allowed to languish without implementation, the entire exercise of collective deliberation stands reduced to an empty formality,” Justice Brar asserted, adding that undue delay eroded public confidence in the executive process and the rule of law. The bench was assisted by advocates Sunny Singla, Riti Aggarwal, PK Goklaney, Ashish Goklaney, and AS Walia, in addition to senior advocate Vikas Chatrath, along with Sheena Verma, Tanya Bhuri, Monika Sharma, Ashish Gupta and PIP Singh
DA linked to inflation, protects dignity and living standards
Explaining the rationale behind DA, Justice Brar observed that it formed an integral component of the remuneration structure of government employees and pensioners, intended to offset the erosion of purchasing power caused by inflation.
DA operated as a cost-of-living adjustment linked to movements in the Consumer Price Index, enabling employees and pensioners to meet essential expenses such as food, housing, healthcare and education. Justice Brar asserted that timely disbursal of DA assumed considerable significance, as delayed payment defeated its very purpose.
“DA is intended to compensate employees and pensioners at the time when prices rise and not retrospectively after long intervals,” Justice Brar asserted. The bench further said the constitutional philosophy underlying DA flowed from the Preamble’s commitment to social and economic justice, and is reinforced by Articles 14 and 21 of the Constitution, as well as Article 43 of the Directive Principles, which sought to secure a decent standard of life.
DA legally enforceable right
Referring to the law laid down by the Supreme Court, Justice Brar reiterated that DA was a legally enforceable and statutorily recognised right and not a discretionary bounty. “The plea of financial constraints cannot defeat constitutional obligations,” the judge observed, adding that once governing rules provided for payment of DA, the state was under a corresponding obligation to release it.
Final direction
Allowing the petitions, the court directed that all up-to-date instalments in terms of the payment plan approved by the Council of Ministers on February 13, 2025, which had fallen due till February 28, 2025, be released to all pensioners by April 30, along with interest at 6 per cent per annum on delayed payments, and also ordered release of arrears of leave encashment payable till April 2026.