In State of West Bengal & Ors. v. Confederation of State Government Employees, West Bengal & Ors., the Calcutta High Court held that the right of Dearness Allowance is to sustain livelihood, and therefore, has elevated to become a fundamental right under Article 21 of the Constitution. While deciding upon the validity of the impugned order of the Tribunal, the Court was faced with question-whether Dearness Allowance is a legally enforceable right? A major grievance of most of the associations of employees has been non-payment of the D.A instalments in time (as per of Government of India’s announced policy, this is payable twice a year viz., w.e.f. 1st January and 1st July each year). They are also aggrieved because of non-payment of arrears.
- We are of the opinion that with some extra effort the State Government should be in a position to clear the backlog of the lone instalment which was sanctioned by the Government of India w.e.f July 1, 2008, and then fall in line with the Central Government pattern of sanctioning two instalments of D.A each year. We recommend this course of action. If it is done, it will mitigate a long-standing grievance of almost all employees within our terms.”
Whether dearness allowance is a legally enforceable right?
- The Court observed that the Tribunal has passed a sustainable order by holding that dearness allowance is a legally enforceable right.
- The Court further went on to say that Dearness Allowance as a right of the employees to sustain their livelihood has elevated as a fundamental right under Article 21 of the Indian Constitution.
Whether classification between employees subjected to the same statutory rules is discriminatory?
- Based on the decision of D.S. Nakara v. Union of IndiaAIR 1983 SC 130, the High Court also held that classification of the State government employees in West Bengal and State government employees in Delhi and Chennai, being subject to the same statutory rules is discriminatory, and has no intelligible differentia, and therefore, violates Article 14 of the Indian Constitution.
Dearness Allowance
- The concept of Dearness Allowance and its horizon is a unique feature to combat the disparity in the living conditions and mitigating the circumstances faced by the Government employees due to cost inflation. The different countries in the world have tackled the inflation by revision of wages instead of granting the Dearness Allowance.
- The Dearness Allowance in our country is a relic of 1st World War to tackle the rise of costs impacted upon the living standards by not using the same terminology but in the form of an ad-hoc payment not linked with the inflation of the cost of living. During this 2nd World War, the Dearness Allowance (“DA”) was introduced in the form of a grain compensation allowances to recompense the employee of the hardships suffered for the rise in the price of the foodgrains and after the independence, the then Central Government constituted the 1st Pay Commission in 1947 to examine the base structure and ascertain the actual hardship which the Central Government employees suffered because of the steep rise in the cost of living, commonly known as the inflation.
- The Committee was also set up on fair wages to evaluate the situation and recommend the suggestive measures which was constituted in the year 1949. In the same line the 2nd Pay Commission was constituted in the year 1959 and, thereafter, a one man independent committee was constituted to enquire the question of Dearness Allowance that may be payable to the Government employees and the report was submitted by such one man committee in the month of July, 1966; the same was followed by an another commission i.e., the Dearness Allowance Commission to examine the principles governing the grant of DA to the Central Government employees in future and also make recommendations pertaining to the modalities and the acceptable structure or the formula to calculate the DA in future.
- Since thereafter, the aforesaid modalities have been adopted by constituting Pay Commission from time to time and the reports suggesting the modalities on well-structured parameter was being accepted either in entirety or with certain modifications. Ironically and historically, the observations of the various commissions and the committees the DA was made applicable to the employees who are at the subsistence level or just above it in order to enable them to sustain the cost of living. Initially, the commission and committees were taking into various factors but concentrating on the rise in the essential commodities which by passage of time and the progression in the society the concept of DA changes to engulf various factors imbibing wide range of the commodities to make the life meaningful and/or maintain the living standard as far as practicable depending upon the compelling limitations of general interests.
- What was the luxury at one point of time prevalent in the Indian society have become a necessity in future and what was the necessity has become a basic need in the changing society and, therefore, the concept of the DA has become more robust and all the Governments are obligated to compensate the loss in the cost of living and ensure the quality life not to be luxurious or extravagant but on mere sustenance. Initially, the DA was intended to be temporary arrangements or a transitional protection but because of the stark reality of the situation and the continuous rising of inflation impacting on the potential and efficacies of the employees in meeting various vicissitudes of the life and, therefore, cannot be perceived to be static.
- In federal system, the Union of State and its independence as envisioned in the Constitution, the State Government from time to time, in tune with the Central Government, constituted the Pay Commission to evaluate the inflation in the cost of living to the State Government employees by adopting a different formula which sometimes raises the disparity.
- DA to be calculated on the basis of the All India Consumer Price Index average
- The Calcutta High Court concluded its decision by holding:
- “…the petitioners are directed to release the Dearness Allowance and Arrear Dearness Allowance to its employees at the rate to be calculated on the basis of All India Consumer Price Index average 536 (1982=100) commensurate with their pay as per the ROPA Rules, 2009 as directed by the Tribunal within 3 months from date.”
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