Delhi HC dismisses plea challenging Centre's decision to freeze hike in dearness allowance

The Delhi High Court on Monday dismissed a plea challenging the Centre's decision to freeze the dearness allowance (DA) of public servants and pensioners in the wake of the COVID-19 pandemic. The HC said that the government has the power to take such a decision.

A bench of justices Vipin Sanghi and Rajnish Bhatnagar said under the All India Services (Dearness Allowance) Rules, 1972, entitlement to draw DA is determined by the central government and it can impose whatever conditions it deems fit from time to time. The court also said there is no statutory obligation on the Centre to continue to enhance the DA or Dearness Relief (DR) at regular intervals i.e. to revise the same upwards from time to time. With regard to the proposed four-per cent hike in DA, the bench said the government was not taking it away, it was only postponing it till July 1, 2021 and it had the power to do so.

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The petition had also opposed the Centre's decision to delay the proposed four-per cent hike in DA till July 2021 in view of the COVID-19 crisis. The petition had also contended that reduction of salaries and allowances could be done at a time of a financial emergency, which was not the case presently.

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Increase in dearness allowance and dearness relief

In September last year, the Centre increased in the dearness allowance (DA) for central government employees and dearness relief for Central government pensioners by 1 per cent to 5 per cent, benefiting 50 lakh employees and 61 lakh pensioners. "Release of additional installment of DA is an increase of 1 percent over the existing rate of 4 percent of the basic pay/pension, to compensate for price rise. The new rate will be applicable from July 1," the official statement stated. On March 13, the Cabinet approved the hike. However, on April 23, the Ministry of Finance postponed the hike from January 2020 till June 30, 2021, in view of the COVID-19 pandemic. 

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(with PTI inputs)