Thursday, 21 February 2013


Please read in conjunction with previous post

The Background

       From the Fifth Pay Commission Report, Part VII, – Armed Forces Personnel: Pay Scales and Allowances: -

Our Approach in 114.10 ……………… We find that the Third CPC, while considering the issue of shortfall in the intake of the officer cadre had held that "the quality of recruitment to the Armed Forces will be satisfactory only if service pays are comparable to levels of remuneration in civilian employment." Considering all these factors, we have recommended a starting salary of Rs.8250/- p.m. for Commissioned Officers of the Armed Forces giving them an edge over the Civil Services.

Our Recommendations in 145. 17……… However, we have recommended continuance of all the existing concessions and have also recommended an edge in the starting scale to compensate for the special features of military life.

The Present Position in 147.12 Armed Forces officers up to the rank of Brigadier are presently paid on the basis of an integrated pay scale introduced on the recommendations of the Fourth CPC so as to provide reasonable career progression to service officers. To compensate for ranks attained, rank pay is also granted which attracts dearness allowance and is reckoned for pensionary benefits.

Our Recommendations 148.2. We have deliberated over the manner in which service pays should be fixed and in order to ensure equality of treatment suggest that the method of fixation of pay on revision recommended for civilian employees may also be adopted for service personnel. For Service Officers upto the rank of Brigadier who are to be brought on to regular scales of pay from the existing integrated scale, we suggest that for fixation of pay the existing rank pay may be taken into account but pay in revised scales be fixed after deducting the revised amount of rank pay.

Extracted from the Order of the Govt No. 50(1)/IC/97.

       The Fifth Central Pay Commission was set up by the Government of India by Resolution No. 5(12)/E. III/93 dated 9th April, 1994 as amended by Resolution No. 5(12)/E. III/93 dated 12th January, 1995, No. 5(12)/E. III/93 dated 17th July, 1996, No. 5(12)/E, III/93 dated 24th October, 1996 and No. 5(12)/E. III/93 dated 19th November, 1996. The Commission submitted on the 30th January, 1997, its Report relating to structure of emoluments, allowances, conditions of service and retirement benefits of Central Government employees including Union Territories, members of All India Services and personnel belonging to the Armed Forces.

2.       The Commission also submitted its Supplementary Report No. 1 on Improving the motivation Level and Supplementary Report No. 2 on Cabinet Secretariat on 28th February, 1997. The Government have given careful consideration to the recommendations of the Commission in respect of civilian employees of the Central Government in Groups 'A', 'B', 'C' and 'D', as also those in the All India Services and have decided that the recommendations of the Commission in respect of these categories of Central Government employees and All India Services shall be accepted broadly subject to the modifications mentioned below: -

(i) The following six scales of pay (S-1, S-2, S-3, S-4, S-5 and S-13 grades), recommended by the Commission will be improved…………………

(ii) With regard to fixation of pay in the revised scales, the percentage of pre-revised basic pay to be added as fitment shall be 40% as against 20% recommended by the Fifth Central Pay Commission. The other recommendation of the Commission in this regard including the recommendation of one increment as a result of "bunching" (for the fifth stage) has been accepted; however, the fixation shall be made in the manner that every employee will get at least one increment in the revised scale of pay for every three increments.

4. The Commission's recommendations and Government decision thereon with regard to revised scales of pay and dearness allowance for civilian employees of the Central Government and personnel of the All India Services as detailed in the Part A of the Annexure shall be made effective from 1-1-1996.

5. The revised allowances, other than dearness allowance, will be effective from 1st day of August, 1997……


7. Department specific recommendations which arc not included in this Resolution shall be processed by the concerned Department/Ministry and approvals of the Government obtained in consultation with the Ministry of Finance and/or Department of Personnel and Training………….

8. The other recommendations of general nature made by the Commission which are not included in the Annexure are being examined by the Government and decisions thereon will be notified separately. 11. The Government of India wish to place on record their appreciation of the work done by the Commission.

Ordered that the Resolution be published in the Gazette of India, Extraordinary.

Ordered that a copy of the Resolution be communicated to the Ministries/Departments of the Government of India, State Governments, Administrations of Union Territories and all others concerned.

Assessment: - By the time the Gazette notification was to take place, the UoI/MoD etc must have known that Maj A.K. Dhanapalan had filed OP 2448 in 1996 alleging that Rank Pay has been wrongly/wrongfully deducted from the re-fixation on transition from 3rd CPC to 4th CPC.
The Chronology below is self-explanatory

(a) February 1996 – Maj AK Dhanapalan (retd) files OP 2448 of 1996 in High Court of Kerala,

          (b) end 1997 – Govt of India approves Report of the Fifth Central Pay Commission

(c)      19th December 1997 – MoD, with concurrence of Min of Finance issues SAI/SNI/SAFI 2/S/1997 being aware that Maj Dhanapalan has challenged the deduction of Rank Pay etc before re-fixation in transition from 3rd CPC to 4th CPC. It also communicated vide M of D I.D. No. 1(2)/95/D (pay/Sers) dated the same date that due to inability of DMR & F, the printing authority to suffix year 1997 and can only be printed in year 1998.

(d)      Copies are addressed to 1. COAS Office, 2. CNS Office, 3. CAS Office, 4. Pay Commission Cell, Army, 5. Pay Commission Cell, Navy, 6. Pay Commission Cell, Air Force, 7. Director, PS-3, Army HQrs, 8. Director, DPA/NHQ, 9. Director, DPP&R/Air HQrs, 10. DFA (AG), 11. DFA (Navy), 12. DFA (Air P&W), 13. O/O CGDA, 14. All CDAs.

(e)      5th October 1998 - Single Judge of the High Court of Kerala passes judgment in OP 2448 of 1996, that deduction of Rank pay for re-fixation is wrong and asks Respondents 2 (COAS) and 3 (CDAO) to re-fix his pay without deducting Rank Pay.

(f)      1999 – Union of India files a Writ Appeal 518 of 1999 challenging the judgment in OP 2448 of 1996

Query: So, did some one in the Concerned Ministries forget (and it is quite possible, especially where matters concern the Armed Forces) to consider the implications of the judgment of the Single Judge of the High Court of Kerala and commit a contempt of court by continuing with deducting Rank Pay for the re-fixation because the Special Leave to Appeal was not filed till 2005 SLP (CC) 5908/2005 ?

           (g)         Govt of India’s Definition of Rank Pay in the Fifth CPC (reproduced fully)

No. 1(26)/97/I/D(Pay/Services)
Government of India,
Ministry of Defence,
New Delhi-110 011, dated the 29th February, 2000.
The Chief of the Army Staff, New Delhi.
The Chief of the Air Staff, New Delhi.
The Chief of the Naval Staff, New Delhi.

Subject : Removal of anomalies arising from the implementation of the revised pay scales and allowances consequent to the V CPC recommendations – definition of Rank Pay – reg.

I am directed to refer to Instructions No. SAI, SNI and SAFI No. 2/S/98 dated 19.12.1997 and to state that the issue of merger of Rank Pay with the pay scales of the Defence Service officers upto the rank of Brigadier and equivalent has since been reconsidered by the Government in the light of the recommendations of a Committee specially constituted on the above subject and in view of the fact that the Rank Pay cannot be merged with the pay scales for the Defence Service officers and also keeping in view the difficulties being faced by the Defence Service officers with regard to interpretation of Rank Pay, it is clarified that:

"Rank Pay is admissible to the Commissioned Officers of the three Services, holding their rank either in a substantive or acting capacity. It is that element of their pay identified with their Rank, which, in turn, has a relationship with their scale of pay. It is granted separately in recognition of the specific needs of their conditions of service and command structure. It will consequently be taken into account for determining their entitlement to such of those financial benefits, concessions, etc, including retirement benefits, as are directly related to the basic pay or their pay scales."

3. The Army/Navy/Air Force Instructions would be amended accordingly

4. This issues with the concurrence of Ministry of Defence (Fin) vide their U.O.No.
1/77/99-PA dated 23.2.2000.
Yours faithfully.
Sd/- x x x x x x
(RK Grover)
Under Secretary to the Government of India.
DISTRIBUTION : As per standard list of distribution.

(h) 2003 – Division Bench of the High Court of Kerala disposes of WA 518 of 1999 upholding judgment of the Single Judge of the High Court of Kerala in OP 2448 of 1996.

(j)      2005 - UoI/MoD files a Special Leave to Appeal (CC) 5908 of 2005 in the Hon’ble Supreme Court which is dismissed in July 2005.

The Cumulative Consequences for 5th and 6th Pay Commission

Did the Concerned Ministries forget to discuss this aspect, that if the Hon’ble Supreme Court dismisses UoI’s SLP that Rank Pay can be deducted for re-fixation in OP 2448 of 1996, this has applicability to all matters where Rank pay is concerned, whether in the 5th CPC or later?
If the Basic Pay itself has been reduced by the extent of the Rank Pay on 1.1.1986, then the fixation as on 1.1.1996 will be reduced by 40% of the difference i.e. difference between the correct interpretation brought out in the court’s orders and the incorrect interpretation by Concerned Ministries.

Its impact would continue to be felt when the lower figure is multiplied by a factor of 1.86 to arrive at the pay fixation from 1.1.2006. It would adversely affect the Pay Band, Grade Pay, Military Service Pay, and, leave encashment, gratuity as well as pensionary benefits.

So what is the obstinacy displayed by Concerned Ministries in correctly implementing the order of the Hon’ble Supreme Court dated 4.9.2012 instead of making loopholes where they don’t exist?
So why the prevailing confusion created by the GoI/MoD letter dated 27.12.2012?

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