A Supreme Court division bench on Thursday directed the Mamata Banerjee government to immediately clear 25 per cent of the dearness allowance due to the state employees and release on the first instalment of the remainder by March 31.
In his order Justice Sanjay Koral said, “To receive dearness allowance is a legally enforceable right that has accrued in favour of the respondents-employees of the state of West Bengal. Given its incorporation in RoPA Rules, the All India Consumer Price Index (AICPI) is the standard to be followed by the appellant- state of West Bengal for determination of ‘existing emoluments’.”
The division bench comprising Justice Koral and Justice Prashant Kumar Mishra directed the “release of arrears” in accordance with the judgment for the years 2008-2019.
A four-member committee chaired by Justice (Retd) Indu Malhotra, Justices (Retd) Tarlok Singh Chauhan and Gautam Bhaduri and either the Comptroller and Auditor General of India or any other senior most official in consultation with the state government will determine the total amount to be paid, decide on the payment fixture and periodically verify the amounts released.
The committee will have to complete its recommendations by March 6, 2026 and the first instalment of the remainder has to be released by March 31.
A compliance report has to be submitted before the apex court on April 15.
“Dearness allowance is designed to neutralise the impact of inflation. When the cost of essential goods increases, salaries that do not account for the same and remain in a bygone era, often fail to meet the basic needs, leading to a decline in living standards. By way of periodic adjustment to salaries in response to changes in the cost of living, the state attempts to ensure that employment continues to provide economic security. This reflects a core concern of the welfare state that its employees should not be pushed into hardship due to economic forces beyond their control. Put differently, dearness allowance is not an additional benefit but a means to maintain a minimum standard of living,” Justice Koral observed.
“The concept of DA is a distinctly Indian response to the problem of inflation and its impact on wages, developed to safeguard employees against the steady erosion of their real income caused by price rises,” Justice Koral observed.
In 2008, the erstwhile Left Front government constituted the Vth Pay Commission to examine employee emolument and recommend guidelines for granting Dearness Allowance based on the cost of living index.
The commission recommended the state to follow the central government’s practice of releasing two DA instalments every year. The rules were formed in 2009.
The Confederation of State Government Employees moved the West Bengal Administrative Tribunal against delays in the release of DA. The Tribunal dismissed the case in 2017, ruling DA was a prerogative of the state government. A division bench of the Calcutta High Court set aside the Tribunal’s verdict in 2018. The Tribunal then asked the state government to evolve norms and pay all arrears, which the state challenged in the Calcutta High Court.
The Bengal government had fielded Kapil Sibal, Shyam Diwan and Hufeza Ahmadi, while Gopal Subramanian, P.S. Patwalia, Bikash Ranjan Bhattacharya and Karuna Nandy appeared for the employees.
The same bench had in August last year reserved its judgement in the case.
In an interim order passed on May 16, last year the apex court had directed the state government to pay 25 per cent of the dearness allowance to its employees “within three months.”
The Mamata Banerjee government later pleaded with the SC to extend the deadline by six months citing funds constraint.
Since 2022 onwards there have been 18 adjournments on the issue after the Mamata Banerjee government filed an appeal against a contempt proceedings initiated by the Calcutta High Court
An earlier bench of Justice Sanjay Karol and Justice Sandeep Mehta had passed the interim order, bringing to a temporary halt the wait of the employees who endured 18 adjournments on the issue after the Mamata government filed an appeal in 2022 challenging the contempt proceedings initiated against it before Calcutta.
The Confederation of State Government Employees and others challenged the state’s refusal to clear the dues.
Since April 1, 2025 the dearness allowance for Bengal government employees has been fixed at 18 per cent of the basic salary. The gap between the central employees and state is around 40 per cent.
Leader of Opposition in the state Assembly Suvendu Adhikari said the SC order had secured the fundamental rights of the state government employees.
“Mamata Banerjee has been proved wrong today. For years she claimed DA was not a right. The apex court has said DA is not a grant. Despite multiple legal battles which the employees won every time, the state government went on spending crores on hiring legal luminaries to deprive the employees,” Suvendu said.