Supreme Court Orders West Bengal to Pay 11-Year DA Arrears to State Employees

While constituting a high-level committee to finalise a binding payment schedule, a Bench of Justices Sanjay Karol and Prashant Kumar Mishra partly upheld the 2022 Calcutta High Court judgment, which had ruled in favour of state government employees and directed payment of DA at par with Central government employees.

Pronouncing the verdict on appeals filed by the West Bengal government, the Apex Court held that once DA is defined in the West Bengal Services (Revision of Pay and Allowances) Rules, 2009 (ROPA) by linking it to the All-India Consumer Price Index (AICPI), the state government could not alter the manner of its calculation through subsequent office memoranda.

"To receive a Dearness Allowance is a legally enforceable fact that has accrued in favour of the employees of the State of West Bengal," the Justice Karol-led Bench observed, adding that the AICPI, as incorporated in the ROPA Rules, was the standard to be followed for determining DA.

However, the Top Court partly allowed the state government's appeals by holding that employees were not entitled to receive DA twice a year merely because the Central government followed such a pattern.

Rejecting the argument that the state government's financial constraints could justify the denial of DA, the Supreme Court held that fiscal policy could not override accrued legal rights.

"Once there is a right which is conferred upon a person, then fiscal policy cannot come in the way of the disbursement of such rights," the Justice Karol-led Bench said.

The Apex Court directed that employees would be entitled to arrears of DA from 2008 to 2019 and clarified that any amount paid pursuant to interim orders or the present judgment would not be recovered, even if there was a subsequent change in law.

It further constituted a committee to monitor the implementation of its directions and to balance employees' statutory rights with the state government's financial autonomy.

The committee will be chaired by former Supreme Court judge Justice Indu Malhotra and will include former Jharkhand High Court Chief Justice Tarlok Singh Chauhan, former judge Gautam Bhiduri, and the Comptroller and Auditor General of India or a senior officer nominated by the CAG. The committee has been tasked with determining the total amount payable and fixing a phased payment schedule in consultation with the state government. The Apex ourt directed that the exercise be completed by March 6, 2026, with the first instalment to be released by March 31, 2026.

The Supreme Court further directed the West Bengal government to extend full logistical support to the committee and bear all related expenses. The committee will submit a final status report after payment of the first instalment, detailing the payment schedule and the status of compliance.

- IANS