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    Whether the claim of the employees serving under the Government of West Bengal for Dearness Allowance at a rate equivalent to that of the employees of the Central Government

    [See the full post at: Confederation Of State vs The State Of West Bengal & Ors (31/08/2018)]


    Dearness Allowance is a condition of service recognised by ROPA 2009.

    Thus, the inexorable conclusion is that the said Rule 9 of the said Rules of 2009 confers a right on the petitioners to payment of dearness allowance at Central Government rates. A writ of mandamus can be issued for enforcement of rights created by statute. The respondents have prayed for enforcement of statutory rates. Dearness Allowance is a condition of service recognised by ROPA 2009. However, given our writ jurisdiction under Article 226 is a discretionary jurisdiction, it is necessary to consider if a discretion is to be exercised in favour of the writ petition.

    The annual accounts for the period subsequent to January, 2016 shows that the appellants have made substantial profits and the payment of DA at the Central Government rate would cause an insignificant erosion in the profit after tax which was estimated by WBSETCL in the financial year 2017-18 at Rs.43.77 crores and WBSET at Rs.63.13 crores. Even for the earlier periods when the power companies were earning profits much less than the subsequent years DA was paid for such periods at the Central Government rates. The affidavits filed by the power companies does not justify avoidance of the contractual terms towards payment of DA at the Central Government rates that were paid till January, 2016. When there has been a significant rise in the profit earned by the companies the financial inability to make payment towards DA which is a benefit required to be extended to the respondents in terms of ROPA 2009 at the Central Government rate cannot be denied. The financial inability not being established we are of the view that the learned Single Judge was justified in allowing the writ petition. We reiterate that the appellants have not been able to establish its incapability or inability to pay DA at the Central Government rates. We, however, accept the submission on behalf of the learned Advocate General that in the event the companies are able to demonstrate poor financial condition the DA may not be payable at the Central Government rate. The observation of the learned Single Judge to the effect that the DA cannot be denied to the writ petitioners even if the management of two companies can demonstrate poor financial condition has to be read in the context of the observation made in the other paragraphs of the said judgment and not in isolation. However, if it means that irrespective of the financial condition the two companies were obliged to pay DA at the Central Government rate in terms of Clause 5(a) the same would be contrary to law as the DA cannot be equated to basic pay or basic wages. The phrase in Clause 5 that the terms and conditions of service of transfer shall not, in any way, be less favourable than those applicable to them immediately before the said effective date of transfer has to be assessed on the financial ability of the companies after the transfer. DA is a part of the larger component of salary. Salary is bifurcated into basic salary and other allowances of which DA is one to make good of the hardship caused due to rise in prices. DA is introduced to neutralise inflation and the percentage of DA is related to cost of living index or on any acceptable rational basic like AICPI and cannot be fixed arbitrarily by the employer. It must have a nexus to the deprivation of benefits in terms of money suffered due to rise in the cost of living. The appellants also did not say that DA is not payable at all. In the facts and circumstances of these cases having regard to the materials on record we are of the view that the appellant companies are capable of paying DA to the writ petitioners at the Central Government rates under ROPA 2009. [Calcutta High Court (Appellete Side)
    West Bengal State Electricity vs West Bengal State Electricity-17 September, 2021]

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