The Supreme Court directed the Centre on Tuesday to re-fix the pay of about 20,000 Defence officers from January 1, 1986, without deducting the rank pay and to pay them arrears.
A three-judge Bench of Justices R.M. Lodha, T.S. Thakur and Anil R. Dave also directed the Centre to pay six per cent interest from January 1, 2006 to all the officers, irrespective of whether they had filed petitions before any of the High Courts or Benches of the Armed Forces Tribunal, within 12 weeks from Tuesday.
The Bench directed that all pending petitions before High Courts or Benches of the Armed Forces Tribunal by similarly placed officers would be governed by this order. The Bench rejected the Centre’s application seeking the recall the order of the Kerala High Court, which in October 1998 found no justification in deducting the rank pay and directed the Centre to re-fix the pay.
The core issue is the wrong fixation of rank pay awarded by the Fourth Pay Commission. The element of rank pay was introduced for all ranks from Captain to Brigadier in the Army and their equivalent ranks in the Air Force and the Navy, in addition to pay in the integrated scale. The rationale behind this was to make the Armed Forces an attractive career option and ensure that the defence officers continued to have an edge vis-à-vis their civilian counterparts, keeping in mind the difficult and challenging nature of their job. However, according to the officers, the rank pay was first deducted at the time of fixation to arrive at the total emoluments and thereafter added, after fixation, in the integrated scale. Consequently, the final fixation of the total pay of the officer became on a par with his civilian counterpart’s and the edge was neutralised.
Major A.K. Dhanapalan was the first officer to challenge this erroneous fixation before the Kerala High Court. Thereafter, several petitions were filed by similarly placed officers in High Courts and before different benches of the Armed Forces Tribunal.
After the High Court judgment, the Armed Forces and the Chiefs of Staff Committee had recommended against pursuing the litigation further in the Supreme Court. However, the Ministry of Defence chose to press the application for recall on several grounds, including a total financial liability of about Rs. 1600 crores.