Case
State of Kerala vs M. Vijayakumar & Others
SLP(C) Nos. 11592-11593 of 2023
Supreme Court of India
Issue
Whether the Government can grant a higher Dearness Allowance (DA) to serving employees and a lower Dearness Relief (DR) to pensioners when both are meant to offset inflation.
Facts
The Kerala Government increased:
- DA to employees: 14%
- DR to pensioners: 11%
KSRTC pensioners challenged this difference as discriminatory and violative of Article 14 of the Constitution.
Supreme Court Findings
1. DA and DR have the same purpose
The Court held that DA for employees and DR for pensioners are both intended to reduce hardship caused by rising prices/inflation.
2. Article 14 applies
Any classification must satisfy:
- Intelligible differentia
- Rational nexus with the object
Even if employees and pensioners are different groups, that distinction has no connection with inflation compensation.
3. Inflation affects all equally
The Court observed that inflation impacts serving employees and pensioners alike. Therefore, paying a higher rate to one and a lower rate to another is arbitrary.
4. Financial difficulty is not enough
Financial constraints may justify delay or phased payment, but cannot justify unequal rates of inflation-linked benefit.
Final Judgment
- Appeals filed by Kerala Government and KSRTC were dismissed.
- Kerala High Court judgment was upheld.
- Lower DR than DA in this case was held discriminatory and unconstitutional.
Key Principle
«If inflation relief is granted, pensioners cannot be paid less than employees merely because they are retired.»
Importance
This judgment is significant for pensioners, government employees, PSUs, and future DA/DR parity disputes across India.
 Nos. 11592-11593 of 2023, Judgment (10-04-2026) – One Page Summary){kind=link}
0 Comments