RBE No.188/1985 Additional Dearness Allowance – Treatment for Retirement Benefits

No.PCIII/85/DP/1, dated 27.06.1985

Sub:   Treatment of a portion of Additional Dearness Allowance as pay for the purpose of retirement benefits.

1.     Reference Railway Ministry’s letter of even number dated 17.05.1985 (RBE No.144/1985) on the above subject. In modification of para 3 (iii) of the letter referred to above, the President has now ben pleased to decide that for purpose of average emoluments under Rule 2515 R-II (Para 502 of Manual of Railway Pension Rules), the Dearness Allowance, Additional Dearness Allowance and ad-hoc Dearness Allowance upto average index level 568, shall be treated as Dearness Pay with effect from the dates from which these were sanctioned.  

2.     It has further been decided, in modification of paras 4 and 7 of the Ministry of Railways letter of even number dated 17.05.1985 (RBE No.144/1985) that the benefit of dearness pay as mentioned in para 1 above would be automatically given both for pension/ service gratuity and DCRG, to all Railway servants retiring on or after 31.03.1985.

However, where the amount of pension so calculated results in loss as compared to the total amount of pension plus relief on pension, admissible at the average index level 320, the loss will be made up by the grant of personal pension to the individual concerned.

It may be clarified that the amount of personal pension will not be taken into account for the purpose of determining the commuted value of pension and relief on pension.

3.     In view of the provisions of the preceding paragraph, the question of exercising option between the two alternatives mentioned in para 4 of this Ministry’s letter of even number dated 17.05.1985 (RBE No.144/1985) shall not arise.

Where, however, such an option has already been exercised in terms of the provisions of paras 4 and 6 of this Ministry’s letter of even number dated 17.05.1985 (RBE No.144/1985), the same shall not be acted upon by the Head of Office Accounts Officer concerned, as the same shall become infructuous with the issue of these orders. Further, where pension has already been determined and authorised in accordance with such an option, the same shall be revised in terms of these orders.