CBPRO TO IBA ON DISCRIMINATORY TREATMENT ON DR TO PENSIONERS
MOHAN P
COORDINATION OF BANK PENSIONERS' AND RETIREES ORGANISATIONS
(Federation of SBI Pensioners' Associations, AIBPARC, RBONC, AIRBEA, FORBE and AIBRAF)
G.D. Nadaf
Joint Convenor St. Mark's Road, Bengaluru 560001
Federation of SBIPA 65, SBI LHO Building,
E-mail: fsb...@gmail.com
Mobile: 09448124777
K.V. Acharya
Joint Convenor
c/o AIBPARC
4, Netaji Subhas Road, 1st Floor, Cubicle no. 170, Kolkata 700001
E-mail: acharyave...@gmail.co
Mobile: 09868220338
CBPRO/IBA/Da-Disparity/04-2026
Date: April 12, 2026
Shri C S Setty,
The Chairman, Indian Bank' Association, Mumbai.
Respected sir,
Sub: Discriminatory treatment in respect of payment of Dearness Relief to Bank
Pensioners.
Ref: Supreme Court Judgement dated 10.04.2026 in respect of State of Kerala Vs M Vijayakumar SLP (C) Nos. 18030 of 2023 and 11592 to 11593 of 2023 by Hon'ble Justices Manoj Misra and Prasanna B Varale.
We wish to invite a kind reference to the judgement of the Hon'ble Supreme Court wherein it is held that the purpose and object of revision/increase of Dearness Allowance/Dearness Relief is to mitigate the hardship faced by the employees and the pensioners on account of inflation.
The Rise in the Consumer Price Index or Inflation hits both the employees and pensioners in equal measure. Hence application of different Dearness Allowance & Dearness Relief to the employees on one hand and Pensioners on the other has no rational nexus to the object sought to be achieved i.e. mitigation of hardship faced on account of inflation. It was made clear that once pension is admissible and Consumer Price Index linked Dearness Allowance/Relief is allowed, paying DA/DR at different rates or using different basis to calculate Rate of DA/DR for the employees and the pensioners is impermissible as it is violative of Article 14 of the Constitution of India.
It thus also emerges that if the different rates of DA/DR are impermissible between Serving Employees and Retired Employees, it is all the more emphatic that different rates of DR cannot be permitted within the same group of pensioners constituting a homogenous class.
Sir, it is in this back drop, we wish to request you to redress the following grievances of the Bank Pensioners and render justice.
A. Uniform Rate of DA to pre-01.11.2002 retirees:
1. Pre-01.11.2002 Pensioners were discriminated while implementing the Uniform Rate of Dearness Relief in terms of Joint Note (Salary Revision) dated 02.06.2005 which provided that on and from 01.05.2005 DA/DR shall be payable at 0.18 percentage of pay to the Pensioners. The Tapered Rate of DA was thus changed to Uniform Rate of DA.
Although the Joint Note clearly and unambiguously provided the uniform rate to be applied to the pensioners but making the amount payable from 01.05.2005, IBA vide its letter dated 25.06.2005 unilaterally and arbitrarily advised the member banks not to pass on the benefit of correction to those who had retired prior to 01.11.2002. Such an advice was unsolicited, unilateral & arbitrary and completely against the settlement signed between the UFBU and IBA.
The IBA & DFS were kind enough to rectify the error but made it effective from 01.11.2023. The affected Pensioners suffered a monetary loss for 18.5 years. payable at 0.18
It is therefore, requested to restore the application of Uniform Rate of DA/DR to pre 01.11.2002 retirees w.e.f. 01.05.2005 as provided in the Joint Note dated 02.06.2005.
B. Shifting CPI base year from 1960-100 to 2016-100:
1. The above judgement of the Hon'ble Supreme Court read with the judgement in DS Nakara case, provide that any improvement in the benefits should be extended to all the beneficiaries of homogenous group or class. The Bank Pensioners being a homogenous class are entitled for a uniform rate of DR calculated on the basis of the same Index.
2. The Joint Note/12th BPS dated 08.03.2024 signed between Associations/Unions and IBA have created yet another anomaly in the application of DR by shifting the base year from 1960 to 2016 and making it applicable only to those pensioners who retired on or after 01.11.2022. This is again arbitrary and discriminatory thus violating Article 14 of the Constitution of India.
3. It is pertinent to point out that if paying different rates of DA/DR to serving employees and retired employees is impermissible, it is all the more not permissible to pay Dearness Relief to the homogenous class of Pensioners at different rates. The 12th Bipartite Settlement has unfortunately created such an anomaly again while the Uniform DA/DR rate anomaly created in 2005 still persists though resolved partially in November 2023. It is arbitrary and discriminatory and violative of Article 14 of the Constitution of India.
C. Quarterly Revision of DR like in the case of Serving Employees:
1. The above cited judgement of the Hon'ble Supreme Court establishes a parity in the rate of payment of DA to Serving Employees and DR to Retired Employees to uphold the principle of reasonableness and Article 14 of the Constitution of India.
2. It is pointed out that while the DA is revised on quarterly basis for the Serving Bank Employees, it is revised on Half Yearly basis to the Retired Employees. It thus breaches the provisions of Article 14 of the Constitution of India and at variance with the above cited judgement of the Hon'ble Supreme Court.
We earnestly request your good self to redress the grievances toryof lakhs of Bank Pensioners and render justice.
We request you to kindly to do the needful immediately and give relief to the fast advancedly aging Bank Pensioners Community.
With Regards,
Yours faithfully,
G D Nadaf
K.V. Acharya
Joint Convenors, CBPRO
Ramakrishnan S
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Kalyanasundaram Subramaniam
Your draft raises serious constitutional and service-law issues, but its legal enforceability depends on how far the cited judgments actually support the claims and whether courts would accept the “homogeneous class” argument in each context. Let’s break this down carefully.
1. Core legal foundation you are relying on (a) Article 14 of the Constitution
Article 14 of the Constitution of India
This guarantees equality and prohibits arbitrary classification unless:
- there is an intelligible differentia, and
- it has a rational nexus to the objective
Your entire demand hinges on showing:
Pensioners (and sub-groups within them) form a homogeneous class → hence differential DR/DA is unconstitutional.
(b) D S Nakara v Union of India
This landmark judgment held:
- Pensioners are a homogeneous class
- Liberalization of pension benefits should not arbitrarily exclude earlier retirees
However, later Supreme Court rulings have narrowed Nakara, holding:
- It does not mandate absolute uniformity across all pension schemes
- Government can create cut-off dates if justified
(c) The cited 2026 judgment
State of Kerala v M Vijayakumar
Based on your summary, the Court held:
- DA/DR aims to offset inflation
- Employees and pensioners are similarly affected
- Arbitrary differentiation in DA/DR may violate Article 14
⚠️ Important caveat:
Until the full judgment is examined, courts typically:
- Avoid blanket parity rules
- Allow policy-based distinctions if justified (financial, structural, contractual)
2. Evaluation of each demand
A. Uniform DA for pre-01.11.2002 retirees (retrospective from 2005) Strengths
- Strongest part of your case
-
Based on:
- Binding settlement (Joint Note 2005)
- Allegation of unilateral deviation by IBA
If proven:
-
This becomes not just a constitutional issue but also:
- Contractual violation
- Possibly arbitrary executive action
✔ Potentially enforceable in court IF:
- The Joint Note clearly granted benefit without exclusion
- IBA’s circular contradicts it
⚠️ Weakness:
- Courts often avoid large retrospective financial burdens
- The 2023 correction weakens claim for full back arrears (18.5 years)
👉 Likely outcome:
- Court may grant limited retrospective relief, not full arrears
B. Common CPI base (1960 vs 2016) for all pensioners Your argument
- Pensioners = homogeneous class
- Different CPI base = discrimination
This is legally contestable but weaker
Courts have repeatedly held:
- Different pension formulas for different retirement periods can be valid
- New settlements can apply prospectively
👉 Key issue:
-
Whether change in CPI base is:
- A methodological improvement (allowed), or
- A discriminatory classification (not allowed)
❌ Courts may uphold:
-
Different CPI bases for different settlement periods
✔ Unless: - You prove no rational basis at all
C. Quarterly DR revision for pensioners Your argument
- DA (employees) = quarterly
- DR (pensioners) = half-yearly → discriminatory
This is the weakest claim
Courts generally allow:
- Administrative differences in revision frequency
-
As long as:
- Formula is rational
- No gross injustice
👉 Likely outcome:
❌ Courts will likely reject this claim
✔ Seen as policy domain, not constitutional violation
3. Key legal risks in your argument 1. Over-extension of “homogeneous class”
Courts today interpret Nakara cautiously:
- Pensioners are not always one single class across time
2. Financial implication factor
Courts often consider:
- Fiscal burden on public institutions
- Banking sector settlements
Large retrospective payouts weaken your case.
3. Settlement-based framework
Bank pension is governed by:
- Bipartite settlements
- Contractual frameworks
Courts hesitate to interfere unless:
- Clear illegality or arbitrariness is shown
4. Overall enforceability assessment
Demand
Legal Strength
Enforceability
A. Uniform DA from 2005
Strong
Moderate to High (partial relief likely)
B. Common CPI base
Moderate
Uncertain / Low to Moderate
C. Quarterly DR revision
Weak
Low
5. Strategic legal advice
If this were to be pursued legally:
Strongest strategy- Focus on Demand A
-
Frame it as:
- Violation of settlement
- Arbitrary administrative action
- Supported by Article 14
- Over-reliance on parity arguments may weaken credibility
- Courts prefer targeted, legally grounded claims
6. Bottom line
Your representation is legally arguable but only partially enforceable:
- ✔ It raises a credible constitutional challenge on DA uniformity (especially pre-2002 retirees issue)
- ⚖️ It overstretches Supreme Court rulings to claim absolute parity
- ❌ Some demands fall into policy domain rather than enforceable rights
Narayanan Venkateshwaran
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Murali
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Satyanarayana N.V.V
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MOHAN P
Dear Mr Murali,
As I have mentioned earlier, our monthly pension and DR on pension are paid in terms of BEPR,1995. Legally each wage settlement creates a separate DR scheme,and Pension is linked to last drawn pay structure, so DR differs by settlement period.
Bank wage revisions /service conditions and DA/DR are decided under bipartite settlement/Joint Note.ln pensioners case these are incorporated in BEPR,1995 under Regulation 37-Appendix II
So any change is to be taken place,the process is through by negotiation between IBA-Unions and the request of CBPRO to IBA is on this line on other points too.DFS/GOI may not directly involve on all these process and only approve once it is agreed.
Here on merger of CPI 8088 points and consequent change in DR to pre 31.10.2022 pensioners, IBA-Unions have recognised the need and agreed under minutes of 8.3.24, which has not been materialised so far.
Regards
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