No.1 (4)/2021/D (Pay/Services)
Government of India
Ministry of Defence
New Delhi

Dated:- 23.05.2023

To,

The Chief of the Army Staff
The Chief of the Naval Staff
The Chief of the Air Staff

Subject:- Pay Rules/ Regulations, 2017 for Army/ Navy/ Air Force officers, MNS, JCOS/OR & equivalent- Opportunity for revision of Option to come over to revised Pay Structure.

Sir,
I am directed to refer to Rules 5 & 6 of Pay Rules/ Regulations 2017 for Defence Personnel regarding exercise of option to come over to the revised pay Structure effective from 01.01.2016 as notified by the Pay Rules/Regulations for Defence personnel and to state that the said option was to be exercised within one hundred and eighty days from the date of the notification i.e. 03.05.2017, 30.06.2017 (for NCs(E)) and 14.07.2017 (for MNS), of the said Rules. In this regard vide MoD letter No. 1(29)/2017/D (Pay /Services) dated 06 Aug 2019 an Opportunity to revise the option to come over to revised pay structure was provided. The following Pay Rules/ Regulations, 2017 have been issued for Defence Personnel:-

(a) Army Officers Pay Rules, 2017.
(b) Navy Officers Pay Regulations, 2017.
(c) Air Force Officers Pay Rules, 2017.
(d) Military Nursing Service Pay Rules, 2017.
(e) Army Pay Rules, 2017.
(f) Navy Pay Regulations, 2017.
(g) Air Force Pay Rules, 2017.
(h) NCs (E) of Air Force Rules- 2017.

7th Pay Commission – Opportunity for revision of Option for Defence Personnel

2. Personnel of Army/ Navy/ Air Force/ MNS/ NCs(E) who were promoted/ financially upgraded between 01.01.2016 and the date of Notification of Pay Rules by this Ministry i.e. 03.05.2017 and who have been requesting for re-exercising of option to switch over to the 7th CPC structure shall be permitted to re-exercise their option in terms of Rules 5 & 6 thereof. The revised option shall be exercised within a period of one hundred and eighty days from the date of issue of this letter. The option exercised in terms of these orders shall be final and shall not be liable to any further change under any circumstances. All other terms and conditions laid down in the Said Rules 5 & 6 of Pay Rules/Regulations 2017 shall continue to be applicable.

3. The personnel covered under this letter May also be given Opportunity to revise option for fixation of Pay as per provision of FR22 (i)(a)(1).

4. The other conditions contained in MoF(DoE) OM No. dated 31.07.2018 and 28.11.2019 as adopted by this Ministry, may be duly followed.

5. This issues with the approval of Ministry of Finance vide their ID No. 03-04 /2022- E.IIIA dated 09.05.2023 and concurrence of Defence( Finance) vide their ID Note No. 1(8)2017-AG/PA/ 85-PA/Part-I dated 15.05.2023.

Yours faithfully

(Laxmi Balasubramanian)
Under Secretary to the Govt. of India.

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ADVISORY NO.

Dated:-26.04.2022

O/o PCDA(O) Pune, Public Relation office PRO

Subject:- Elements to be taken into account for the purpose of Encashment of leave as per 7th CPC order: MSP regarding

Your kind attention is invited towards the provisions of Rule 5(2) (iii) of SRO 12(E) applicable for Pay Rules for Army Officers-2017 for 7th CPC order which categorically stipulates that Military Service Pay (MSP) shall be counted as Pay for the purpose of computation of Dearness Allowance and Pension.

Thereafter, MoD, New Delhi vide their ID No. 1((1)2018/D(Pay /Services) dated 05.06.2020 has intimated that the matter has since been examined in close consultation with Ministry of Finance and Ministry of Finance has not agreed to the MoD’s proposal regarding counting of MSP for the purpose of Leave Encashment to Defence Personnel.

Accordingly, leave encashment is being calculated on the basis of Basic Pay, DA and NPA (where ever applicable), Military Service Pay (MSP) is not considered as an integral element for calculation of leave encashment.

This is for your kind information please.

This is issued with kind approval of PCDA (O), Pune.

Regards,
Jai Hind

Encl: As above

(Smt. Arati Ray Chaudhury, IDAS)
ACDA & PRO

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Defence Revised Pay Structure – 7th pay commission pay scales

Part.I Office Order No.At/09

Date: 04/11/2019

To
All CsFA/All Br. AOs

Subject: Pay Rules / Regulations, 2017 for Army /Navy / Air force officers, MNS, JCOs / OR & Equivalent for revision of option to come over to revised pay structure

A copy of Government of India MOD Letter No-1(29)/2017/D (Pay/Service), dated-06/08/2019 on the above subject received vide CGDA No CGDA/ NAVY/03/ Misc-III/2019 dated-20/09/2019, is forwarded herewith for information, guidance and compliance, please.

Enclosure: As above

(Dr. DL Meena, IDAS)
Deputy Controller of Accounts (Fys)

Np.Pay/tech-I/01 (7th CPC), dated 04-11-2019

Also check: Pay Scales for PBORs of Armed Forces

Rules 5 & 6 of pay Rules / Regulations 2017 for Defence personnel regarding exercise of option to come over to the revised pay structure effective from 01.01.2016 as notified by the Pay Rules / Regulations for Defence personnel and to say that the said option was to be exercised within one hundred and eighty days from the date of the notification i.e. 03.05.2017, 30.06.2017 (for NCs(E)) and 14.07.2017 (for MNS), of the said Rules. The Rules 5(4) and 6(4) thereof provides that the option once exercised shall be final.The following pay Rules/Regulations,2017 have been issued for Defence Personnel:

• Army officers pay Rules, 2017.
• Navy officers pay Regulations, 2017.
• Air Force officers pay Rules, 2017.
• Military Nursing service pay Rules, 2017.
• Army pay Rules, 2017.
• Navy pay Regulations, 2017.
• Air Force pay Rules, 2017.
• NCs(E) of Air Force Rules, 2017.

The provisions of Para 3 & 4 of ibid MOF letter is extended to Personnel of Army / Navy / Air Force / MNS / NCs(E) personnel, for relaxation of the stipulation contained in para 6(4) and para-5(4) of Pay Rules / Regulations as mentioned above, who have already exercised their option to come over to the revised pay structure as notified by the Pay Rules / Regulations 2017, shall be permitted to revise their initial option in terms of Rules 5 & 6 thereof. The revised option shall be exercised within a period of one hundred and eighty days from the date of issue of these orders. The option, exercised in terms of these orders shall be final and shall not be liable to any further change under any circumstances. All other terms and conditions laid down in the said Rules 5 & 6 of Pay Rules/ Regulations 2017 shall continue to be applicable.

2. It is obvious that in respect of those personnel of Defence Force who have already exercised their option to come over to the revised pay structure from 01.01.2016 itself or in whose case the revised pay structure took effect from 01.01.2016 and who re-exercise their option under these orders to come over to the revised pay structure from a date subsequent to 01.01.2016 as per Rule 5 of Pay Rules / Regulations mentioned at Para1(a) to (g) above and as per Rule 4 of Pay Rules mentioned at Para-1(h) above, the arrears on account of revised pay already drawn by them from 01.01.2016 up to the date from which they opt to come over to the revised pay structure shall be recovered.

3. This issues with the approval of Ministry of Finance vide their ID No. 3-7/2019-E.IIIA dated 04.06.2019 and concurrence of Defence (Finance) vide their ID No.1(14)2018-AG/158-PA dated 04.07.2019.

Yours faithfully,
(Arun Kumar)
Under Secretary to the Government of India

Download Order

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No. 1(2)/2004/D(Pay/Services)
Government of India
Ministry of Defence

New Delhi, the 18th, September, 2018

To
The Chief of the Army Staff
The Chief of the Air Staff
The Chief of Naval Staff

Subject: Payment of Dearness Allowance to Armed Forces Officers and Personnel Below Officer Rank including NCs(E) – Revised rates effective from 01.07. 2018.

Sir,

I am directed to refer to this Ministry’s letter No. 1(2)/2004- D(Pay/Services) dated 28th March 2018, on the subject cited above and to say that the President is pleased to decide that the Dearness Allowance payable to Armed Forces Officers and Personnel Below Officer Rank, including Non-Combatants (Enrolled), shall be enhanced from the existing rate of 7% to 9% with effect from 01.07. 2018.

2. The term ‘basic pay’ in the revised pay structure means the pay drawn in the prescribed Level in the Pay Matrix as per 7th CPC recommendations accepted by the Government, but does not include any other type of pay like special pay, etc.

3. The Dearness Allowance will continue to be a distinct element of remuneration and will not be treated as pay within the ambit of Pay rules of Defence Force Personnel.

4. The payment on account of Dearness Allowance involving fractions of 50 paise and above may be rounded to the next higher rupee and the fractions of less than 50 paise may be ignored.

5. This letter issues with the concurrence of Finance Division of this Ministry vide their Dy. No. 257-PA dated 17.09.2018 based on Ministry of Finance (Department of Expenditure) O.M. No. 1/2/2018-E.II(B), dated 7th September 2018.

Yours faithfully,
(Arun Kumar)
Under Secretary to the Government of India

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There is a press note floating around on social media regarding certain decisions taken by the Cabinet related to pay and pensionary modalities related to the 7th Central Pay Commission (CPC). Though many have questioned its veracity, this is to confirm that it is absolutely a valid document and has been officially issued by the Ministry of Finance.

That said, let me run through some of the important decisions taken by the Cabinet, clarifications thereon and their impact. Please note that the new Pay Rules issued by the Ministry of Defence do not take into account the changes in the pay structure or removal of anomalies and these shall be incorporated through separate amendments in the rules issued on 03 May 2017.

Restoration of Percentage based Disability Pension Rates

The 7th CPC had recommended ‘flat/slab’ rates of disability pension for the defence services rather than the ones based upon ‘percentage of pay’. Civil disabled personnel were however retained on the percentage system as before. As stated earlier, frankly, I never expected this regressive 7th CPC recommendation to be accepted by the Government, but unfortunately it was. While recommending this aspect, the 7th CPC had also made unfounded and uncharitable remarks against disabled soldiers by casting aspersions on those who have incurred disabilities while in service which was discussed in detail by me earlier in my opeds, here and here. This resulted in a massive decrease after the 7th CPC resulting in a payout even lower than 6th CPC rates for almost all post-2016 retirees of all ranks and also for pre-2016 retirees of certain ranks. The arbitrariness of this decision becomes evident from the following chart at the apex levels:

Thankfully, the then Defence Minister, Mr Manohar Parrikar, fully understood the issue and took personal interest in getting the issue referred to an Anomaly Committee. The Defence Services HQ as well as the Ministry, and even civilian employee organisations, supported the resolution of this anomaly which now stands addressed and the Cabinet has decided to retain the old system of calculation on percentage basis, that is, 30% of pay shall remain the disability element for 100% disability. I however do hope that a protection clause is introduced for pre-2016 retirees of lower ranks who stood to gain from the slab rates.

Improvement in Pension calculation system for pre-2016 civil and defence retirees

The Cabinet has also accepted an improvement over and above the system of pension calculation which was finally effectuated after the 7th CPC. Rather than basing the pensionary calculations on the “Old Pension X 2.57” formula, an option would be provided to calculate the pension based upon the notional pay stage from which the employee had retired as opposed to the minimum of pay as was the system followed till the 6th CPC. Calculation of pension in this manner would definitely enhance the pension of civil pensioners and perhaps a small number of defence pensioners, who, in all probability would be provided the opportunity of choosing the most beneficial option, that is, the new formula, 2.57 multiplication formula or OROP rates. Contrary to popular perception, this does not exactly result in OROP for pre-2016 civil employees as is being projected, since while this is based on notional data, the military OROP is operated on live date of fresh retirees, moreover while this system is expected to be revised only after ten years, the military OROP as per the current scheme is meant to be revised after every five years.

Issuance of Pay Rules rather than Instructions on Pay

There were messages that the Chiefs of the Defence Services have been sidelined and downgraded since the earlier system of issuance of Special Army Instructions, Special Navy Instructions and Special Air Force Instructions (SAI/SNI/SAFI) has been discontinued and a new dispensation of ‘Pay Rules’ has been initiated. This seems to be the negative imagination of fertile minds. SAI/SNI/SAFI were never issued under the authority of the Chiefs of the Defence Services HQ but were always issued by the Ministry of Defence, that is, the Government of India. ‘Orders’ such as Army Orders (AO) etc were (and are) issued by the Defence Services HQ under the power of the Chiefs. The new Pay Rules have been promulgated under the authority of Article 309 of the Constitution of India and are statutory in character rather than being mere executive instructions like was the case till now. With this, the pay rules of the Defence Services are at par with the statutory pay rules of the civil services which are also issued under the authority of Article 309 of the Constitution of India.

Defence Pay Matrix to have 40 stages

The 7th CPC had recommended only 24 stages in the defence matrix while 40 stages were provided to civilians. This anomaly has been rectified and now the defence pay matrix shall also have 40 stages. This will particularly be helpful for JCOs towards the retiring years and will also beneficially affect their pension and other retiral benefits.

Multiplication factor of 2.67

This anomaly had been rectified earlier for Brigadiers and a multiplication factor of 2.67 had been applied for the said rank. Now the same benefit has also been extended to Lieutenant Colonels, Directors to Government of India and Colonels, that is, Levels 12A and 13 of the Pay Matrix.

Other Anomalies

There shall be pay protection for the amount of Military Service Pay (MSP) on promotion from the rank of Brigadier to Major General. It may be recalled that MSP is not entitled to ranks above the rank of Brigadier. No decision has been taken by the Government on the aspect of Non Functional Upgradation till now since the matter is being considered sub judice. On directions of the Supreme Court, the Government is re-considering the issue of NFU for Central Armed Police Forces for which a meeting was recently held. The issue is to be considered by the Government and the fresh decision is to be placed before the Supreme Court in August 2017. The most pertinent anomaly of enhancement of Military Service Pay, especially for JCOs, also remains pending along with other matters and probably these issues would be clearer after various anomaly committees submit their reports and a decision is taken thereafter by the Cabinet. The committee on allowances has already submitted its report which will now be examined by the Government. Unlike pay and pension which are admissible retrospectively from 01 January 2016, most freshly rationalized allowances shall only be admissible prospectively.

This is all I have to say at present, please DO NOT mail me individual queries on email or social media. You are free to discuss the above @ the comments section of this post.

Thank You.

Source: Maj Navdeep Blog

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