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1(2)/97/D (Pension/ Service)
overnment of India
harat Sarkar

Ministry of Defence

Raksha Mantralaya

New Delhi Dated 24th Nov. 1997  



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

Subject :       Implementation of Government's decision on the recommendations of the Fifth Central Pay Commission - Rationalisation of pension of pre - 1996 pensioner / family pensioners belonging to the Armed forces.


The undersigned is directed to state that in pursuance of Government's decision on the recommendations of Fifth Central pay Commission announced vide Govt. of India, Ministry of Personnel, Public Grievances and Pension, Department of Pension & Pensioner's Welfare resolution No. 45/86/97 - P & PW (A) dt. 30.09.97 sanction of the President is hereby accorded to the regulation, with effect from 1.1.96, of pension / family pension of all the pre -  1996 pensioners / family pensioners of  the Armed Forces in the manner indicated in the succeeding paragraphs.  

2.1       These orders apply to all the Armed Forces Pensioners / Family Pensioners who were drawing pension / family pension under the Pension Regulations of the three Services / State Forces and various other orders issued from time to time.  

2.2       The Provisions of this latter do not apply to the following categories :-

(i)         Gallantry awardees - monetary allowance attached to the award, such as Param Vir Chakra, Ashok Chakra, etc.

(ii)        UK / HKSRA Pensioners.  

(iii)       KCIOs who were in receipt of pension in pound sterling as on 01.01.96.  

iv)        Persons in receipt of Compassionate Allowance Guzara, Reservist allowance or any other allowance on which relief is not admissible.    

(v)        Ex-gratia family pension at Rs. 150/- per month to the families of deceased reservist covered by Govt. of India Min. of Defence Order No. 10 (7) / 92 / D (Pens / Sers ) dt. 30th March 1992. 

(vi)       Persons in receipt of Disability element only. 
(Separate orders will be issued in respect of (v) and (vi) above.)

3.            Definitions. In these orders :-  

(a)       Existing Pensioner' or 'Existing family Pensioner'  means a pensioner who was drawing / entitled to pension / family pension on 31.12.95 or who retired on 31.12.95. For purpose of family pension, it also covers members of family of those who retired prior to 1.1.1996 and in whose case family pension had not commenced as the pensioner was alive on 31.12.1995.  

(b)       Existing Pension     means the basic pension inclusive of commuted portion, if any, and One Time Increase (OTI), if any, due on 31.12.1995. It covers all classes of pension including Disability pension granted under the Pension Regulations of the three services / State Forces and various other Orders issued from time to time on the subject. This also includes additional pension sanctioned to Havildar granted Honorary Rank of Naib Subedar. However, it will not include Adhoc ex-gratia payment and personal pension (PP) and unabsorbed personal pension (UPP), if any.  

(c)        Existing family pension '  means the basic family pension drawn on 31.12.1995 under the Pension Regulations of the three services / State Forces and other orders issued on the subject from time to time. It also cover Liberalised and Special family pension including Children Allowance, if any, and Dependent pension sanctioned in battle and non - battle casualty case.  

(d)        Existing Dearness Relief'   means the dearness relief due to pensioners / family pensioners up to average CPI 1510 ( as on 1.1.1996 ) at the rate contained in government of India, Ministry of Personnel, Public Grievances and Pension, Department of Pension and Pensioners Welfare Office Memorandum No. 42/8/96 - P & PW (G) dated 20.03.96.  

(e)       Pension Disbursing Authority (PDA) means, Treasury, Sub-Treasury, Post Office, Sub post office, Pay and Accounts Office, Defence Pension Disbursing Office (DPDO) and Public Sector Banks.  

(f)        Pension Sanctioning Authority (PSA)  means CCDA (Pension ) Allahabad; CDA (Navy) Mumbai; or CDA (AF), Delhi.  

4.1.1    The pension / family pension of existing pre- 1996 pensioner / family pensioners will be consolidated with effect from 1.1.1996 by adding together :-            

(i)         The existing pension / family pension.            

            (ii)        Dearness Relief up to CPI 1510 i.e. @ 148%, 111% and 96% of basic pension as admissible
                        on 1.1.96 vide DP &PW's O.M. No. 12/8/96 - P &PW (G) dated 20.03.96. 

(iii)       Interim Relief I.  

(iv)       Interim Relief II.  

(v)        Fitment weightage @ 40% of the existing pension / family pension i.e., of (i) above  

NOTE :Where the amount of fitment weightage works out in fraction of a rupee, it will be be rounded off the next higher rupee.  

4.1.2    The amount so arrived at will be regarded as consolidated pension / family pension with effect from
            1.1.1996. Since the consolidated pension will be inclusive of commuted portion of pension if any the
            commuted portion will be deducted from the said amount while making monthly disbursements.  

4.2       The following elements will continue to be paid as separate elements in addition to the pension / family
             pension consolidated under these orders. These payments will not be taken into account for purposes
            of consolidation as well as for applying minimum limit of Rs. 1275.00 to the pension / family pension :-  

(i)         Personal Pension (PP)., or Unabsorbed Personal Pension (UPP), if any admissible to those who retired between 01.04.85 and 31.12.85.  

(ii)        Adhoc ex-gratia payment to Armed Forces pensioners who retired prior to 1.1.1973. 

(iii)       Monetary allowance attached to gallantry awards such as Param Vir Chakra, Ashok Chakra Etc.  

(iv)       Children Allowance and Children Education Allowance, where admissible.  

(v)        Constant Attendance Allowance where admissible.  

4.3       Since the consolidated pension / family pension arrived at as per paragraph 4.1.1 includes dearness relief up to  average index level 1510, dearness relief will be admissible thereon only beyond index average 1510 in accordance with the revised scheme of dearness relief for which orders have been issued separately by Department of Pension and Pensioners' Welfare vide their office Memorandum NO. 42/2/97 - P&PW/ (G) dt . 27th Oct. 1997,. The two installments of dearness relief sanctioned earlier from 1.7.1996 and 1.1.1997 in department of P&PW's office Memorandum NO. 42 (8) P&PW / 96 dated the 12th September 1996 and Office memorandum NO. 42(2) P&PW /97 dated the 3rd April 1997 respectively will be adjusted towards the arrears becoming due on consolidation of pension / family pension as in Para 4.1.1 above.  

4.4       The amount already paid on account of Interim Relief III sanctioned vide Deptt of P & PW's Office Memorandum No. 42/18/95-P & PW/G-Vol II dated 6.9.1996 will be recovered from the arrears becoming due on consolidation of pension/family pension as in Para 4.1.1 above. Since the OTI Will now be a part of consolidated basic pension with effect from 1.1.96, any amount of OTI paid as separate element from 1.1.96 and the relief there on if any, will be recovered from the arrears becoming due on consolidation of pension/family pension as per the provisions in Para 4.1.1 above.  

5.         Where the consolidated pension /family pension in terms of paragraph 4.1.1 above works out to an amount less than Rs.. 1275/- the same will be stepped up to Rs. 1275/-. This will be regarded as pension /family pension with effect from 1.1.96. In the  case of pensioners who are in receipt of more than one pension, the floor ceiling of Rs. 1275/- will apply to the total of all pensions taken together.  

6.         The employed / re-employed pensioners / family pensioners are not getting dearness relief on pension at present under extant orders. In their case the notional dearness relief which would have been admissible to them but for their employment / re-employment will be taken into account for consolidation of their pension in terms of paragraph 4.1.1 above as if they were drawing the dearness relief. Their pay will be re-fixed w.e.f. 01.01.1996 with reference to consolidated pension becoming admissible to them. Dearness relief beyond 01.01.1996 will, however not be admissible to them during the period of employment / re- employment.

7.         The cases of Armed Forces personnel who have been permanently absorbed in public sector undertakings / autonomous bodies will be regulated as follows :-  

(a)        Pension  Where the Government servants on permanent absorption in public sector undertaking / autonomous bodies continue to draw pension separately from the Government, the pension of such absorbees will be updated in terms of these orders. where the Government servants have drawn one time lump sum terminal benefits equal to 100% of their pensions and have become entitled to the restoration of 45% of their pension in case of PBORs and Officers, respectively, commuted portion of Pension restored as per Department of P & PW's OM NO. 4/3/86 - P&PW (d) dated 30.09.1996 their cases will not be covered by these order. They will be paid only restored value of the commuted portion.  

(b)        Family Pension  In cases where, on permanent absorption in public sector undertakings / autonomous bodies, the terms of absorption permit grant of family pension under the orders applicable to the Armed Forces, the family pension will be updated in accordance with these orders.  

8.         All Pension Disbursing Authorities including public sector Banks handling disbursement of pension to the Defence pensioners are hereby authorised to pay pension / family pension to existing pensioners / family pensioners at the consolidated rates without any further authorisation from the concerned Pension Sanctioning Authority. A table indicating the existing pension, the consolidated pension and difference payable from 1.1.96 is enclosed for ready reference. (Annexure I). This table may be used where the pensioner is in receipt of a single pension only. Where a pensioner is in receipt of more than one pension, consolidation may be done separately in terms of paragraph 4.1.1 and as indicated in paragraph 5. Floor ceiling of Rs. 1275/- may be applied to total pension from all sources taken together. A suitable entry regarding the revised consolidated pension will be recorded by the Pension Disbursing Authorities in the Pension Payment Order an check register / pension payment scroll register. An intimation regarding disbursement of revised pension may be sent by the pension disbursing authorities to the office of Chief CDA (Pensions) Allahabad in the form given at Annexure II so that the latter can update the audit Cards and other pension documents maintained by him. An acknowledgment shall be obtained by the Pension Disbursing Authorities from Office of CCDA(P), Allahabad.

9.         The consolidated pension / family pension as worked out in accordance with provisions of Para 4.1.1 above will be treated as interim Basic Pension / family Pension with effect from 1.1.1996 as interim measure only so as to provide them immediate relief and may be subject to variation. This interim pension / family pension will qualify for grant of Dearness Relief sanctioned at revised rate vide department of P&PW 's O.M NO. 42/2/97 - P&PW (G) dated 27.10.97. Detailed instructions regarding fixation of the pay on notional basis / revision / consolidation of all kinds of pensions  / family pension and issue of authorisation in this regard will be issued separately. Pending issue of detailed instructions as stated above grant of interim pension / family pension to all these pensioners / family pensioners may be continued to be regulated under these orders.  

10.       the arrears on account of consolidation of pension would be paid in cash with the stipulation that where amount of arrears in less than 5000/- it should be paid on one installment and where its is in excess of Rs. 5000/-, it should be paid in two installments; in the first installment payment should be restricted to Rs. 5000/- plus fifty per cent of their balance amount of arrears.  

11.       It is considered desirable that the benefit of  these orders should reach the pensioners as expeditiously as possible. To achieve this object, it is desired that all Pension Disbursing Authorities should ensure that the revised pension and the first installment of arrears due to the pensioners in terms of the above orders is paid to the pensioners or credited to their account by 31st December 1997 or before, positively. Instructions regarding release of second installment of arrears will be issued later.  

12.       These orders issue with the concurrence of the finance Division of this Ministry vide their U.O No. 2196 / 97/ Pension dated 17.11.1997.  

13.       Hindi version of these order follow.


Joint Secretary to the Govt. of India




Form of Intimation by the Pension Disbursing Authority to the CDA (P) Allahabad 
regarding consolidation of pension in terms of Ministry of Defence  
letter NO. 1 (2) /97 / D (Pen/ Ser) Dated Nov. 1997


1 Name of the Pensioner / Family Pensioner  
2 PPO No.
3 Date of retirement / Death (In case of family Pension)  
4 Name of the Bank / Paying Branch / Treasury / DPDO/ PAO/PO  
5 Bank Code No.  
6 Saving Bank A/C No/TS/PS No.  
7 Computation of consolidated Pension / Family pension

   Pension             Family Pension       Family Pension (at enhanced rate)  

(A) Existing basic pension (Inclusive of commuted portion of pension, OTI, Disability element if any) .  
Existing Family Pension
(B) Dearness Relief up to CPI 1510 i.e. 148% 111% and 96% of Pension / Family pension as drawn  
(C) 1st Interim Relief  
(D) IInd interim Relief :  
(E) 40% of Basic Pension/ Family Pension as at 'A' above.  
(F)  Consolidated Pension / Family Pension   (A+B+C+D+E)  
(G) Consolidated Pension after deducting commuted portion.  
  1. Since the OTI will now be a part of consolidated basic pension with effect from 1.1.1996 any amount of  OTI paid as separate element from 1.1.96 and the relief thereon, if any , will be recovered from the arrears becoming due on consolidation of pension / family pension as per the provisions in Para 4.1.1 above.  
  2.   The final revision of pension in respect of pensioners retired prior to 1.1.1996 and also those retired after 1.1.1996 will be done by the Pay & Account Office concerned.  
  3. The final revision of family Pension except in case of those who became eligible for Family pension during the 01.01.1996 to 31.12.1996 and were sanctioned the same @ 30%  of last pay drawn by the deceased employee, will also be done by the Pay & Account Office concerned. (If not applicable drawn a line across)  
8.  Whether consolidated pension / family pension is final or allowed as immediate relief.  
9. Remarks , If any  


            1.         The Chief CDA (Pensions) 
            Draupdi Ghat,