NO.FIN/ROP/4/84(VOL-I)                                 Dated Kohima, the 13th December,2005.




Subject:  Merger of 50% of Dearness Allowance / Dearness Relief with basic pay / pension / Family Pension to State Government employees/pensioners/Family Pensioners w.e.f. 1.4.2004.


           The Fifth CPC in para 105.11 of their Report had recommended that DA should be converted into Dearness Pay each time the CPI increases by 50% over the base index used by the last Pay commission.


2.        The matter of adopting this recommendation of the Fifth Central Pay Commission had been under consideration of the State Government for some time and the Governor of Nagaland is pleased to decide that, with effect from 1.4.2004 DA equal to 50% of the existing basic pay shall be merged with the basic pay and shown distinctly as Dearness Pay (DP) in respect of the State Government employees including  State employees under UGC Scale. The Dearness Pay (DP) would be counted for purposes like retirement benefits and Dearness Allowance/Dearness Relief. The entitlements for LTC,TA/DA  while on tour and transfer, Government accommodation, HRA, NPA and other allowances shall, however, continue to be governed on the basis of the basic pay alone without taking into account Dearness Pay. In case of existing pensioners, Dearness Relief equal to 50% of the present pension will, w.e.f. 1.4.2004, be merged with pension and shown distinctly as Dearness Pension. Dearness Allowance/Dearness Relief converted into Dearness Pay/Dearness Pension respectively  would be deducted from the existing rate of Dearness Allowance/Dearness Relief.


3.        To ensure  that pensioners retiring between 1.4.2004 to 31.1.2005 do not face any loss in fixation of pension, as a special dispensation in their case, DA equal to 50% of the basic pay would be treated as basic pay for purposes of computation of pension in respect of basic pay received by them prior to 1.4.2004. Consequently, element of dearness pension will exist only for pensioners retired from State Government Service upto 31.3.2004.


4.        The whole of the arrears from 1.4.2004 to 30.11.2005 arising under these orders shall be credited to the respective GPF/CPF accounts of the employees concerned. Cash payment shall be made from December, 2005 salary onwards (that is, from the salaries of December 2005 payable in January 2006). No part of the arrears upto 30.11.2005 be paid in cash except in respect of those employees who have already retired from service, or have died or are due to RETIRE ON SUPERANUATION on or before 31.3.2006. The Government servants who have not yet opened Provident Fund Account can be allowed to draw the arrears only after the Provident Fund Accounts are opened so that the arrears can be credited to their Provident Fund Accounts.


5.        All heads of offices/DDOs are hereby instructed to carefully scrutinize all arrears bills to ensure that NO CASH PAYMENTS are allowed  except in respect of those who have already retired or died or are due to RETIRE ON SUPERANUATION on or before 31.3.2006. All such bills must be clearly certified, to that effect, by the head of office/DDO concerned. In case of Government servants due to retire on superannuation, the exact date of retirement shall be recorded in each case. In case of Gazetted officers claiming cash payment on account of being due for retirement on superannuation certificate to that effect indicating the exact date of retirement shall be recorded on the body of the bill. Treasury officer shall personally ensure that no cash payment of arrears in respect of serving Gazetted officers is allowed in the absence of such certificate.


6.        In regard to the credit of arrears to the Contributory Provident Fund, there shall be no matching contribution by the Government.


7.        The amount of arrears credited to the Provident Funds shall not be treated as accumulation for the purpose of temporary or Non-refundable withdrawals till 31.03.2007. While sanctioning temporary or Non-refundable withdrawals from Provident Funds, the sanctioning authority shall take care to EXCLUDE this lump sum credit till 31.03.2007. However, this condition shall not apply in case of final withdrawal form Provident Funds in respect of employees who have retired, died or have ceased to be in service otherwise.


8.        The amount of arrears credited to Provident Funds under these orders shall earn interest at normal rate.


9.        To facilitate easy calculation of entitlement of DP/DA/DR, consequent upon the merger ordered now, Ready Reckoner is enclosed at Annexure I & II. The Ready Reckoner is illustrative and in case any stage of Basic Pay or Pension is missing, the calculations on the basis of the actual stage of Pay/Pension should be done on the line of calculations shown in the Ready Reckoner


10.       The Ready Reckoner has not been sent to Accountants General outside the State of Nagaland. This can however be downloaded from Nagaland Official web site:-




Finance Commissioner,


NO.FIN/ROP/4/84(VOL-I)                                 Dated Kohima, the 13th December,2005.


Copy to :-

1. The Accountant General, Nagaland, Kohima.

2. The Commissioner & Secretary to the Governor of Nagaland, Raj Bhavan, Kohima.

3. The Sr. P.S. to Chief Secretary, Nagaland, Kohima.

4. All Addl. Chief Secretaries, Govt. of Nagaland, Kohima.

5. All Principal Secretaries/Commissioners & Secretaries/Addl. Secretaries to the Govt.

of Nagaland.

6. The Secretary, Nagaland Legislative Assembly, Kohima.

7. The Secretary, NPSC, Kohima.

8. All Heads of Departments,

9. All D.Cs/ADCs in Nagaland.

10. All Treasuries/Sub-Treasuries, Nagaland.

11. Nagaland House, New Delhi/Kolkata/Shillong/Guwahati.

12. All Branches in the Secretariat.



Officer-on-Special Duty (Finance)

Merger 50%’04

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