THE STATE OF ANDHRA PRADESH AND ANOTHER versus SMT. DINAVAHI LAKSHMI KAMESWARI

Citation: [2021] 1 S.C.R. 694 · Decided: 08-02-2021 · Supreme Court of India · Bench: D.Y. CHANDRACHUD, M.R. SHAH · Disposal: Disposed off
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Judgment (excerpt)

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SUPREME COURT REPORTS
[2021] 1 S.C.R.
   [2021] 1 S.C.R. 694
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THE STATE OF ANDHRA PRADESH AND ANOTHER
v.
SMT. DINAVAHI LAKSHMI KAMESWARI
(Civil Appeal No. 399 of 2021)
FEBRUARY 08, 2021
[DR. DHANANJAYA Y CHANDRACHUD AND
M. R. SHAH, JJ.]
Disaster Management Act, 2005 – COVID-19 – Pandemic –
Deferment of the salaries and pensions by the State – The revenues
of the State were impacted by the onset of the pandemic – As an
urgent measure, on 31.03.2020 the State deferred the salaries/wages/
remuneration/honorarium/pensions on gross basis for the month of
March 2020, payable in April 2020 and would continue to remain
in force until further orders – On 04.04.2020, there was a
modification by the State, which provided payment of full salary to
the employees of the medical and health department, police
department and sanitation workers – On 26.04.2020, further
modification was provided with direction for full payment of pension
to pensioners - Writ petition was filed before the High Court – The
gravamen of the grievance was that salaries and pensions are due
as a matter of right to employees and to the former employees who
have served the State – Consequently, a direction was sought in the
petition to the State Government to pay the outstanding salaries
and pensions which had remained due – The High Court held that
the State could not by means of a government order have provided
for the deferment of salaries and pension without following recourse
to law – The High court directed (i) payment of the deferred salary
for the months of March-April 2020 together with interest at the
rate of 12% p.a. and payment of deferred pension for the month of
March 2020 with a similar rate of interest – On appeal, held: On 18
November 2020, the Court issued direction to the effect that the
deferred portion of the payments on account of salaries, pensions
and honoraria due to the employees or, as the case may be, to former
employees be paid in two equal tranches – The issue in regard to
the payment of interest was stayed by the Court – In pursuance, the
State complied with the directions for payment of the outstanding
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dues in two tranches – Insofar as the interest is concerned, the rate
of 12% p.a. which was fixed by the High Court was scaled down –
The Government directed to pay simple interest computed at the
rate of 6% p.a. on account of deferred salaries and pensions.
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 399 of
2021.
From the Judgment and Order dated 11.08.2020 of the High Court
of Andhra Pradesh at Amravati in Writ Petition (PIL) No. 128 of 2020.
J. N. Bhushan, AAG, Shekhar Naphade, Sr. Adv., Mahfooz Ahsan
Nazki, Polanki Gowtham, Shaik Mohamad Haneef, T. Vijaya Bhaskar
Reddy, Amitabh Sinha, Shrey Sharma, Advs. for the Appellants.
Yelamanchili Shiva Santosh Kumar, Naumene Suraparaj
Karlapalem, Tarun Gupta, Advs. for the Respondent.
The following Order of the Court was passed:
ORDER
1. Leave granted.
2. This appeal arises from a judgment and order of the Andhra
Pradesh High Court dated 11 August 2020. The State of Andhra Pradesh
issued GOMs No. 26 on 31 March 2020 and GOMs No. 37 on 26 April
2020. The backdrop for the orders was the outbreak of Covid-19 and
the financial crises which had resulted as a consequence. The revenues
of the State of Andhra Pradesh were impacted by the onset of the
pandemic. The financial position of the State finds reference in the
judgment of the High Court, which has been extracted below:
“The States’ own revenue consisting of tax revenue and non-tax
revenue have shown a precipitous decline of 52% i.e. Rs 7593
crores in first quarter of 2020-21 as compared to 2019-20. The
receipts were only Rs. 7089 crores against Rs. 14,682 crores of
2019-20. The States’ own revenue have not shown any
appreciable improvement in the month of July, 2020 also as the
decline is to an extent of 49% amounting to Rs. 2,129 crores for
the first 20 days of the month of July, 2019.”
The above extract in the judgment of the High Court is based on
the submissions of the State.
THE STATE OF ANDHRA PRADESH AND ANOTHER  v.
SMT. DINAVAHI LAKSHMI KAMESWARI
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SUPREME COURT REPORTS
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3. By GOMs No. 26 of 31 March 2020, the State Government
determined that it was necessary, as an urgent measure, to provide for a
deferment of the salaries and pensions which it was obligated to pay.
Consequently, paragraph 5 stipulated as follows:
“5. Government, after careful consi
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