New Delhi: The Supreme Court on Thursday stayed criminal contempt proceedings initiated by the Punjab and Haryana High Court against Punjab Chief Secretary K.A.P. Sinha, a 1992-batch IAS officer of the Punjab cadre, and other officials over the state government’s failure to implement directions for payment of pending Dearness Allowance (DA) and Dearness Relief (DR) to government employees and pensioners.
A Bench of Justices B V Nagarathna and R Mahadevan also directed that no coercive steps be taken in the connected civil contempt proceedings. The interim relief came while the court was hearing the Punjab government’s challenge to the High Court’s contempt-related orders.
The Supreme Court asked the state government to come forward with a concrete plan for disbursing the outstanding amounts by March 2027. The matter has been adjourned to December for further consideration.
What Did the Supreme Court Say?
During the hearing, the Bench examined the Punjab and Haryana High Court’s orders dated October 12 and October 30, 2026. The latter had directed the Chief Secretary to appear personally before it on November 5 in connection with the criminal contempt proceedings.
Read Also: Punjab Chief Secretary K.A.P. Sinha Faces High Court Contempt Notice Over Unpaid DA Arrears
The Supreme Court stayed further proceedings in the criminal contempt matter until further orders and restrained coercive action in the civil contempt case.
The Bench also sought clarity on how much the state government proposed to release towards the pending dues.
“You got a breather. Come up with a positive response. How much will you release?” the Bench told the state’s counsel.
The judges also made observations on accountability among government employees and the functioning of public administration during the hearing.
How the DA Arrears Dispute Began
The dispute stems from an August 3, 2026, judgment of the Punjab and Haryana High Court, which directed the Punjab government and the Punjab State Power Corporation Limited (PSPCL) to release pending DA and DR instalments to employees and pensioners.
The payments were to be made at the rates applicable to All India Services officers serving in Punjab, in accordance with the Central Government pattern.
The High Court had directed that the outstanding instalments be cleared within a fortnight, setting August 18 as the deadline. It also ordered simple interest at 6% per annum on delayed payments and required the Chief Secretary to submit a compliance affidavit by August 31.
The court had additionally restrained the state from undertaking what it described as unproductive expenditure, including large-scale advertising campaigns, until the outstanding dues were cleared.
High Court Initiates Contempt Proceedings
After the state failed to comply with the August 3 directions, employees and pensioners approached the High Court seeking contempt action.
On October 12, the High Court issued a criminal contempt notice to the Chief Secretary and other officials. It also raised concerns over the handling of the state’s appeal before the Supreme Court and an instruction issued by the Finance Secretary asking departments not to implement the August 3 order.
The High Court subsequently directed the Chief Secretary to appear personally on November 5.
In the connected civil contempt proceedings, the High Court had also imposed costs of ₹1 lakh on the Chief Secretary for failing to file the required compliance report.
Punjab Government Cites Financial Constraints
The Punjab government challenged the High Court’s directions before the Supreme Court, arguing that releasing the entire amount within the stipulated 15-day period was not financially or procedurally feasible.
The state cited constitutional and budgetary requirements governing withdrawals from the Consolidated Fund, including the need for legislative approval and an appropriation process.
It also referred to the substantial burden of salaries, pensions and other committed expenditure on the state’s finances.
According to a status report submitted by the Chief Secretary before the High Court, Punjab’s outstanding DA and DR liability for the period from July 1, 2021, to September 30, 2026, stood at ₹22,818 crore. The state’s total outstanding liability towards employees and pensioners was estimated at ₹32,418 crore.
The government has also maintained that it inherited substantial pending liabilities from the previous administration.
Current DA Rate at 53%
During Thursday’s hearing, the Supreme Court was informed that the state had increased the DA rate from 43% to 53%.
However, the dispute over the release of accumulated arrears remains unresolved. The Supreme Court has now asked Punjab to present a concrete disbursement roadmap, with further consideration of the matter scheduled for December.
The stay provides interim relief to the Chief Secretary and other officials from the ongoing contempt proceedings.
