The Punjab and Haryana High Court on Monday directed the Punjab government to release the pending Dearness Allowance (DA) to its employees and pensioners within 15 days and barred it from issuing any large-scale advertisement campaigns until the dues are paid.Rejecting appeals by the State and Punjab State Power Corporation Limited (PSPCL) challenging a single-judge verdict, a division bench of Acting Chief Justice Ashwani Kumar Mishra and Justice Rohit Kapoor also made it clear that if the payment is not made by the end of the deadline, the government will have to pay six per cent simple interest on the outstanding amount.“The State of Punjab and PSPCL are directed to grant and release all up-to-date pending installments of Dearness Allowance/Dearness Relief (DA/DR) to all its employees and pensioners, respectively, at the same rates as has been paid to the members of the All India Services (IAS/IPS/IFS) serving within the State of Punjab, in accordance with the Central Government pattern, within a fortnight,” the bench ruled.“Till all such dues are cleared, the State of Punjab shall not resort to any unproductive expenditures such as large-scale advertising campaigns in print or social media as these expenses cannot justify the denial of dues admissible to State employees”, the Bench ordered.The bench also directed the Punjab chief secretary to to ensure “scrupulous compliance of the directions” and “file a compliance report by way of affidavit” by August 31, 2026.The State government had earlier submitted that it was not in a position to comply with the single bench directions to release arrears amounting to more than Rs 15,000 crore.Delivering the order, the division bench laid emphasis on “unproductive expenditures”.Story continues below this ad“…the issue of financial constraints is being raised as a ground for withholding the legitimate dues of the State’s own employees. However, as per the information available in the public domain, the State is expending large amounts of money on grant of freebies, doles, advertorial campaigns, and other expenditure, which would not strictly fall within the domain of essential expenditure by a welfare State, cannot be brushed aside, lightly,” the bench said.The bench further held that State cannot withhold the legitimate dues payable to the employees. “Viewed in any manner, large scale advertising campaigns in print or social media and other unproductive expenses cannot justify denial of dues admissible to the State employees,” it added.If implemented, close to 8 lakh employees and pensioners will benefit from the order. The salary of certain employees could increase by approximately Rs 10,000 to Rs 15,000 per month.The State government had challenged the order submitting that it was not in a position to comply with the single bench directions to release arrears that amount to more than Rs 15,000 crore.Story continues below this adRejecting Punjab’s submission, a single bench of Justice Harpreet Singh Brar on April 8 had directed the state government and PSPCL to grant 58 per cent DA alongwith arrears to all employees and pensioners at par with officers from the IAS, IPS, IFS and judicial services. The court had given the State to comply with the order by June 30.The petitioners had earlier submitted that DA instalments with effect from July 1, 2023 have not been released to serving employees and pensioners. They had also challenged a liquidation plan submitted by the Punjab government proposing to pay the pending pension and DA to employees over five financial years and for pensioners below the age of 75 years over 42 instalments without interest.The division bench, however, termed the proposal a “discriminatory approach” and held that the state government was bound by its policy decision of adopting the central government pattern for payment of DA.The then Congress led dispensation in Punjab had in June 2021 approved the recommendation of the 6th Pay Commission to grant DA to the state employees on the patter of central government. It, however, failed to release the money following which employees moved the court.Story continues below this adIn the high court, the Punjab government had argued that it had not accepted the June 2021 report. It had submitted that a new plan had been introduced on February 18, 2025. The government had further contended that Punjab already provides its employees with higher pay scales than many other states (“high pay master”), and therefore there was no need to grant additional DA.However, Advocate Sunny Singla, appearing for the employee organizations, argued that the Punjab government is legally bound to provide DA to its employees and pensioners in accordance with the central government pattern. He pointed out that IAS, IPS, IFS, and judicial officers were already receiving DA at central government rates, while other employees and pensioners were being unfairly denied the same benefit.According to Singla, the court also directed the government to release the DA pending from January 1, 2016.The Punjab government is currently paying 42% DA to its employees. However, compared to central government staff, 18 per cent DA remains unpaid. Employee organizations had long been demanding that this gap be eliminated and the outstanding amount be released.Story continues below this adEmployee organisations also relied on a judgment of the Supreme Court, which held that DA is not a bonus or an ex gratia payment but an integral component of an employee’s salary. On this basis, they argued that the pending DA and arrears should be released without further delay.