J&K Govt Raises Retirement Gratuity Cap to ₹25 Lakh as DA Hits 50%

Srinagar: The Jammu and Kashmir Government has enhanced the maximum ceiling of Death-cum-Retirement Gratuity (DCRG) for its employees from ₹20 lakh to ₹25 lakh with effect from January 1, 2024, following the Dearness Allowance (DA) reaching 50 per cent of the basic pay under the 7th Pay Commission.

The announcement was made by the Finance Department in response to queries regarding the applicability of the increased gratuity limit after the DA revision. The enhancement is in accordance with Note 8 below Article 240-BB of the Jammu and Kashmir Civil Service Regulations, Volume I, inserted vide SRO-194 dated April 24, 2018.

The provision states that the ceiling on Death-cum-Retirement Gratuity shall automatically increase by 25 per cent whenever Dearness Allowance rises by 50 per cent of the basic pay.

Earlier, through Government Order No. 178-F of 2024 dated May 21, 2024, the government had sanctioned payment of Dearness Allowance at the revised rate of 50 per cent of Basic Pay to employees working in regular pay levels under the 7th Pay Commission, effective from January 1, 2024.

Following representations seeking clarity on the consequential enhancement of DCRG, the Finance Department examined the matter and clarified that the maximum gratuity limit stands revised by 25 per cent, from ₹20 lakh to ₹25 lakh, effective from the date the DA reached 50 per cent, i.e., January 1, 2024, subject to the conditions governing grant of gratuity under the rules.

The decision is expected to benefit government employees retiring on or after the specified date, ensuring alignment of gratuity benefits with the revised DA structure.