Is TDS Applicable To Allowances To Judicial Officers Under SNJPC? Supreme Court To Consider

The Supreme Court is set to examine the issue of the applicability of provisions of Tax Deduction at Source (TDS) on the allowances given to judicial officers under the Second National Judicial Pay Commission (SNJPC) . The Court is examining this issue in the All India Judges Association case in which it is overseeing the implementation of the recommendations of the Second National Judicial Pay Commission (SNJPC). 

During the hearing, amicus curiae K Parameshwar told the bench that many states are imposing TDS on the allowances given to judicial officers. He said that the issue required a determination.

Additional Solicitor General (ASG) Mr N Venkataraman sought time to examine the question of TDS applicability with the Revenue Department of the Ministry of Finance.

Accordingly, the bench comprising CJI DY Chandrachud and Justices JB Pardiwala and Manoj Misra posted the matter on August 5 for further deliberation. Additionally, the Court directed that the issue of applicability of the National Pension Scheme to district court judges will be heard on July 22 at 2 PM. 

On January 10, the Top Court in its decision in the All India Judges Association directed the States to implement the recommendations of the Second National Judicial Pay Commission regarding the pay and allowances for judicial officers. 

The judgment set a deadline of February 29, 2024, for the States to pay the arrears to judicial officers in terms of the recommendations of the SNJPC. The Court also directed the High Courts to constitute a committee named 'Committee for Service Conditions of the District Judiciary' to oversee the implementation. 

“All States and Union Territories shall now act in terms of the above directions expeditiously. Disbursements on account of arrears of salary, pension and allowances due and payable to judicial officers, retired judicial officers and family pensioners shall be computed and paid on or before 29 February 2024.,”

Last week, the Court took exception to various States defaulting on the directions and directed the personal appearance of the Chief and Finance Secretaries of those States on August 23.

In terms of the allowances, the decision extensively covers 13 types of major and minor allowances for the judicial officers. These include (1) House Building Advance (HBA); 2. Children Education Allowance (CEA); 3. Conveyance/Transport Allowance (TP); 4. Higher Qualification Allowance; 5. Hill Area/Tough Location Allowance; 6. Home Orderly/Domestic Help Allowance; 7. House Rent Allowance and Residential Quarters; 8. Medical Allowance; 9. Risk Allowance; 10. Special Pay for Administrative Work; 11.Transfer Grant; 12. Newspaper and Magazine allowance and 13. robe Allowance. 

Details of each allowance can be found here. 

Background 

In June 2022, the Supreme Court had directed the implementation of the enhanced pay scale as recommended by the Second National Judicial Pay Commission with effect from January 1, 2016. The bench of Chief Justice of India NV Ramana, Justices Krishna Murari and Hima Kohli also directed the Centre and the States to pay the arrears to the officers in 3 instalments - 25% in 3 months, another 25% in next 3 months and balance by June 30, 2023. Revised directions on disbursal of arrears were passed by the Court in May 2023.

The Second National Judicial Pay Commission was constituted by the Apex Court in 2017 to review the pay scale and other conditions of Judicial Officers belonging to the district judiciary all over the country. The Bench comprising Justices J Chelameswar and Abdul Nazeer had appointed former Supreme Court Judge Justice PV Reddy as commission Chairman and former Kerala High Court Judge and Senior Supreme Court lawyer R.Basant as member.

Case Title: All India Judges Association v. UoI And Ors. WP(C) No. 643/2015

Click here to read the order