7th Pay Commission latest update: Big relief for central government employees! Modi Govt announces major relaxations on LTC allowance

New Delhi: The Narendra Modi government has announced 3 major relaxations on reimbursement of cancellation/reschedule charges for air/train tickets booked for the purpose of LTC and relaxation of LTC advance due to COVID-19 pandemic- relaxation with the Ministry of Personnel & Training issuing an Office Memorandum (OM) on the 7th pay commission linked LTC allowance.

Ministry of Personnel, Public Grievances and Pensions Department of Personnel and Training has announced that during the months of March– May, 2020, a nation-wide lockdown was implemented across the country in view of the prevailing Covid-19 epidemic. During this period, all domestic flights within India were cancelled but certain airlines have charged the cancellation charges against the pre-booked air tickets. In such a situation, many government employees who had booked LTC tickets in advance for that period are facing financial difficulties in view of the high cancellation amount charged by the airlines. In this regard, requests are being received in this Department for grant of one-time relaxation for reimbursement of the cancellation charges.

The ministry has also observed that many airlines have not refunded the ticket amount for the air tickets booked in advance for the LTC journey scheduled during the Iockdown period. 

"These airlines have kept the booking amount with them in the form of ‘credit shell’ and have given the option to the passengers to travel within a year. This is causing undue hardships to the Government employees as the LTC advance along with penal interest, is required to be returned if the journey is not undertaken. Requests have been received in this regard for extension of time-limit for settlement of LTC advance and exemption of penal interest till such date the journey is performed by them," an official statement said.

For the benefit of the employees, Ministries/ Departments have been delegated the power to reimburse the cancellation/ reschedule charges of air/train tickets, as a one-time relaxation, to such Government servants who had booked advance air/train tickets for the purpose of LTC journey during the Lockdown period from 24th March, 2020 to 31st May, 2020 but were not able to perform the journey due to cancellation/ rescheduling of flights / trains during that period. 

Such government servants seeking reimbursement of cancellation/ reschedule charges shall be required to produce the receipt of cancellation/ re-schedule charges incurred by them. In cases where the airlines have kept the refund amount in ‘Credit Shell’, Ministries / Departments may extend the period of repayment of LTC advance taken by the Government servant for LTC journey scheduled during the lockdown period(March-May, 2020), till 28.02.2021 or till such time the amount in ‘Credit Shell’ is utilised by the Government servant to perform LTC journey, whichever is earlier. Also, penal interest may not be charged on LTC advance amount taken by the Government servant on LTC journey scheduled during the lockdown period.

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In cases where the Government servants have drawn LTC advance as well as leave encashment so as to perform the LTC journey, but could not perform journey during the lockdown period and now intend to opt for Special Cash Package Scheme in lieu of LTC in accordance with Department of Expenditure’s OM No. 12(2) / 2020-E.II(A) dated 12.10.2020, they are also allowed to avail the facility of the Scheme. The LTC advance and leave encashment which have remained unsettled due to non-performance of the journey, may be adjusted as per the provisions of the Special Cash Package Scheme.