Ration Money Allowance

The Ration Money Allowance is the cash paid to an entitled uniformed employee in place of the ration they are entitled to receive in kind, when the ration is not actually issued as food. It settles the ration entitlement in money at a per-day rate fixed by the cost of the authorized daily ration scale, so it is a provisioning allowance for food rather than a reward, a risk allowance or a pay-linked allowance. It is drawn mainly by the personnel of the Central Armed Police Forces and, in defined circumstances, by defence personnel.

The allowance is worth understanding precisely because it works on a different principle from almost every other allowance in this series. The risk and hardship allowances, from the flying allowance to the field area allowance , are keyed to pay and stepped up with dearness allowance; the Ration Money Allowance is keyed to the price of food. It is the one allowance that tracks the cost of a daily ration rather than the pay commission, and that single fact explains most of what is distinctive about it: how its rate is fixed, how it is revised, and why it is not a percentage of pay.

This article explains what the ration entitlement is and how the allowance settles it in cash, who is entitled, how the per-day rate is fixed against the ration scale, the free-ration policy in the Central Armed Police Forces, the defence context, how the allowance differs from the pay-linked allowances, and the tax position. It is a child of the allowances hub.

The ration entitlement and the cash in lieu

The uniformed forces have long carried an entitlement to a daily ration. A member of an entitled force is authorised a fixed scale of food each day, the ration scale, which sets out the quantities of the various food items a person is to receive. That entitlement can be met in two ways. It can be provided in kind, as cooked food in a mess or as dry ration issued to the individual, or it can be settled in cash, by paying the money equivalent of the day’s ration, which is the Ration Money Allowance.

The allowance, then, is not an addition on top of the ration; it is the ration itself, paid in money because the food was not issued. Where a force provides free ration in kind, the member does not also draw the Ration Money Allowance for the same period, because the entitlement has been met in food. Where ration in kind is not provided, the member draws the allowance instead, at the per-day rate, so that the ration entitlement is honoured one way or the other. This in-kind-or-cash character is the heart of the allowance and marks it off from the pay-linked allowances, which are additions to pay rather than the cash form of a benefit.

Who is entitled

The main body entitled to the ration, and therefore to the allowance when ration in kind is not issued, is the personnel of the Central Armed Police Forces: the Central Reserve Police Force , the Border Security Force, the Central Industrial Security Force, the Indo-Tibetan Border Police, the Sashastra Seema Bal and the Assam Rifles. These forces carry a ration entitlement for their personnel, and the Ration Money Allowance is the cash settlement of that entitlement where food is not provided in kind.

Defence personnel are also entitled to rations, and draw ration money in lieu in defined situations where rations in kind are not issued. The common thread is that entitlement to a ration is a feature of the uniformed services, tied to the demands of their service and their deployment, rather than a benefit of central government employment generally. An ordinary civilian central government employee is not entitled to a ration and does not draw this allowance; it belongs to the forces whose service rules carry the ration entitlement.

Why the ration is provided at all

It is worth pausing on why the uniformed services carry a ration entitlement in the first place, because it explains the shape of the allowance. A soldier or a member of a paramilitary force is often deployed away from home and from the ordinary means of feeding themselves: in barracks, in camps, on operational duty in the field, in places where there is no market and no kitchen of one’s own, and under a discipline and a readiness that do not leave a person free to arrange their own meals. Feeding the force is therefore part of sustaining it, not a personal matter left to each member, and the ration entitlement is the mechanism by which the service ensures its people are fed to a set standard wherever they serve.

That is why the ration is defined as a scale, a fixed daily standard of nutrition, rather than left to the individual, and why it is provided in kind through messing arrangements wherever the deployment allows. The Ration Money Allowance enters only where feeding in kind is not the arrangement, as the cash form of the same entitlement. Seen this way, the allowance is not a perk added to pay but the monetary tail of a provisioning obligation the service owes its personnel, which is a very different thing from an allowance designed to compensate a hardship or reward a duty.

How the per-day rate is fixed

This is the section that explains what is distinctive about the allowance. The Ration Money Allowance is a per-day amount, and the amount is fixed by the cost of the authorized ration scale. The ration scale is a fixed basket, so many grams of this and so many of that across the food items a person is entitled to, and the allowance is the money value of that basket at prevailing prices. When the ration is settled in cash rather than in kind, the member is paid what the day’s ration would cost.

Because the rate is a food cost, it is revised as the cost of the ration scale changes, not by the pay commission and not by the dearness-allowance escalator that lifts the pay-linked allowances. The administering ministry, the Ministry of Home Affairs for the Central Armed Police Forces, notifies the current per-day rate and revises it as food prices move, so the figure is periodically updated rather than fixed at a pay-commission value. The rate is of the order of about a hundred rupees a day at recent levels, but because it is revised with food prices the precise current figure should be read from the latest notification for the force rather than assumed, since it is exactly the kind of number that changes between revisions.

The contrast with the matrix allowances is worth stating plainly. A field area allowance is a fixed rupee amount set by the 7th Central Pay Commission and stepped up 25 per cent at each 50-point rise of dearness allowance; the Ration Money Allowance is a food-cost figure revised against the ration scale. The two move on entirely different clocks, and that is why the Ration Money Allowance is not quoted as a pay-commission rate.

The ration scale and how it is priced

The ration scale is the anchor of the whole allowance, so it is worth seeing what it is. It is an authorised list of food items with a daily quantity for each, wheat or rice, dal, edible oil, vegetables, milk, sugar, tea, meat or its equivalent and so on, designed to provide a set nutritional standard for a person on the strength of the force. The scale is a service document, revised as dietary standards and requirements are reviewed, and it defines exactly what the ration entitlement consists of on any given day.

Pricing that scale is what produces the money figure. The cost of the basket is worked out at the prevailing rates for the items, and it is that cost, per person per day, that the Ration Money Allowance pays where the ration is settled in cash. Because the basket is fixed but its cost is not, the allowance rises and falls with the price of the items in the scale, which is why it is revised on a food-cost cycle rather than on a pay cycle. When the cost of the scale is reassessed, the per-day rate is renotified, and the new figure flows through to the members drawing the allowance. This mechanism, a fixed basket priced at current rates, is the reason the allowance behaves like a cost-of-food index rather than like a pay-linked allowance, and it is the single most important thing to understand about how the rate is set and revised.

In kind or in cash: the practical difference

For the member, the difference between receiving the ration in kind and drawing the Ration Money Allowance is a real one in daily life, not just an accounting distinction. Ration in kind means the food is provided: a mess cooks and serves meals to a set scale, or dry ration is issued to the individual to prepare, and the member does not handle the money for it. Ration money means the member is paid the cash equivalent and arranges their own food from it. Which arrangement applies depends on the deployment and the force’s policy for it, and it can change as a member moves between a static posting with a mess and a deployment without one.

The two are alternatives for the same entitlement, so a member is not paid the Ration Money Allowance for a period in which they are being fed in kind, and is not fed in kind and also paid the cash for the same day. The entitlement is met once, in food or in money. This is the practical face of the in-kind-or-cash principle set out above, and it is why a member’s pay slip may show the Ration Money Allowance in some months or postings and not in others, according to how the ration was met, rather than as a steady monthly figure like a pay-linked allowance.

How it is claimed and disbursed

Because the allowance is tied to the days on which the ration entitlement is met in cash rather than in kind, it is claimed and paid on the basis of the entitled days and the current per-day rate. The establishment works out, for the period, the days on which the member was entitled to the ration and was not fed in kind, and pays the per-day rate for those days, so the amount for a period is the per-day rate multiplied by the number of qualifying days. In a large force this is a routine part of the monthly processing, drawn from the strength and deployment records rather than from an individual claim in most cases.

Two points follow. First, the allowance is inherently variable from month to month, because it depends on the number of qualifying days and on the current per-day rate, both of which can change. Second, a change in the per-day rate, when the ration scale is repriced, flows into the allowance from the effective date of the new rate, and any adjustment for an intervening period is settled as the accounts are brought up to date. The allowance is, in short, administered as the cash settlement of a daily entitlement, which is a different rhythm from the flat monthly pay-linked allowances.

The free-ration policy in the CAPFs

The mix of ration in kind and ration money in the Central Armed Police Forces has been a live policy question, and it is worth setting out the shape of it even though the detail is governed by the Ministry of Home Affairs orders. The general direction has been to provide ration in kind, free ration, where it is feasible, particularly on operational and field deployments where a member cannot readily buy and cook food, and to pay the Ration Money Allowance where ration in kind is not provided. The aim is that the ration entitlement is met, in food where food can be provided and in cash where it cannot.

The Government has revised the arrangements over the years, including steps to extend free ration within the forces, so the balance between free ration and ration money for a particular force and a particular category of personnel is set by the current orders rather than fixed for all time. The safe reading for any specific case is that the entitlement to a ration is settled either in kind or in cash under the current Ministry of Home Affairs policy for the force, and a member should read the arrangement that applies to their force and deployment rather than assume a single rule across all the Central Armed Police Forces.

The direction of these revisions has been a welfare one. Providing free ration in kind, rather than leaving personnel to feed themselves from a cash allowance, is treated as a measure that supports the morale and the operational readiness of a force whose members are frequently deployed away from home for long periods, and successive orders have leaned towards widening free ration where it can be provided. That welfare framing is why the ration question recurs in the discussion of conditions of service for the forces: it is read not merely as an accounting choice between food and cash but as part of how the state looks after the people it deploys. The Ration Money Allowance remains the necessary cash form of the entitlement wherever feeding in kind is not practical, but the policy emphasis has been to feed in kind where it can be done.

The defence context

In the defence forces the ration is a long-standing entitlement, and the ordinary arrangement in service is ration in kind: free rations are provided to personnel, in peace stations and in the field, as part of the conditions of military service. The Ration Money Allowance arises in the defined situations where rations in kind are not issued and the entitlement is met in cash instead, so in the defence context the cash allowance is the exception and ration in kind is the norm, the reverse of the emphasis in some other settings.

That difference of emphasis is itself instructive. It shows that the ration entitlement is the constant across the uniformed services, and that whether it appears as free food or as Ration Money Allowance depends on how the particular force meets the entitlement for the particular deployment. The Military Service Pay and the risk and hardship allowances are separate matters entirely; the ration, whether in kind or in cash, is the provisioning of food and stands apart from the pay elements that recognise the nature and the hazard of the service.

How it differs from the pay-linked allowances

It helps to place the Ration Money Allowance against the other allowances a member of the forces draws, because it is easy to lump them together as “allowances” when they work quite differently. The field area allowance , the high altitude and Siachen allowance and the other risk and hardship allowances are pay-linked: they are fixed rupee amounts by pay band, set by the pay commission and stepped up with dearness allowance, and they compensate the risk and hardship of the duty. The Ration Money Allowance is none of these things. It is not a percentage of pay, it does not step up with dearness allowance, and it does not compensate risk or hardship; it settles a food entitlement in cash at the cost of the ration.

The practical upshot is that a member of the Central Armed Police Forces on an operational deployment may draw a field area allowance for the hardship of the deployment and, separately, either free ration in kind or the Ration Money Allowance for the food, because the two answer completely different things. The field allowance is for the field service; the ration or its cash equivalent is for the food. Treating them as one would misunderstand both, which is why the Ration Money Allowance is best kept in its own category, the provisioning allowances, apart from the pay-linked risk and hardship allowances.

The tax position

The cash Ration Money Allowance is generally taxable as part of salary income. There is no specific exemption for it under the Section 10(14) provisions read with Rule 2BB of the Income-tax Rules, which exempt defined categories of field, travel and duty allowances rather than a food-provisioning allowance, so the cash allowance is counted in gross salary in the ordinary way. Under the default new tax regime the great majority of the Section 10(14) exemptions are withdrawn in any case, so the position there is likewise that the allowance is taxable.

Ration provided in kind is a different matter, treated as a benefit rather than a cash allowance, and its tax treatment follows the rules for benefits in kind rather than those for a cash allowance. This creates an asymmetry worth noting: the same ration entitlement, met in cash, is a taxable allowance, while met in food it is a benefit in kind valued under different rules, so the tax outcome can differ according to how the entitlement is settled even though the underlying entitlement is the same. Because the treatment can turn on the force, the situation and whether the ration is met in kind or in cash, the precise position for a given member should be confirmed against the current rules. For how allowances generally feed into the salary computation and the choice of regime, see income tax for government employees and old versus new tax regime .

The 8th CPC outlook

The Ration Money Allowance is not a pay-commission rate in the way the matrix allowances are, so it does not depend on a pay commission to move; it is revised against the cost of the ration scale by the administering ministry, and it will continue to be settled in kind or in cash under the policy for each force. The 8th Central Pay Commission may comment on the ration arrangements, but the rate itself is a food-cost figure that is revised on its own cycle rather than fixed by the commission, so there is no pay-commission figure to await for it in the way there is for the risk and hardship allowances. The settled position is that the ration entitlement is met in kind where feasible and in cash as the Ration Money Allowance otherwise, at the per-day rate notified for the force.

Related Articles

• Allowances for central government employees
• Central Armed Police Forces
• Central Reserve Police Force
• CAPF constable salary
• Field area allowance
• High Altitude and Siachen Allowance
• Flying allowance
• Risk and hardship allowance
• Counter-insurgency operations allowance
• Military Service Pay
• Dress allowance
• Dearness allowance
• Salary by pay level
• Pay matrix
• Basic pay
• Income tax for government employees
• Old versus new tax regime
• Section 115BAC (default new regime)
• Take-home salary for central government employees
• Defence pay matrix
• Department of Expenditure
• 7th Central Pay Commission
• 8th Central Pay Commission
• Central government employees in India
• 7th CPC salary calculator

External references

• Department of Expenditure: 7th CPC allowance orders
• Ministry of Home Affairs
• Income Tax: allowances under Rule 2BB

References

1. Report of the Seventh Central Pay Commission (November 2015), Chapter 8 (Allowances): treatment of the Ration Money Allowance and the ration entitlement of the uniformed forces.
2. Ministry of Home Affairs orders on the ration entitlement of the Central Armed Police Forces, the provision of ration in kind and the Ration Money Allowance in lieu, and the per-day rates fixed against the authorized ration scale.
3. Ministry of Defence orders on the ration entitlement of the defence forces and ration money in lieu where rations in kind are not issued.
4. Notifications revising the per-day Ration Money Allowance rate against the cost of the authorized daily ration scale.
5. Income-tax Act 1961, Section 10(14) read with Rule 2BB of the Income-tax Rules, and Section 115BAC (the new tax regime), on the taxability of a cash provisioning allowance outside the notified exemptions.