On what basis is the minimum Pay Band & Grade Pay created?
Only in the 6th Pay commission, the new method of Running pay band and Grade Pay was introduced. Till the 5th pay commission, the Basic Pay was not divided, but in the 6th CPC, it was split in to Pay Band and Grade Pay.
The Pay Band was calculated by putting together the 5th CPC Basic Pay, Dearness Pay and Dearness Allowance of 24% . (i.e. 1.86 Multiple factor in 6 CPC) 

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