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) 

Recommendations of the VI CPC

Grade pay taken from 40% Exiting maximum pre -revised  pay scale (Details of 6th CPC Report attached)
In some cases, the amount of grade pay has been adjusted so as to maintain a clear differential between successive grades pay.(PB 3-PB4)
Recommendations of the VI CPC grade pay


Pay Band Calculation
Basic pay *1.86
Pay band(rounded of)
Grade pay
Calculation
40% Exiting maximum pay scale

Grade pay

S4
2750-70-3300-75-4400

2750*1.86=5115
PB1
5200-20000
4400*40/100=1760
1800
S5
3050-75-3950-80-4590
PB1
5200-20000
4590*40/100=1836
1900
S6
3200-85-4900
PB1
5200-20000
4900*40/100=1960
2000
S7
4000-100-6000
PB1
5200-20000
6000*40/100=2400
2400
S8
4500-125-7000
PB1
5200-20000
7000*40/100=2800
2800
S9
5000-150-8000
5000-8000,5500-9000 and Rs 6500-10500
(pre revised pay scale of Rs of Merged)

5000*1.86=9300
PB2 (START)
9300-34800
(10500*40/100=4200

4200
S10
5500-175-9000
PB2
9300-34800

4200
S11
6500-200-6900
PB2
9300-34800

4200
S12
6500-200-10500
PB2
9300-34800

4200
S13
7450-250-11500
PB2
9300-34800
11500*40/100=4600
4600
S14
7500-250-12000
PB2
9300-34800
12000*40/100=4800
4800
S15
8000-275-13500
PB2
9300-34800
13500*40/100=5400
5400






GROUB A
8000-275-13500
PB3
15600-39100

5400
S16
9000-

15600-39100

5400
S17
9000-275-9550

15600-39100

5400
S18
10325-325-10975

15600-39100


S19
10000-325-15200-16500

15600-39100
16500*40/100=6600
6600








From the timetable given above, we can clearly understand how the Pay Band and Grade Pay are calculated. This calculation method generally applies for Pay Bands I and II. For Pay Bands III and IV it differs slightly. 
Developed by Viswa P