{"id":192263,"date":"1994-07-26T00:00:00","date_gmt":"1994-07-25T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/director-central-plantation-vs-m-purushothaman-and-ors-on-26-july-1994"},"modified":"2016-09-27T08:19:40","modified_gmt":"2016-09-27T02:49:40","slug":"director-central-plantation-vs-m-purushothaman-and-ors-on-26-july-1994","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/director-central-plantation-vs-m-purushothaman-and-ors-on-26-july-1994","title":{"rendered":"Director, Central Plantation &#8230; vs M. Purushothaman And Ors on 26 July, 1994"},"content":{"rendered":"<div class=\"docsource_main\">Supreme Court of India<\/div>\n<div class=\"doc_title\">Director, Central Plantation &#8230; vs M. Purushothaman And Ors on 26 July, 1994<\/div>\n<div class=\"doc_bench\">Bench: P.B. Sawant, M.K. Mukherjee<\/div>\n<pre>           CASE NO.:\nAppeal (civil)  885 of 1993\n\nPETITIONER:\nDIRECTOR, CENTRAL PLANTATION CROPS RESEARCH INSTITUTE, KESARAGOD AND ORS.\n\nRESPONDENT:\nM. PURUSHOTHAMAN AND ORS.\n\nDATE OF JUDGMENT: 26\/07\/1994\n\nBENCH:\nP.B. SAWANT &amp; M.K. MUKHERJEE\n\nJUDGMENT:\n<\/pre>\n<p>JUDGMENT<\/p>\n<p>1994 SUPPL. (2) SCR 267<\/p>\n<p>The following Order of the Court was delivered :\n<\/p>\n<p>This short question that falls for consideration in this appeal is whether<br \/>\nthe employees of the appellant-organisation, viz., the Central Plantation<br \/>\nCorps. Research Institute are entitled to House Rent Allowance (HRA)<br \/>\nalthough&#8217; they are offered official accommodation and they refuse to occupy<br \/>\nthe same.\n<\/p>\n<p>The responder-employees are occupying various posts in the appellant-<br \/>\norganisation. Orders allotting official quarters they were entitled to,<br \/>\nwere passed by the appellant-organisation. However, the employees declined<br \/>\nto occupy the same for one reason or the other. On their refusal to occupy<br \/>\nthe quarters, the appellant issued orders denying to them the benefit of<br \/>\nHRA which they were till then drawing. The respondent-employees challenged<br \/>\nthese orders before the High Court, Their writ petitions were subsequently<br \/>\ntransferred to the Central Administrative Tribunal and the Tribunal by the<br \/>\nimpugned common decision dated 5.5.1988, held that the employees cannot be<br \/>\ncompelled to occupy the official quarters and hence on their refusal to<br \/>\noccupy the same, they cannot be denied the benefit of the HRA. To arrive at<br \/>\nthis conclusion the Tribunal has given two reasons. The first is that under<br \/>\nthe relevant provisions, it is only those employees who had applied for<br \/>\nofficial accommodation and who refused to occupy the same, are liable to<br \/>\nforfeit the benefit of the HRA and not others. The second reason given by<br \/>\nthe Tribunal is that the HRA is a part of wages and no deduction from the<br \/>\nwages can be made merely on account of the refusal to accept the<br \/>\naccommodation.\n<\/p>\n<p>We are unable to agree with either of the said reason. It is obvious that<br \/>\nthe Tribunal has misread both the relevant provisions governing the<br \/>\nentitlement of the accommodation and the HRA as well as the rules which<br \/>\ndefine &#8220;pay&#8221;.\n<\/p>\n<p>It cannot be disputed and it does not appear to have been disputed before<br \/>\nthe Tribunal that it is para 4 of the Office Memorandum dated 27.11.1965 of<br \/>\nthe Government of India, Ministry of Finance which would govern the present<br \/>\ncase. The relevant portion of the said paragraph reads as follows :\n<\/p>\n<p>&#8220;4. The grant of house rent allowance shall be subject to the following<br \/>\nconditions:\n<\/p>\n<p>(a) (i) To those Government servants who are eligible for Govern-ment<br \/>\naccommodation, the allowance will be admissible only if they have applied<br \/>\nfor such accommodation in accordance with the prescribed procedure, if any,<br \/>\nbut have not been provided with it, in places where due to availability of<br \/>\nsurplus Government accommodation, special orders are issued by the Ministry<br \/>\nof Works and Housing from time to time making it Obligatory for employees<br \/>\nconcerned to obtain and furnish &#8216;no accommodation&#8217; certificate in respect<br \/>\nof government residential accommodation at their place of posting. In all<br \/>\nother places no such certificate is necessary.\n<\/p>\n<p>(ii) Government servants posted in localities where there is at present no<br \/>\nresidential accommodation in the general pool owned or requisitioned by the<br \/>\nCentral Government for allot-ment to them, need not apply for government<br \/>\nresidential accommodation in order to become eligible for house rent<br \/>\nallowance. But where Government quarters are available far the staff of<br \/>\nspecified Departments or for specified categories of staff, the procedure<br \/>\nfor applying for accommodation will be regulated under the rules of<br \/>\nallotment of the Department concerned or of the local office of the Central<br \/>\nPublic Works Department, as the case may be.\n<\/p>\n<p>[b] (i) The allowance shall not be admissible to those who occupy<br \/>\naccommodation provided by Government or those to whom accommodation has<br \/>\nbeen offered by Government but who have refused it. In the latter case, the<br \/>\nallowance will not be admissible for the period for which a Government<br \/>\nservant is debarred from further allotment of Government accommodation<br \/>\nunder the allotment rules applicable to him.\n<\/p>\n<p>(ii) The house rent allowance drawn by a Government servant, who accepts<br \/>\nallotment of Government accommodation, shall be stopped from the date of<br \/>\noccupation, or from the eight day after the date of allotment of Government<br \/>\naccommodation, whichever, is earlier. In case of refusal of allotment of<br \/>\nGovernment accommodation, house rent allowance shall cease to be admissible<br \/>\nfrom the date of allotment of Govern-ment accommodation. In case of<br \/>\nsurrender of Government accommodation, the house rent allowance, if<br \/>\notherwise ad-missible, will be payable from the date of such surrender.&#8221;\n<\/p>\n<p>It is clear from the aforesaid provisions that paragraphs 4 [a] (i) and\n<\/p>\n<p>(ii) -lay down the procedure for making application for accommodation.<br \/>\nParagraph 4 [b] (i) lays down the consequences on refusal to accept the<br \/>\naccommodation when offered. There is no doubt that paragraphs 4[a] (i) and\n<\/p>\n<p>(ii) state that an application has to be made to secure accommodation.<br \/>\nHowever, that does not mean that Government or the organisation such as the<br \/>\nappellant &#8211; organisation to which the said provisions apply, cannot on<br \/>\ntheir own offer accommodation to the employees. Hence the reason given by<br \/>\nthe Tribunal that it is only if the employee applies for such accommodation<br \/>\nand he refuses to accept the same when offered that he would be disentitled<br \/>\nto the HRA, is not correct. It must be remembered in this connection that<br \/>\nthe Government or the organisation of the kind of the appellant spends huge<br \/>\npublic funds for constructing quarters for their employees both for the<br \/>\nconvenience of the management as well as of the employees. The investment<br \/>\nthus made in constructing and maintaining the quarters will be a waste if<br \/>\nthey are to lie unoccupied. The HRA is not a matter of right. It is in lieu<br \/>\nof the accommodation not made available to the employees. This being the<br \/>\ncase, it follows that whenever the accommodation is offered the employees<br \/>\nhave either to accept it or to forfeit the HRA, The management cannot be<br \/>\nsaddled with double liability, viz., to construct and maintain the quarters<br \/>\nas well as to pay the HRA. This is the rationale of the provisions of<br \/>\nparagraph 4 of the said Government Office Memorandum.\n<\/p>\n<p>It is for this reason again that paragraph 4 [b] (I) provides that the HRA<br \/>\nshall not be admissible to those who occupy accommodation provided for them<br \/>\nas well as to those to whom accommodation has been offered but who have<br \/>\nrefused to accept it. The provisions of paragraph 4 [b] (i) are independent<br \/>\nof the provisions of paragraph 4 [a] (i) and (ii). Whereas paragraphs 4 [a]\n<\/p>\n<p>(i) and (ii) speak of procedure to be followed by the employees who are in<br \/>\nneed of accommodation, paragraph 4 [v] (i) provides for the forfeiture of<br \/>\nthe HRA even when the accommodation has been offered on its own by the<br \/>\nmanagement whether the application for the same has been made or not. There<br \/>\nis no distinction made in this provision between those who have applied and<br \/>\nthose who have not applied for accommodation. Even otherwise, we are of the<br \/>\nview that the distinction sought to be made by the Tribunal is on the face<br \/>\nof it, irrational, particularly taking into consideration the resources<br \/>\nspent on constructing the quarters.\n<\/p>\n<p>We are also afraid that the Tribunal is not right in including the.HRA in<br \/>\nthe definition of wages. The Fundamental Rule 9[21] (a) which is applicable<br \/>\nto the respondent-employees defines &#8220;pay&#8221; as follows :\n<\/p>\n<p>&#8220;9[21] (a) Pay means the amount drawn monthly by a Government servant as<\/p>\n<p>[i]      the pay, other than special pay granted in view of his ional<br \/>\nqualifications, which has been sanctioned for a. post held by him<br \/>\nsubstantively or in an officiating capacity, or to which he is entitled by<br \/>\nreason of his position in a cadre; and<\/p>\n<p>(ii]     overseas pay, special pay and personal pay; and<\/p>\n<p>[iii]    any other emoluments which may be specially classed as pay by the<br \/>\nPresident.&#8221;\n<\/p>\n<p>It is obvious from this definition that HRA is not part of &#8220;pay. Further,<br \/>\nFundamental Rule 44 defines &#8220;Compensatory Allowance&#8221; as follows :\n<\/p>\n<p>&#8220;F.R. 44. Compensatory allowance. &#8211; Subject to the general rule that the<br \/>\namount of compensatory allowance should be so regulated that the allowance<br \/>\nis not on the whole a source of profit to the recipient, the Central<br \/>\nGovernment may grant such allowances to any Government servant under its<br \/>\ncontrol and may make rules prescribing their amounts and the conditions<br \/>\nunder which they may be drawn.&#8221;\n<\/p>\n<p>The HRA would be covered by the definition of Compensatory Allowance, It is<br \/>\ncompensation in lieu of accommodation. This definition itself further makes<br \/>\nit clear that compensatory allowance is not to be used as a source of<br \/>\nprofit. It is given only to compensate for the amenities which are hot<br \/>\navailable or provided to the employee. The moment, therefore, the amenities<br \/>\nare provided or offered, the employee should cease to be in receipt of the<br \/>\ncompensation which is given for want of it. We wish the Tribunal had<br \/>\nperused the definition of &#8220;pay and compensatory allowance&#8221; given in the<br \/>\nFundamental Rules before pronouncing that the HRA is a part of the wages or<br \/>\npay and, therefore, cannot be disturbed.\n<\/p>\n<p>For both these reasons, therefore, we are unable to accept the conclusion<br \/>\nof the Tribunal.\n<\/p>\n<p>Shri Ranjit Kumar, learned counsel appearing for the appellant-organisation<br \/>\npointed out a letter dated 13.8.1986 addressed by the Under Secretary of<br \/>\nthe Indian Council of Agricultural Research to the appellant Wherein it is<br \/>\nstated that the matter was examined and it was held that the HRA should be<br \/>\ndenied to the employee who refuses to take the allotment made or when<br \/>\noffered to him till such time the quarter in question lies Vacant for want<br \/>\nof any other taker. This would mean that the HRA would be denied to the<br \/>\nemployee only for the period the quarter lies vacant consequent upon his<br \/>\nrefusal. While, therefore, setting aside the impugned order and allowing<br \/>\nthe appeal, we direct the appellant-organisation to deduct the HRA from the<br \/>\nsalary of the Respondent-employees only for the period the quarters which<br \/>\nwere offered to the employees remained vacant. The appeal is allowed<br \/>\naccordingly with no Order as to cost.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Supreme Court of India Director, Central Plantation &#8230; vs M. Purushothaman And Ors on 26 July, 1994 Bench: P.B. Sawant, M.K. Mukherjee CASE NO.: Appeal (civil) 885 of 1993 PETITIONER: DIRECTOR, CENTRAL PLANTATION CROPS RESEARCH INSTITUTE, KESARAGOD AND ORS. RESPONDENT: M. PURUSHOTHAMAN AND ORS. DATE OF JUDGMENT: 26\/07\/1994 BENCH: P.B. SAWANT &amp; M.K. MUKHERJEE JUDGMENT: [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-192263","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Director, Central Plantation ... vs M. 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