Karnataka High Court
B.H. Amar Venkatesh And Ors. vs Senior Superintendent Of Post Officers ... on 19 February, 2004
Equivalent citations: ILR2004KAR1600, 2004(5)KARLJ563
ORDER Raveendran, J.
1. The petitioners are employees of the Department of Posts presently working as Postmen/Post women/Postal Assistants. Petitioners claim that they are entitled to House Rent Allowance ("HRA" for short) if they are not provided any residential accommodation by the employer (Central Government).
2. The petitioners allege that they were not provided governmental accommodation. M/s Hindustan Machine Tools Limited ("'HMT' for short), a Government Company, which had some surplus residential quarters in its colony, has let out such quarters to them on rent. They claimed that they were paying a rent of Rs. 900/- per month (at the rate of Rs. 2/- Per square foot for an accommodation of about 450 square feet) plus other misc. charges ranging from Rs. 200/- to 400/ - per month towards electricity, water etc.. It is stated that rent has been subsequently increased to Rs. 3/- per sq ft and consequently they are paying rent at the rate of Rs. 1,350/- from 01-04-.2003, apart from other misc. charges.
3. The Department of posts have refused to pay HRA to the petitioners. The reason has been stated thus in its letter dated 26-4-2002:-
"In respect of those officials who are residing in the quarters allotted to them by the HMT authorities in HMT colony, HRA cannot be drawn as rent charged by the HMT authorities is not at market rate."
4. Feeling aggrieved petitioners filed Original Applications No. 892 and 904 to 912 of 2002 before the Central Administrative Tribunal, Bangalore Bench, for quashing the said communication dated 26-04-2002 issued by the Senior Superintendent of Post Offices, Bangalore West Division, Bangalore, and seeking a direction to the respondents to grant them admissible HRA with all consequential benefits. Subsequently, another prayer was added seeking a declaration that portions of Clauses (ii) and (iii) of Rule 5(c) of part V of FR/SR (HRC & CCC) as unconstitutional.
5. Respondents I to 4 resisted the said applications. Relying on Rule 5(c) of Part V of FR/SR (HRA & CCC), it was contended that Government servants are not entitled to HRA if they reside in any accommodation allotted to them by the Central Government, State Government or an Autonomous Public undertaking like HMT. They alternatively contended that as HMT has made available residential accommodation to petitioners at a concessional rate of rent on account of petitioners being Central Government employees, they are not entitled to HRA.
6. The Tribunal by order dated 21-05-2003 dismissed the applications, proceeding on the basis that Rule 5(c) barred payment of HRA, if the Government servant resided in an accommodation provided by an Autonomous Public Undertaking. Feeling aggrieved the petitioners have filed these Writ Petitions reiterating their contentions and the reliefs sought before the Tribunal. Before us, the petitioners did not press their prayer challenging the validity of Rule 5(c)(ii) and (iii). They also do not dispute the fact that 'HMT' may fall under the description of Autonomous public undertaking. Therefore, the only question that arises for consideration is whether Rule 5(c) disentitles petitioners to HRA.
7. Rule 5(c) relied on by the Department to deny HRA to petitioners reads as follows:
"5(c) A Government servant shall not be entitled to House Rent Allowance, if -
(i) he shares Government accommodation allotted rent-free to another Government servant; or
(ii) he/she resides in accommodation allotted to his/her parents/son/daughter by the Central Government, State Government, an Autonomous Public Undertaking or semi- Government organization such as a Municipality, Port Trust, Nationalized Banks, Life Insurance Corporation of India, etc.
(iii) his wife/her husband has been allotted accommodation at the same station by the Central Government, State Government, an Autonomous Public Undertaking or semi - Government Organization such as Municipality, Port Trust etc., whether he/she resides in that accommodation or he/she resides separately in accommodation rented by him/her."
8. A careful reading of Rule 5(c) shows that the petitioners do not fall under any of the three categories of Government servants enumerated in Rule 5(c) who are not entitled to HRA. We will refer to each category briefly.
8.1) A Government servant who shares Government accommodation allotted rent-free to another Government servant, falls under the first category. None of the petitioners share any rent-free Government accommodation allotted to another Government servant, as contemplated under Rule 5(c)(i).
8.2) A Government servant residing in an accommodation allotted to the spouse, parent, son, or daughter of such Government servant by an Autonomous Public Undertaking (or State Government, or Central Government or semi-Government Organizations such as Municipality, Port Trust, Nationalized Banks, Life Insurance Corporation of India etc.,) falls under the second category. Rule 5(c)(ii) will apply only if the following three conditions are fulfilled:
(i) The accommodation should belong to the State Government or Central Government or Autonomous Public undertaking or Semi-Government organisation (such as Municipality, Port Trust, Nationalised Banks, LIC etc.,);
(ii) Such accommodation should have been 'allotted' to the spouse/parent/son/daughter of the Government Servant. In the context, the term 'allotted' refers to allotment as residential quarters in connection with the employment of such spouse, parent, son or daughter. It does not refer to a regular renting of a premises belonging State/Central Government or autonomous public undertaking. [For example, if a Government servant's son doing private business, takes on rent a house from a Bank or Municipality, it cannot be said that the accommodation was 'allotted' by the Bank or Municipality);
(iii) The Government servant should reside in such accommodation allotted to the spouse/parent/son/ daughter.
Admittedly in these cases, the accommodation belonging to HMT has not been allotted to the spouse or parent or son or daughter of any of the petitioners. The accommodation is let out on rent on regular terms, to the Government servant himself. Therefore petitioners do not fall under Rule 5(c)(ii).
8.3) The third category is where the spouse (wife or husband, as the case may be) of the Government servant has been allotted accommodation at the same station by an Autonomous Public Undertaking (or State or Central Government or a semi Government Organization) irrespective of whether the Government servant resides in such accommodation or not. The spouse of none of the petitioners, has been allotted any accommodation by any Autonomous Public undertaking (or State/Central Government or Semi-Government organisation). Therefore, Rule 5(c)(iii) is also not applicable.
8.4) If petitioners do not fall under any of the three categories mentioned in Rule 5(c), obviously, they cannot he denied HRA by relying on Rule 5(c). It is contended by the Department that HRA is not admissible to those who occupy accommodation provided by the Government, or to those who have been offered accommodation by the Government, but who have refused it. The petitioners do not fall under those categories.
9. The State has relied on the following reasoning contained in a communication dated 12-8-2003 from the Director of Accounts (Postal), Karnataka Circle.
"A Govt. official who is allotted accommodation by Govt./Public Sector Undertaking is not entitled to HRA. According to para 5(c)(ii) & (iii) of GOI, MF OM No. 21011/ 13/89 E(8) dt. 20-12-1989, such of the employees whose spouse/ Parents/sons/daughters are allotted quarters by an autonomous Public Sector Undertaking shall not be entitled to HRA irrespective of the fact whether he/she resides in that accommodation or not. Further as per Rule 4(b)(viii) the Govt. servants living in hostels run by autonomous and semi-govt. organisations which are not run on commercial lines, (i.e., Central Govt. employees allotted hostel accommodation are not charged market rent, but subsidised rent), would not be entitled to house rent allowance.
On the analogy the employees who have been allotted the quarters by HMT (Govt. of India Public Sector Undertaking) are not eligible for HRA. As per HMT letter No. CSD/EO/OUT SIDE - ALLOT/2002-03 dated 26-12-2002, Postal officials occupying HMT quarters are not being charged rent at market rate."
We have already held Rule 5(C)(ii) and (iii) are not attracted.. Rule 4(b)(viii) applies only to Government Servants staying either in Government run Hostels, or Hostels run by Autonomous or semi-Government organisations which are not run on commercial lines. Rule 4(b)(viii) clarifies that Central Government employees who are allotted hostel accommodation at subsidised rent and not market rent will not be entitled to HRA. But, none of the petitioners are residing in any 'Hostels'.
10. Reliance is next placed on a communication dated 26- 12-2002 said to have been issued by HMT stating that it is not charging 'market rate' of rent in the case of petitioners. We fail to understand what HMT means when it says that 'it is not charging market rate of rent'. When rent is charged at the rate of Rs. 2/- per sq.ft. (now Rs. 3/ - per sq.ft.) in regard to quarters situated on the outskirts of Bangalore, to tenants who are in occupation for several years, we find no basis or logic in the alleged statement of HMT' that 'market rate' is not charged. We extract below the relevant portion of a standard allotment letter (dated 14-6-2001) issued by HMT to demonstrate that the letting of accommodation in favour of petitioners are regular/normal leases:
"1. Licence fee: The monthly rent for this quarter shall be Rs. 2/- per sq.ft.. per month. The total plinth area is 450 sq.ft. The total rent works out to Rs. 900/- per month.
2. Electrical Charges will be at actuals for consumption of power and hire charges for Electric Meter reading according to prevailing KEB, AEH rates.
3. Water Charges: A sum of Rs. 96/- per month shall be charged towards water consumption for the present or as fixed by the Management from time to time.
4. Service Charges: Rs. 25/- will be levied for servicing, water, electricity, sanitation and other services.
5. Repairs at the time of occupation: This shall be carried out by the allottee only.
6. Water/Electrical Fittings: HMT will provide only Fan(fixture) but all other Electrical/Water supply fittings such as tubes, bulbs taps etc., will have to be put by the allottee only.
7. Advance Payment and monthly payment of Licence Fees, Water & Elec. Charges etc.,: Three months licence fee, water and electrical charges Rs. 3,000/-(approximately) shall be deposited with HMT before occupation of the above quarter which shall not carry any interest. Licence fee and all other charges should be deducted/recovered from the monthly salary of your employee and remitted to us, within 10 days from the date of raising such bill, you are solely responsible for making recoveries from the salary/otherwise and to pay it to HMT Ltd., Common Services Division. Interest shall be charged at 24% pa. for belated payment."
Nothing is placed on record to show that the rent charged is either nominal or at a concessional rate because the petitioners happen to be Government Servants. Even if HMT is charging a marginally lower rate of rent than market rate to petitioners, HRA cannot be denied to petitioners as there is no provision for denial on such ground. As the letting of the premises of HMT to the petitioners do not fall under Rule 5(c). HRA cannot be denied to them.
11. The Tribunal has misread Rule 5(c). In para 10 of its order, it has proceeded on the basis that Rule 5(C) of FR/SR Part V of HRA and CCA Rules provides that "No HRA is payable to Government Servants, if they reside in an accommodation allotted to them by an autonomous public sector undertaking". But, Rule 5(c) does not contain such a provision. In fact the Tribunal has gone to the extent of saying that its earlier decisions in OA No. 1102/1994 and 1132 to 1141/ 1994 to the contrary, were rendered without noticing such a provision. The fact that HMT which has allotted its surplus houses in its colony to State Government or Central Government employees on rent, is a public sector undertaking/Government Company does not mean that the Government Servant who have taken houses on rent from the HMT can be denied HRA. The Tribunal by misreading Rule 5(c), has denied benefit of HRA to the petitioners.
12. In view of the above the petitions are allowed in part as follows:
(i) The order of the Central Administrative Tribunal, Bangalore Bench, dated 21.5.2003 in OA No. 892, 904 to 912/2002 is set aside.
(ii) The communication dated 26-04-2002 sent by the Senior Superintendent of Post Offices, Bangalore West Division, Bangalore, holding that officials of Postal Department who are residing in the quarters allotted on rent by HMT cannot draw HRA, is quashed.
(iii) The respondents are directed to consider the request of petitioner to pay the HRA admissible to them in accordance with law. Compliance in three months from the date of receipt of this order.