JUDGMENT

The short question that falls for consideration in this appeal is whether the employees of the appellantorganisation, viz., the Central Plantation Crops Research Institute are entitled to House Rent Allowance (HRA) although they are offered official accommodation and they refuse to occupy the same.

2. The respondent-employees are occupying various posts in the appellant-organisation. Orders allotting official quarters they were entitled to were passed by the appellant organisation. However, the employees declined to occupy the same for one reason or the other. On their refusal to occupy the quarters, the appellant issued orders denying them the benefit of HRA which they were till then drawing. The respondent-employees challenged these orders before the High Court. Their writ petitions were subsequently transferred to the Central Administrative Tribunal and the Tribunal by the impugned common decision dated 5-5-1988, held that the employees cannot be compelled to occupy the official quarters and hence on their refusal to occupy the same, they cannot be denied the benefit of the HRA. To arrive at this conclusion the Tribunal has given two reasons. The first is that under the relevant provisions, it is only those employees who has applied for official accommodation and who refused to occupy the same are liable to forfeit the benefit of the HRA and not others. The second reason given by the Tribunal is that the HRA is a part of wages and no deduction from the wages can be made merely on account of the refusal to accept the accommodation.

3. We are unable to agree with either of the said reasons. It is obvious that the Tribunal has misread both the relevant provisions governing the entitlement of the accommodation and the HRA as well as the rules which define "pay".

4. It cannot be disputed and it does not appear to have been disputed before the Tribunal that it is para 4 of the Office Memorandum dated 27-11-1965 of the Government of India, Ministry of Finance which would govern the present case. The relevant portion of the said paragraph reads as follows:

"4. The grant of house rent allowance shall be subject to the following conditions:-

(a)(i) To those Government servants who are eligible for Government accommodation, the allowances will be admissible only if they have applied for such accommodation in accordance with the prescribed procedure, if any, but have not been provided with it, in places where due to availability of surplus Government accommodation, special orders are issued by the Ministry of Works and Housing from time to time making it obligatory for employees concerned to obtain and furnish no accommodation certificate in respect of Government residential accommodation at their place of posting. In all other places no such certificate is necessary.

(ii) Government servants posted in localities where there is at present no residential accommodation in the general pool owned or requisitioned by the Central Government for allotment to them, need not apply for Government residential accommodation in order to become eligible for house rent allowance. But where Government quarters are available for the staff of specified Departments or for specified categories of staff, the procedure for applying for accommodation will be regulated under the rules of allotment of the Department concerned or of the local office of the Central Public Works Department, as the case may be.

(b)(i) The allowance shall not be admissible to those who occupy accommodation provided by Government or those to whom accommodation has been offered by Government but who have refused it. In the latter case, the allowance will not be admissible for the period for which a Government servant is debarred from further allotment of Government accommodation under the allotment rules applicable to him.

(ii) The house rent allowance drawn by a Government servant, who accepts allotment of Government accommodation, shall be stopped from the date of occupation, or f