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Supreme Court Of India
Decided On : (March 31, 1998)
State of West Bengal
Versus
RANBINDRA NATH SENGUPTA
HOUSE RENT ALLOWANCE - CLASSIFICATION OF GOVERNMENT EMPLOYEES - REASONABLE BASIS - ARTICLE 14 - WEST BENGAL GOVERNMENT PREMISES (TENANCY REGULATION) ACT, 1976 - WEST BENGAL GOVERNMENT PREMISES (REGULATION OF OCCUPANCY) ACT, 1984 - ROPA RULES, 1990 - CLASSIFICATION OF GOVERNMENT EMPLOYEES INTO TWO CATEGORIES FOR THE PURPOSE OF HOUSE RENT ALLOWANCE (HRA) IS REASONABLE AND DOES NOT VIOLATE ARTICLE 14 OF THE CONSTITUTION.
Fact of the Case:
The appellants, the State Government, challenged the judgment of the Division Bench of the Calcutta High Court, which allowed the writ petition filed by the respondents, Government employees, and set aside the judgment of the Single Bench of the said High Court. The respondents had challenged the provisions of House Rent Allowance in the ROPA Rules and the Notification issued in this regard. The ROPA Rules provided for HRA to Government employees at 15% of basic pay subject to a maximum of Rs. 800 per month. However, for Government employees provided with accommodation owned/hired by the Government, the HRA was limited to the actual assessed rent/license fee paid.
Finding of the Court:
The Court held that the classification of Government employees into two categories for the purpose of HRA is reasonable and does not violate Article 14 of the Constitution. The Court noted that the distinction between the two categories of employees is based on the fact that those provided with Government accommodation are required to pay only nominal license fees, while those not provided with such accommodation have to bear the full cost of their accommodation. The Court also noted that the Third Pay Commission had recommended the revised HRA policy after considering various aspects of HRA, including the fact that Government employees provided with Government accommodation were enjoying an element of unjust profit.
Issues: 1. Whether the classification of Government employees into two categories for the purpose of HRA is reasonable and does not violate Article 14 of the Constitution? 2. Whether the revised HRA policy is arbitrary, capricious, and without any basis?
Ratio Decidendi: 1. The classification of Government employees into two categories for the purpose of HRA is reasonable and does not violate Article 14 of the Constitution. The distinction between the two categories of employees is based on the fact that those provided with Government accommodation are required to pay only nominal license fees, while those not provided with such accommodation have to bear the full cost of their accommodation. 2. The revised HRA policy is not arbitrary, capricious, and without any basis. The Third Pay Commission had recommended the revised HRA policy after considering various aspects of HRA, including the fact that Government employees provided with Government accommodation were enjoying an element of unjust profit.
Final Decision: The appeal was allowed, and the impugned decision of the Division Bench of the High Court was set aside. The decision of the learned Single Bench (Judge) was upheld.
Judgment
G. N. RAY, J.
( 1 ) LEAVE granted. Heard learned counsel for the parties.
( 2 ) THIS appeal is directed against judgment dated 17-5-1994 passed by the Division Bench of Calcutta High Court in F. M. A. T. No. 1966 of 1992 allowing the appeal and setting aside the judgment of the Single Bench of the said High Court in the writ petition being Civil Rule No. 11360 (W) of 1990.
( 3 ) THE aforesaid writ petition was made by the respondents Ranbindra Nath Sengupta and other petitioners being employees of the State Government who had been allotted Government flats and had been paying assessed amounts for such occupation and were enjoying the House Rent Allowance.
( 4 ) IN order to appreciate the rival contentions of the parties it will be appropriate to note certain facts. After the submissions of Third Pay Commissions Report, the West Bengal Services (Revision of Pay and Allowance) Rules, 1990 (hereinafter referred to as ROPA Rules) was published. In the writ petition being CR No. 11360 (W) of 1997, the writ petitioners challenged the provisions of House Rent Allowance in the ROPA Rules and the Notification issued in this regard. The ROPA Rules provided for House Rent Allowance to the following effect :-"house Rent Allowance : With effect from the 1/01/1988 the House Rent Allowance admissible to a Government employee shall be 15 Per Cent of basic pay subject to a maximum of Rs. 800. 00 per month. The ceiling of the House Rent Allowance drawn by husband and wife taken together was also been raised to Rs. 800. 00 per month. The allowance may be drawn, without reference to quantum of rent paid, by all Government employees (other than those provided with accommodation owned/hired by Government) without requiring them to produce rent receipt. They should however be required to furnish a certificate to the effect that they are incurring some expenditure on rent/contributing towards rent. House Rent Allowance at the above rate shall also be paid to Government employees living in their own houses, subject to their furnishing a certificate that they are paying/contributing towards house of property tax or maintenance of the house. Pending fixation of licence fees according to the system recommended by the Pay Commission, the drawal of House Rent Allowance by Government employees provided with accommodation owned/hired by Government and recovery of licence fee from them shall be regulated as follows :- (1) For those employees living in flats for which assessment of rent has been made and the occupier pays assessed rent as licence fee and draws usual house rent allowance the drawal of house rent allowance shall be further limited to the actual assessed rent allowance shall be further limited to the actual assessed rent paid. (2) For those employees paying licence fee as percentage of pay, the recovery shall be frozen at the level at which the licence fee was recovered from the pay bill for December, 1989 in the unrevised scale. ALL other conditions regarding drawal of House Rent Allowance by Government employees and recovery of licence fee from them shall, in so far as they are not inconsistent with these decisions, continue to hold good. "
( 5 ) IT may be stated here that till 1994, the occupation of housing estates belonging to the State Government was regulated by the West Bengal Premises (Tenancy Regulation) Act, 1976. The amount assessed for occupation of Government housing estates was termed rent. Previously, some dispute about the House Rent Allowance for occupiers of Government flats were raised in writ petition being CR No. 1527 (W) of 1973. (Sri Deba Prasad Mukherjee v. Financial Commissioner as Secretary, etc.) Such Writ Petition was disposed of by the Calcutta High Court by order dated 28-1-1996 passed by consent of parties in the following terms :-"upon the petitioner being agreeable to pay assessed rent calculated as per relevant principle for such occupation, the petitioners will be entitled to compensatory house rent allow
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