Government Employee Staying In Rent-Free Accommodation Allotted To Retired Government Servant Father Cannot Claim HRA : Supreme Court

Recently, the Supreme Court held that a government employee staying in a rent-free accommodation allotted to his father, a retired government servant, was not entitled to claim any House Rent Allowance (HRA), 

The bench of Justices BR Gavai and Sandeep Mehta, while upholding a HRA recovery notice against the appellant, held that under the Jammu and Kashmir Civil Services (House Rent Allowance and City Compensation Allowance) Rules, 1992, HRA could not be claimed by the retired father upon superannuation. It was therefore justified to issue a recovery notice to the appellant to pay Rs.3,96,814/- which he claimed earlier as HRA. 

"The appellant being a Government employee, could not have claimed HRA while sharing rent-free accommodation allotted to his father, a retired Government servant. There is no infirmity in the impugned orders warranting interference" 

The facts of the case pertained to the appellant who was an Inspector(Telecom) in Jammu and Kashmir Police, 4th Battalion who superannuated from services on 30th April 2014. He subsequently received a communication regarding the recovery of the outstanding House Rent Allowance (HRA) due in his name. 

The said recovery notice was issued upon a complaint that the appellant was availing Government accommodation and simultaneously drawing HRA. Notice was given to the appellant to deposit a sum of Rs.3,96,814/- determined to have been drawn by him as HRA without entitlement. The recovery notice was issued after the appellant failed to establish that the house in question was not in his possession. 

The challenge to the recovery notice in a writ petition before the High Court of Jammu & Kashmir & Ladakh was rejected by the Single Bench as well as the Division Bench in a letters patent appeal by orders dated December 19, 2019, and September 27, 2021, respectively. 

Arguments By The Counsels  

Appearing on behalf of the appellant, Advocate Ms Purnima Bhat argued that the house in question was allotted to the appellant's father who was a retired Deputy Superintendent of Police and that the appellant occasionally shared the house with his father. 

She directed the attention of the bench to Rule 6(h)(iv) of the1992 Rules. As per Rule 6(h)(iv) provides that when a family has multiple members working for the central or state government and they live together in housing given by the government, only one of them can receive a housing allowance,  as decided amongst them. 

“6. The grant of House Rent Allowance shall be subject to the following conditions:

(h) A Govt employee shall not be entitled to House Rent Allowance if:

(iv) In cases where husband/wife/parents, children two or more of them being State Govt servants or employees of Central Govt, Autonomous Public Undertakings or semi government organisations share accommodation allotted to another Government Servant, House Rent Allowance will be admissible to only one of them at their choice."   

The counsel stressed that the house was allotted to the appellant's father who retired from the post as a Gazetted Officer and was a displaced Kashmiri Pandit. The HRA could not be recovered for sharing the house with the father who was also a government servant. 

On the other hand, the counsel for the State, Mr Parth Awasthi contended that since the appellant enjoyed the residence of the house allotted to his father, Rules 6(h)(i) and (ii) apply to the present case to disentitle the appellant to claim HRA. The counsel in light of the said provisions submitted that the recovery notice was justified. 

As per Rules 6(h)(i)and(ii), a government employee will not be entitled to the HRA if (i) the person shares accommodation allotted rent-free to another government servant;  (ii) the person resides in accommodation allotted to his/her parents, son, daughter by the Govt. 

Appellant's Retired Father Could Not Claim HRA Upon Suppernuation: Reliance Upon Rule 6(h)(iv) Misplaced 

Rejecting the contentions of the appellant, the Court noted that since the appellant's father retired from his service in 1993  it would be ' axiomatic that he would not be entitled to claim HRA after demitting office'. While the house is allotted to the retired father of the appellant, HRA could not be claimed by the father upon his retirement as he is no longer in service and thus Rule 6(h)(iv) would not be applicable in the present case. 

"Thus reliance placed by learned counsel for the appellant on Rule 6(h)(iv) is misplaced as the said provision has no application to the situation at hand." 

The court further held that the High Court had correctly dismissed the petitions on the grounds mentioned under Rule 6(h)(i) and (ii). It was expressly observed that in the said two provisions, the appellant who was a government employee was disentitled to claim HRA for sharing a rent-free house which was allotted to his father who was already retired. 

"The appellant being a Government employee, could not have claimed HRA while sharing rent-free accommodation allotted to his father, a retired Government servant. There is no infirmity in the impugned orders warranting interference" 

Case Details: R.K. MUNSHI v. UNION TERRITORY OF JAMMU & KASHMIR AND ORS SLP(Civil) No(s). 43 OF 2022 

Citation : 2024 LiveLaw (SC) 364

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