House Rent Allowance denied upon government accommodation offer, irrespective of refusal.

The applicant, Nandan Singh Patwal, was appointed as a Junior Clerk on 09.11.1983

In 2004, he applied for and received a House Building Advance (HBA)

On 20.04.2011, he was allotted Type-III government accommodation based on his seniority.

However, he submitted a representation on 03.05.2011, seeking cancellation of the allotment, stating he had constructed his own house using the HBA and no longer required government accommodation

This request was processed but no formal cancellation order was issued

Despite non-occupation, house rent/license fee deductions continued

The applicant did not claim House Rent Allowance (HRA) for the period from 01.05.2011 to 04.03.2019 until a request was made on 18.11.2019

The respondents, following an Office Memorandum dated 08.04.2019, sanctioned and released HRA to the applicant from 05.03.2019 until his retirement on 31.08.2020, as he was not availing government accommodation

However, his claim for HRA for the earlier period (01.05.2011 to 04.03.2019) was denied via an order dated 10.10.2022

Whether the applicant is entitled to House Rent Allowance (HRA) for the period from 01.05.2011 to 04.03.2019, despite being allotted government accommodation, which he refused to occupy?

Whether the lack of a formal cancellation order for the allotted government accommodation affects the applicant's eligibility for HRA during the disputed period?

The court primarily applied the principle that House Rent Allowance (HRA) is intended to compensate for the non-availability of government accommodation and is not an absolute right

It relied on *The Divisional Engineer, G.L.P. Railway v. Mahadeo Raghoo and Another* (1955) 1 SCR 134, which held that HRA is not admissible to those who occupy accommodation provided by the Government or to whom accommodation has been offered but refused

It further cited *Director, Central Plantation Crops Research Institute, Kesaragod and Others v. M. Purushothaman and Others* (AIR 1994 SC 2541), which clarified that HRA is a Compensatory Allowance, not part of "pay," and its purpose is to compensate for the lack of amenities, ceasing when amenities are provided or offered

The court also noted *D. Peri Reddy and Ors. v. Government of A.P., Finance and Planning* (1997) 1 ALT 721, stating that allowances cannot be claimed as a matter of right

The court analyzed that while the applicant applied for cancellation of the allotted government accommodation on 03.05.2011, there was no formal record of acceptance or rejection of this request

The court emphasized that HRA is not an absolute right but a compensatory allowance for the non-availability of government accommodation

Citing *Mahadeo Raghoo*, the court noted that if suitable accommodation is offered and refused, an employee ceases to be entitled to HRA

The court further referenced *M. Purushothaman*, stating that HRA is to compensate for the lack of amenities, and once provided or offered, the compensation should cease

The applicant did not pursue his claim for HRA for the disputed period until 18.11.2019

The court found that allowing HRA while accommodation was allotted and refused, even due to taking an HBA, would amount to "profiting from both"

The HRA granted from 05.03.2019 was specifically noted as prospective, following a change in policy

The court concluded that HRA is intended to compensate for the non-availability of government accommodation, and once accommodation is offered, an employee cannot refuse it and still claim HRA, even if they have availed a housing loan advance, as this would result in profiting from both

The judgment implies that the allotment of government accommodation, even if refused, rendered the applicant ineligible for HRA for the period from 01.05.2011 to 04.03.2019