N SUBHAS BABU Vs. GOVERNMENT OF ANDHRA PRADESH

JUDGEMENT

(1.) The petitioners are the teaching and non-teaching staff of Kakatiya Medical College, Warangal. In the initial stages, the college was being run by the Regional Medical Education Society, Warangal. The petitioners were appointed when the College was being managed by the said society. The Management of the institution together with its assets was takenover by the Government pursuant to an agreement entered into on 5-1-1977 between the Society and the Governor of A.P. Clause 6 of the said agreement provides : "The staff employed in the college, immediately before the said day, shall be employed and continued by the Government upon the same terms and conditions and with the same rights and privileges as to pension, gratuity and other matters as the said staff would have had under the Society, until the said remuneration, terms and conditions are duly altered by the Government or until the employment of any member of such staff is duly terminated after giving notice of three months or the salary for three months in lieu thereof. Provided that...."

(2.) The dispute in the present writ petition is about House Rent Allowance (HRA). It is not in dispute that prior to takeover of the College, the petitioners were being given HRA at the prescribed percentage, even though residential quarters were provided to them by the Management. The petitioners were paying the rent for the quarters at a rate which is undoubtedly beyond the normal rate or market rate. We arc told that the petitioners were paying Rs. 100.00 in the beginning, later it was revised to Rs. 175/- and presently the petitioners who are in service are paying Rs.225.00 per quarter. Thus, the HRA that is being paid to them is far in excess of the house rent for quarters which the petitioners are liable to pay. In the year 1978, there was a move to apply the State Government rules with regard to collection of rent and deduction of HRA. The occupants of staff quarters were notified that from May, 1978 onwards, the rent will be deducted at the rate of 10% of basic pay and the HRA will be disallowed. The staff members then filed Writ Petition No.2125 of 1978. The WP was allowed and the impugned circular issued by the Principal on 6-4-1978 was quashed on the ground that the petitioners were not put to notice before issuing the impugned order and on the further ground that the Principal had no jurisdiction to issue the circular. Thereafter, the Government issued orders in G.O.Ms.No.649 (M&H) dated 29-10-1981. The Government ordered that the staff in occupation of the quarters are not entitled for HRA as they were in the same position as Government Servants and therefore the HRA already drawn has to be recovered from them with effect from 1-2-1977. However, it was further directed that the said orders did not apply to the 50 persons who are petitioners in W.P.No.2125 of 1978 and they shall continue to be paid salary and allowances including HRA in the same manner as they were being paid prior to the date of takeover of the College. Again this order was questioned in W.P.No.968 of 1982. It was allowed on 9-4-1985 on the ground that the action of the Government was in violation of principles of natural justice. Thereafter, on 4-12-1985, the Principal of the Kakatiya Medical College issued notices to the petitioners and other staff occupying the official quarters to show cause why the HRA paid to them should not be recovered with effect from 1-2-1977. It was stated in the notice that the petitioners are not entitled to claim HRA, The petitioners submitted explanation stating that they were provided a quarter with a fixed rent and not a rent free quarter. It was further pointed out that the Government itself granted the benefit to the persons who succeeded in W.P.No.2125 of 1978. Nearly three years thereafter, the impugned order was issued by the Government in G.O.Ms.No-575 (HMFW) dated 3-11-1988 directing the payment of HRA to be stopped to the employees of Kakatiya Medical College, who arc in occupation of the quarters attached to the College and further directing that they should be charged house rent at 10% of the basic pay or standard rent whichever is less with effect from 1-4-1986, The Government further directed that the amounts wrongly paid should be recovered from the employees concerned and credited to the Government account. As a sequel to this G.O. the Principal of the College issued a memo dated 17-2-1988 notifying the petitioners that the excess HRA paid to them from 1-4-1986 to 30-11-1988 will be recovered from their salaries from 1-1-1989 onwards. Challenging G.O.Ms. No.575 and the consequential orders issued by the Principal, the present writ petition is filed. This Court granted interim suspension of the impugned order.

(3.) During the pendency of the writ petition it appears that some of the petitioners retired or resigned or vacated the quarters. However, petitioners 1, 4, 6 and 10 who are still in service continue to remain in occupation of Government quarters paying the rent of Rs.225.00 per month, while drawing House Rent Allowance at the rate of Rs. 1,000.00 or so per month.