Secretary, O.N.G.C. Ltd. & Anr. v. V.U. Warrier

After reading this case analysis, you will learn that the Supreme Court held an employee liable for having been in unauthorised possession a government quarter.
COURTSupreme Court of India
JUDGES/CORAMJustice Ruma Pal and Justice C.K. Thakker


This is the case between the employee and the employer, where the employer deducted the charges for unauthorized possession of the government place. Because they having power under their administrative capacity to penalize any of the employees for his misconduct. But the court firstly given ex-parte order to petitioner because of respondent advocated failed to appear due to his ill-health. Later the respondent filed the reason for not appearing before the court but dismissed it. Through the special leave petition they got the chance to prove the legality in the administrative action.


The facts of the case are as follows: The petitioner who was employee of ONGC (respondent in appeal case). He was holding the post of Additional Director (Finance and Accounts) prior to his retirement. As an employee of the Commission, he was allotted quarter on December 10, 1982. He retired from service on reaching the age of superannuation with effect from February 28, 1990. It is the case of the appellant that after the retirement, an employee has to vacate the residential accommodation given to him by the Commission. The respondent, therefore, was informed by the Commission that he had to vacate the quarter. It was the policy of the Commission to grant four months’ time to retain a quarter by an employee after his retirement. Accordingly, the respondent was asked to handover vacant and peaceful possession of the quarter to the Commission latest by 30th June, 1990. It is an admitted fact that the respondent did not vacate the quarter. It has come on record that he made representations to permit him to continue to occupy the quarter but those representations were rejected. In those proceedings, an undertaking was given by the respondent that he would vacate the quarter latest by May 30, 1991. Pursuant to the said undertaking, the respondent vacated the quarter on May 16, 1991. Eviction proceedings were then dropped. The respondent claimed an amount of gratuity payable to him. According to the respondent, he was entitled to Rs. 1 lakh towards payment of gratuity. The Commission, however, deducted an amount of Rs.53,632 towards unauthorized occupation charges of official accommodation from July 01, 1990 to May 15, 1991 at the rate of Rs.5,100 being 75 per cent of the basic pay of Rs.6,800 per month. According to the respondent, it was not open to the Commission to deduct any amount payable to him towards gratuity. He, therefore, approached the High Court of Judicature at Bombay challenging the action.

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The main issue in the case was: Whether or not the deduction by ONGC was valid.

Summary of court decision and judgment

The Court observed that the appellant having unauthorised kept the government quarter was liable to pay penal rent in accordance with rules and there was no illegality in adjusting those dues against death-cum-retirement benefits.


While seeing the points of both the parties they have proper claim but coming to legality, it’s purely on respondent. Because seeing the things generally employee knows the rules of the commission or his working place which he ignored instead of binding to rules and claiming the benefits alone. Looking to the jurisprudence, duty and rights are correlated when he failed to do his duty then he has no claim of rights too. And, looking at the rules it’s clear that he lost his rights to claim the gratuity fully because of his misconduct of act.


The primary decision of the court supported the petitioner on the grounds of the payment of gratuity can’t be stopped or deducted which is on pure grounds of an employee because there is no point given by the respondent. But the court doesn’t prohibit the respondent from collecting the reasonable amount for unauthorized possession. And the question is when the administration has the right to take dues from the employee through their gratuity amount payable to such employee is fair and reasonable because it’s an entity have right to claim damages from the person who committed any civil wrong.