Yours is a very good problem to have! But, the solution can be vexing because in your heart you don't want to let go of one for the other - and I can understand that.
You're experiencing what is commonly referred to as a 'moment of truth'. What that means is that you have to take a decision. And, from your viewpoint, it is truly a huge decision.
So, what are you to do?
Do you give up the job so that you can continue your studies? Or, do you stop your studies so you can take up the job?
The real question is not any of the 2 I've mentioned above. The real question you have to ask yourself is this - "What Does Satish Want to Do in His Life - particularly in the next 3 years?"
Go back to the real reason you started the MTech in the first place. Did you do that because you didn't have anything else to do in life and it was a good way to kill time while getting a fairly powerful degree? Or, are you doing the course because you've always dreamed of completing a MTech and getting down and dirty in the field of whatever engineering your MTech is in?
If you are doing MTech just to pass time and your heart isn't in it, then it would be highly advisable that you look at the government job offer very seriously.
But, I don't think that you're doing it just to pass time. Why? Because if that was your primary driver, you wouldn't have topped the 2nd semester.
This indicates to me that you're doing your MTech because you really believe in it and it has been your dream for some time.
If what I've guessed is really the case, then I suspect that your government job offer is to test how committed you really are to the MTech and the future you saw for yourself prior to being offered the government job.
Having said the philosophical piece above, there are also a number of practical considerations.
Do you have any financial responsibilities at home? Do you have any social responsibiliites? Are there any domestic expectations on you? Are you married? Do you have any children? Do you have any EMIs which you're repaying monthly?
If you've answered yes to 2 or more of the practical considerations above, then I seriously suggest that you consider the government job offer.
Like I said earlier, what kind of a life does Satish dream about in the next 3 years?
The worst thing you can do is to ignore your inner voice and listen to the 'helpful advice' and 'advice for your bhallaa' that you'll receive from others - purely because you want to keep them happy.
And, please please don't even for a moment entertain the thought of 'what will people say?' Let me clue you in - people don't think. They don't even think about themselves - let alone you!
Now you know why its called a moment of truth - its the time when you have to be brutally honest with yourself and for a moment forget the image you want to project to the rest of the world. After all, its only about Your LIFE! Does it matter how it looks to OTHERS?
Good luck my friend and Believe in Yourself!
All The Best!
17th August 2012 From India, Gurgaon