Varuna is the guardian of rita (cosmic order) and the lord of the sky. As the upholder of the physical and moral order, he is the protector of oaths and the divine judge. A constant observer of human actions, Varuna is so vigilant and stern in executing his duties that beings violating their dharmas are sure to suffer for their indiscretions, making Varuna the most feared of all powers in the Vedic+pantheon. He has the power to see what any being is doing at any time. By looking into a being’s heart, Varuna always knows whether the individual is being completely honest and whether or not he is violating his dharma. In his true form, Varuna is the sky.
Varuna sees and hears all, so it is impossible to keep anything secret from him. He especially loathes lawful oath-breakers and never fails to punish them for violating their dharma, but this does not apply to oathbreakers of chaotic or neutral alignments. Omens from Varuna generally take a celestial form, such as the appearance of a comet, ball of fire, or eclipse.
Source: Deities & Demigods (First Edition), Gods, Demi-Gods & Heroes, Legends & Lore (Second Edition), Manual of the Planes (First Edition), page 66