This attack can only be used in combat, and will strike at the eyes of your opponent, causing damage and temporary blindness. Note that gouge has a reduced chance of hitting if the gouger is not one of the primary combatants (ie. is not tanking).
Gouge blinds the target and lowers their hitroll by 4. If you are blinded but are affected with true sight, then the blindness will not affect you (unless you are still affected by it when true sight wears off).
If you are blind, you can't see any players, mobs or objects. This means you can't target any of them directly and thus cannot pick up items (or quaff potions) or attack a specific target. You will still defend yourself in combat, however, and can 'get all'. You can't see rooms or exits either.