Unfair Advantage Gained By Party Must Be Neutralized: SC

The Supreme Court recently invoked the principle of restitution to solve an error on its part, where two persons received a combined amount of approximately ₹98 crore.

The division Bench of Chief Justice of India DY Chandrachud and Justice MR Shah stated in its order,
The order stated that “As per the settled law, any undeserved or unfair advantage gained by a party invoking the jurisdiction of the court must be neutralized, as the institution of litigation cannot be permitted to confer any advantage on a suitor by the act of the Court.”

The case is related to the sale consideration of 26 acres and 19 guntas of land which was owned by Unitech Limited in favor of M/s Devas Global Services LLP. Unitech argued that it was the absolute owner of the land and was entitled to the entire consideration of ₹172.08 crore.

Out of the total consideration, the company received only ₹87.35 crores, and the balance amount was ordered to be paid to Naresh Kempanna and Col. Mohinder Khaira, who had no title or ownership rights in the land in question.

After perusing its previous orders in the case and the report of the Justice Dhingra Committee, the Court conceded that the amount was ordered to be paid to Kempanna and Col Khaira by completely overlooking the rights and claims of the respective parties such as Unitech and M/s Devas.

Therefore, the Court accepted its error and noted that “there was an obvious error and/or mistake on the part of this Court in directing to pay Rs. 56.11 crores to Shri Naresh Kempanna and Rs. 41.96 crores to Col. Mohinder Khaira, which as such was without any adjudication of the claims of the aforesaid two persons.”

Thus, applying the principal restitution, the Court directed the duo to return the amount and deposit the same with the Court with 9% interest from the date on which the payment was received by them.
Additional Solicitor General N Venkataraman appeared for the management of Unitech.