Whether interim order ends if the proceeding in which stay is granted is dismissed?

  From the above discussion, it is clear that imposition of a stay on the operation of an order means that the order which has been stayed would not be operative from the date of passing of the stay order. However, it does not mean that the stayed order is wiped out from the existence, unless it is quashed. Once the proceedings, wherein a stay was granted, are dismissed, any interim order granted earlier merges with the final order. In other words, the interim order comes to an end with the dismissal of the proceedings. In such a situation, it is the duty of the Court to put the parties in the same position they would have been but for the interim order of the court, unless the order granting interim stay or final order dismissing the proceedings specifies otherwise. On the dismissal of the proceedings or vacation of the interim order, the beneficiary of the interim order shall have to pay interest on the amount withheld or not paid by virtue of the interim order. {Para 24}

IN THE SUPREME COURT OF INDIA

 CIVIL APPELLATE JURISDICTION 

CIVIL APPEAL NO. 2417 OF 2022 

 STATE OF U.P. THR. SECRETARY AND ORS. Vs PREM CHOPRA

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What is the court's duty when the proceeding in which a stay granted to recover money is dismissed?

  Following the said decision, this Court in Kanoria Chemicals and Industries Ltd. and Others v. U.P. State Electricity Board and Others, (1997) 5 SCC 772 has held that an order of stay which is granted during the pendency of a writ petition/suit or other proceeding comes to an end with the dismissal of the substantive proceedings and it is the duty of the court in such cases to put the parties in the same position that they would have been in but for the interim order of the court. In that case, this Court rejected the contention that when the operation of the notification itself was stayed, no surcharge could be demanded upon the amount withheld. It was held thus:

“11. …. Holding otherwise would mean that even though the Electricity Board, who was the respondent in the writ petitions succeeded therein, yet deprived of the late payment surcharge which was due to it under the tariff rules/regulations. It would be a case where the Board suffers prejudice on account of the orders of the court and for no fault of its. It succeeds in the writ petition and yet loses. The consumer files the writ petition, obtains stay of operation of the notification revising the rates and fails in his attack upon the validity of the notification and yet he is relieved of the obligation to pay the late payment surcharge for the period of stay, which he is liable to pay according to the statutory terms and conditions of supply — which terms and conditions indeed form part of the contract of supply entered into by him with the Board. We do not think that any such unfair and inequitable proposition can be sustained in law.

xxx xxx xxx

It is equally well settled that an order of stay granted pending disposal of a writ petition/suit or other proceeding, comes to an end with the dismissal of the substantive proceeding and that it is the duty of the court in such a case to put the parties in the same position they would have been but for the interim orders of the court. Any other view would result in the act or order of the court prejudicing a party (Board in this case) for no fault of its and would also mean rewarding a writ petitioner in spite of his failure. We do not think that any such unjust consequence can be countenanced by the courts. As a matter of fact, the contention of the consumers herein, extended logically should mean that even the enhanced rates are also not payable for the period covered by the order of stay because the operation of the very notification revising/enhancing the tariff rates was stayed. Mercifully, no such argument was urged by the appellants. It is un-understandable how the enhanced rates can be said to be payable but not the late payment surcharge thereon, when both the enhancement and the late payment surcharge are provided by the same notification — the operation of which was stayed.”{Para 19}

20. In Rajasthan Housing Board and Others v. Krishna Kumari, (2005) 13 SCC 151 this Court observed that Order 39 of the Civil Procedure Code, 1908 provides for grant of temporary injunction at the risk and responsibility of the person who obtains it and, if ultimately case is decided against such person, he would be liable to pay interest on the arrears of any amount due which had been stayed by the injunction order. The legal maxim actus curiae neminem gravabit, which means that an act of the Court shall prejudice no man, becomes applicable in such a case.

21. In South Eastern Coalfields Ltd. V. State of M.P. and Others, (2003) 8 SCC 648 the writ petitioner therein had argued that interest accrued due to nonpayment of enhanced amount of royalty was protected by a judicial order of an interim nature and, therefore, merely because the writ was finally dismissed, the writ petitioner should not be held liable for payment of interest so long as money was withheld under the protective umbrella of the injunction order. This submission was rejected by this Court by holding as under:

“The principle of restitution has been statutorily recognized in Section 144 of the Code of Civil Procedure, 1908. Section 144 CPC speaks not only of a decree being varied, reversed, set aside or modified but also includes an order on a par with a decree. The scope of the provision is wide enough so as to include therein almost all the kinds of variation, reversal, setting aside or modification of a decree or order. The interim order passed by the court merges into a final decision. The validity of an interim order, passed in favour of a party, stands reversed in the event of a final decision going against the party successful at the interim stage. Unless otherwise ordered by the court, the successful party at the end would be justified with all expediency in demanding compensation and being placed in the same situation in which it would have been if the interim order would not have been passed against it. The successful party can demand (a) the delivery of benefit earned by the opposite party under the interim order of the court, or (b) to make restitution for what it has lost; and it is the duty of the court to do so unless it feels that in the facts and on the circumstances of the case, the restitution far from meeting the ends of justice, would rather defeat the same. Undoing the effect of an interim order by resorting to principles of restitution is an obligation of the party, who has gained by the interim order of the court, so as to wipe out the effect of the interim order passed which, in view of the reasoning adopted by the court at the stage of final decision, the court earlier would not or ought not to have passed. There is nothing wrong in an effort being made to restore the parties to the same position in which they would have been if the interim order would not have existed.”

IN THE SUPREME COURT OF INDIA

 CIVIL APPELLATE JURISDICTION 

CIVIL APPEAL NO. 2417 OF 2022 

 STATE OF U.P. THR. SECRETARY AND ORS. Vs PREM CHOPRA

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What is difference between stay of operation of an order and quashing of an order?

 When the interim order was in force, the recovery of license fee was temporarily suspended. The restraint was only against the Department not to recover the license fee. There was no prohibition for the respondent to deposit the balance of license fee. It is to be stated here that the High Court has not quashed the demand of license fee made by the appellants. There is a difference between stay of operation of an order and quashing of an order which has been explained by this Court in Shree Chamundi Mopeds Ltd. V. Church of South India Trust Association CSI CINOD Secretariat, Madras, (1992) 3 SCC 1 as under:

“While considering the effect of an interim order staying the operation of the order under challenge, a distinction has to be made between quashing of an order and stay of operation of an order. Quashing of an order results in the restoration of the position as it stood on the date of the passing of the order which has been quashed. The stay of operation of an order does not, however, lead to such a result. It only means that the order which has been stayed would not be operative from the date of the passing of the stay order and it does not mean that the said order has been wiped out from existence.”{Para 18}

19. Following the said decision, this Court in Kanoria Chemicals and Industries Ltd. and Others v. U.P. State Electricity Board and Others, (1997) 5 SCC 772 has held that an order of stay which is granted during the pendency of a writ petition/suit or other proceeding comes to an end with the dismissal of the substantive proceedings and it is the duty of the court in such cases to put the parties in the same position that they would have been in but for the interim order of the court. In that case, this Court rejected the contention that when the operation of the notification itself was stayed, no surcharge could be demanded upon the amount withheld. It was held thus:

“11. …. Holding otherwise would mean that even though the Electricity Board, who was the respondent in the writ petitions succeeded therein, yet deprived of the late payment surcharge which was due to it under the tariff rules/regulations. It would be a case where the Board suffers prejudice on account of the orders of the court and for no fault of its. It succeeds in the writ petition and yet loses. The consumer files the writ petition, obtains stay of operation of the notification revising the rates and fails in his attack upon the validity of the notification and yet he is relieved of the obligation to pay the late payment surcharge for the period of stay, which he is liable to pay according to the statutory terms and conditions of supply — which terms and conditions indeed form part of the contract of supply entered into by him with the Board. We do not think that any such unfair and inequitable proposition can be sustained in law.

It is equally well settled that an order of stay granted pending disposal of a writ petition/suit or other proceeding, comes to an end with the dismissal of the substantive proceeding and that it is the duty of the court in such a case to put the parties in the same position they would have been but for the interim orders of the court. Any other view would result in the act or order of the court prejudicing a party (Board in this case) for no fault of its and would also mean rewarding a writ petitioner in spite of his failure. We do not think that any such unjust consequence can be countenanced by the courts.

IN THE SUPREME COURT OF INDIA

 CIVIL APPELLATE JURISDICTION 

CIVIL APPEAL NO. 2417 OF 2022 

 STATE OF U.P. THR. SECRETARY AND ORS. Vs PREM CHOPRA

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Whether a party should pay interest on the amount payable by him which he has not paid due to stay order after the dismissal of that proceeding?

When the interim order was in force, the recovery of license fee was temporarily suspended. The restraint was only against the Department not to recover the license fee. There was no prohibition for the respondent to deposit the balance of license fee. {Para 18}

24. From the above discussion, it is clear that imposition of a stay on the operation of an order means that the order which has been stayed would not be operative from the date of passing of the stay order. However, it does not mean that the stayed order is wiped out from the existence, unless it is quashed. Once the proceedings, wherein a stay was granted, are dismissed, any interim order granted earlier merges with the final order. In other words, the interim order comes to an end with the dismissal of the proceedings. In such a situation, it is the duty of the Court to put the parties in the same position they would have been but for the interim order of the court, unless the order granting interim stay or final order dismissing the proceedings specifies otherwise. On the dismissal of the proceedings or vacation of the interim order, the beneficiary of the interim order shall have to pay interest on the amount withheld or not paid by virtue of the interim order. 

25. Coming to the facts of the present case, the respondent was not successful in his challenge to the notice dated 06.01.2003 demanding the balance of license fee before the Authorities under the Act. Therefore, he filed the writ petition bearing Misc. Single No.2582 of 2003 before the High Court wherein the High Court, by an interim order, stayed the recovery of the monthly instalment of license fee for the months January 2003 to March 2003, subject to deposit of Rs.2,75,000/within a period of six weeks before the District Excise Officer. It is not disputed that this amount of Rs.2,75,000/was deposited by the respondent. The said writ petition was dismissed by the High Court for nonprosecution vide Order dated 21.12.2015. On 23.12.2017, the respondent deposited the remaining amount of Rs.3,68,562/towards license fee. However, the respondent did not make payment of interest to the Department. The writ petition was restored on 19.01.2018. In the meantime, the appellants issued a notice calling upon the respondent to pay Rs.10,08,210.51/towards interest due. The High Court held that the respondent was not liable to pay interest as he was under the protection of the interim order. Given the settled position of law, in our view the High Court has erred in holding that the respondent was not liable to pay interest due to the protection given under the interim order.

IN THE SUPREME COURT OF INDIA

 CIVIL APPELLATE JURISDICTION 

CIVIL APPEAL NO. 2417 OF 2022 

 STATE OF U.P. THR. SECRETARY AND ORS. Vs PREM CHOPRA

Coram: S. ABDUL NAZEER; VIKRAM NATH; JJ. 

Author: S. ABDUL NAZEER, J.

Dated: March 25, 2022 

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Supreme Court: No One Can Be Permitted To Take The Benefit Of A Wrong Order Passed By A Court

The interim order passed by the court merges into a final decision. The validity of an interim order, passed in favour of a party, stands reversed in the event of a final order going against the party successful at the interim stage. Section 144 of the Code of Civil Procedure is not the fountain source of restitution. It is rather a statutory recognition of the Rule of justice, equity and fair play. The court has inherent jurisdiction to order restitution so as to do complete justice. This is also on the principle that a wrong order should not be perpetuated by keeping it alive and respecting it. In exercise of such power, the courts have applied the principle of restitution to myriad situations not falling within the terms of Section 144 Code of Civil Procedure. What attracts applicability of restitution is not the act of the court being wrongful or mistake or an error committed by the court; the test is whether, on account of an act of the party persuading the court to pass an order held at the end as not sustainable, resulting in one party gaining an advantage which it would not have otherwise earned, or the other party having suffered an impoverishment, restitution has to be made. Litigation cannot be permitted to be a productive industry. Litigation cannot be reduced to gaming where there is an element of chance in every case. If the concept of restitution is excluded from application to interim orders, then the litigant would stand to gain by swallowing the benefits yielding out of the interim order. This Court observed in South Eastern Coalfields [South Eastern Coalfields Ltd. v. State of M.P., MANU/SC/0807/2003 : (2003) 8 SCC 648] thus: (SCC pp. 662-64, paras 26-28)

IN THE SUPREME COURT OF INDIA

Civil Appeal Nos. 2229-2234, 2235-2249, 2250-2251, 2252 and 2253-2256 of 2022

 Mekha Ram and Ors. Vs. State of Rajasthan and Ors.

Hon'ble Judges/Coram:

M.R. Shah and B.V. Nagarathna, JJ.

Author: M.R. Shah, J.

Decided On: 29.03.2022

Citation: MANU/SC/0372/2022

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Whether court should grant restitution to a party he is equally or more responsible for the illegality in comparison to the defendant?

 Hence, in adjudicating a claim of restitution under Section 65 of the Indian Contract Act, the court must determine the illegality which caused the contract to become void and the role the party claiming restitution has played in it. If the party claiming restitution was equally or more responsible for the illegality (in comparison to the defendant), there shall be no cause for restitution. This has to be determined on the facts of each individual case. {Para 52}

IN THE SUPREME COURT OF INDIA 

CIVIL APPELLATE JURISDICTION

Civil Appeal Nos. 1447-1467 of 2016 and with Civil Appeal No. 893 of 2019

Loop Telecom and Trading Limited Versus Union of India and Anr.

Coram: Dr. Dhananjaya Y. Chandrachud, J; Surya Kant, J; Vikram Nath, J. 

Author: Dr Dhananjaya Y Chandrachud, J

Dated: March 03, 2022

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Whether the trial court can grant restitution of property if the case did not fall within the ambit of S 144 of CPC?

 In the case of Mrs. Kavita Trehan and another v. Balsara

Hygiene Products Ltd., reported in AIR 1995 SC 441, in paragraph

nos. 13 and 15, the Supreme Court has made the following

observations:

“13. The Law of Restitution encompasses all claims

founded upon the principle of unjust enrichment.

'Restitutionary claims are to be found in equity as well as

at law'. Restitutionary law has many branches. The law of

quasi-contract is "that part of restitution which stems

from the common Indebitatus counts for money had and

received and for money paid, and from quantum meruit

and quantum vale bat claims." [See 'The Law of

Restitution" - Goff & Jones, 4th Edn. Page 3]. Halsburys

Law of England, 4th Edn. Page 434 states :

“Common Law. Any civilised system of law is

bound to provide remedies for cases of what has

been called unjust enrichment or unjust benefit,

that is, to prevent a man from retaining the

money of, or some benefit derived from, another

which it is against conscience that he should

keep. Such remedies in English law are

generically different from remedies in contract

or in tort, and are now recognised to fall within

a third category of the common law which has

been called quasi contract or restitution.”

For historical reasons, quasi contract has traditionally

been treated as part of, or together with, the law of

contract. Yet independently, equity has also developed

principles which are aimed at providing a remedy for

unjustifiable enrichment. It may be that today these two

strands are in the process of being woven into a single

topic in the law, which may be termed "restitution”.

Recently the House of Lords had occasion to examine some

of these principles in Woolwich Equitable Building Society

v. Inland Revenue Commissioners, [1993] A.C. 70.

14. ......

15. Section 144 CPC incorporates only a part of the

general law of restitution. It is not exhaustive. (See

Gangadhar v. Raghubar Dayal, AIR 1975 All 102 (FB)

and State Govt. of Andhra Pradesh v. M/s. Manickchand

Jeevraj & Co., Bombay , AIR 1973 Andhra Pra. 27).

The jurisdiction to make restitution is inherent in every

court and will be exercised whenever the justice of the

case demands. It will be exercised under inherent powers

where the case did not strictly fall within the ambit of

Section 144. Section 144 opens with the words, "Where

and in so far as a decree or an order is varied or reversed

in any appeal, revision or other proceeding or is set aside

or modified in any suit instituted for the purpose,...." The

instant case may not strictly fall within the terms of

Section 144; but the aggrieved party in such a case can

appeal to the larger and general powers of restitution

inherent in every court..............”

In view of the above observations, even if the cases not

falling within the ambit of Section 144 of CPC, restitution can be

made under inherent powers.

IN THE HIGH COURT OF JUDICATURE AT BOMBAY

BENCH AT AURANGABAD

901 WRIT PETITION NO. 269 OF 2018

CHANDRAKALABAI  BAPURAO SHIRSAT  Vs HABIB KHAN 

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Whether the trial court should restore possession of suit property to the party successful in the second appeal even though the appellate court has not directed restitution?

 Respondent no.1/original plaintiff raised objection to the effect that in favour of the petitioner no specific order has been passed by the Court to put her in possession and as such, the petitioner is not entitled to claim possession of the suit property. 

When a party, who lost his property in

execution of a decree, seeks to recover the same by

reason of the appellate decree in his favour, he is not

initiating any original proceeding, but he is only

concerned with the working out of the appellate decree

in his favour. The application flows from the appellate

decree and is filed to implement or enforce the same. He

is entitled to the relief of restitution, because the

appellate decree enables him to obtain that relief, either

expressly or by necessary implication. He is recovering

the fruits of the appellate decree. Prima facie, therefore,

having regard to the history of the section, there is no

reason why such an application shall not be treated as

one for the execution of the appellate decree.”

In view of the above observations made by the Supreme

Court, the application filed by the petitioner/original defendant

no.3 Chandrakalabai before the court below shall be required to be treated as one for the execution of appellate decree.

9. Learned counsel appearing for the respondents vehemently

submits that so far as the appellate decree is concerned, there are

no directions for restoration of possession and as such, the

provisions under Section 144 of CPC are inapplicable. I find no

substance in this submission. In the case of Union of India

represented by the Commissioner of Income-tax Madras v.

Ummer Sait and others, reported in AIR 1969 Madras 212, the

Madras High Court held that the right to get restitution is a right created by the statute, flowing as a consequence of the decree being reversed by the appellate court. Whether there is any direction expressly authorising the successful party in the appeal to claim restitution or not, by the very fact of success in the appeal, the successful party acquires a right in terms of Section 144 of C.P. Code.

IN THE HIGH COURT OF JUDICATURE AT BOMBAY

BENCH AT AURANGABAD

901 WRIT PETITION NO. 269 OF 2018

CHANDRAKALABAI  BAPURAO SHIRSAT  Vs HABIB KHAN 

CORAM : V. K. JADHAV, J.

DATED : 04th December, 2019

Citation: 2020 (6) MHLJ 356

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Whether tenant inducted by decree holder landlord is bound to deliver possession in restitution?

We are unable to share the view expressed by the High Court as in our considered opinion, the status of a bona fide purchaser in an auction sale in execution of a decree to which he was not a party stands on a distinct and different footing from that of a person who is inducted as a tenant by a decree holder-landlord. A stranger auction-purchaser does not derive his title from either the decree holder or the judgment-debtor and therefore restitution may not be granted against him but a tenant who obtains possession from the decree holder-landlord cannot avail of the same right as his possession as a tenant is derived from the landlord. 

4. In our view the above principle will apply in the case in hand as it is the decree holder who has put Respondent 2 in possession and, therefore, when the decree has been set aside he is bound to restore to the judgment-debtor what he gained under the decree and subsequently transferred to Respondent 2.

IN THE SUPREME COURT OF INDIA

Civil Appeal No. 3307 of 1983

Decided On: 09.02.1994

 Gurjoginder Singh  Vs. Jaswant Kaur and Ors.

Hon'ble Judges/Coram:

S. Mohan and M.K. Mukherjee, JJ.

Citation : 1994 MhLJ1 510

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Whether it is necessary to pay ad valorem Court-fee on application for restitution?

In my considered view, law is quite clear that the application for restitution under Section 144, C.P.C. is an application for execution of decree within the purview of Section 2(2), C.P.C. read with Order 21 , C.P.C.

6. This Court also in a case between Sri Tapan Sarkar v. Smt. Sukhila Boro reported in 1990 (2) GLR 29 held that the application for restitution under Section 144, C.P.C. is an application for execution of the decree. In view of the above well principle of law, I am of the view that the First Appellate Court has jurisdiction to hear the appeal arising from the order passed under Section 144, C.P.C. I am also of the view that as the application for restitution under Section 144, C.P.C. is an application for execution of the decree, no ad valorem Court-fee is required on the value of the suit land or mesne profit except the required Court-fees for the purpose of execution of decree or order.

IN THE HIGH COURT OF GAUHATI (AGARTALA BENCH)

Second Appeal No. 30 of 1984

Decided On: 13.06.1996

Ramesh Ch. Deb Vs.  Barindra Kr. Chakraborty

Hon'ble Judges/Coram:

N. Surjamani Singh, J.

Citation : AIR 1997 Gau 24

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Whether appellate court can direct restitution of premises?

Another grievance was made that after setting aside the ex parte decree, the learned appellate Judge has granted restitution of the premises to the tenant. On this short ground, rule is granted and both the parties are heard finally on this question.

Under S. 144 C. P. C. when a decree or order of a trial Court has been set aside in appeal or revision, it is only the Court of first instance which is given power to order restitution. That is the law which has been laid down by the Supreme Court in the case of State Bank of Saurashtra v. Chitranjan Rangnath, reported in MANU/SC/0006/1980 : [1980]3SCR915 . The Section itself is very clear that the application for restitution should be filed to the Court of first instance. Here in his enthusiasm to do justice, the learned appellate Judge has himself granted an order of restitution which cannot be strictly sustainable within the four corners of S. 144 C. P. C.

IN THE HIGH COURT OF BOMBAY

Writ Petn. No. 3219 of 1995

Decided On: 20.07.1995

V.T. Hundlani  Vs.  Robert C. Kenny

Hon'ble Judges/Coram:

R.G. Vaidyanatha, J.

Citation: Citation : AIR 1996 Bom 48

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Whether court can allow cross examination of deponent of application for restitution of property?

 The adjudication of an application under Section 144 of CPC conclusively determines the rights of the parties with regard to the matter in controversy. The definition of decree under Section 2(2) of CPC also makes it clear that any adjudication by a Court under Section 144 of CPC is also a decree. The decree is passed only after appreciation of evidence by the court. Therefore, the requirement of evidence for the purpose of deciding an application under Order XIX Rule 2 of CPC has been satisfied by the respondents/defendants. The application filed by the respondents/defendants is under Section 144 of CPC seeking restitution of possession and an application under Section 144 of CPC cannot be treated on par with an application for injunction under Order XXXIX of CPC. The averments contained in the affidavit filed in support of I.A. No. 3508 of 2008 in O.S. No. 2077 of 1997 under Section 144 of CPC regarding illegal dispossession of the petitioners can be adjudicated only through evidence and a bare affidavit will not be sufficient to prove or disprove the rival contentions. The Judgment relied upon by the learned counsel for the petitioners (a) Dhanalakshmi vs. Karuppayee reported in MANU/TN/4427/2017 : 2017-5-L.W. 758; (b) V. Baby v. Sekar and Another reported in MANU/TN/2877/2014 : (2015) 1 MLJ 443; (c) Kannammal v. Bagyammal reported in MANU/TN/0047/1998 : 1998 (1) CTC 280; (d) P.N. Karuppa Gounder v. Karuppayal and Others reported in MANU/TN/2228/2012 : (2013) 1 MLJ 814 relate to injunction applications filed under Order XXXIX of the CPC and they are not applicable for the facts of the instant case, since the application filed by the respondents/defendants is one under Section 144 of CPC which cannot be equated on par with an affidavit filed in support of an injunction application under Order XXXIX of CPC.

17. This Court has perused and examined the impugned order and is of the considered view that the Trial Court has rightly allowed the application filed by the respondents/defendants under Order XIX Rule 2 of CPC to cross examine the deponent of the affidavit filed in support of an application under Section 144 read with Section 151 of CPC

IN THE HIGH COURT OF MADRAS

C.R.P.(PD). No. 1627 of 2014 and M.P. No. 1 of 2014

Decided On: 01.02.2019

N. Vamanan  Vs. Doss and Ors.

Hon'ble Judges/Coram:

Abdul Quddhose, J.

Citation: AIR 2019 Madras 94

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Whether appellate court is required to frame separate points for determination and record his findings on each points?

 Normally, the first Appellate Court is last Court of appreciation of facts. It should record the arguments advanced from both the sides and frame separate points for determination and record his findings separately on each point with reasons. The growing tendency to adopt a shortcut and frame only a point as to whether any interference is required in judgment and decree of trial Court is contrary to the provisions of Order 41, Rule 31, Civil Procedure Code.

IN THE HIGH COURT OF BOMBAY

S.A. No. 1053 of 2005

Decided On: 11.10.2018

Rukmini A. Jadhav Vs.  Shankar Bhau Patil and Ors.

Hon'ble Judges/Coram:

A.M. Dhavale, J.

Citation: 2019(2) MHLJ 228

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Whether S 144 of CPC is applicable if there is no variation or reversal of decree or order in appeal or revision?

Section 144 applies to a situation where a decree or an order is varied or reversed in appeal, revision or any other proceeding or is set aside or modified in any suit instituted for the purpose. In that situation, the Court which has passed the decree may cause restitution to be made, on an application of any party entitled, so as to place the parties in the position which they would have occupied but for the decree or order or such part thereof as has been varied, reversed, set aside or modified. The court is empowered to pass orders which are consequential in nature to the decree or order being varied or reversed.

12. In the present case, the interim order of the Trial court did not require the Defendant to hand over the possession to the Plaintiff. There was no decree or order of the Trial court by virtue of which the Appellant was given possession of the property, nor did any decree or order mandate that the Respondent hand over possession to the Appellant.

13. In these circumstances, the provisions of Section 144, Code of Civil Procedure were not attracted there being no variation or reversal of a decree or order as contemplated by Section 144.

IN THE SUPREME COURT OF INDIA

Civil Appeal No. 880 of 2019 (Arising out of SLP (C) No. 2378 of 2006)

Decided On: 21.01.2019

 Murti Bhawani Mata Mandir  Vs.  Ramesh and Ors.

Hon'ble Judges/Coram:

Dr. D.Y. Chandrachud and Hemant Gupta, JJ.

Citation: AIR 2019 SC 679

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Whether court should order restitution if there is no variation or reversal of decree of order?

Section 144 applies to a situation where a decree or an
order is varied or reversed in appeal, revision or any other
proceeding or is set aside or modified in any suit instituted
for the purpose. In that situation, the Court which has passed
the decree may cause restitution to be made, on an application
of any party entitled, so as to place the parties in the
position which they would have occupied but for the decree or
order or such part thereof as has been varied, reversed, set
aside or modified. The court is empowered to pass orders which
are consequential in nature to the decree or order being varied
or reversed.
In the present case, the interim order of the Trial court
did not require the defendant to hand over the possession to
the plaintiff. There was no decree or order of the Trial court
by virtue of which the appellant was given possession of the
property, nor did any decree or order mandate that the
respondent hand over possession to the appellant.
In these circumstances, the provisions of Section 144,

CPC were not attracted there being no variation or reversal of
a decree or order as contemplated by Section 144.
The remedy of the first respondent, if any, did not lie
in an application for restitution before the executing court
under Section 144, CPC. The executing court was justified in
declining to entertain the application under Section 144, CPC.
The order of the first appellate court which has been
affirmed by the High Court was unsustainable.
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 880 OF 2019
(Arising out of SLP(C) No. 2378 of 2006)

MURTI BHAWANI MATA MANDIR Vs RAMESH & ORS. 

Dr. Dhananjaya Y. Chandrachud, J.
Dated:January 21, 2019

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Whether subsequent tenant getting possession from landlord is liable to be evicted in restitution proceeding?

In February 1971 Smt. Jaswant Kaur, Respondent 1 herein, initiated legal proceeding before the Rent Controller for eviction of her tenant, the Appellant herein, and in execution of the ex parte order passed therein obtained possession of the suit premises in October 1971. Immediately thereafter the Appellant filed an application under Order 9, Rule 13 of the Code of Civil Procedure which was dismissed by the Rent Controller. However, in appeal the ex parte order of eviction was set aside by the Rent Control Tribunal and the proceeding for eviction filed by Respondent 1 was revived. On such revival the Appellant filed an application under Section 144 of the Code of Civil Procedure before the Rent Controller for restoration of his possession which was allowed by an order dated May 13, 1977 and warrant for possession was issued. Before, however, possession could be taken pursuant thereto, Respondent 2 filed an objection before the Rent Controller contending that in terms of an agreement he had arrived at with Respondent 1 he took possession of the suit premises on May 1, 1973 as a tenant under her. He further contended that he was a bona fide transferee and that he did not know about the earlier eviction proceeding initiated against the erstwhile tenant. Consequently, he contended, he was not liable to be dispossessed pursuant to the warrant of possession.

We are unable to share the view expressed by the High Court as in our considered opinion, the status of a bona fide purchaser in an auction sale in execution of a decree to which he was not a party stands on a distinct and different footing from that of a person who is inducted as a tenant by a decree holder-landlord. A stranger auction-purchaser does not derive his title from either the decree holder or the judgment-debtor and therefore restitution may not be granted against him but a tenant who obtains possession from the decree holder-landlord cannot avail of the same right as his possession as a tenant is derived from the landlord. 

IN THE SUPREME COURT OF INDIA

Civil Appeal No. 3307 of 1983

Decided On: 09.02.1994

 Gurjoginder Singh  Vs.  Jaswant Kaur and Ors.

Hon'ble Judges/Coram:

S. Mohan and M.K. Mukherjee, JJ.

Citation: 1994 MHLJ 1510

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Basic concept of Restitution U/S 144 of CPC

The word restitution in this section means restoring to a party on the variation or reversal of a decree, what has been lost to him in execution of

decree or directly in consequence of that decree. This section does not apply unless property was lost in execution of decree or directly in consequence of that decree.

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Whether supreme court can order restitution?

We cannot accept either of the two submissions. The limitation for restitution under the Limitation Act is 12 years. The ex parte decree was set aside on 28th August, 1998 and thereafter, the Appellant has been litigating at various levels. If the Appellant had obtained stay order(s) during this period, obviously the period for which the stay was granted, would have to be excluded while calculating the period of limitation. This is not the job of this Court. It is for the executing court to decide whether the restitution petition, if any filed, is within the limitation or not. It is only the court which passed the original decree, which can order restitution. Restitution cannot be granted by the Supreme Court, as held in the case of State Bank of Saurashtra v. Chitranjan Rangnath MANU/SC/0006/1980 : (1980) 4 SCC 516.

IN THE SUPREME COURT OF INDIA

Civil Appeal No. 2062 of 2009

Decided On: 08.09.2017

Vijay Singh Vs. Shanti Devi and Ors.

Hon'ble Judges/Coram:

Madan B. Lokur and Deepak Gupta, JJ.

Citation: (2017) 8 SCC 837,2018(2) MHLJ 7.
Read full judgment here: Click here

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Whether application for restitution is application for execution of decree?

We have gone though the judgments carefully and we have derived great assistance from them. If we are not dealing with each of the cases specifically, it is only because we have practically dealt with all the views. We realize that the opposite construction for which the appellant contended is also a possible one; but it ignores the history of the legislation and the anomalies that it introduces. On a procedural matter pertaining to execution when a section yields to two conflicting constructions, the Court shall adopt a construction which maintains rather than disturbs the equilibrium in the field of execution. The historical background of section 144 of the Code of Civil Procedure, the acceptance of the legal position that an application for restitution is one for execution of a decree by a number of High Courts, the inevitable adoption of the said legal position by innumerable successful appellants within the jurisdiction of the said High Courts, the possible deleterious impact of a contrary view on such appellants, while there will be no such effect on similar appellants within the jurisdiction of the High Courts which have taken a contrary view, also persuade us to accept the construction that the application for restitution is one for execution of a decree. We, therefore, hold on a fair construction of the previous of section 144 of the Code of Civil Procedure that an application for restitution is an application for execution of a decree.

IN THE SUPREME COURT OF INDIA

Civil Appeals Nos. 777 and 778 of 1964

Decided On: 11.12.1964

Mahjibhai Mohanbhai Barot Vs. Patel Manibhai Gokalbhai and Ors.

Hon'ble Judges/Coram:

A.K. Sarkar, J.R. Mudholkar, K. Subba Rao, N. Rajagopala Ayyangar and Raghubar Dayal, JJ.

Citation: AIR 1965 SC 1477

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Whether higher courts can order restitution after reversal of decree?

The limited question is whether this Court can grant restitution. Prior to Amendment Act, 1976, an application for restitution Under Section 144 in all cases had to be made to the Court of first instance. Ever since the amendment the substituted expression 'the Court which passed the decree or order' would as per Clause (a) of the explanation, mean the Court of first instance because the expression 'the Court which passed the decree or order' has been deemed to include where the decree or order has been varied or reversed in exercise of appellate or revisional jurisdiction, the Court of first instance. The present one is the simplest case where the suit in favour of the appellant and against the surety was decreed by the trial court, i.e. the Court of first instance, and this decree has been reversed by the High Court in exercise of its appellate jurisdiction. In such a situation Clause (a) of the explanation would be attracted and an application for restitution will have to be made to the Court of first instance, i.e. the Court of Civil Judge, Senior Division, Gondal. It is nowhere suggested that such a Court does not exist. Therefore, it would not be proper for this Court to direct restitution. 

IN THE SUPREME COURT OF INDIA

Civil Appeal No. 1058 of 1970

Decided On: 30.04.1980

State Bank of Saurashtra Vs.Chitranjan Rangnath Raja and Anr.

Hon'ble Judges/Coram:
A.C. Gupta, D.A. Desai and E.S. Venkataramiah, JJ.
Citation:(1980) 4 SCC 516.

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