No one can be permitted to take benefit of wrong Order which was subsequently set aside by higher forum, says Apex Court

Read Judgment: Mekha Ram and Others vs. State of Rajasthan and Others

Pankaj Bajpai

New Delhi, March 30, 2022: The Supreme Court has held that that the amount paid in excess pursuant to an Order passed by the Single Judge which was set aside by the Division Bench has to be refunded or returned by the original writ petitioners, which the State is entitled to recover from them on the principle of restitution.

The Division Bench of Justice M.R Shah and Justice B.V. Nagarathna said, “no one can be permitted to take the benefit of the wrong order passed by the court which has been subsequently set aside by the higher forum/court. As per the settled position of law, no party should be prejudiced because of the order of the court”.

Finding that the order passed by the Single Judge has been set aside by the Division Bench of the High Court and therefore by applying Section 144 CPC also, the amount paid pursuant to the order passed by the Single Judge which has been set aside by the Division Bench is required to be refunded/returned by the appellants (in-service candidates, seeking admission to the course of General Nursing), observed that the Division Bench of the High Court was absolutely justified in reserving liberty in favour of the State to recover the amount paid in excess to the appellants. 

The observation came pursuant to an appeal challenging the judgment whereby the Division Bench of the High Court had held that the three years Nursing Course by the in-service candidates could not be treated as a period on deputation and be treated only on leave whatever due to the candidates and consequently has reserved the liberty in favour of the State to recover the excess amount paid to Mekha Ram and Others (original writ petitioners – appellants) treating the period of training as a period of leave permissible to him/her in easy equal installments. 

After considering the submissions, the Top Court noted that in the present case the amount paid in excess to the appellants was not due to any mistake on the part of the State/State authorities, rather it had been paid pursuant to the order passed by the Single Judge, which has been subsequently set aside by the Division Bench. 

Therefore, the amount paid in excess pursuant to the order passed by the Single Judge which has been set aside by the Division Bench had to be refunded and/or returned by the appellants which the State is entitled to recover from them on the principle of restitution, added the Court. 

Speaking for the Bench, Justice Shah quoted the decision in Indore Development Authority v. Manohar Lal , (2020) 8 SCC 129, wherein it was observed “…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…”. 

The decision in Indore Development Authority’s Case (Supra) further held that the restitution principle recognizes and gives shape to the idea that advantages secured by a litigant, on account of orders of court, at his behest, should not be perpetuated, added the Bench. 

Therefore, considering the prayer made on behalf of the appellants to recover the amount in easy equal installments, the Apex Court directed that whatever amount was paid in excess to the appellants pursuant to the order passed by the Single Judge, be recovered from the appellants in thirty-six equal monthly installments, to be deducted from their salary commencing from April, 2022.