SC Slams Litigant for Retaining Property After ₹2 Crore Compensation, Cites Unjust Enrichment

New Delhi – In a stern rebuke against litigant opportunism, the Supreme Court of India has emphatically ruled that a party cannot retain possession of a property while simultaneously accepting a substantial monetary award granted in lieu of specific performance. A bench of Justices Vikram Nath and Sandeep Mehta, in the case of PREM AGGARWAL Versus MOHAN SINGH & ORS. , held that clinging to both the property and the compensation constitutes "unjust enrichment" and is an abuse of the judicial process.

The Court dismissed an appeal by a plaintiff who, after being awarded ₹2 crore as equitable compensation, refused to vacate a property, arguing that the Court's earlier order did not explicitly direct him to do so. The bench not only upheld the execution of possession warrants but also imposed a hefty cost of ₹10 lakhs on the appellant, signalling its strong disapproval of such conduct.

Case Background: A Three-Decade Dispute

The legal battle originated from a sale agreement executed in 1989. The appellant, Prem Aggarwal, had paid an earnest money of ₹25,000 and, as per the agreement, obtained possession of a portion of the disputed property. When the sale did not materialize, Aggarwal filed a suit for specific performance, seeking a court order to compel the sellers to execute the sale deed.

After decades of litigation through the lower courts, the matter reached the Supreme Court. In a judgment dated April 1, 2025, the apex court set aside the decree for specific performance that had been granted by the trial court and the High Court. However, recognizing the significant passage of time and the meager sum paid as earnest money, the Court decided to "balance the equities." It awarded an "extraordinary monetary award" of ₹2 crore to the appellant as compensation, aiming to provide a final resolution, or "quietus," to the prolonged dispute.

The Execution Standoff and the Appellant's Gambit

The respondents (the original property owners) duly deposited the ₹2 crore with the executing court to comply with the Supreme Court's order. However, when they sought to take back possession of their property, the appellant resisted. He refused to accept the compensation and argued that since the Supreme Court's order of April 1, 2025, did not contain an explicit direction for him to hand over possession, he was not obligated to do so.

This resistance forced the respondents to seek the issuance of possession warrants from the executing court, a move the court granted. The appellant challenged this decision before the High Court of Punjab & Haryana, which rejected his revision petition. Undeterred, he filed the present appeal before the Supreme Court, essentially challenging the execution of the very judgment that had awarded him a significant financial windfall.

Supreme Court's Analysis: Equity, Implied Obligations, and Judicial Inadvertence

The Supreme Court bench was unpersuaded by the appellant's hyper-technical argument. In a judgment authored by Justice Vikram Nath, the Court systematically dismantled the appellant's case, terming his actions a classic case of having "shot himself in the foot."

1. The Principle of Unjust Enrichment: The cornerstone of the Court's ruling was the equitable principle against unjust enrichment. The bench observed that the ₹2 crore award was not a standalone grant but was intrinsically linked to the denial of specific performance. It was compensation for the loss of the bargain, which inherently included the right to possess the property. The Court stated, "a litigant cannot retain possession while benefiting from an 'extraordinary monetary award,' and equity would not permit such 'unjust enrichment.'" To allow the appellant to keep both the money and the land would be a gross miscarriage of justice.

2. Possession as an Implied Corollary: The Court clarified that the obligation to return possession was a "necessary and implied corollary" of the judgment. When a court denies specific performance to a plaintiff who is already in possession, the restoration of possession to the rightful owner is a natural and logical consequence. The judgment's primary effect was to nullify the appellant's claim to the property; the monetary award was a balm for that legal outcome.

The Court observed:

“Once it has been held that no relief can be granted for specific performance and an extraordinary amount has been awarded to compensate the meagre amount of advance is only to adjust the equities. Appellant cannot have any right to resist possession and should not have obstructed or resisted the delivery of possession.”

3. Invoking Actus Curiae Neminem Gravabit : Addressing the appellant's central claim about the omission in the earlier order, the Court invoked the legal maxim Actus Curiae Neminem Gravabit – an act of the court shall prejudice no one. Justice Nath noted that an inadvertent oversight by the court in not explicitly mentioning the return of possession cannot be exploited by a litigant to secure an unfair advantage. The judiciary has an inherent duty to correct its orders and ensure that no party is prejudiced by a clerical or accidental omission.

The judgment explained:

“Accordingly, where a party has been disadvantaged by reason of an act of the Court, it is incumbent upon the Court to undo such prejudice and restore the party to the position he would have occupied but for such act.”

Implications for Legal Practice

This judgment serves as a powerful precedent and a cautionary tale for litigants and their counsel in execution proceedings. It reinforces several key legal tenets:

• Holistic Interpretation of Judgments: Courts and legal practitioners must interpret judgments holistically, understanding the underlying intent and the interconnectedness of the reliefs granted or denied. An order cannot be dissected to cherry-pick favorable clauses while ignoring consequential obligations.
• Equity Demands Equity: Parties seeking equitable relief must be prepared to fulfill their own equitable obligations. The Supreme Court has made it clear that its efforts to "balance the equities" are a two-way street.
• Execution is the Heart of the Decree: The ruling champions the robustness of execution proceedings. It empowers executing courts to look beyond mere semantics and enforce the true spirit and substance of a decree, preventing judgments from becoming mere paper tigers.
• Consequences for Frivolous Litigation: The imposition of ₹10 lakhs in costs is a significant deterrent. It sends a clear message that the Supreme Court will not tolerate attempts to subvert its orders through clever but disingenuous legal arguments, especially at the execution stage.

Ultimately, the Supreme Court found that the executing court and the High Court were correct in issuing warrants of possession. By dismissing the appeal with substantial costs, the Court has brought a decisive end to a 35-year-old dispute, ensuring that justice is not only declared but also effectively delivered.