Tag: Unjust Enrichment

Specific Performance Suit Fails: Supreme Court Explains Why Buyer Must Vacate Despite Long Possession
4Dec By The Legal ChamberNo Comments
Supreme Court

Specific Performance Suit Fails: Supreme Court Explains Why Buyer Must Vacate Despite Long Possession

The Supreme Court affirmed the executability of a warrant of possession, ruling that a party who receives substantial monetary compensation in lieu of specific performance cannot retain possession of the property. The Court held that equity prevents unjust enrichment and that execution proceedings exist to enforce judgments, not to facilitate windfalls for unscrupulous litigants. Facts Of The Case: On 12.06.1989, the defendants agreed to sell a property to the plaintiff for ₹14,50,000, with ₹25,000 paid as earnest money. Possession of the vacant ground floor was handed over to the plaintiff. In 1990, the plaintiff first filed and withdrew a suit for permanent injunction. Subsequently, in June 1990, the plaintiff filed a suit for specific performance, which was decreed by the Trial Court ...
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Supreme Court Rules: Bank’s Illegal Mortgage Voids Multi-Crore Property Auction
21Nov By The Legal ChamberNo Comments
Supreme Court

Supreme Court Rules: Bank’s Illegal Mortgage Voids Multi-Crore Property Auction

The Supreme Court quashed the e-auction sale as the proclamation violated Rule 53 of the Income Tax Act's Second Schedule, applicable via the RDDB Act. It failed to disclose material encumbrances, specifically DDA's claim for unearned increase. The Court held the sale was void, applying principles of restitution to refund the auction purchaser with interest. Facts Of The Case: The Delhi Development Authority (DDA) allotted a plot to Sarita Vihar Club on a leasehold basis. The club mortgaged the plot to Corporation Bank without obtaining the mandatory prior written consent from the Lieutenant Governor, as required by the lease deed. When the club defaulted on its loan, the Bank initiated recovery proceedings. The Debt Recovery Tribunal (DRT) ordered the sale of the plot. Despite DDA's obj...
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Supreme Court Rules on Power Theft: Generator Must Pay Full Compensation for Diverted Electricity
19Nov By The Legal ChamberNo Comments
Supreme Court

Supreme Court Rules on Power Theft: Generator Must Pay Full Compensation for Diverted Electricity

In a significant ruling, the Supreme Court clarified that compensation for wrongful diversion of electricity under a Power Purchase Agreement is distinct from the reimbursement of fixed charges. The Court held that the beneficiary is entitled to both remedies concurrently, reinforcing the 'proportionate principle' and preventing unjust enrichment by the power generator. Facts Of The Case: The dispute originated from a 1996 Power Purchase Agreement (PPA) between Gujarat Electricity Board (GEB, later GUVNL) and Essar Power Limited (EPL). EPL's plant had a total capacity of 515 MW, with 300 MW allocated to GEB and 215 MW to its sister concern, Essar Steel Limited (ESL). The core issue arose when EPL began supplying more power to ESL from GUVNL's allocated 58% share, violating the ag...
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Supreme Court Upholds Buyer’s Right: Builder Must Pay 18% Interest for Delay, Same Rate It Charged
15Nov By The Legal ChamberNo Comments
Supreme Court

Supreme Court Upholds Buyer’s Right: Builder Must Pay 18% Interest for Delay, Same Rate It Charged

The Supreme Court held that while there is no absolute rule for parity in interest rates between builders and buyers, the principle of equity and fairness may warrant it in cases of one-sided agreements and egregious conduct. The Court modified the awarded interest from 9% to 18% p.a., aligning the builder's liability for delay with the rate it charged the buyer, to serve the ends of justice. Facts Of The Case: The appellant booked a plot in the respondent's project in 2006, paying a significant advance. A Plot Buyer Agreement was executed in 2007, stipulating possession within 24 months of sanction of service plans and allowing the respondent to charge 18% p.a. interest on delayed payments by the appellant. By 2011, the appellant had paid over ₹28 lakhs. That year, the respondent invoke...
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Coal India’s 20% Price Hike for Select Industries Upheld by Supreme Court
1Nov By The Legal ChamberNo Comments
Supreme Court

Coal India’s 20% Price Hike for Select Industries Upheld by Supreme Court

The Supreme Court upheld the constitutional validity of Coal India's Interim Pricing Policy, ruling that the 20% price increase for the non-core sector was a valid economic policy decision. The Court affirmed that such price fixation, based on reasonable classification and to subserve the common good, does not violate Article 14, and set aside the refund directed by the High Court. Facts Of The Case: Following the Supreme Court's 2006 decision in Ashoka Smokeless that struck down the e-auction system for coal sales, Coal India Limited (CIL) introduced an Interim Coal Policy on December 15, 2006. This policy increased the price of coal by 20% over the pre-e-auction notified price specifically for linked consumers in the non-core sector, such as manufacturers of smokeless fuel. An associat...
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Supreme Court Backs Discom: Upholds Right to Encash Bank Guarantee in Delayed Solar Project
29Sep By The Legal ChamberNo Comments
Supreme Court

Supreme Court Backs Discom: Upholds Right to Encash Bank Guarantee in Delayed Solar Project

The Supreme Court held that the Power Purchase Agreement's explicit terms govern the parties' rights. The encashment of the performance bank guarantee was valid as the developer failed to seek an extension under the contractual mechanism or issue a mandatory Force Majeure notice. Regulatory commissions cannot rewrite the contractual risk allocation or grant remedies outside the agreed framework. Facts Of The Case: The dispute arose from a Power Purchase Agreement (PPA) executed between Chamundeshwari Electricity Supply Company Ltd. (CESC) and Saisudhir Energy Pvt. Ltd. for a 10 MW solar power project. The PPA stipulated that the developer was to achieve the Commercial Operation Date (COD) within 12 months, preceded by fulfilling certain Conditions Precedent within 240 days. A critical pr...
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When a Society Becomes a “Trust”: Supreme Court’s Landmark Ruling on Mismanagement in Charitable NGOs
6Sep By The Legal ChamberNo Comments
Supreme Court

When a Society Becomes a “Trust”: Supreme Court’s Landmark Ruling on Mismanagement in Charitable NGOs

The Supreme Court ruled that a society registered under the Societies Registration Act, 1860, can be construed as a constructive trust under Section 92 CPC if it is created for public charitable purposes and its properties are held in a fiduciary capacity. This allows aggrieved parties to sue for breach of trust and seek remedies like a scheme for administration. Facts Of The Case: In 2005, Operation ASHA, a society registered under the Societies Registration Act, 1860, was established to provide healthcare services, particularly tuberculosis treatment, to underprivileged sections of society. A dispute arose in 2020 when its co-founder and CEO, Sandeep Ahuja (Respondent No. 3), terminated the services of another co-founder, Dr. Shelly Batra (Respondent No. 1), alleging misrepresentation ...
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Supreme Court Rules: Private Schools Can Sue in Civil Court to Recover Unpaid Fees
5Sep By The Legal ChamberNo Comments
Supreme Court

Supreme Court Rules: Private Schools Can Sue in Civil Court to Recover Unpaid Fees

The Supreme Court held that the civil courts retain jurisdiction to adjudicate fee recovery suits filed by unaided private schools, as there is no express or implied ouster of jurisdiction under the Haryana School Education Act and Rules. The statutory remedy before the Fee and Fund Regulatory Committee is available only to parents/students to challenge excessive fees, not to schools for recovery. Facts Of The Case: The appellant, Apeejay School, an unaided private institution, filed suits for recovery of fees against students and their parents. The dispute arose from a fee hike implemented by the school for the academic year 2009-10, which the respondents refused to pay, continuing instead to remit only the pre-hike amount. The school's suits were initially decreed by the trial court. W...
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