Inherent powers under Section 151 CPC extend to directing restitution of excess compensation to prevent unjust enrichment.

The petitioner’s land (6 kanals, 2 marlas) and structures in District Anantnag were acquired for the Srinagar–Jammu National Highway.

After a reference to the Principal District Judge, Anantnag, an award was passed on 15.07.2014 granting compensation for land, structures, and loss of earnings, while specifically directing the deduction of any amount already received.

This award attained finality after challenges by the NHAI were dismissed by the High Court and the Supreme Court.

Subsequently, NHAI filed an application under Section 151 CPC and Section 17-B of the JK Land Acquisition Act alleging that the petitioner received a double payment amounting to ₹2,61,34,972/-.

The trial court allowed the application on 04.02.2026, directing recovery with 6% interest, and later dismissed a review petition on 27.04.2026.

The petitioner challenged these orders under Article 227 of the Constitution.

1. Whether the Reference Court became functus officio after the award attained finality, thereby barring the exercise of inherent powers under Section 151 CPC to correct payment errors.

2. Whether an amount paid specifically for "demolition of structures" constitutes compensation subject to adjustment/deduction under the Land Acquisition Act.

3. Whether the doctrine of restitution and Section 17-B of the JK Land Acquisition Act permit the recovery of excess payments with interest.

Section 151 of the CPC regarding the inherent powers of the court to prevent abuse of process and ensure justice.

The precedent of My Palace Mutually Aided Cooperative Society vs B. Mahesh established that inherent powers can rectify mistakes or fraud even after finality.

South Eastern Coalfields Ltd. v. State of M.P. regarding the doctrine of restitution to prevent unjust enrichment.

Section 17-B of the JK Land Acquisition Act, which mandates the refund of any compensation paid in excess of the final award, recoverable as arrears of land revenue.

The maxim actus curiae neminem gravabit (an act of the court shall prejudice no man).

The court reasoned that the supervisory jurisdiction under Article 227 is limited to correcting jurisdictional errors or manifest perversity, neither of which were present here.

It held that Section 151 CPC was appropriately invoked not to re-adjudicate the award, but to correct an arithmetical error that led to a double disbursement of public funds.

Regarding the demolition costs, the court found that since the original award directed the deduction of "amounts already received," and because compensation includes all interests attached to the land (including structures), the demolition payment was an integral part of the acquisition process subject to adjustment.

The court determined that Section 17-B provides a specific statutory mechanism for recovering such surpluses.

The court held that restitution requires the disgorging of unjust benefits, and since the petitioner held public money to which he was not entitled, the imposition of 6% interest was necessary to restore the parties to their rightful position.

The High Court dismissed the petition, upholding the orders dated 04.02.2026 and 27.04.2026, directing the petitioner to deposit the principal sum along with 6% interest within one month, failing which the amount shall be recovered as arrears of land revenue.