§ Actus curiae neminem gravabit

An act of the court shall prejudice no one. The maxim is the foundation of the section, and it explains both the duty and its breadth.

The reasoning runs in three steps. A party obtained a benefit because the court gave him a decree. That decree has since been held to be wrong. The party against whom it was executed is therefore worse off because of an act of the court, and the court itself must undo the consequence.

Two consequences follow. The obligation to restore does not depend on any fault in the decree-holder: he did nothing wrong in executing a decree that was valid when he executed it. And the duty is the court's own, which is why the section says the court shall cause restitution to be made, and why the remedy is an application in the same proceeding rather than a fresh suit.

§ Section 144, CPC 1908 (in substance)

(1) 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 Court which passed the decree or order shall, on the application of any party entitled to any benefit by way of restitution or otherwise, cause such restitution to be made as will, so far as may be, place the parties in the position which they would have occupied but for such decree or order or such part thereof as has been varied, reversed, set aside or modified; and, for this purpose, the Court may make any orders, including orders for the refund of costs and for the payment of interest, damages, compensation and mesne profits, which are properly consequential on such variation, reversal, setting aside or modification of the decree or order.

Explanation. For the purposes of sub-section (1), the expression Court which passed the decree or order shall be deemed to include — (a) where the decree or order has been varied or reversed in exercise of appellate or revisional jurisdiction, the Court of first instance; (b) where the decree or order has been set aside by a separate suit, the Court of first instance which passed such decree or order; (c) where the Court of first instance has ceased to exist or to have jurisdiction to execute it, the Court which, if the suit wherein the decree or order was passed were instituted at the time of making the application for restitution under this section, would have jurisdiction to try such suit.

(2) No suit shall be instituted for the purpose of obtaining any restitution or other relief which could be obtained by application under sub-section (1).

§ Three conditions, all of which must be satisfied

• The applicant must be a party to the decree or order, or entitled to a benefit by way of restitution under it. A stranger who has suffered incidentally cannot apply under the section.

• The decree or order must have been varied or reversed, in an appeal, a revision or any other proceeding, or set aside or modified in a suit instituted for the purpose. The words or other proceeding are wide, and cover, for example, an order setting aside an ex parte decree or a sale.

• The applicant must have been deprived of a benefit under the decree that has gone, so that there is something to restore. Restitution is not a free-standing claim for compensation; it is the undoing of what the decree caused.

§ Which court restores

The section says the court which passed the decree or order, and the Explanation gives that phrase the same extended meaning it has in execution under Section 37.

So where an appellate or revisional court reversed the decree, the application lies to the court of first instance; where it was set aside by a separate suit, again to the court of first instance; and where that court has ceased to exist or to have jurisdiction, to the court that would today have jurisdiction to try the suit.

The reason is practical. The court of first instance holds the record and the execution file, and it is the court that ordered the thing now to be undone.

The principal benefit

Restoration of money recovered, property delivered, or possession taken under the reversed decree

The court places the parties, so far as may be, in the position they would have occupied but for the decree

Refund of costs

Repayment of the costs recovered under the decree

Expressly named in the section

Interest

Interest on money restored, for the period the party was kept out of it

Awarded as properly consequential; the rate is in the court's discretion

Mesne profits

For the period during which the property was held under the reversed decree

Measured as in Section 2(12): what the person in wrongful possession received or might with ordinary diligence have received

Damages and compensation

For loss properly consequential on the execution of the decree

Named in the section, and confined to what is consequential on the reversal

Consequential orders generally

Any order properly consequential on the variation, reversal, setting aside or modification

The words are wide, but the limit is the phrase properly consequential

§ Why the bar exists

Sub-section (2) provides that no suit shall be instituted for the purpose of obtaining any restitution or other relief which could be obtained by application under sub-section (1).

The reason is the same as for Section 47 in execution: the proceeding that caused the loss is the proceeding in which it should be undone. Requiring a fresh suit would add years, another round of court fees, and another appeal to a matter that the court which acted can resolve at once.

The limit of the bar. It bars a suit for relief which could be obtained by application under the section. Where the relief is outside Section 144, because the applicant is not a party, or the claim is not consequential on a reversal, a suit is not barred by this sub-section, though it must stand on its own footing.

Limitation. An application under Section 144 is governed by Article 137 of the Limitation Act, 1963, which allows three years from the date when the right to apply accrues, that is, ordinarily the date of the appellate decree reversing or varying the decree.

When it applies

Where a decree or order has been varied, reversed, set aside or modified, and a party has been deprived of a benefit under it

Where the case falls outside Section 144 but the ends of justice require the court to undo the consequence of its own act

Source

An express statutory provision

The court's inherent power, which is preserved rather than conferred by the Code

Who may apply

A party entitled to a benefit by way of restitution

Any person affected, in a proper case, including one who is not a party

Typical situation

Money or property recovered in execution of a decree afterwards reversed

Benefit obtained under an interim order that is afterwards vacated, or under an order that is not a decree

Separate suit

Barred by Section 144(2)

Not barred by that sub-section, but the inherent power is exercised in the same proceeding

Relationship

Where Section 144 applies, it governs, and the inherent power is not used to circumvent its conditions

The inherent power fills the gap where the section does not reach, on the same principle: an act of the court shall prejudice no one

§ Restitution and execution distinguished

Execution enforces a decree that stands. Restitution undoes what was done under a decree that has fallen.

The direction is opposite. In execution the decree-holder takes; in restitution he gives back.

The proceeding is the same file. Restitution is applied for to the court that passed the decree, and the order made is enforceable as an order of that court. In that sense restitution is worked through the execution machinery, but it is not execution of the reversed decree, which no longer exists.

The link with Order XXI Rule 93. Where a sale is set aside, the purchase money is repaid to the purchaser under that rule. Section 144 performs the same function generally, wherever a decree has been executed and then reversed.