CITIBANK N.A.versusHITEN P. DALAL & ORS.

                        [2015].9 S.C.R. 583


                           CITIBANK N.A.                              A
                                  v.
                      HiTEN P. DALAL& ORS.
                 (Civil Appeal No.3580 of2005 etc.)
                         AUGUST21, 2015                               B
       [VIKRAMAJIT SEN AND SHIVA KIRTI SINGH, JJ.]

         Code of Civil Procedure, 1908 - s. 144 - Restitution of
    decree- Money decree in favour of the appellant and against
    the respondent - Respondent was directed either to pay            c
    Rs. 50 crores or to deliver 9% /RFC Bonds of the face value
    of Rs. 50 crores alongwith 9% interest - Respondent opted
    to deliver the bonds alongwith interest-Appellants disposed
    of the bonds in the market, during March/April 1997, when
                                                                      D
    the prevailing market rate was Rs. 851- (face value of the bond
    being Rs. 1001- redeemable on 15. 7. 2001) - Subsequently
    the decree was reversed by Supreme Court - Demand of
    Rs. 135, 18, 28, 0531- by way of restitution -Appellant as per
    its own calculation tendered Rs.107, 75,40, 1411- before          E
    Special Court - Application by appellant before Special
    Court for recording satisfaction of Supreme Court Judgment
    - Respondent's application, claiming to be entitled to further
    amount of Rs. 51. 83 crores- Special Court allowed additional
    sum of Rs. 30, 13, 55, 1751- to respondent- On appeal, held:      F
    Power u/s. 144 has to be exercised to ensure equity, fairness
    and justice to both the parties- For ascertaining the value of
    the property which is no longer available for restitution, the
    Court should adopt realistic and verifiable approach instead
    of resorting to hypothetical and presumptive value - The          G
    Special Court determined the amount for restitution, ignoring
    the relevant facts as to the value of the bonds on the date
•   when the bonds were handed over to the appellant or the

                                 583                                  H
584         SUPREME COURT REPORTS                 [2015] 9 S.C.R.

A   date when the appellant sold them to the third party and by
   .presuming that the respondent would have retained the bonds
    with them till maturity - The alternative calculation of
    Rs: 115, 08, 98, 8351- as suggested by the appellant is accepted
    - the respondents are directed to refund Rs.22, 14,36, 7561-
 B to the appellant with 9% interest.

           Allowing the appeals, the Court

        HELD: 1. Section 144 of the CPC, vests expansive
 c power in the Court, but such power has to be exercised
   to ensure equity, fairness and justice for both the parties.
   It also flows from more or less common stand of parties
   on the principle of law that for ascertaining the value of
   the property which is no longer available for restitution
 o on account of sale etc., the court should adopt a realistic
   and verifiable approach instead of resorting to
   hypothetical and presumptive value. It is also one of the
   established propositions that in the context of
   restitution, the Court should keep under consideration
 E not only the loss suffered by the party entitled to
   restitution but also the gain, if any, made by other party
   who is obliged to make restitution. No unmerited injustice
   should be caused to any of the parties. [Para 19] [597-E-
      H]
 F
        2. In the present case, in the course of finding out
   the value of the bonds which are no longer available for
   restitution, the Special Court committed a clear error of
   law in ignoring a relevant fact that the bonds in question
 G were a tradable commodity on the stock market and its
   value could be easily ascertained either on the date when
   the bonds were handed over to the appellant-Bank or at
                                                                       •
   the time when the appellant-Bank sold the bonds to third
   parties. Such relevant facts shou.ld not have been lost
 H sight of and no presumption should have been made
               CITIBANK N.A. v. HITEN P. DALAL & ORS.          585


       thatthe respondent would have retained the bonds with A
       it till the maturity period. [Para 20] [598-B~D]

            3. There are sufficient materials available to lend ·
        credence to the view that in all eventuality, the
        respondent would have sold the bonds because it was B
      · in such business and also because earlier when it had
        the option, it chose to hand over the bonds to the
        appellant~Bank instead of preferring the other option of
        paying its monetary value. Sale of the bonds by the
        appellant-Bank to third parties at a verifiable rate not C
        being under dispute, it is evidently unjust to saddle the
        appellant-Bank with liability to repay the possible gains
        made by the third party or subsequent purchasers of
        the bonds. Therefore, the amount determined by the
        Special Court for restitution and payment by the D
        appellant-Bank is unjust and is a result of error in not
        keeping under view the relevant facts as well as in
        applying the settled legal propositions for the purpose
        of compensating the respondent by way of restitution.
        [Para 20] [598-D-F]                                       E

            4. The appellant, as an alternative submission apart
       from the figure of Rs.107 crores, suggested two other
       figures by way of possible restitution which are Rs.109
       crores, Rs.111.30 crores and 115,08 crores F
       approximately. The figure of Rs. 115,08,98,835/- is
       accepted to be correct calculation of the amount payable
       by way of restitution by the appellant-Bank to the
       respondent. After adjusting the further amount paid by
       the appellant-Bank to the respondent under protest on G
       25.4.2005, the appellant-Bank is entitled to a refund by
...    the respondent as on 25.4.2005 to an amount of Rs.
       22, 14,36,756/-. Interest on this amount at the rate of 9%
       per annum from 25.4.2005 till the date of actual refund is H
       allowed. [Paras 10 and 21] [592-B-D] [599-A-C]
586           SUPREME COURT REPORTS              [2015] 9 S.C.R.


A         Lal Bhagwant Singh vs. Rai Sahib Lala Sri Kishen Das
      1953 SCR 559: AIR 1953 SC 136; Kartar Singh & Ors. vs.
      State of Punjab 1995 (2) SCR 922 : (1995) 4 sec 101;
      Kera/a State Electricity Board and Anr. vs. M.R.t=. Limited
      1995 (6) Suppl. SCR 599: (1996) 1SCC597; South Eastern
B     Coalfields Ltd. vs. State of M.P. & Ors. AIR 2003 SC 4482:
      2003 (4) Suppl. SCR 651; Indian Council for Enviro-Legal
      Action vs. Union of India & Ors. 2011 (9) SCR 146: (2011) 8
      sec 161 - relied on.
c          Lakshmi Amma vs. Thazhathitathil Krishna Kurup AIR
      1931 Madras 81; S. Choka/ingam Asari vs. N.S. Krishna
      Iyer and Ors. AIR 1964 Madras 404; Surendra Lal Chowdhury
      and Ors. vs. Sultan Ahmed and Ors. AIR 1935 Calcutta 206
      - approved.
D
          Jai Berham vs. Kedar Nath Marwari AIR 1922 PC 269 -
      referred to.

                           Case Law Reference
 E          AIR 1931 Madras 81          approved      Para 13

            AIR 1964 Madras 404         approved      Para 13

            AIR 1935 Calcutta 206       approved      Para 13
 F
            1953 SCR 559                relied on     Para 13

            1995 (2) SCR 922            relied on     Para 13

            1995 (6) Suppl. SCR 599     relied on     Para 13
 G
            2003 (4) Suppl. SCR 651     relied on     Para 13
        •
            AIR 1922 PC 269             referred to   Para 17       ••
            2011 (9) SCR 146            relied on     Para 18
 H
        CITIBANK N.A. v. HITEN P. DALAL & ORS.               587


    CIVILAPPELLATE JURISDICTION :Civil Appeal No. 3580           A
of2005.

     From the Judgment and Order dated 12.04.2005 of the
Special Court at Mumbai Constituted under The Special Court ,
(Trial of Offences Relating to Transactions in Secirotoes)Act, B
1992, in Miscellaneous Application No. 24 of 2005 in Suit No.
1of1995.

                              WITH
    C. A. NO. 3548 of 2005.                                      c
    Kapil Sibal, P.K. Samdani, Bindi Dave, Rashmi Virmani,
Sandeep Narain, Ankit Virmani, Ashish Kothari, Abhishek
Prasad, S. Narain & Co. for the Appellant.
                                                                 D
    Pradeep Sancheti, Sunita Dutt, Shashank Trivedi, Rajiv
Mehta for the Respondents.

    The Judgment of the Court was delivered by

     SHIVA KIRTI SINGH, J. 1. The simple grievance of the        E
appellant is that by impugned judgment and order dated
12.04.2005 passed by a Hon'ble Judge presiding over the
Special Court (Trial of Offences Relating to Transactions in
Securities) at Bombay ~as erred in determining an excessive      F
amount payable by the appellant Citibank to the respondent
applicant- Canbank Financial Services Limited (hereinafter
referred to as 'Canfina') by way of restitution.

     2. There is no dispute that on account of reversal of a
money decree in favour of Citibank in Suit No. 1 of 1995 filed   G
by it against Canfina, by a common order dated 7.7.2004
passed by this Court in Civil Appeal nos. 7426, 9063 and 9138
of 1996, the Citibank is required to restore back the monetary
benefits it received under the decree against Canfina. The       H
operative part of the said decree dated 22/23/26.04.1996 in
588         SUPREME COURT REPORTS                       [2015) 9 S.C.R.


A     Suit no. 1 of 1995 is as follows:

            "121. xxxxAccordingly, the defendants are directed to
           deliver to the plaintiffs, 9% IRFC Bonds of the face value
           of Rs. 50 crore within a period of 16 weeks xxx"
B
             "122. the question then arises as to the interest the
           defendants must therefore pay to the plaintiffs, the interest
           @ 9% on these Bonds for the period starting from 151h
           July, 1991 till they deliver the Bonds. If the Defendants
c          do not deliver the Bonds but choose to return the monies
           they must still pay interest. However, in my view the
           Plaintiffs would still be entitled to interest at 9% only. This,
           however, will be from the date the consideration amount
           was received by the Defendants till the date of repayment.
 D          xxx.·
        3. Since the decree gave an option to Canfina, it opted to
   deliver to the Citibank the 9% IRFC Bonds of the face value of
   Rs. 50 crores on 13.8.1996. It also paid the awarded interest
 E at the rate of 9%. The aggregate interest amounted to
   Rs.22,34,58,904/- calculated for the period 15.7.1991 to
   30.6.1996. There is no controversy so far as the restitution of
   interest amount is concerned but there is a strong disagreement
   between the parties as to how the market value of the bonds
 F be calculated for the purpose of effective and satisfactory
   restitution. Admittedly the bonds delivered to Citibank on
   13.8.1996, were being traded in the market and there is no
   serious dispute that on that date the market value of a bond
   was Rs. 81/- and the aggregate value of the bonds on that
 G basis would be Rs 40.50 crores.

        4. According to learned senior counsel, Mr. Kapil Sibal
   the Canfina suffered only the loss of Rs 40.50 crores and Rs.
   22.34 crores and on decree being set aside it is entitled only
 H to such loss along with 9% interest, by way of restitution.
          CITIBANK N.A. v. HITEN P. DALAL & ORS.                   589
                 [SHIVAKIRTI SINGH, J.]

       5. There would have been no difficulty in working out the A
 loss of Canfina if it had opted to pay the money value of the
 bonds instead of delivering the bonds. It is also not in dispute
 that after receiving the bonds, Citibank in its wisdom disposed
 of the bonds in the market during March/April 1997 when the
 prevailing average market rate was Rs. 85/- per bond although B
 its face value was Rs. 100/- redeemable on 15.7.2001. The
 bonds delivered to City Bank carried with them coupons for
 half yearly interest at the rate of 9% on the face value of the
 bonds and for one set of coupons for half yearly interest, Rs.
 2.25 crores in aggregate was also received by Citibank in C
 January 1997. Thereafter between April/March 1997 the
 Citibank sold the bonds at average price of Rs. 85/- receiving
 in aggregate Rs. 42.56 crores.

      6. By the very nature, the bonds, on 15.7.2001 attheirface    D
 value would be worth Rs. 50 crores. This along with half yearly
 interest through coupons redeemed after April 1997 has
 presumably gone to third parties who might have purchased
 the bonds in the market.
                                                                    E
       7. The appellant Citibank in compliance of the judgment
  of this Court dated 7.7.2004 had to offer restitution of "total
  amount paid" by Canfina to Citibank (principal and interest)
  along with interest at the rate of 9% per annum from the date
  of payment. But in case the full amount was not paid by F
  1.9.2004, the liability would increase to interest at the rate of
  12% per annum till repayment by Citibank. Obviously, the total
  amount of principal paid by Canfina to Citibank through delivery
  of Bonds on 13.8.1996 had to be worked out in a reasonable
  and just manner. This problem has arisen because Canfina G
  had opted to deliver the bonds and not the money which it had
  received for those bonds. Admittedly the total consideration
· paid by Citibank to Canfina for the 9% IRFC bonds of face
  value of Rs. 50 crores was Rs. 49 crores at market value of H
  Rs. 98/- on 30.12.1991 along with an interest component of
590         SUPREME COURT REPORTS                    [2015] 9 S.C.R.


A     approximately Rs. 2 crores, bringing the total consideration to
      Rs. 51,07, 12,328.77.

           8. The issue is, when the bonds are no longer in currency
      and not available for return by way of total amount paid by
B     Canfina to the Citibank, then for restitution what method of
      calculation shall serve the purpose best in arriving at the total
      amount paid to Citibank "by way of principal'' which it must
      return to Canfina.

c        · 9. After the Supreme Court judgment on 12.7.2004
  Canfina by a letter to Citibank demanded Rs. 135, 18,28,053/
  - by way of restitution. The Citibank made its own calculations
  and through its advocate's letter, on 19.7.2004 tendered the
  aggregate amount of 107,75,40,141/- to Canfina. When
o Canfina declined to accept this offer the Citibank filed a
  praecipe in the Special Court for depositing the aforesaid sum
  in Court with notice to Canfina. The Special Court vide its order
  dated 20. 7 .2004 recorded the statement of Canfina that it will
  accept the amount without prejudice to their rights and
E contentions in view of their stand that the amount is not correct
  and Canfina is entitled to claim more. Thereafter Citibank
  unsuccessfully attempted to get a recording in this Court that it
  had complied with the order of restitution. This Court on
  26.10.2004 disposed of Citibank's I .A. no. 5 of 2004 in Civil
F Appeal No. 9063 of 1996 and granted liberty to Citibank to
  approach the Special Court. On 24.12.2004 Citibank filed
  miscellaneous application no. 24 of 2005 in the Special Court
  for recording satisfaction of this Court's judgment. On 2.3.2005
  Canfina also filed miscellaneous application no. 118 of 2005
G claiming that it was entitled to further amount of approximately
  Rs. 51.83 crores after deducting Rs ..107. 76 crores
  approximately already paid by Citibank. By the impugned order
  dated 12.4.2005 the Special Court disposed of both the above
H applications and allowed an additional sum of Rs.
  30, 13,55, 175/-. This amount has been paid by the appellant
         CITIBANK N.A. v. HITEN P. DALAL &ORS.                 591
                [SHIVAKIRTI SINGH, J.]

without prejudice to its rights sought through the present       A
appeals arising out of common judgment dismissing
appellant's miscellaneous application and allowing that
preferred by Canfina.

      10. Learned senior counsel for the appellant, Mr. Kapil B
Sibal as well as learned senior counsel for the respondent
Canfina have relied upon various judgments, many of them
being common, to highlight the true meaning of restitution in
the light of Section 144 of the Code of Civil Procedure. It goes
without saying that they highlighted different words and C
sentences to support their respective case. Simply put, the
contention on behalf of the Citibank is that for restitution the
correct amount is required to be calculated on the basis of
"market value" of the bonds when they were delivered by
Canfina to the Citibank i.e, atthe rate of Rs.81/-, aggregating D
Rs. 40.50 crores. This amount and also approximately Rs.
22.34 crores paid by Canfina as interest at the rate of 9% per
annum for the period 15.7.1991 to 30.6.1996 is the "total
amount paid" by Canfina to Citib;mk as principal and interest
and therefore the sum of these two amounts alone is required E
to be repaid by way of restitution along with interest at the rate
of 9% per annum because the Citibank chose to comply with
the order of Supreme Court for the purpose of restitution before
1.9.2004 by tendering the aggregate sum of Rs. F
107, 75,40, 141 /~to Canfina. However, in order to appear more
fair and accommodative, Citibank has placed three more set
of calculations/charts. The first chart claims that in the light of
various judgments on the issue of restitution, it may be proper
to calculate the market value of the bonds on the basis of NSE G
letter showing the rate as Rs. 82.80 per bond. So calculated,
the total amount along with interest payable to Canfina has
been shown as Rs.109,31,28,500/-. The second chart shows
the total amount payable as Rs.111,30,97 ,602/-. This has been
calculated by accepting the market value of the bonds on the H
592        SUPREME COURT REPORTS                   [2015] 9 S.C.R.


A basis of average sale price during March/April 1997 as
  Rs.85.129 per bond aggregating Rs. 42,56,45,000/-. From
  the figures in the two charts noted above, it is evident that while
  seeking to justify its earlier calculation of approximately Rs.
  107 crores as the total value of restitution, as an alternative
B submission Citibank appears to have suggested two other
  figures by way of possible restitution which are Rs. 109 crores
  and Rs. 111.30 crores approximately. But the last chart (third
  in this series) filed on behalf of Citibank acknowledges a further
  receipt of Rs. 2.25 crores as coupon interest for half yearly
C coupons dated 1.1.1997 on which interest has been calculated
  till 20. 7.2004. That brings the aggregate total amount payable
  to Canfina as Rs. 115,08,98,835/-. Since Citibank paid the
  sum of Rs. 30, 13,55, 175/- on April 25, 2005 in terms of the
  impugned order hence as per the last chart of calculations
0
  noted above, it has claimed that on adjustment, it is entitled to
  refund by Canfina as on April 25, 2005 of a total sum of Rs.
  22, 14,36,756/- along with interest either at the rate of 12%
  per annum or as may be awarded by this Court on the aforesaid
E amount from 25th April 2005 till the date of actual refund.

        11. On the other hand the stand of the Canfina is that after
   the Supreme Court judgment setting aside the decree against
   Canfina on 7. 7.2004 the only safe method for calculating the
 F value of the bonds delivered to Citibank on 13.8.1996 would
   be to accept and act upon its face value, i.e, Rs. 100/- per
   bond on the maturity date, 15.7.2001 and add to it the half
   yearly interest received after 13.8.1996 and then calculate
   interest on and from 15.7.2001 at the rate indicated in the order
 G of this Court dated 7.7.2004. The aforesaid claim, according
   to Canfina has rightly been accepted by the Special Court in
   the impugned order so that status quo ante is restored by way
   of restitution by ignoring the intervening circumstance of sale
   of the bonds by Citibank to third parties in March/April 1997.
 H
        12. In reply learned senior counsel for the appellant has
         CITIBANK N.A. v. HITEN P. DALAL & ORS.                       593
                [SHIVAKIRTI SINGH, J.]

 criticized the impugned order by highlighting that in paragraph A
 7 the Special Court has erred in going beyond the three items
.delivered by Canfina to Citibank i.e, the bonds, the amount of
 interest and interest coupons by indulging in speculation that
 "had the Canfina not been required to deliver the bonds to
 Citibank, the bonds would have remained with it so also the B
 amount of interest till the date of redemption." Same criticism
 was also made against another observation/opinion of the
 Special Court in the same paragraph recorded in the following
 words:
                                                                       c
      " ............. in so far as the restitution is concerned the
      fact that the bonds were sold by Citibank during the
      pendency of the appeal is not relevant."·

      The contention of appellant is that the Special Court came       o
to an unjust and erroneous conclusion that Canfina would be
entitled to the redemption value of the bonds i.e, Rs. 50 Crores,
mainly on account of aforesaid erroneous presumption and
opinion.
                                                                 E
      13. Learned senior counsel, Mr. Kapil Sibal has advanced
a contention that as per settled principles of law governing
restitution, the respondent Canfina can be given back only what
it lost on the date it satisfied the decree which was ultimately
reversed and not what it could have gained on certain F
presumptions made in the impugned order. In support of this
contention he placed reliance upon two judgments of Madras
High Court in the case of Lakshmi Amma vs.
Thazhathitathil Krishna Kurup (AIR 1931 Madras 81) and
in the case of S. Chokalingam Asari vs. N.S. Krishna Iyer G
and Ors. (AIR 1964 Madras404). He also placed reliance on
Calcutta High Court judgment in the case of Surendra Lal
Chowdhury and Ors. vs. Sultan Ahmed and Ors. (AIR 1935
Calcutta 206) and the following four Supreme Court judgments:
                                                                 H
594       SUPREME COURT REPORTS                     [2015] 9 S.C.R.


A          1.     Lal Bhagwant Singh vs. Rai Sahib Lala Sri
                  Kishen Das, 1953 SCR 559=AIR 1953 SC 136

           2.     Kartar Singh & Ors. vs. State of Punjab,
                  (1995) 4 sec 101
B
           3.     Kerala State Electricity Board and Anr. vs.
                  M.R.F. Limited, (1996) 1 sec 597

           4.     South Eastern Coalfields Ltd. vs. State of
                  M.P. & Ors., AIR 2003 SC 4482
c
         14. In the case of Lakshmi Amma (Supra), the Madras
    High Court noticed certain privy council judgments and also
   the contention that Section 144 of the CPC providing for
    restitution would apply only to cases where in execution of a
 D decree passed by one court a benefit is received by the decree
    holder and thereafter that decree is reversed or set aside
   ·subsequently by a competent court then in such cases the court
    should place the parties in the position which they would have
    occupied but for such a decree which was varied or set aside.
 E However, on the facts of that case the claim of the plaintiff
    appellant for restitution was turned down. In the other Madras
    High Court judgment in the case of S. Chokalingam (Supra)
    the right of a bona fide purchaser for value was upheld in
 F paragraph 30 of the judgment and thereafter in paragraph 31
    reliance was placed upon judgment of this Court in the case of
    Bhagwant Singh (Supra) by extracting the following
    passage:

            " The doctrine of restitution is that on the reversal of a
 G        judgment the law raises an obligation on the party to the
          record, who received the benefit of the erroneous
          judgment to make restitution to the other party for what
          he had lost and it is the duty of the Court to enforce that
          obligation unless it is shown that restitution would be
 H
         CITIBANK N.A. v. HITEN P. DALAL & ORS.                     595
                [SHIVAKIRTI SINGH, J.]

      clearly contrary to the interests of justice."                   A

      15. In the case of Surendra Lal (Supra), the Calcutta
 High Court explained that it is the duty of the Court under
 Section 144 CPC to place the parties in the earlier position
 after a decree executed in favour of one be varied or reversed. B
 But it was clarified that "in assessing what a party may have
 lost or of what he may have been deprived during his
·dispossession the law takes into account not what he could
 have made but what his opponent did in fact make or could
 with reasonable diligence have made." This conclusion was C
 predicated on the reasoning that in vast majority of cases it
 would be hypothetical, remote and uncertain to find out what
 the party subjected to dispossession could have made if it
 was left in possession.
                                                                       D
     16. The ·relevant part of judgment in the case of
Bhagwant Singh (Supra) has been extracted in the Madras
High Court judgment and a1ready noticed earlier. This Court in
the penultimate paragraph has reiterated the salutary and well
established principle of restitution that on the reversal of a         E
judgment the party who received the benefit of an erroneous
judgment is obliged to make restitution to the other party for
what he had lost. The Court is also duty bound to enforce such
obligation unless it finds that restitution would be clearly
contrary to the real justice of the case. Similar words have been      F
used by this Court in the case of Kartar Singh (Supra) by
holding that the party which had received the benefit of the
erroneous decree is required to make the restitution to other
party for what he had lost.
                                                                       G
     17. In the case of Kerala State Electricity Board
(Supra) also the view taken by this Court was similar. But it
was further clarified that the Court has a duty that in the matter
of restitution justice be done as per facts of the case, In granting
relief of restitution the Court "should not be oblivious of any        H
596         SUPREME COURT REPORTS                   (2015) 9 S.C.R.


A unmerited hardship to be suffered by the party against whom
  action by way of restitution is taken." This Court favoured a
  pragmatic view and grant of relief in a manner as may be
  reasonable, fair and practicable without causing unmerited
  hardships to either of the parties. In the case of South Eastern
B Coalfields Limited (Supra), this Court re-emphasized that
  restitution is for meeting the ends of justice and depends upon
  the peculiar facts and circumstances of the case. This Court
  further clarified in para 27 that as held by Privy Council in the
  case of Jai Berham vs. Kedar Nath Marwari, AIR 1922 PC
C 269, Section 144 CPC is rather a statutory recognition of an
  already existing rule of justice, equity and fair play and therefore
  even apart from Section 144 the Court has inherent jurisdiction
  to order restitution so as to do complete justice between the
  parties. Th is Court approved the view of the Privy Council that
0
  the Court has to act rightly and fairly according to the
  circumstances, towards all parties involved.
            18. Learned senior counsel for the respondent Canfina,
      as was indicated earlier also placed reliance upon the
 E    aforesaid judgments in support of hi~ plea that restitution
      requires that the parties be placed in the position which they
      could have occupied but for the wrong order or decree which
      is ultimately varied or reversed. He amplified his submissions
 F    by highlighting certain other paragraphs in the earlier noted
      judgments that suggest that the status quo as obtaining on the
      date of wrongful deprivation should be restored and only if.
      same is not possible due to intervening circumstances like
      the sale of the property, price and mesne profits may have to ·
 G    be ordered. According to him the actual sale is of no
      consequence for calculating what the wronged party had
      actually lost. However, according to him also, for proper
      restitution the Court must rely upon verifiable value of the goods
      lost due to sale etc. and not indulge in speculation or
 H    hypothetical presumptions. He placed reliance also upon
         CITIBANK N.A. v. HITEN P. DALAL & ORS.                   597
                [SHIVAKIRTI SINGH, J.]

judgment of this Court in the case of Indian Council for              A
Enviro-Legal Action vs. Union of India & Ors. (2011) 8
sec 161. This judgment was in the context of constitutional
provisions such as Article 21 and compensation for loss
suffered by citizenry due to pollution. Advancing the principle
that the polluter pays for the sufferings, the Court propounded       B
the principle of disgorgement of gains of wrongdoers and that
the Court could even think of imposing compound interest in
place of simple interest provided by statute. Exercise of such
inherent powers was contemplated only in interest of principles
of justice and equity as warranted by the facts in cases of           C
 pollution causing sufferings to citizenry. All these principles
were justified on the basis of power to order for restitution under
inherent powers of the Court. But this Court did not over-rule
 any of the earlier judgments of this Court laying down classic
                                                                      0
 principles of restitution under Section 144 of the CPC on which
the appellant has placed reliance and which require a just and
fair approach s0 that no unmerited hardship is caused to either
 of the parties.

     19. In the ultimate analysis we find that the law on.            E
restitution under Section 144 of the CPC is quite well settled.
It vests expansive power in the Court but such power has to be
exercised to ensure equity, fairness and justice for both the
parties. It also flows from more or less common stand of parties      F
on the principle of law that for ascertaining the value of the
property which is no longer available for restitution on account
of sale etc., the Court should adopt a realistic and verifiable
approach instead of resorting to hypothetical and presumptive
value. It is also one of the established propositions that in the     G
context of restitution the Court should keep under consideration
not only the loss suffered by the party entitled to restitution but
also the gain, if any, made by other party who is obliged to
make restitution. No unmerited injustice should be caused to
any of the parties.                                                   H
598        SUPREME COURT REPORTS                    [2015] 9 S.C.R.


A       20. Keeping the aforesaid principles in view it has to be
   seen whether the order under appeal suffers from any illegality
   requiring interference and correction by this Court. In our
   considered view in the course of finding out the value of the
   bonds which. are no longer available for restitution, the learned
B Special Court committed a clear error of law in ignoring a
   relevant fact that the bonds in question were a tradable
   commodity on the stock market and its value could be easily
   ascertained either on the date when the bonds were handed
   over to the Citibank or at the time when the Citibank sold the
C bonds to third parties. Such relevant facts should not have been
   lost sight of and no presumption should have been made that
   Canfina would have retained the bonds with it till the maturity
   period. There are sufficient materials available to lend credence
D to the view that in all eventuality Canfina would have sold the
   bonds because it was in such business and also because
   earlier whe~ it had the option, it chose to hand over the bonds
   to Citibank instead of preferring the other option of paying its
   monetary value. Sale of the bonds by Citibank to third parties
E at a verifiable rate not being under dispute, it is evidently unjust
  ·to saddle Citibank with liability to repay the possible gains
   made by the third party or subsequent purchasers of the bonds.
   For these reasons we come to the conclusion that the amount
   determined by the Special Court for restitution and payment
F by Citibank is unjust and is a result of error in not keeping
   under view the relevant facts as well as in applying the settled
   legal propositions for the purpose of compensating Canfina
   by way ofrestitution.

G      21. In view of above the impugned order is set aside. In
  order to bring the dispute to a just, logical and early conclusion,
  instead of remanding the matter to the Special Court we accept
  the last chart submitted on behalf of appellant to be correct
  calculation of the amount payable by way of .restitution by
H Citibank to Canfina. As noted earlier as per such chart the
          CITIBANK N.A. v. HITEN P. DALAL & ORS.                599
                 [SHIVAKIRTI SINGH, J.]

total amount payable to Canfina on 20.7.2004 is Rs. A
115,08,98,835/- and after adjusting the further amount paid by
Citibank to Canfina under protest on 25.4.2005 the Citibank
is entitled to a refund by Canfina as on 25.4.2005 to an amount
of Rs. 22,14,36,756/-. In line with earlier orders, we allow
interest on this amount at the rate of 9% per annum from B
25.4.2005 till the date of actual refund. Canfina should make a
refund of aforesaid due amount along with interest awarded
by us within four weeks. Both the appeals are allowed to the
extent indicated above. In the facts of the case there shall be
no order as to costs.                                            c
Kalpana K. Tripathy                          Appeals allowed.