Restitution after invalid revenue recovery sale requires return of land when the underlying assessment is set aside.

When the assessment or demand forming the foundation of revenue recovery is set aside, the consequent recovery sale cannot be sustained merely because it had been confirmed in favour of the Government. The material distinction is between reconveyance of bought-in-land after payment of dues and restitution after the underlying assessment itself has been annulled. In such a situation, principles of restitution and unjust enrichment require restoration of the parties to the position they would have occupied but for the invalid recovery action, including return of the property and cancellation of the sale and confirmation orders.

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Issues: Whether the State could retain land sold in revenue recovery and treated as bought-in-land after the assessment order forming the basis of the recovery had been set aside, and whether the appellant was entitled to restitution and return of the property.

Analysis: The basis of the revenue recovery proceedings had been effaced when the assessment order was set aside by the appellate tribunal. Once the foundation of the demand and the consequent recovery action disappeared, the sale conducted on that basis could not be sustained merely because it had earlier been confirmed in favour of the Government. The distinction between a claim for reconveyance of bought-in-land and a claim for restitution was material: the case was not one of seeking reconveyance after voluntary payment of dues, but of seeking restoration of property after the very assessment underpinning the sale had been annulled. The principles of restitution and unjust enrichment required the court to place the parties in the position they would have occupied but for the invalidated recovery action.

Conclusion: The State was not entitled to retain the property as bought-in-land, and the appellant was entitled to restitution by return of the land after cancellation of the sale and confirmation orders.

Final Conclusion: The appeal succeeded, the judgment of the Single Judge was set aside, and the authorities were directed to restore the property to the appellant.

Ratio Decidendi: When the assessment or demand that forms the foundation of revenue recovery is set aside, the consequent sale cannot be sustained and the court may order restitution to prevent unjust enrichment and restore the parties to their original position.

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