High Court exceeded Article 227 jurisdiction; executing court’s plausible interpretation of guideline value must prevail.

on

Facts

Dispute over valuation payable under compromise decree.

Under a compromise decree (20.08.2007), N.I.C.E. was obliged to either convey alternate land or pay the “guideline value” of the retained land (Schedule ‘AA’) if it failed. Upon failure, execution proceedings were initiated.

The Executing Court determined value at Rs. 1,000 per sq. ft. based on the Karnataka Government Notification dated 17.04.2007. The High Court, exercising Art. 227 Const. of India, reduced it to Rs. 500 per sq. ft. by applying certain “special instructions” in the notification.

Both parties appealed.

Issues Framed

(a) Whether the High Court exceeded jurisdiction under Art. 227 Const. of India.
(b) Whether interference with the Executing Court’s valuation was justified.

Court’s Reasoning

(a) Scope of supervisory jurisdiction under Art. 227 Const. of India
The Court reiterated that supervisory jurisdiction is limited: it cannot be used to “act as an appellate court” or to “substitute its own judgment” (Para 31–35). Interference is justified only in cases of jurisdictional error, perversity, or manifest injustice.

Applying this, the Court held that the Executing Court had jurisdiction and adopted a plausible interpretation. Hence, the High Court’s re-evaluation amounted to appellate review, which is impermissible (Para 36).

(b) Improper intervention by High Court
The High Court:
(i) impleaded the State in a private lis;
(ii) relied on executive clarification; and
(iii) substituted its interpretation merely because another view was possible.

This was held impermissible: “the executive cannot be allowed to… reinterpret a statutory instrument during litigation” (Para 36.3.2).

(c) Correct interpretation of guideline notification
The Court affirmed the Executing Court’s approach:

The base value under the notification was Rs. 800 per sq. ft., with 25% addition for highway abutment, totalling Rs. 1,000 per sq. ft. (Para 37).

Instruction No. 6 (50% reduction for industrial lands) was held inapplicable as a residual provision: it applies only where no specific rate exists. Since a rate existed for municipal lands, it could not be invoked.

Applying it would produce “anomalous and absurd outcome” (Para 37).

(d) Rejection of N.I.C.E.’s contention (agricultural valuation)
The Court held that parties had agreed to guideline value at the time of compromise, knowing the land was converted for industrial use. Thus, valuation could not revert to agricultural basis (Para 39).

(e) Interest
Though not part of the decree, interest at 6% p.a. was upheld based on prior High Court order governing delayed payment (Para 39.3).

Held

High Court judgment set aside. Executing Court’s valuation restored at Rs. 1,000 per sq. ft. Appeals by decree holders allowed; appeals by N.I.C.E. dismissed.

Ratio

Under Art. 227 Const. of India, the High Court cannot substitute a plausible interpretation of the executing court merely because another view is possible; supervisory jurisdiction is confined to correcting jurisdictional error or perversity.

Case Details

Citation: 2026 INSC 434
Decided on: 30 April 2026
Case Title: Nandi Infrastructure Corridor Enterprises Ltd. v. B. Gurappa Naidu
Court: Supreme Court of India
Bench: Aravind Kumar, J.