Does non-disclosure of pending litigation in a public auction entitle the purchaser to a refund?

Yes. The Supreme Court held that suppression of known encumbrances and pending litigation vitiates the sale, and an innocent purchaser is entitled to refund with interest under principles of restitution and unjust enrichment.

Can the auction purchaser claim interest on the refunded amount?

Yes. The court directed the respondent authority to refund the deposited amount along with 9% interest per annum from the date of deposit until realization.

What is the legal basis for restitution in public auction cases?

Restitution is based on the principles of unjust enrichment and equity, ensuring that no party is unfairly enriched at the expense of an innocent purchaser.

Viney Kumar Sharma v. Improvement Trust and Another, REEDLAW 2026 SC 01006

REEDLAW
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REEDLAW Legal News Network | Published on: 24 January 2026 | 🔗 Find Shareable Link — **REEDLAW Legal News Network | Published on: 24 January 2026 |** **🔗 Find Shareable Link**

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Failure by a public authority to disclose all known encumbrances, including pending litigation, in a public auction vitiates the sale and entitles the bona fide purchaser to a refund with interest under restitution and unjust enrichment principles.

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Viney Kumar Sharma v. Improvement Trust and Another, REEDLAW 2026 SC 01006

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