In the case of Nandi Infrastructure Corridor Enterprises Ltd. & Anr. v. B. Gurappa Naidu & Ors. (2026), the Supreme Court of India set aside a High Court order and restored the valuation fixed by an Executing Court, ruling that land converted for industrial use within municipal limits must be valued according to specific statutory guidelines rather than general fallback rules.
Case Background and Dispute
The litigation involved a lengthy dispute over approximately 3 acres of land in Kengeri Village used for the Bangalore-Mysore Infrastructure Corridor Project (BMICP). In 2007, the parties entered into a Memorandum of Settlement (MOS) where the appellant (N.I.C.E.) agreed to convey exchange land to the respondents (Decree Holders) within 24 months. A specific clause—Clause (xiii)—stipulated that if N.I.C.E. failed to provide the exchange land, they would instead pay the guideline value of the utilized land prevailing on the date of the settlement (August 20, 2007).
Procedural History and Valuation Conflict
- Executing Court: When N.I.C.E. failed to convey the exchange land, the respondents sought execution of the decree. The Executing Court fixed the value at ₹1,000 per square foot, determining that the land was urban converted property situated within municipal limits and abutting a State Highway.
- High Court: The High Court reduced the valuation to ₹500 per square foot. It relied on a belated clarification from the State Government suggesting that since the industrial land was “undeveloped,” it should be valued at only 50% of the residential rate.
Key Findings of the Supreme Court
The Supreme Court allowed the appeal and restored the higher valuation, identifying several legal errors in the High Court’s judgment:
- Excess of Supervisory Jurisdiction: The Court held that the High Court exceeded its limited jurisdiction under Article 227 of the Constitution. By impleading the State Government to reinterpret a notification and re-appreciating evidence, the High Court acted as a “Court of First Appeal” rather than a supervisory body.
- Misinterpretation of Guidelines: The Court found that the 2007 guideline notification explicitly covered the subject land. The “50% reduction” rule was a residual provision meant only for areas where no specific rate was prescribed. Since the land was within municipal limits and had a defined rate, the fallback rule did not apply.
- Contractual Fairness: The Court noted that N.I.C.E., as an “experienced infrastructure company,” was fully aware of the land’s potential and its industrial conversion status when signing the compromise decree. It could not later seek to value the land on a lower agricultural or undeveloped basis to evade its payment obligations.
- Adherence to the Decree: The Court emphasized that an Executing Court is bound to enforce a decree according to its terms. The High Court erred by allowing “notions of fairness or sympathy” for the judgment debtor to override the clear statutory valuation rules incorporated into the decree.
Conclusion
The Supreme Court set aside the High Court’s order and restored the Executing Court’s decree. N.I.C.E. was directed to pay the balance amount of approximately ₹8.79 Crores with 6% interest per annum from August 20, 2007, until the date of payment.
2026 INSC 434
Nandi Infrastructure Corridor Enterprises Ltd. & Anr. V. B. Gurappa Naidu & Ors.(D.O.J. 30.04.2026)
