The court directed Ghai to hand over possession of the land to the village panchayat which was asked to return money to him with interest.
The order came in the wake of the High Court taking cognizance of a petition alleging favouritism by the Haryana government in granting permission to sell 20 acres of 'shamlat (village common) land' to Ghai.
The petitioner, a teacher, had alleged the land was sold to Ghai in 2010 for public purpose but he put it to private use.
The petitioner's counsel contended the decision to sell the village land to the Mukta Arts was taken under pressure.
The village panchayat had sent a resolution to the Haryana government on January 6, 2010 to permit it to sell 20 acres of land to Mukta Arts.
The state government allowed the panchayat to sell the land in September that year for Rs 8.02 crore which included the land price and annuity.