The Court Fees Act, 1870
and
The Suits Valuation Act, 1887
The Court-Fees Act, 1870 and the Suits Valuation Act, 1887 cannot be treated as forming a Code, nor they are pari-materia with regard to their respective provisions. In other words they cannot be read together. The only common feature between the two Acts is that under both the legislations value of the suit is fixed. Under Suits Valuation Act, 1887, the value is fixed for the purposes of jurisdiction and under the Court-Fees Act, 1870, the value of the suit is fixed in order to determine the amount of Court-fee to be paid to the Court.
Hence, the Court-Fees Act is a fiscal enactment prescribing rules to determine the value of the suit for the purposes of Court-Fees. Therefore, one may say that the valuation of suit for jurisdictional purposes in the Suits Valuation Act is distinct from its valuation for fiscal purposes of Court-Fees in the Court-Fees Act, 1870. Under the Suits Valuation Act, 1887, the value of the suit is dependent on the value of the subject-matter, whereas for the fiscal purposes the value of the suit is to be determined on the basis of certain statutory rules. Therefore, the rules laid down under the Court-Fees Act, 1870 cannot constitute a guide to determine the value of the suit for the purposes of jurisdiction, though section 8 of the Suit Valuation Act, 1887 provides that where in suits other than those referred to in the Court-Fees Act, 1870 (7 of 1870), section 7, paragraphs V, VI and IX, and paragraph X, clause (d), Court-fees are payable ad valorem under the Court-Fees Act, 1870 (7 of 1870), the value as determinable for the computation of Court-Fees and the value for the purposes of jurisdiction shall be the same.
Generally, one of the preliminary objections taken by the Advocates in their written statements to the plaint, is with regard to valuation of the suit. Since the question whether or not a suit has been properly valued goes to the root of the matter the same ought to be decided at the first instance and the trial Court should not wait till the conclusion of the case and the same should be determined by the Court, which has to try the case.
Further, the value of the suit, for the purposes of jurisdiction and for the purposes of Court-Fees is regulated and governed by the averments made in the plaint and not keeping in view the defence/pleas set up by the defendant. In other words, in order to decide the value of the case one has to look only into the plaint and not written statement. Not only this, prima facie it is the valuation estimated by the plaintiff, in view of its averments in his plaint, which determines the jurisdiction and the Court-Fees.
If on examining the plaint, the Court finds that the relief claimed is under valued it should require the plaintiff to correct the valuation within a time and consequently on his failure to do so, the plaint is liable to the rejected under Order VII, rule 11 of the Civil Procedure Code. If the matter requires investigation, the Court may record evidence of the parties bearing on the point and consequently adjudicate issue at the earliest after staying further proceedings in the matter. It is pertinent to mention here that section 10 of the Court-Fees Act, 1870 specifically provides that if the plaintiff fails to make good the deficiency despite the directions of the Court, within specified period, the suit shall be dismissed. Before parting with this introductory portion, it is necessary to reiterate with regard to the Court-Fees Act, 1870 that like the Registration Act and the Indian Stamp Act, 1899 even this statute is a fiscal statute and consequently must be interpreted strictly. Accordingly, it is also reiterated that the present statute is not intended to arm a litigant with a weapon of technicality but to secure revenue to the State.
For questions on this segment kindly see the case law.
Section 1 of the Court-Fees Act, 1870 relates to the title of the Act and its extent and commencement. Section 3 is a charging section and provides for the fees payable in terms of Second Schedule of the Act with regard to certain specific matters. Sections 5 and 12 provide the procedure with regard to the difference as to necessity or amount of fee and decision on questions as to valuation respectively. The decisions with regard to the valuation under these sections are final. However, we would be discussing a case on this aspect as to how far the finality can be attached to such decisions in view of definition of decree as defined in section 2(ii) of CPC. Chapter 3 of the Court-Fees starts with section 6, which provides fees on document filed, etc. in Mofussil Courts or in public offices. Section 7, which provides computation of fees payable in certain suits, is a very important provision under the Act. For ready reference it would be appropriate to reproduce the said section as under since its language itself is self-explanatory.
"Section 7. Computation of fees payable in certain suits.-The amount of fee payable under this Act in the suits next hereinafter mentioned shall be computed as follows:-
(i) For money-In suits for money (including suits for damages or compensation, or arrears of maintenance, of annuities, or of other sums payable periodically)-according to the amount claimed;
(ii) For maintenance and annuities.-In suits for maintenance and annuities or other sums payable periodically-according to the value of the subject-matter of the suit, and such value shall be deemed to be ten times the amount claimed to be payable for one year;
(iii) For other movable property having a market value.-In suits for movable property other than money, where the subject-matter has a market value according to such value at the date of presenting the plaint;
(iv) In suits-
(a) For pomovable property of no market value. - For movable property where the subject-matter has no market value as, for instance, in case of documents relating to title,
(b) To enforce a right to share in joint family property.-To enforce the right to share in any property on the ground that it is joint family property,
(c) For a declaratory decree and consequential relief.-To obtain a declaratory decree or order, where consequential relief is prayed,
(d) For an injunction.-To obtain an injunction,
(e) For easements.-For a right to some benefit (not herein otherwise provided for) to arise out of land, and
(f) For accounts.-For accounts-
according to the amount at which the relief sought is valued in the plaint or memorandum of appeal;
In all such suits the plaintiff shall state the amount at which he values the relief sought.
(v) For possession of land, houses and gardens.-In suits for the possession of land, houses and gardens-according to the value of the subject-matter; and such value shall be deemed to be-
where the subject-matter is land, and-
(a) where the land forms an entire estate, or a definite share of an estate, paying annual revenue to Government,
or forms part of such an estate and is recorded in the Collectors' register as separately assessed with such revenue,
and such revenue is permanently settled - ten times the revenue so payable;
(b) Where the land forms an entire estate, or a definite share of an estate, paying annual revenue to Government, or forms part of such estate and is recorded as aforesaid;
and such revenue is settled, but not permanently-
five times the revenue so payable;
(c) Where the land pays no such revenue or has been partially exempted from such payment, or is charged with any fixed payment in lieu of such revenue,
and net profits have arisen from the land during the year next before the date of presenting the plaint-
Fifteen times such net profits;
but where no such net profits have arisen therefrom-the amount at which the Court shall estimate the land with reference to the value of similar land in the neighbourhood-
(d) Where the land forms part of an estate - paying revenue to Government, but is not a definite share of such estate and is not separately assessed as above mentioned - the market value of the land:
Provided that, in the territories subject to the Governor of Bombay in Council, the value of the land shall be deemed to be-
(1) where the land is held on settlement for a period not exceeding thirty years and pays full assessment to Government-a sum equal to five times the survey-assessment;
(2) where the land is held on a permanent settlement, or on settlement, for any period exceeding thirty years, and pays the full assessment to Government-a sum equal to ten times the survey-assessment; and
(3) where the whole or any part of the annual survey-assessment is remitted-a sum computed under para (1) or para (2) of this proviso, as the case may be, in addition to ten times the assessment, or the portion of assessment, so remitted
Explanation.-The word "estate", as used in this paragraph, means any land subject to the payment or revenue, for which the proprietor or a farmer or ryat shall have executed a separate engagement to Government, or which in the absence of such engagement, shall have been separately assessed with revenue;
(e) For houses and gardens.-Where the subject-matter is a house or garden-according to the market value of the house or garden;
(vi) To enforce a right of pre-emption.-In suits to enforce a right of pre-emption-according to the value [computed in accordance with para (v) of this section] of the land, house or garden in respect of which the right is claimed;
(vii) For interest of assignee of land revenue.-In suits for the interest of an assignee of land-revenue-fifteen times his net profits as such for the year next before the date of presenting the plaint;
(viii) To set aside an attachment.-In suits to set aside an attachment of land or of an interest in land or revenue-according to the amount for which the land or interest was attached:
Provided that, where such amount exceeds the value of the land or interest, the amount of fee shall be computed as if the suit were for the possession of such land or interest.
(ix) To redeem - To foreclose.-In suits against a mortgagee for the recovery of the property mortgaged, and in suits by a mortgagee to foreclose the mortgage,
or, where the mortgage is made by conditional sale, to have the sale declared absolute-
according to the principal money expressed to be secured by the instrument of mortgage;
(x) For specific performance.-In suits for specific performance-
(a) of a contract of sale-according to the amount of the consideration;
(b) of a contract of mortgage-according to the amount agreed to be secured;
(c) of a contract of lease-according to the aggregate amount of the fine or premium (if any) and of the rent agreed to be paid during the first year of the term;
(d) of an award - according to the amount or value of the property in dispute;
(xi) Between landlord and tenant - In the following suits between landlord and tenant:
(a) for the delivery by tenant of the counterpart of a lease,
(b) to enhance the rent of a tenant having a right of occupancy,
(c) for the delivery by a landlord of a lease,
(cc) for the recovery of immovable property from a tenant, including a tenant holding over after the determination of tenancy,
(d) to contest a notice of ejectment,
(e) to recover the occupancy of immovable property from which a tenant has been illegally ejected by the landlord, and
(f) for abatement of rent-
according to the amount of the rent of the immovable property to which the suit refers, payable for the year next before the date of presenting the plaint."
Section 8 deals with the fee payable on a memorandum of appeal against the order relating to compensation under any Land Acquisition Act for the time being in force. Section 9 empowers the Court to make an investigation in any annual net profits or market value of any land, house or garden as the case may be, when it is pointed out that suit has been under valued. Section 10 is supplementary to the preceding section and as such both the sections provide a machinery for ascertaining the value of the land and house, the subject-matter of the suit when the Court thinks that the value has been wrongly estimated to the detriment of the Revenue. It also makes the provision that in such a case the suit shall be stayed until the additional fee is paid and on failure to pay such additional fee within such time, as may be prescribed, the suit shall be dismissed. Section 12 was prima facie for fiscal purposes and again it is reiterated that it is not intended to arm a litigant with a weapon of technicality. Hence, it is to be construed strictly. It makes the decision of the first court as to value of the suit between the parties as final and enables a Court of appeal to correct any error in this regard, only when the first court decides to the detriment of the Revenue, but provision is not applicable when the question raised is one of the class or category under which the suit falls or of the competency of the Court of the first instance, or in other words an appeal lies against the decision as to the class to which a suit belongs, although it does not lie against a decision as to the valuation in that class. Section 13 provides for those cases, wherein the Court-fee is to be refunded. Similarly, section 14 also provides for refund of the Court-fee when an application for review is presented to the Court on or after the 90th day from the date of the decree. Section 15 provides for refund where the Court reverses or modifies its former decision on the ground of mistake. Similarly, section 16 enables the plaintiff for refund of fee, if the Court refers the parties to the suit to any one of the mode of settlement of dispute referred to in section 89 of the CPC. The object of section 17 is to prevent loss of Revenue by the joinder of separate causes of action in one suit. Section 18 requires a Court-fee on written complaints for all non-cognizable offences, and also for the offences of wrongful confinement and wrongful restraint. Section 19 means a document exempts certain documents from payment of Court-fees. Chapter IIIA, introduced in 1875, is with regard to probates, letters of administration and certificates of administration. Chapter IV of the Act relates to rules as to costs of processes. Chapter V begins with section 25 which provides that all fees referred to in section 3 chargeable under this Act shall be collected by stamps. Section 26 provides that the stamps used to denote any fee chargeable under this Act shall be impressed, or adhesive, or partly impressed and partly adhesive, as the appropriate government may by notification in the Official Gazette, from time to time direct. Section 27 provides that the appropriate government may, from time to time, make rules for regulating (a) the supply of stamps to be used under this Act; (b) the number of stamps to be used for denoting any fee chargeable under this Act; (c) the renewal of damaged or spoiled stamps; and (d) the keeping accounts of all stamps used under this Act:
Provided that, in the case of stamps used under section 3 in a High Court, such rules shall be made with the concurrence of the Chief Justice of such court. All such rules shall be published in the Official Gazette, and shall thereupon have the force of law. Section 28 provides for stamping documents inadvertently received. Section 29 provides that where any such document is amended in order merely to correct a mistake and to make it conform to the original intention of the parties, it shall not be necessary to impose a fresh stamp. Section 30 is with regard to cancellation of stamp. Chapter VI is a miscellaneous chapter not relevant for the purposes of our study.
Before coming to the case law we may briefly note down certain points on this subject here as under:
1. The Court-Fees Act, 1870 and the Suits Valuation Act, 1887 cannot be treated as forming a Code, nor they are pari-materia with regard to their respective provisions. In other words they cannot be read together. The only common feature between the two Acts is that under both the legislations value of the suit is fixed. Under Suits Valuation Act, 1887, the value is fixed for the purposes of jurisdiction and under the Court-Fees Act, 1870, the value of the suit is fixed in order to determine the amount of Court-Fee to be paid to the Court.
2. The Court-Fees Act, 1870 is a fiscal enactment prescribing rules to determine the value of the suit for the purposes of Court-Fees. Therefore, one may say that the valuation of suit for jurisdictional purposes in the Suits Valuation Act, 1887 is distinct from its valuation for fiscal purposes of Court-Fees in the Court-Fees Act, 1870. Under the Suits Valuation Act, the value of the suit is dependent on the value of the subject-matter, whereas for the fiscal purposes the value of the suit is to be determined on the basis of certain statutory rules. Therefore, the rules laid down under the Court-Fees Act, 1870 cannot constitute a guide to determine the value of the suit for the purposes of jurisdiction, though section 8 of the Suit Valuation Act, 1887 provides that where in suits other than those referred to in the Court-Fees Act, 1870 (7 of 1870), section 7, paragraphs V, VI and IX and paragraph X, clause (d), Court-Fees are payable ad valorem under the Court-Fees Act, 1870 (7 of 1870), the value as determinable for the computation of Court-Fees and the value for the purposes of jurisdiction shall be the same.
3. How far the finality can be attached to a decision under section 12 of the Court-Fees Act, 1870 when section 2(ii) of the CPC provides that an order rejecting the plaint is a decree, which is admittedly appealable? It has been held that finality declared by section 12 of the Court-Fees Act means that the parties cannot impugn such a decision by preferring an appeal but that it does not confer on such decisions a complete immunity from examination in a higher court. In other words, section 12 when it says that such a decision shall be final between the parties only makes the decision of the court on a question of Court-fee non-appealable and places it on the same footing as other interlocutory non-appealable orders under the Code and it does no more than that. If a decision under section 12 is reached by assuming jurisdiction which the court does not possess or without observing the formalities which are prescribed for reaching such a decision, the order obviously would be revisable by the High Court in the exercise of revisional powers. Similarly, when a party thinking that a decision under section 12 is palpably wrong takes the risk of his plaint being rejected or suit dismissed and then appeals from the order rejecting the plaint or from the decree dismissing the suit but not from the decision on the question of Court-Fee, then it is open to him to challenge the interlocutory order even on the question of Court-Fee made in the suit or appeal. The word 'finality', construed in the limited sense in which it is often used in statutes, means that no appeal lies from an order of this character as such and it means no more than that.1
4. The Court is empowered even to grant future mesne profit, even though the prayer in the plaint is only with regard to past mesne profit and the Court-Fees is also paid only for the past mesne profit. It was also laid down that with regard to past mesne profits, the plaintiff has an existing cause of action on the date of the institution of the suit, which the plaintiff must plead and subsequently claim a decree for the same after valuing the claim approximately and consequently Court-Fee must be paid thereon. With regard to future mesne profit the plaintiff has no cause of action on the date of institution of the suit and accordingly it is not possible for him to plead this
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1. Nemi Chand v. Edward Mills Co. Ltd., MANU/SC/0007/1952 : 1953 SCR 197: AIR 1953 SC 28.
cause of action or value it and consequently to pay Court-Fees thereon at the time of institution of the suit. But it was discretionary power with the Court to pass decree directing an enquiry into the future mesne profits and Court may grant this relief, though it is not specifically asked for.1
5. Court-fee payable on plaint is certainly to be decided on the basis of allegations and the prayer in the plaint. Question whether plaintiff's suit will have to fail for failure to ask for consequential relief is of no concern to the Court at that stage. The Court in deciding the question of Court-fee should look into the allegations in the plaint to see what is the substantive relief that is asked for. Mere astuteness in drafting the plaint will not be allowed to stand in the way of the court looking at the substance of the relief asked for. Consequently, when the plaintiff's suit for a declaration that the decree obtained by the appellant against their father was not binding on them they were really asking either for setting aside the decree or for the consequential relief of injunction restraining the decree-holder from executing the decree against the mortgaged property as he was entitled to do. Mere fact that the relief as stated in the prayer clause is expressed in a declaratory form does not necessarily show that the suit is for a mere declaration and no more. If the relief so disclosed is a declaration pure and simple and involves no other relief, the suit would fall under article 17(iii).2
6. Section 7, sub-section (iv)(b) deals with suits to enforce the right to share in any property on the ground that it is joint family property and the amount of fees payable on plaints in such suits is "according to the amount at which the relief sought is valued in the plaint or memorandum of appeal". Section 7 further provides that in all suits falling under section 7(iv) the plaintiff shall state the amount at which the value of the relief is sought. If the scheme laid down for the computation of fees payable in suits covered by the several sub-sections of section 7 is considered, it would be clear that, in respect of suits falling under sub-section (iv), a departure has been made and liberty has been given to the plaintiff to value his claim for the purposes of Court-Fees. The theoretical basis of this provision appears to be that in cases in which the plaintiff is given the option to value his claim, it is really difficult to value the claim with any precision or definiteness. Take for instance the claim for partition where the plaintiff seeks to enforce his right to share in any property on the ground that it is joint family property. The basis of the claim is that the property in respect of which a share is claimed is joint family property. In other words, it is property in which the plaintiff has an undivided share. What the plaintiff purports to do by making a claim for partition is to ask the Court to give him certain specified properties separately and absolutely on his own account for his share in lieu of his undivided share in the whole property. Now it would be clear that the conversion of the plaintiff's alleged undivided share in the joint family property into his separate share cannot be easily valued in terms of rupees with any precision
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1. Gopalakrishna Pillai v. Meenakshi Ayal, 1966 Supp SCR 128: MANU/SC/0268/1966 : AIR 1967 SC 155.
2. Shamsher Singh v. Rajinder Prashad, MANU/SC/0261/1973 : (1973) 2 SCC 524: MANU/SC/0261/1973 : AIR 1973 SC 2384.
or definiteness. That is why legislature has left it to the option of the plaintiff to value his claim for the payment of Court-Fees. It really means that in suits falling under section 7(iv)(b) the amount stated by the plaintiff as the value of his claim for partition has ordinarily to be accepted by the court in computing the Court-fees payable in respect of the said relief.1
7. What would be the value for the purpose of jurisdiction in such suits is another question which often arises for decision. This question has to be decided by reading section 7(iv) of the Act along with section 8 of the Suits Valuation Act, 1887. This latter section provides that, where in any suits other than those referred to in Court-Fees Act, 1870, section 7, paras V, VI and IX and para X clause (d), Court-fees are payable ad valorem under the Act, the value determinable for the computation of Court-fees and the value for the purposes of jurisdiction shall be the same. In other words, so far as suits falling under section 7, sub-section (iv) of the Act are concerned, section 8 of the Suits Valuation Act provides that the value as determinable for the computation of Court-fees and the value for the purposes of jurisdiction shall be the same. There can be little doubt that the effect of the provisions of section 8 is to make the value for the purpose of jurisdiction dependent upon the value as determinable for computation of Court-Fees and that is natural enough. The computation of Court-fees in suits falling under section 7(iv) of the Act depends upon the valuation that the plaintiff makes in respect of his claim. Once the plaintiff exercises his option and values his claim for the purpose of Court-fees, that determines the value for jurisdiction. The value for Court-Fees and the value for jurisdiction must no doubt be the same in such cases; but it is the value for Court-fees stated by the plaintiff that is of primary importance. It is from this value that the value for jurisdiction must be determined. The result is that it is the amount at which the plaintiff has valued the relief sought for the purposes of Court-Fees that determines the value for jurisdiction in the suit and not vice versa.1
8. The court in deciding the question of Court-fees should look into the allegations in the plaint to see what is the substantive relief that is asked for. Mere astuteness in drafting the plaint will not be allowed to stand in the way of the court looking at the substance of the relief asked for.2
9. Where a decree is otherwise binding on the plaintiff, a suit though couched in a declaratory form, is in substance a suit either for setting aside the decree or for a declaration with a consequential relief of injunction restraining the decree-holder from executing the decree against the judgment-debtor and the plaintiff is liable to pay ad valorem Court-Fee under section 7(iv)(c) of the Court-Fees Act, 1870.2
10. In a suit for declaration with consequential relief falling under section 7(iv)(c) of the Court-Fees Act, 1870, the plaintiff is free to make his own estimation of the reliefs sought in the plaint and as such valuation both for the purposes of Court-fee and jurisdiction has to be ordinarily accepted. It is only in cases where it appears to the court on a consideration of the facts and
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1. Sathappa Chettiar v. Ramanathan Chettiar, 1958 SCR 1024: MANU/SC/0003/1957 : AIR 1958 SC 245.
2. Ashok v. Narasingh Rao, MANU/MP/0010/1975 : AIR 1975 MP 39.
circumstances of the case that the valuation is arbitrary, unreasonable and the plaint has been demonstratively undervalued, the court can examine the valuation and can revise the same. In this regard the judgments reported in Sathappa Chettiar v. Ramanathan Chettiar, MANU/SC/0003/1957 : AIR 1958 SC 245 and Meenakshisundaram Chettiar v. Venkattachalam Chettiar, MANU/SC/0016/1979 : AIR 1979 SC 989 are relied upon.1
11. It is true that in a suit for accounts the correct amount payable by one party to the other can be ascertained only when the accounts are examined and it is not possible to give an accurate valuation of the claim at the inception of the suit. The plaintiff is, therefore, allowed to value his own tentative valuation. Ordinarily the court shall not examine the correctness of the valuation chosen, but if a plaintiff chooses whimsically a ridiculous figure it tantamounts to not exercising his right in this regard. In such a case, it is not only open to the court but it is its duty to reject such a valuation. It was held that the cases of some of the High Courts which have taken a different view must be held to be incorrectly decided.1
12. In the cases falling under section 7(iv) of the Court-Fees Act, 1870 a test of "objective standards" was laid down in such like matters and held that where there are objective standards of valuation or, in other words, the plaintiff or the court can reasonably value the relief correctly on certain definite and positive materials, the plaintiff will not be permitted to put an arbitrary valuation de hors such objective standards or material.2
13. The plaintiff has the option to state the amount at which he values the relief. The provision is different from that of section 7(v) which applies to suits for possession of lands, houses and gardens where valuation is to be made in accordance with the subject-matter. The said section also contains the provisions as to how the value of the subject-matter is to be determined under different circumstances. Inasmuch as the legislature has made distinction between the suits coming under sections 7(iv) and 7(v), which is an indication to show that the valuation to be made by the plaintiffs under section 7(iv)(c) is not on the basis of valuation of the subject-matter and an objection cannot be raised that the suit must fail if the plaintiff does not value the relief on the basis of the market value of the land.3
14. For the purposes of valuation of the suit for determination of the
Court-fees payable thereon, what is relevant is the plaint. The averments made and relief sought in the plaint determines the character of the suit for the purposes of the Court-Fees payable thereon. What is stated in the written statement is not material in this regard. The view has also been taken by many High Courts. The Court followed and affirmed the law laid down in a series of judgments, as mentioned earlier, including Sathappa Chettiar v. Ramanathan
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1. Tara Devi v. Sri Thakur Radha Krishna Maharaj, MANU/SC/0054/1987 : (1987) 4 SCC 69; Abdul Hamid Shamsi v. Abdul Majid, MANU/SC/0003/1988 : (1988) 2 SCC 575: AIR 1988 SC 1150.
2. Commercial Aviation and Travel Co. v. Vimla Pannalal, MANU/SC/0299/1988 : (1988) 3 SCC 423: AIR 1988 SC 1636.
3. Gopal Chandra Jena v. Laxmi Narayan Bijo Maura Alava, MANU/OR/0021/1990 : AIR 1990 Ori 98.
Chettiar, MANU/SC/0003/1957 : AIR 1958 SC 245 that the question of Court-Fees had to be considered in the light of the allegations made in the plaint and its decision could not be influenced either by the pleas in the written statement or by the final decision of the suit on the merits.1
15. When there is a special rule in the Act for valuing the property for the purpose of court fee, that method of valuation must be adopted in preference to any other method.2
Nemi Chand v. Edward Mills Co. Ltd., MANU/SC/0007/1952 : 1953 SCR 197: AIR 1953 SC 281
Question of law decided: How far the finality can be attached to a decision under section 12 of the Court-Fees Act when section 2(ii) of the CPC provides that an order rejecting the plaint is a decree, which is admittedly appealable? The Court held that finality declared by section 12 of the Court-Fees Act means that the parties cannot impugn such a decision by preferring an appeal but that it does not confer on such decisions a complete immunity from examination in a higher court. In other words, section 12 when it says that such a decision shall be final between the parties only makes the decision of the Court on a question of Court-fee non-appeal and places it on the same footing as other interlocutory non-appeal orders under the Code and it does no more than that. If a decision under section 12 is reached by assuming jurisdiction which the Court does not possess or without observing the formalities which are prescribed for reaching such a decision, the order obviously would be revisable by the High Court in the exercise of revisional powers. Similarly, when a party thinking that a decision under section 12 is palpably wrong takes the risk of his plaint being rejected or suit dismissed and then appeals from the order rejecting the plaint or from the decree dismissing the suit but not from the decision on the question of Court-fee, then it is open to him to challenge the interlocutory order even on the question of Court-fee made in the suit or appeal. The word 'finality', construed in the limited sense in which it is often used in statutes, means that no appeal lies from an order of this character as such and it means no more than that.
Facts of the case: This is an appeal by special leave granted by the Privy Council and limited to the question of Court-fee viz. whether the memorandum of appeal presented to the High Court Court-fee was payable under section 7(iv)(c) or article 17 of Schedule II of the Court-Fees Act, 1870.
The question whether the memorandum of appeal was properly stamped arose in the following circumstances: Edward Mills Co. Ltd. is a joint stock company situate in Beawar, Ajmer-Merwara. In accordance with the provisions of the articles of the Company one Seth Gadh Mal Lodha and Rai Sahib Moti Lal (Respondent 2) were its Chairman and Managing Director respectively since 1916. Seth Gadh Mal Lodha represented the joint family firm of Kanwal Nain
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1. Ram Narain Prasad v. Atul Chander Mitra, (1994) 4 SCC 349.
2. Satheedevi v. Prasanna, Civil Appeal No. 4347 of 2010 (Arising out of S.L.P. (C) No. 3597 of 2009), decided on 7-5-2010.
Hamir Singh, while Rai Sahib Moti Lal represented the joint family firm of Champa Lal Ram Swaroop. On 1st July, 1938, Rai Sahib Moti Lal and his firm were adjudged insolvents by the Bombay High Court. The result was that Respondent 2 had to vacate the office of Managing Director and the members of his firm also became ineligible for it. By a resolution of the Board of Directors passed on 18th July, 1938, Gadh Mal Lodha was appointed to take the place of Rai Sahib Moti Lal as Managing Director. Gadh Mal Lodha died on 11th January, 1942, and the Board of Directors then appointed Seth Sobhagmal Lodha to act as Chairman as well as Managing Directors till the appointment was made by the Company. An extraordinary meeting of the company was called for the 8th February, 1945, for the election of the Chairman. At this meeting conflict arose between the two groups represented by Sobhagmal Lodha and Moti Lal. The Chairman therefore dissolved the meeting but the supporters of Moti Lal continued to hold it and passed a resolution appointing him as the sole agent and Chairman for a period of twenty years a remuneration equal to ten per cent. of the profits of the Company. It is this resolution of the 8th February, 1942, which has led to the present dispute.
Seth Sobhagmal in the situation that arose approached the District Judge of Ajmer with the prayer that a general meeting of the Company may be held under the supervision of the court. This request was allowed on 11th
February, 1942, and the Court ordered that the meeting be held on 12th February, 1942, under the Chairmanship of Seth Sobhagmal. Respondent 2 being aggrieved by this order, filed an application in revision in the Court of the Judicial Commissioner impugning the order. The learned Judicial Commissioner allowed the revision and directed that the resolution of 8th February, 1942, should be acted upon.
Having failed to get redress in the summary proceedings, the appellant then filed the suit of which this appeal arises for quashing the resolution of 8th February, 1942. In the plaint he asked for the following relief:-
1. That it be declared that the appointment of Defendant 2 is illegal, invalid and ultra vires and that he has no right to act as Chairman, Managing Director, etc., of Defendant 1;
2. That a receiver be appointed to take charge of the management of the Company, until a properly qualified Chairman, Managing Director, etc., are duly appointed as required by the memorandum and articles of the company.
The plaint bore a Court-fee stamp of Rs. 10 only, but the objection of the respondents that Court-fee was payable on Relief No. 2 the appellants paid ad valorem fee Rs. 51,000 which was the valuation of the suit for purposes of jurisdiction.
The Additional District Judge dismissed the suit on the preliminary ground that it was not maintainable as it related to the internal management of the Company and that the appellants had no right to bring it without impleading the Directors who were necessary parties to it.
Aggrieved by this decision of the trial Judge, the appellants preferred an appeal to the Court of the Judicial Commissioner, Ajmer-Merwara, at Ajmer. The memorandum of appeal was stamped with a Court-fee stamp of Rs. 10 and it was expressly stated therein that Relief No. 2 of the plaint was given up. An objection was raised regarding the amount of Court-fee paid on the memorandum of appeal. The Judicial Commissioner ordered that proper Court-fee be paid thereon in a month. In this order no reasons were given for this decision. The additional fee demanded was not paid, and the Judicial Commissioner dismissed the appeal with costs on 22nd March, 1945. An application was made for leave to appeal to the Privy Council against this order but it was refused. In the order refusing leave it was said as follows:-
"On appeal to this Court, the memorandum was again stamped with a ten rupee stamp only and the respondents therefore objected. It having been conceded by the plaintiffs earlier that the relief for the receivership was consequential to the relief for the declaration, the appellants were directed to pay the same stamp as had been paid in the Trial Court. They objected stating that they had expunged from their memorandum of appeal the request that the court should appoint a Receiver and that they were not, therefore, liable to pay the same amount. On this a notice was issued and counsel were heard.
It being clearly set out in section 42 of the Specific Relief Act, 1963 that no court shall grant a declaration only where the plaintiff being able to seek further relief than a mere declaration of title omits to do so, the appellants were directed to pay as earlier ordered the same amount as had ultimately been paid on the plaint. They had earlier sought a consequential relief and the court was, therefore, entirely unable to hold that the plaintiffs were unable to seek a further relief, they having sought the relief in the lower court and it having been refused to them. The amount of the stamp was not paid and the appeal was therefore dismissed with costs."
The reasons for demanding additional Court-fee though not mentioned in the original order, are stated in this order. Hence, appeal to the Supreme Court.
Decision of the Court: The question for determination before the Court was whether the order of Judicial Commissioner demanding additional fee can be sustained in law. It was observed that a memorandum of appeal as provided in article 1 of Schedule I of the Court-Fees Act, 1870, has to be stamped according to the value of the subject-matter in dispute in appeal; in other words, the relief claimed in the memorandum of appeal determines the value of the appeal for purposes of Court-fee. The only relief claimed in the memorandum of appeal was the first one mentioned in the plaint. It was observed that this relief being purely of a declaratory character, the memorandum of appeal was properly stamped under article 17 of the Second Schedule. It was further observed that it is always open to the appellant in appeal to give up a portion of his claim and to restrict it. It is further open to him, unless the relief is of such a nature that it cannot be split up, to relinquish a part of the claim and to bring it within the amount of Court-fee already paid. The plaintiffs in express terms relinquished the second relief they had claimed in the plaint, in their memorandum of appeal. For the purpose of deciding whether the memorandum of appeal was properly stamped according to the subject-matter of the appeal, it was not open to the Judicial Commissioner to canvass the question whether the suit with the second prayer eliminated from it fell within the mischief of the proviso to section 42 of the Specific Relief Act, 1963. That was a question which related to the merits of the appeal and did not concern its proper institution. On this ground, therefore, the Judicial Commissioner had no jurisdiction to demand additional fee from the plaintiffs and the appeal could not be dismissed for failure to meet it. Court was of the opinion that the order demanding additional Court-fee on the memorandum of appeal as it stood, that is, minus the second prayer, was erroneous and held that the memorandum of appeal was properly stamped, as the subject-matter of the appeal was purely of a declaratory character.
Ld. counsel for the respondents argued that the first relief claimed in the plaint, and which was the subject-matter of the appeal included within it consequential relief and was not purely declaratory in nature and therefore the Judicial Commissioner was right in demanding additional Court-fee on the value of the consequential relief. It was said that the words that Respondent 2 "had no right to act as Chairman and Managing Director" amounted to a claim for consequential relief. However, Court did not agree. It was found that the claim contained in the first relief of the plaint was to the effect that it be declared that Defendant 2 had no right to act as Chairman and Managing Director because of his appointment being illegal, invalid, and ultra vires. The declaration claimed was in negative form that Defendant 2 had no right to act as Chairman and Managing Director. No claim for a consequential relief could be read within this prayer. The words "that Defendant 2 has no right to act as Chairman...." are mere repetition and reiteration of what was contained in the opening sentence of the para.
With regard to the apparent conflict between the provisions of Code of Civil Procedure and the provisions of section 12 of the Court-Fees Act, 1870 relating to make the valuation final, the Court tried to reconcile the said provisions and observed that:
"The difference in the phraseology employed in sections 5 and 12 of the Court-Fees Act, 1870 indicates that the scope of section 12 is narrower than that of section 5. Section 5 which declares decisions on questions of Court-fee whenever they arise in the chartered High Courts as final makes a decision as to the necessity of paying a fee or the amount thereof final. Whereas section 12 makes a decision on every question relating to valuation for the purpose of determining the amount of any fee payable under Chapter 3 on a plaint or memorandum of appeal final. Had
section 12 been drafted somewhat as follows:-
"If any dispute arises at to the amount of any fee chargeable under this chapter on a plaint or memorandum of appeal, it shall be decided by the court in which such plaint or memorandum is filed and as such decision shall be final as between the parties."
then the construction contended for by Mr. Setalvad might have been upheld. When the two sections in the same Act relating to the same subject-matter have been drafted in different language, it is not unreasonable to infer that they were enacted with a different intention and that in one case the intention was to give finality to all decisions of the taxing officer or the taxing Judge, as the case may be, while in the other case it was only intended to give finality to questions of fact that are decided by a court but not to questions of law. Whether a case falls under one particular section of the Act or another is a pure question of law and does not directly determine the valuation of the suit for purposes of Court-fee. The question of determination of valuation or appraisement only arises after it is settled in what class or category it falls.
It has been argued in some decisions that it is absolutely necessary to decide the category in which a case falls before assessing its value and therefore the determination of the question of category is necessarily involved in the determination of the valuation of the suit for purposes of Court-fee. This argument, though plausible, does not seem sound. The actual assessment of the value depends either on arithmetical calculations or upon a valuation by an expert and the evidence led in the case, while the decision of the question of category is one of law and may well be said to be an independent question antecedent but not relating to valuation. The expression "valuation" interpreted in its ordinary meaning of "appraisement", cannot be said to necessarily include within its ambit the question of category which is a matter of law. The construction placed on this section by a long course of decisions is one which reconciles the provisions of the Court-Fees Act with that of the Code of Civil Procedure and does not make those provisions nugatory and is therefore more acceptable than the other constructions which would make the provisions of either one or the other of these statutes nugatory. Perhaps it may be possible to reconcile the provisions of the two statutes by holding that the finality declared by section 12 of the Court-Fees Act, 1870 means that the parties cannot impugn such a decision by preferring an appeal but that it does not confer on such decisions a complete immunity from examination in a higher court. In other words, section 12 when it says that such a decision shall be final between the parties only makes the decision of the court on a question of Court-fee non-appealable and places it on the same footing as other interlocutory non-appealable orders under the Code and it does no more than that. If a decision under section 12 is reached by assuming jurisdiction which the Court does not possess or without observing the formalities which are prescribed for reaching such a decision, the order obviously would be revisable by the High Court in the exercise of revisional powers. Similarly, when a party thinking that a decision under section 12 is palpably wrong takes the risk of his plaint being rejected or suit dismissed and then appeals from the order rejecting the plaint or from the decree dismissing the suit but not from the decision on the question of Court-fee, then it is open to him to challenge the interlocutory order even on the question of Court-fee made in the suit or appeal. The word "finality" construed in the limited sense in which it is often used in statutes means that no appeal lies from an order of this character as such and it means no more than that."
In this background it was held that no finality can be attached to such a decision by the provisions of section 12, as in reality it decides no question within the ambit of section 12 of the Court-Fees Act, 1870. In the result the appeal was allowed and the decision of the Judicial Commissioner was set aside and the case remanded back for decision in accordance with law on the basis that the memorandum of appeal presented to him was properly stamped.
Gopalakrishna Pillai v. Meenakshi Ayal, 1966 Supp SCR 128: MANU/SC/0268/1966 : AIR 1967 SC 155
Question of law decided: This case is more on facts than on law since the only issue before the Supreme Court was to whether future mesne profit, as granted by the High Court was according to law or not. For the purpose of our present study it is sufficient to say that the Court laid down that the Court is empowered even to grant future mesne profit, even though the prayer in the plaint is only with regard to past mesne profit and the Court-fees is also paid only for the past mesne profit. It was also laid down that with regard to past mesne profits, the plaintiff has an existing cause of action on the date of the institution of the suit, which the plaintiff must plead and subsequently claim a decree for the same after valuing the claim approximately and consequently Court-fee must be paid thereon. With regard to future mesne profit the plaintiff has no cause of action on the date of institution of the suit and accordingly it is not possible for him to plead this cause of action or value it and consequently to pay Court-fees thereon at the time of institution of the suit. But it was discretionary power with the Court to pass decree directing an enquiry into the future mesne profits and Court may grant this relief, though it is not specifically asked for.
Facts of the case: It would be useful to look into the facts of the case from the judgment itself and the same are reproduced as under:
"Sivasami died issueless in 1927. By his Will dated September 14, 1927, he bequeathed Items 1 to 4 and one half of Items 12 and 13 of the suit properties to his wife, Neelayadakshi absolutely and Items 5 to 11 and one half of Items 12 and 13 to this mother, Chinnayal absolutely. He also appointed Chinnayal as the trustee of Items 14 to 18 for the benefit of the Pillayar temple. Neelayadakshi died in 1931. It is common case that on her death Chinnayala inherited her properties as a limited heir. Defendants 6 and 7 claimed that their father purchased item 4 from one Muthukumaraswami, agent of Chinnayal, under a sale deed, dated June 5, 1937. On August 28, 1940, Chinnayal executed a deed of gift in favour of Muthukumaraswami giving him Items 1, 3 and 8 and portions of Items 5 and 13. On September 4, 1940, Chinnayal is said to have executed a Will bequeathing to Muthukumaraswami the remaining properties belonging to her absolutely and inherited by her as a limited heir from Neelayadakshi and also Items 14 to 18 and her trusteeship right in respect of those items. Chinnayal died on September 15, 1940. It is common case that the plaintiffs are her heirs. Soon after her death, Muthukumaraswami conveyed to one Venugopala all the properties acquired by him under the aforesaid gift deed and Will. Venugopala died in 1943 leaving Defendants 1 to 5 as his heirs. In or about August 1952, Meenakshi and Kamakshi instituted a suit in the Court of the Subordinate Judge, Cuddalore for possession of the suit properties alleging that they were entitled to the properties left by Chinnayal and Neelayadkshi and denying the factum and validity of the gift deed, dated August 28, 1940, the Will dated September 4, 1940 and the alleged sale in favour of the father of defendants 6 and 7. The defendants contested the suit.
The courts below held that (1) Chinnayal had no power to dispose of any of the properties which she had inherited from Neelayadkashi as a limited heir, (2) Chinnayal duly executed the gift deed and by that deed she lawfully disposed of Item 8 and portions of Items 5 and 13, and (3) there was no sale of Item 4 to the father of defendants 6 and 7. These findings are no longer challenged. The Subordinate Judge held that the plaintiffs failed to prove that they were the reversioners of Neelayadakshi, or were entitled to inherit her properties on the death of Chinnayal and that the Will dated September 4, 1940 was forged and its execution and attestation were not proved. The plaintiffs and the defendants preferred separate appeals from this decree to the Madras High Court. Ramaswami, J., held that the Will was genuine and was duly executed and attested but it was inoperative with regard to Items 14 to 18 and the trusteeship rights in those items. He also held that the question whether the plaintiffs were the next reversioners of Neelayadakshi should be tried afresh by the Trial Court. Thereafter, Kamakshi died and her legal representatives were substituted on the record. Meenakshi and the legal representatives of Kamakshi filed an appeal under clause 15 of the Letters Patent of the High Court, and the appellants filed cross objections. A Division Bench of the Madras High Court held that the Will was not genuine and its execution and attestation were not proved. It also held that on the materials on the record the plaintiffs must be held to be the next reversioners of Neelayadakshi. On this finding, the Division Bench passed a decree in favour of the appellants before them for the recovery of possession of Items 1 to 4, 3 cents in Item 5, Items 6, 7 and 9 to 13 and Items 14 to 18, declared that they were entitled to mesne profits for three years prior to the suit and to future mesne profits in respect of the aforesaid properties, directed the Trial Court to make an enquiry into the mesne profits under Order XX, rule 12 of the Code of Civil Procedure, 1908 and ordered that in respect of the rest of the suit properties the suit be dismissed. Some of the defendants now appeal to this Court by special leave."
Decision of the Court: The counsel for the appellants challenged the correctness of the findings of the High Court and contended that High Court had no power to pass a decree of mesne profit accrued after the institution of the suit. Leaving the factual aspect aside, which are not relevant for the purposes of our discussion with regard to the dispute qua decree for mesne profit subsequent to the institution of the suit, the Court observed as under:
"In the plaint, there was no specific prayer for a decree of mesne profits subsequent to the institution of the suit. Counsel for the appellants argued that in the absence of such a specific prayer, the High Court had no jurisdiction to pass a decree for such mesne profits. We are unable to accept this contention. Order XX, rule 12 of the Code of Civil Procedure provides that "where a suit is for the recovery of possession of immovable property and for rent or mesne profits" the court may pass a decree for the possession of the property and directing an enquiry as to the rent or mesne profits for a period prior to the institution of the suit and as to the subsequent mesne profits. The question is whether the provisions of Order XX, rule 12 apply to the present suit. We find that the plaintiffs distinctly pleaded in para 9 of the plaint that they were entitled to call upon the defendants to account for mesne profits since the death of Chinnayal in respect of the suit properties. For the purposes of jurisdiction and Court-fees, they valued their claim for possession and mesne profits for three years prior to the date of the suit and paid
Court-fee thereon. In the prayer portion of the plaint, they claimed recovery of possession, on account of mesne profits for three years prior to the date of the suit, costs and such other relief as may seem fit and proper to the Court in the circumstances of the case. On a reading of the plaint, we are satisfied that the suit was for recovery of possession of immovable property and for mesne profits. The provisions of Order 20, rule 12 were, therefore, attracted to the suit and the Court had power to pass a decree in the suit for both past and future mesne profits.
Order XX, rule 12 enables the Court to pass a decree for both past and future mesne profits but there are important distinctions in the procedure for the enforcement of the two claims. With regard to the past mesne profits, a plaintiff has an existing cause of action on the date of the institution of the suit. In view of Order VII, rules 1 and 2 and Order VII, rule 7 of the Code of Civil Procedure, 1908 and section 7(1) of the
Court-Fees Act, 1870, the plaintiff must plead this cause of action, specifically claim a decree for the past mesne profits, value the claim approximately and pay Court-fees thereon. With regard to future mesne profits, the plaintiff has no cause of action on the date of the institution of the suit, and it is not possible for him to plead this cause of action or to value it or to pay Court-fees thereon at the time of the institution of the suit. Moreover, he can obtain relief in respect of this future cause of action only in a suit to which the provisions of Order XX, rule 12 apply. But in a suit to which the provisions of Order XX, rule 12 apply, the Court has a discretionary power to pass a decree directing an enquiry into the future mesne profits, and the Court may grant this general relief, though it is not specifically asked for in the plaint. In Fakharuddin Mahomed Ahsan v. Official Trustee of Bengal, (1881) ILR 8 Cal 178 (PC) 189, Sir R.P. Collier observed:
"The plaint has been already read in the first case, and Their Lordships are of opinion that it is at all events open to the construction that the plaintiff intended to claim wasilat up to the time of delivery of possession, although, for the purpose of valuation only, so much was valued as was then due; but be that as it may, they are of opinion that, under section 196 of Act 8 of 1859, it was in the power of the Court if it thought fit, to make a decree which should give the plaintiff wasilat up to the date of obtaining possession."
Section 196 of Act 8 of 1859 empowered the Court in a suit for land or other property paying rent to pass a decree for mesne profits from the date of the suit until the date of delivery of possession to the
decree-holder. The observations of the Privy Council suggest that in a suit to which section 196 of Act 8 of 1859 applied, the Court had jurisdiction to pass a decree for mesne profits though there was no specific claim in the plaint for future mesne profits. The Court has the like power to pass a decree directing an equiry into future mesne profits. The court has the like power to pass a decree directing an enquiry into future mesne profits in a suit to which the provisions of Order XX, rule 12 of the Code of Civil Procedure, 1908, apply."
Therefore, the order of the High Court was affirmed, since it was not contended that High Court exercised its discretion improperly or erroneously. In the result, appeal was dismissed.
Shamsher Singh v. Rajinder Prashad, MANU/SC/0261/1973 : (1973) 2 SCC 524: MANU/SC/0261/1973 : AIR 1973 SC 2384
At the time of computing the Court-fee in a suit whether reading of prayer clause itself would be enough?Give reasons with the help of relevant statutory provisions and case law.
Question of law: The case involves interpretation of section 7(iv)(c) of the Court-Fees Act, 1870, which provides for computation of Court-fee in a suit for a declaratory decree and consequential relief. The Court laid down that while Court-fee payable on plaint is certainly to be decided on the basis of allegations and the prayer in the plaint, question whether plaintiff's suit will have to fail for failure to ask for consequential relief is of no concern to the court at that stage. The Court in deciding the question of Court-fee should look into the allegations in the plaint to see what is the substantive relief that is asked for. Mere astuteness in drafting the plaint will not be allowed to stand in the way of the court looking at the substance of the relief asked for. Consequently, when the plaintiffs sued for a declaration that the decree obtained by the appellant against their father was not binding on them they were really asking either for setting aside the decree or for the consequential relief of injunction restraining the decree-holder from executing the decree against the mortgaged property as he was entitled to do. Mere fact that the relief as stated in the prayer clause is expressed in a declaratory form does not necessarily show that the suit is for a mere declaration and no more. If the relief so disclosed is a declaration pure and simple and involves no other relief, the suit would fall under article 17(iii).
Facts of the case: This appeal raises the question of the Court-fee payable in the suit filed by the first respondent and his minor brother the second respondent against their father the third respondent and the alienee from him the appellant.
On July 13, 1962, the father executed a mortgage deed in favour of the appellant of a property which he claimed to be the sole owner for a sum of Rs. 15,000. The mortgagee, the appellant filed a suit on the foot of this mortgage and obtained a decree. When he tried to take out execution proceedings for the sale of the mortgaged property, Respondents 1 and 2 filed a suit for a declaration that the mortgage executed by their father in favour of the appellant is null and void and ineffectual as against them as the property was a joint Hindu family property and the mortgage had been effected without consideration and family necessity. On this plaint the plaintiffs paid a fixed Court-fee of Rs. 19.50 and the value of the suit for purposes of jurisdiction was given as Rs. 16,000. A preliminary objection having been raised by the appellant that the suit was not properly valued for purposes of Court-fees and jurisdiction, the Subordinate Judge tried it as a preliminary issue. He held that although the case is covered by section 7(iv)(c) of the Court-Fees Act, 1870, the proviso to that section applied and directed the plaintiffs to pay Court-fee on the value of Rs. 16,000 which was the amount at which the plaintiffs valued the suit for the purposes of jurisdiction. The Court-fee not having been paid the plaint was rejected. The plaintiffs thereupon carried the matter upon appeal before the High Court of Punjab and Haryana. Before that Court the plaintiffs did not seriously contest the position that the consequential relief of setting aside the decree within the meaning of section 7(iv)(c) of the Court-Fees
Act, 1870 was inherent in the declaration which was claimed with regard to the decree. But taking the view that the plaintiffs were not at all bound by the mortgage in dispute or the decree, the High Court held that there was no consequential relief involved since, neither the decree nor the alienation binds the plaintiffs in any manner. The first defendant in the suit has, therefore, filed this appeal.
Decision of the Court: While deciding the above mentioned important issue, the Court observed as under:
"As regards the main question that arises for decision it appears to us that while the Court-fee payable on a plaint is certainly to be decided on the basis of the allegations and the prayer in the plaint and the question whether the plaintiff's suit will have to fail for failure to ask - for consequential relief is of no concern to the court at that stage, the court in deciding the question of Court-fee should look into the allegations in the plaint to see what is the substantive relief that is asked for. Mere astuteness in drafting the plaint will not be allowed to stand in the way of the Court looking at the substance of the relief asked for. In this case the relief asked for is on the basis that the property in dispute is a joint Hindu family property and there was no legal necessity to execute the mortgage. It is now well-settled that under Hindu Law if the manager of a joint family is the father and the other members are the sons the father may by incurring a debt so long as it is not for an immoral purpose lay the joint family estate open to be taken in execution proceedings upon a decree for the payment of the debt not only where it is an unsecured debt and a simple money decree for the debt but also to a mortgage debt which the father is personally liable to pay and to a decree for the recovery of the mortgage debt by the sale of the property even where the mortgage is not for legal necessity or for payment of antecedent debt. Consequently when the plaintiffs sued for a declaration that the decree obtained by the appellant against their father was not binding on them they were really asking either for setting aside the decree or for the consequential relief of injunction restraining the decree-holder from executing the decree against the mortgaged property as he was entitled to do. This aspect brought out in a decision of the Full Bench of the Lahore High Court in Zeb-ul-Nisa v. Din Mohammad, AIR 1941 Lah 97, where it was held that:
"The mere fact that the relief as stated in the prayer clause is expressed in a declaratory form, does not necessarily show that the suit is for a mere declaration and no more. If the relief so disclosed is a declaration pure and simple and involves no other relief, the suit would fall under article 17(iii)."
In that case the plaintiff had sued for a two fold declaration: (i) that the property described in the plaint was a waqf, and (ii) that certain alienations thereof by the mutwali and his brother were null and void and were ineffectual against the waqf property. It was held that the second part of the declaration tantamounts to the setting aside or cancellation of the alienations and therefore the relief claimed could not be treated as a purely declaratory one and inasmuch as it could not be said to follow directly from the declaration sought for in the first part of the relief, the relief claimed in the case could be treated as a declaration with a "consequential relief".... It was substantive one in the shape of setting aside of alienations requiring ad valorem Court-fee on the value of the subject-matter of the sale, and even if the relief sought for fell within the purview of section 7(iv)(c) the plaintiffs in view of sections 8 and 9, Suits Valuation Act, 1887, having already fixed the value of the relief in the plaint for the purposes of jurisdiction were bound to fix the same value for purposes of Court-fee. It was also pointed out that in deciding whether a suit is a purely declaratory, the substance and not merely the language or the form of the relief claimed should be considered. The Court also observed:
"It seems to me that neither the answer to the question whether the plaintiff is or is not a party to the decree or the deed sought to be declared as null and void, nor to the question whether the declaration sought does or does not fall within the purview of section 42, Specific Relief Act, 1963, furnished a satisfactory or conclusive test for determining the Court-fee payable in the suit of this description. When the plaintiff is a party to the decree or deed, the declaratory relief, if granted, necessarily relieves the plaintiff of his obligations under the decree or the deed and, hence it seems to have been held in such cases, that the declaration involves a consequential relief. In cases where the plaintiff is not a party to the decree or the deed, the declaratory relief does not ordinarily include any such consequential relief. But there are exceptional cases in which the plaintiff though not a party to the deed or the decree is nevertheless, bound thereby. For instance, when a sale or mortgage of joint family property is effected by a manager of a joint Hindu family, the alienation is binding on the other members of the family (even if they are not parties to it) until and unless it is set aside. Similarly, a decree passed against the manager will be binding on the other members of the family. If, therefore, a coparcener sues for a declaration that such an alienation or decree is null and void, the declaration must, I think, be held to include consequential relief in the same way as in those cases in which the plaintiff is himself a party to the alienation or the decree, which is sought to be declared null and void. The case dealt with in Sohindar Singh v. Shankar Das, AIR 1936 Lah 166 seems to have been of this description. The case of an alienation by a mutwalli of waqf property would also appear to stand on a similar footing; In the case of waqf property, it is only the trustee or the mutwalli who can alienate the property. If he makes an alienation it is binding on all concerned, until and unless it is set aside. If, therefore, a person sues to get such an alienation declared null and void, he can only do so by getting the deed invalidated. The relief claimed in such cases also may therefore be found to include a consequential relief'."
Therefore, it was held that the decision of the High Court was not correct and consequently the appeal was allowed with costs. The plaintiffs were given a month's time for paying the necessary Court-fee.
Sathappa Chettiar v. Ramanathan Chettiar, 1958 SCR 1024: MANU/SC/0003/1957 : AIR 1958 SC 245
Question of law decided: 1. Whether under the facts and circumstances of the case it could be said that order passed by the learned Authority under section 5 of the Court-Fees Act, 1870 was final.
2. Whether under the facts of the case the learned Judges after exercising their jurisdiction under section 12(2) of the Court-Fees Act, 1870 were right to direct the appellant to pay additional Court-fee on the plaint on the basis of valuation of Rs. 15 lakhs, which was the Court-fee determined for the purposes of jurisdiction.
3. Whether the plaintiff has unfettered discretion in giving his own valuation of the suit falling under section 7(iv) of the Court-Fees Act, 1870?
Facts of the case: The Court, in the present case while interpreting
section 8 of the Suit Valuation Act, 1887 held that the plaintiff should first value his claim for the purposes of Court-fee and thereafter the said value would determine the value for the purpose of jurisdiction. The facts of the case are little bit complicated and in short compass may be narrowed down by simply stating that Madras High Court on 25-1-1995 called upon the plaintiff to pay Court-fee on the valuation of Rs. 15 lakhs both on his plaint and his memorandum of appeal. In fact, the appellant had filed civil suit No. 311/51 on the original side of Madras High Court, in which he claimed partition of the joint family property and account in respect of the joint family assets managed by the respondent. In the plaint it has been alleged that son of the appellant had filed suit for partition of his share and had obtained a decree in the Trial Court. The respondent had taken an appeal against the said decree in the High Court. Pending appeal the dispute was settled amicably between the parties and in consideration of payment of a specified sum and delivery of possession of certain sites Subbiah agreed to release all his claims and those of his son, the present appellant, in respect of the properties then in suit. According to the appellant, this compromise transaction did not bind him and so he claimed to recover his share ignoring the said transaction between his father and the respondent.
The plaint filed by the appellant valued the claim for accounts of Rs. 1000 under section 7(iv)(f) of the Act and Court-fee of Rs. 112.7 was paid on the said amount on an ad valorem basis. In regard to the relief for partition the fixed Court-fee of Rs. 100 was paid by the appellant under article 17B (Madras) of Schedule II of the Act. For the purposes of jurisdiction, however, the appellant gave Rs. 15 lakhs as the value of his share. The Registry, on examining the plaint, was of the view that it should have borne Court-fee under section 7(v) in respect of the claim for partition. The matter was referred to the Court Master, who was the Taxing Officer, under the Madras High Court-Fees Rules, 1933. The question, being considered as of some importance, was in turn referred to the Judge sitting on the original side under section 5 of the Court-Fees Act, 1870 on 18-10-1951, who held that appellant was not bound to set aside the prior compromise decree between his father and respondent and plaint was governed by article 17B of Schedule II. Hence the Court-fee brought by the appellant in respect of his claim for partition was held to be in order. It is pertinent to mention here that it is this order which was challenged as not being final. Continuing the sequence of events, the respondent was served and he filed written statement raising several contentions against the appellant's claim for partition and accounts, one of which was that the compromise and the release deed executed by the appellant's father and the decree was subsequently passed between the parties were fair and bona fide transactions and, since they amounted to a settlement of the disputed claim by the appellant's father, the plaintiff was bound by them. The learned Judge Ramaswamy Gounder, J., who heard the suit tried the respondent's contention about the binding character of the compromise decree as a preliminary issue and held that that there was a fair and bona fide settlement of the dispute by the appellant's father acting as the manager of his branch and so the appellant was bound by the compromise decree. Accordingly, the suit was dismissed on 22-9-1953.
Against this decree the appellant presented his memorandum of appeal on 1-2-1953, which bore the same Court-fee as the plaint. On examining the memorandum of appeal, the Registry again raised the question about sufficiency of Court-fees paid by the appellant. The Registry took a view that the appellant should have paid Court-fee under section 7(v) of the Act in respect of his claim for partition as the appellant's claim in substance was a claim for recovery of possession based on title within the meaning of section 7(v). The matter was then referred to Master, but, in his turn, same was again referred to the Taxation Judge under section 12(2) of the Act. Thereupon, the learned Chief Justice constituted a Bench of two Judges to deal with this reference. However, the reference was dealt with under section 5 of the Act. It was urged that the order passed by the earlier Judge Krishnaswami Naidu, J. was final but this contention was not accepted and it was held that the record did not show that the said Judge had been nominated by Chief Justice to hear the reference under section 5 either by a general or a special order and so no finality could be claimed for the said order under section 5 of the Act. On the merits, the learned Judges agreed with the view taken by the said Judge who held that section 7(v) of the Act was not applicable to the appellant's claim for partition. According to them neither was article 17B of Schedule II applicable. They held that the provisions of section 7(iv)(b) of the Act applied and that is why appellant was directed to mention his value for the relief of partition under the said section. It may be mentioned at this stage that this order became necessary because in the plaint the plaintiff had not specifically mentioned the value for the relief of partition claimed by him. He had merely stated that for the relief of partition claimed by him he was paying a Court-fee of Rs. 100 in accordance with Schedule II, article 17B. All that he had done in the plaint was to value his total claim for jurisdiction at Rs. 15 lakhs.
In compliance with this order, the appellant valued his relief to enforce his right to share in the joint family properties in suit at Rs. 50,000 and paid the deficit Court-fee and represented his memorandum of appeal on 7-5-1954. However, this was not end of the matter in respect of the Court-fees. The Registry again raised another objection this time and since the appellant had valued his relief for the purposes of jurisdiction at Rs. 15,00,000, it was not open to him to value his relief on the memorandum of appeal under section 7(iv)(b) without an amendment of the valuation made in the plaint. Since the appellant did not accept this view of the Registry, the matter was again placed before the Court for orders. The appellant then offered to file an application for formal amendment of his plaint by substituting Rs. 50,000, in place of Rs. 15 lakhs for jurisdictional value of his relief. Accordingly the appellant made an application on 18-10-1954, which was opposed both by the respondent and the Assistant Govt. Pleader on behalf of the State. The learned Judges who heard this application took a view that if the appellant had given the value in the first instance for purposes of jurisdiction he was precluded from giving a different value at a later stage. Accordingly, it was held that Rs. 15 lakhs which had been mentioned in the plaint as the value of the appellant's claim for jurisdictional purposes should be treated as the value given by the appellant also for the purposes of Court-fees under section 7(iv)(b) of the Act. The result was that the application made by the appellant for a formal amendment of the valuation made in the plaint was rejected. The learned Judges also purported to exercise their jurisdiction under section 12(2) of the Act and directed that the appellant should pay deficit Court-fees on the basis of Rs. 15 lakhs, not only on his memorandum of appeal but also on his plaint. It is this order which has given rise to the present case in the form of appeal to the Supreme Court.
Decision of the Court: The first point raised before the Court was that the order passed by the learned Chamber Judge on 18-10-1951 under section 5 of the Act was final, vide which it was held that the plaint filed in the present suit did not attract the provisions of section 7(v) of the Act and that the proper Court-fee to be paid was determined by article 17B of Schedule II of the Act. If this order had really been passed under section 5 of the Act, it would undoubtedly be final. Section 5 of the Act provides for procedure in case of difference as to necessity of Court-fee. In cases where a difference arises between an officer whose duty is to see that any fee is paid under Chapter III and a suitor as to the necessity of paying the fee or the amount thereof, it has to be referred to the Taxing Officer whose decision thereon shall be final. In turn the Taxing Officer may refer the matter, if found to be of general importance to the final decision of the Chief Justice of the High Court or such Judge of the High Court as the Chief Justice shall appoint either generally or specially in this behalf. However, on the basis of records in the present case it was found that there was no such general or special order as contemplated under section 5 and that is why it was held by Apex Court that learned Judges of Division Bench were right in refusing to attach finality to the order passed by earlier Chamber Judge namely Krishnaswamy Naidu, J.
The next point urged was that learned Judges were in error in purporting to exercise their jurisdiction under section 12(2) of the Act when they directed the appellant to pay additional Court-fees on the plaint on the basis of the valuation of Rs. 15 lakhs. The contention was that section 12 did not apply to the appeals arising from judgments and decrees passed in suits on the Original Side of the Madras High Court. On this aspect it was observed as under:
"It is perfectly true that the question about the levy of fees in the High Courts on their Original Sides is governed by section 3 of the Act and, if the matter had to be decided solely by reference to the Act, it would not be possible to apply any of the provisions contained in Chapter III of the Act either to the suits filed on the Original Side of the Madras High Court or to the appeals arising from judgments and decrees in such suits. But it is common ground that, on the plaints filed on the Original Side of the Madras High Court, Court-fees are leviable under the relevant provisions contained in Chapter III of the Act and the levy of these fees is authorized by Order 2, rule 1 of the High Court-Fees Rules, 1933. It is, therefore, necessary to inquire what provisions of the Act have been extended to the suits filed on the Original Side. The authority and jurisdiction of the Madras High Court in enacting rule 1 of Order II are not in dispute. What is in dispute before us is the effect of the said rule. The appellant's case is that the said rule merely contemplates the levy of certain specified Court-fees as indicated in the provisions of the Act which are expressly made applicable to the Original Side. No other provision of the Act, according to the appellant, can be said to have been extended and so the learned Judges were in error in purporting to exercise their jurisdiction under section 12(2). We are not satisfied that this argument is
well-founded. Order 2, rule 1 reads thus:
'Order II, rule 1 of the Madras High Court-Fees Rules, 1933
ORDER 2
1. The fees and commissions set out in Appendix II hereto shall be charged by the Registrar, Sheriff, Reserve Bank of India and Imperial Bank of India, as the case may be, upon the several documents, matters and transactions therein specified as chargeable. The commission chargeable to Government shall be charged by Reserved Bank of India and credited to Government. (To other documents including Memoranda of appeals the Registrar shall apply so far as may be the law for the time being in force relating to Court-fees, as regards the scale of such fees, the manner of levy of such fees, the refund of such fees and in every other respect, in the manner and to the extent that it is applicable to similar documents filed in original proceedings in a District Court and in appeals from decree and orders of a District Court.)'
It cannot be disputed that as a result of this rule, section 7(iv)(a), (b), (c), (d), (e) and (f) of the Act along with the proviso as well as article 17B of Schedule II of the Act applied to suits filed on the Original Side of the High Court. The latter portion of the order which has been added in 1949 obviously makes applicable to the suits and appeals on the Original Side of the High Court provisions of the Act as regards the scale of fees, the manner of their levy and the refund of fees. It also makes the relevant provisions of the Act applicable in "every other respect". The words "in every other respect" in the context clearly indicate that section 12 which confers upon the Appellate Court Authority or jurisdiction to examine the question about the sufficiency or otherwise of the Court-fees paid not only on the memorandum of appeal but also on the plaint in the suit which comes before the court of appeal is obviously intended to apply. It would indeed be illogical to apply the relevant provisions of the Act for the levy of Court-fees on plaints and memoranda of appeal and not to confer jurisdiction on the appropriate court to examine the sufficiency or otherwise of the Court-fees paid in that behalf. The power to entertain claims for refund of Court-fees has been specifically mentioned. A claim for refund can be validly made, for instance in a case where excess Court-fee has been paid. That is why the provisions of sections 13, 14 and 15 had to be applied in terms. If a litigant is entitled to make a claim for refund of Court-fees in cases governed by the relevant provisions of the Act, there appears to be no reason why it should not be open to the Court to entertain the question about inadequate payment of Court-fees. Logically, if excess Court-fees paid should and can be refunded in these proceedings, inadequate or insufficient Court-fees paid can and should be dealt with on that footing and orders passed to pay the deficit
Court-fees in such cases. It is matters of this kind that are clearly covered by the expression "in every other respect" to which we have referred. We, therefore, hold that the learned Judges below were justified in assuming jurisdiction under sub-sections (1) and (2) of section 12. Section 12 consists of two parts. Sub-section (1) provides that the question about the proper payment of Court-fees on the plaint or memorandum of appeal shall be decided by the court in which such plaint or memorandum of appeal is filed. It also lays down that such decision is final between the parties to the suit. Sub-section (2) confers upon the court of appeal, reference, or revision, jurisdiction to deal with the question of adequacy of Court-fee paid on the plaint whenever the suit in which such plaint has been filed comes before it and if the court is satisfied that proper Court-fees has not been paid then it can pass an order requiring the party to pay so much additional fee as would have been payable if the question had been rightly decided in the first instance. Since the decision of Krishnawamy Naidu, J., cannot attract the finality mentioned in
section 5 of the Act, it was open to the Division Bench to consider the correctness of the view taken by the learned Chamber Judge, and as they were satisfied that the plaint did not fall under article 17B of Schedule II, they were entitled to pass appropriate orders under section 12(1) and (2).
The appellant, however, contends that the learned Judges were in error in directing him to pay Court-fees on the basis of the value of
Rs. 15,00,000 both on his plaint and on his memorandum of appeal because he argues that this decision is consistent with the earlier order that the proper Court-fees to be paid on the memorandum of appeal had to be determined under section 7(iv)(b) of the Act. This order has been passed by the Division Bench under section 5 of the Act and it is final between the parties. This order gives the appellant leave to value his claim for the relief of partition and he exercised his option by valuing it at Rs. 50,000. The valuation thus made by the appellant in respect of the value of his relief of partition for the payment of Court-fees should and must be taken to be the valuation even for the purposes of jurisdiction and it is on this valuation alone that the appellant can be justly called upon to pay Court-fees both on the plaint and on the memorandum of appeal. The learned Judges were, therefore, in error in not allowing the appellant leave to make amendment in the plaint so as to bring the plaint in conformity with the provisions of section 7, sub-section (iv) of the Act. That in brief is the appellant's case.
On the other hand, on behalf of the Intervener-Advocate-General of Madras as well as on behalf of the respondent, it was sought to be urged before us that both the plaint and the memorandum of appeal ought to be valued for the purposes of payment of Court-fees under section 7(v) of the Act. It is conceded that the question of Court-fees must be considered in the light of the allegations made in the plaint and its decision cannot be influenced either by the pleas in the written statement or by the final decision of the suit on the merits. The argument, however, is that if all the material allegations contained in the plaint are fairly construed and taken as a whole it would appear that the plaintiff has been ousted from the enjoyment of the properties in suit and his claim for partition in substance is a claim for possession of the suit properties and as such falls within the provisions of section 7, sub-section (v) of the Act. The question about proper Court-fees leviable on plaints in which Hindu plaintiffs make claims for partition under varying circumstances has given rise to several conflicting decisions in the High Courts of India. We are, however, not called upon to consider the point as to whether section 7(v) would apply to the present suit or whether the present suit would fall under section 7(iv)(b). In our opinion, the decision of the Division Bench of the Madras High Court that the memorandum of appeal should be taxed for the purposes of Court-fee under
section 7(iv)(b) of the Act is final under the provisions of section 5 of the Act and it cannot be reopened at this stage. It may be that when the Division Bench of the Madras High Court considered this matter under reference made by the Master under section 5, the respondent was not heard. Normally the dispute between the litigant and the Registry in respect of Court-fees arises at the initial stage of the presentation of the plaint or the appeal and the defendant or the respondent is usually not interested in such a dispute unless the question of payment of Court-fees involves also the question of jurisdiction of the court either to try the suit or to entertain the appeal. There is no doubt that the question about the adequacy of the Court-fees leviable on the appellant's memorandum of appeal was properly referred by the Master to learned Chief Justice of the Madras High Court and has been decided by the Division Bench of the said High Court in pursuance of the requisite order made by the Chief Justice in that behalf. In such a case, the decision reached by the Division Bench must be held to be final under section 5 of the Act. That is why we have not allowed the merits of this order to be questioned in the present appeal".
While dealing with the appellant's contention on the basis that the
Court-fees on his memorandum of appeal must be levied under section 7(iv)(b) of the Act, it was observed as under:
"The question which still remains to be considered is whether the Division Bench was justified in directing the appellant to pay Court-fees both on the plaint and on the memorandum of appeal on the basis of the valuation of Rs. 15,00,000. In our opinion, the appellant is justified in contending that this order is erroneous in law. Section 7,
sub-section (iv)(b) deals with suits to enforce the right to share in any property on the ground that it is joint family property and the amount of fees payable on plaints in such suits is "according to the amount at which the relief sought is valued in the plaint or memorandum of appeal". Section 7 further provides that in all suits falling under
section 7(iv) the plaintiff shall state the amount at which the value of the relief is sought. If the scheme laid down for the computation of fees payable in suits covered by the several sub-sections of section 7 is considered, it would be clear that, in respect of suits falling under
sub-section (iv), a departure has been made and liberty has been given to the plaintiff to value his claim for the purposes of Court-fees. The theoretical basis of this provision appears to be that in cases in which the plaintiff is given the option to value his claim, it is really difficult to value the claim with any precision or definiteness. Take for instance the claim for partition where the plaintiff seeks to enforce his right to share in any property on the ground that it is joint family property. The basis of the claim is that the property in respect of which a share is claimed is joint family property. In other words, it is property in which the plaintiff has an undivided share. What the plaintiff purports to do by making a claim for partition is to ask the Court to give him certain specified properties separately and absolutely on his own account for his share in lieu of his undivided share in the whole property. Now it would be clear that the conversion of the plaintiff's alleged undivided share in the joint family property into his separate share cannot be easily valued in terms of rupees with any precision or definiteness. That is why legislature has left it to the option of the plaintiff to value his claim for the payment of Court-fees. It really means that in suits falling under section 7(iv)(b) the amount stated by the plaintiff as the value of his claim for partition has ordinarily to be accepted by the court in computing the Court-fees payable in respect of the said relief. In the circumstances of this case it is unnecessary to consider whether, under the provisions of this section, the plaintiff has been given an absolute right or option to place any valuation whatever on his relief.
What would be the value for the purpose of jurisdiction in such suits is another question which often arises for decision. This question has to be decided by reading section 7(iv) of the Act along with section 8 of the Suits Valuation Act, 1887. This latter section provides that, where in any suits other than those referred to in Court-Fees Act, 1870 section 7, paras 5, 6 and 9 and para 10 clause (d), Court-fees are payable ad valorem under the Act, the value determinable for the computation of Court-fees and the value for the purposes of jurisdiction shall be the same. In other words, so far as suits falling under section 7, sub-section (iv) of the Act are concerned, section 8 of the Suits Valuation Act, 1887 provides that the value as determinable for the computation of Court-fees and the value for the purposes of jurisdiction shall be the same. There can be little doubt that the effect of the provisions of section 8 is to make the value for the purpose of jurisdiction dependent upon the value as determinable for computation of Court-fees and that is natural enough. The computation of Court-fees in suits falling under section 7(iv) of the Act depends upon the valuation that the plaintiff makes in respect of his claim. Once the plaintiff exercises his option and values his claim for the purpose of Court-fees, that determines the value for jurisdiction. The value for
Court-fees and the value for jurisdiction must no doubt be the same in such cases; but it is the value for Court-fees stated by the plaintiff that is of primary importance. It is from this value that the value for jurisdiction must be determined. The result is that it is the amount at which the plaintiff has valued the relief sought for the purposes of
Court-fees that determines the value for jurisdiction in the suit and not vice versa. Incidentally we may point out that according to the appellant it was really not necessary in the present case to mention Rs. 15,00,000 as the valuation for the purposes of jurisdiction since on plaints filed on the Original Side of the Madras High Court prior to 1953 there was no need to make any jurisdictional valuation.
The plaintiff's failure to state that the amount at which he values the relief sought is often due to the fact that in suits for partition the plaintiff attempts to obtain the benefit of article 17B of Schedule II in the matter of payment of Court-fees. Where the plaintiff seeks to pay the fixed
Court-fee as required by the said article, he and his advisers are apt to take the view that it is unnecessary to state the amount for which relief is sought to be claimed for the purposes of Court-fees and the valuation for jurisdiction purposes alone is, therefore, mentioned. Often enough, it turns out that the plaint does not strictly attract the provisions of
article 17B of Schedule II and that the Court-fee has to be paid either under section 7(iv)(b) or under section 7(v) of the Act. If the court comes to the conclusion that the case falls under section 7(iv)(b) or 7(iv)(c) ordinarily liberty should be given to the plaintiff to amend his plaint and set out specifically the amount at which he seeks to value his claim for the payment of Court-fees. It would not be reasonable or proper in such a case to hold the plaintiff be and by the valuation made by him for the purposes of jurisdiction and to infer that the said valuation should be also taken as the valuation for the payment of Court-fees. In this connection we may point out that this is the view taken by the Full Bench decision of the Lahore High Court in Karam Ilahi v. Muhammad Bashir, AIR 1949 Lah 116. As we have already indicated section 8 of the Suits Valuation Act, 1887 postulates that the plaintiff should first value his claim for the purpose of Court-fee and it provides for the determination of the value for jurisdiction on the basis of such claim. In our opinion, therefore, the learned Judges of the Madras High Court were in error in holding that the valuation for jurisdiction showed in the plaint should be taken to be the valuation for the payment of Court-fees on the plaint as well as the memorandum of appeal. In view of their prior decision that the present case fell under section 7(iv)(b), they should have allowed the appellant to amend his valuation for the payment of Court-fees not only on the memorandum of appeal but also on the plaint."
Accordingly, the appeal was allowed and the impugned order was set aside. Consequently, the plaintiff was allowed to state the amount of
Rs. 50,000 at which he valued the relief sought by him for the purposes of section 7(iv)(b) of the Act. On the oral request liberty was granted to make the appropriate amendment in his plaint. Hence, while allowing the appeal the appellant was directed to pay additional Court-fees on his plaint on the basis of the valuation of Rs. 50,000 within two months from the date of passing of the judgment. Since the appellant had already paid the adequate Court-fees on his memorandum of appeal, no further order was passed in that behalf.
Ashok v. Narasingh Rao, MANU/MP/0010/1975 : AIR 1975 MP 39
For questions on this case the student may look into the case of Shamsher Singh v. Rajinder Prasad, MANU/SC/0261/1973 : AIR 1973 SC 2384, discussed earlier.
Question of law decided: (1) The court in deciding the question of Court-fees should look into the allegations in the plaint to see what is the substantive relief that is asked for. Mere astuteness in drafting the plaint will not be allowed to stand in the way of the court looking at the substance of the relief asked for.
(2) Where a decree is otherwise binding on the plaintiff, a suit though couched in a declaratory form, is in substance a suit either for setting aside the decree or for a declaration with a consequential relief of injunction restraining the decree-holder from executing the decree against the judgment-debtor and the plaintiff is liable to pay ad valorem Court-fee under section 7(iv)(c) of the Court-Fees Act, 1870.
Facts of the case: The plaintiff is aggrieved by an order of the Trial Court whereby it has been held that the plaintiff must pay proper ad valorem Court-fees.
Earlier a suit for ejectment and arrears of rent was instituted by Narasingh Rao (now defendant No. 1) against the plaintiff and defendants Nos. 2 to 8. That was Civil Suit No. 150A/1968 in the Court of Civil Judge Class II, Gwalior. In that suit, the plaintiff was described as a minor and Kishan defendant No. 3 was appointed as guardian ad litem. Eventually, in that suit a compromise decree was passed. That decree is being challenged in the present suit on the ground that the plaintiff (there defendant) had attained the age of majority and further it was misrepresented in the compromise that he was under the guardianship of his mother Smt. Ramabai (defendant No. 5). It is alleged in the plaint that fraud was practiced upon the court by his mother, defendant No. 5, who arrogated to herself the position of a guardian. The decree is challenged as null and void and is fraudulently obtained.
In the relief clause, there is no proper prayer for setting aside the decree, but merely declaration has been sought that the decree is ineffective and void as against the plaintiff.
The Trial Court has held that the suit for mere declaration is not maintainable. It was necessary for the plaintiff to claim consequential relief of setting aside the decree and further that the plaintiff had to pay ad valorem Court-fees.
Decision of the Court: The contention of the plaintiff is that the decree is not binding in the matter on him and, therefore, it is not necessary for him to pray for setting it aside. In this regard besides urging other points he specifically contended that since the impugned decree was not passed on adjudication by the Court, but on a compromise, which in the eye of law is a contract, the decree is not binding on the defendant after his attaining majority. However, the Court while rejecting the said contention of the plaintiff on the basis of decision of Supreme Court in Shamsher Singh v. Rajinder Prasad, MANU/SC/0261/1973 : AIR 1973 SC 2384, discussed earlier, laid down the aforementioned law and observed that the plaintiff was a defendant in the earlier suit and the impugned decree was passed against him. That decree is per se binding upon him and it can be executed against him. Even if he has grounds to show that the decree is liable to be set aside, unless and until he establishes those grounds and the decree is in fact set aside by another decree of a competent court, the existing decree subsists as binding on him. The suit is, therefore, within the above dictum of the Supreme Court. In the relief clause the prayer for setting aside the decree is implicit.
Hence, the revision was dismissed without costs.
Tara Devi v. Sri Thakur Radha Krishna Maharaj, MANU/SC/0054/1987 : (1987) 4 SCC 69
Question of law decided: In a suit for declaration with consequential relief falling under section 7(iv)(c) of the Court-Fees Act, 1870, the plaintiff is free to make his own estimation of the reliefs sought in the plaint and as such valuation both for the purposes of Court-fee and jurisdiction has to be ordinarily accepted. It is only in cases where it appears to the court on a consideration of the facts and circumstances of the case that the valuation is arbitrary, unreasonable and the plaint has been demonstratively undervalued, the court can examine the valuation and can revise the same. In this regard the judgments reported in Sathappa Chettiar v. Ramanathan Chettiar, MANU/SC/0003/1957 : AIR 1958 SC 245 and Meenakshisundaram Chettiar v. Venkattachalam Chettiar, MANU/SC/0016/1979 : AIR 1979 SC 989 were relied upon.
Facts of the case: The present Special Leave against the judgment and order dated 11-1-1987 of the Patna High Court arises out of a suit for declaration that pattas dated December 15, 1948, July 1, 1950, April 24, 1951 and November 26, 1952 executed by Nagendra Prasad Bhagat in the name of defendant No. 1 were illegal, ineffective and not binding on the plaintiff. There was no prayer for recovery of possession with mesne profits. The suit was valued on the basis of rent payable for the land. In the written statement filed by the defendant the preliminary objection taken by the defendant was that the suit was undervalued and accordingly jurisdiction of the court to entertain the same was challenged. The Trial Court held that the suit was governed by section 7(iv)(c) of the
Court-Fees Act, 1870, hence the plaintiff has rightly valued the lease-hold interest created by the lessee. The plaintiff was entitled to put his own valuation of the reliefs claimed. Therefore, it was held that valuation was not arbitrary and unreasonable and the same was rightly valued and accordingly proper
Court-fee has been paid thereon.
The revision petition filed before the High Court, Patna was referred to the Full Bench on the question as to whether the court had the jurisdiction to examine the correctness of the valuation given by the plaintiff and whether the plaintiff has an absolute right or option to place any valuation whatever on the relief claimed in such a suit.
Decision of the Court: After hearing both the parties the Court held that there was no merit in the arguments made on behalf of the petitioner and after relying upon the judgments reported in Sathappa Chettiar v. Ramanathan Chettiar, MANU/SC/0003/1957 : AIR 1958 SC 245 and Meenakshisundaram Chettiar v. Venkattachalam Chettiar, MANU/SC/0016/1979 : AIR 1979 SC 989, it was laid down that in a suit for declaration with consequential relief falling under section 7(iv)(c) of the Court-Fees Act, 1870, the plaintiff is free to make his own estimation of the reliefs sought in the plaint and as such valuation both for the purposes of Court-fee and jurisdiction has to be ordinarily accepted. It is only in cases where it appears to the court on a consideration of the facts and circumstances of the case that the valuation is arbitrary, unreasonable and the plaint has been demonstratively undervalued, the court can examine the valuation and can revise the same.
Accordingly, it was held that the plaintiff has valued the lease hold interest on the basis of the rent, which has been rightly held by the Courts below as reasonable and the same is not demonstratively arbitrary nor there has been any deliberate underestimation of the reliefs. Therefore, Special Leave to Appeal was not granted in the matter and accordingly the Special Leave Petition was dismissed without costs.
Abdul Hamid Shamsi v. Abdul Majid, MANU/SC/0003/1988 : (1988) 2 SCC 575: AIR 1988 SC 1150
Question of law decided: While following the ratio of the decisions discussed in earlier cases, which fall under section 7(iv) of the Court-Fees
Act, 1870, in the present case also the Court showed reluctance in interfering in the tentative valuation of the suit given by the plaintiff in a suit for accounts.
It was laid down that it is true that in a suit for accounts the correct amount payable by one party to the other can be ascertained only when the accounts are examined and it is not possible to give an accurate valuation of the claim at the inception of the suit. The plaintiff is, therefore, allowed to value his own tentative valuation. Ordinarily the court shall not examine the correctness of the valuation chosen, but if a plaintiff chooses whimsically a ridiculous figure it tantamount to not exercising his right in this regard. In such a case it is not only open to the court but it is its duty to reject such a valuation. It was held that the cases of some of the High Courts which have taken a different view must be held to be incorrectly decided.
Facts of the case: The jurisdiction of the City Civil Court, Calcutta to entertain a suit being T.S. No. 520 of 1983 filed by Respondent 1 is under challenge in the present appeal, on the ground that the correct value of the suit is beyond the pecuniary jurisdiction of the court. The plaintiff-respondent 1 has alleged that he is a partner of a partnership business along with his brothers Defendants 1 and 2. Originally it was a proprietary business belonging to Abdul Samad, father of the plaintiff and Defendants 1 and 2, and was later converted into a partnership firm by a regular deed. During his
life-time the business was under the control of Abdul Samad, but on his death Defendants 1 and 2 have effectively taken charge of the business and excluded the plaintiff. A suggestion to reconstitute the partnership made and repeated by the plaintiff has been ignored. In reply to the plaintiff's letter seeking information Defendant 2 - petitioner has stated in his letter to the plaintiff that he (the plaintiff) has no interest in the firm. In paragraph 11 of the plaint it is stated that he has on enquiry discovered that Defendants 1 and 2 have been falsely representing before the Income Tax Department, inter alia, that a new deed of partnership had been executed on January 15, 1979 to be effective from January 1, 1979 in which the plaintiff has no interest. The Income Tax Officer passed an order on December 26, 1981 on the basis of the false allegations made by the defendant. The plaintiff has challenged the aforementioned partnership deed of 1979. In paragraph 16 of the plaint the amount of profit from the business has been described as "huge". In the prayer portion of the plaint the plaintiff prayed for declaring the partnership deed of 1979 as illegal and void and for passing a decree for dissolution of the partnership firm and for accounts. The valuation of the suit was put at Rs. 150 being the sum of Rs. 50 for declaration, Rs. 50 for rendition of accounts and another sum of Rs. 50 for profit to the share of the plaintiff arising out of the business. Court-fee was accordingly paid.
Defendants 1 and 2, besides denying the plaint allegations made by the plaintiff, challenged the valuation given by the plaintiff as grossly undervalued and arbitrary. The issues relating to the correct valuation and pecuniary jurisdiction of the court to entertain the suit were taken up as preliminary issues and were decided in favour of the plaintiff. The defendants challenged the order by a civil revision application before the Calcutta High Court which was dismissed. Defendant 2 has now come to the Supreme Court against the High Court's order. Special leave is granted.
Decision of the Court: The Court while rejecting the contention of the learned counsel for the plaintiff Respondent 1, to the effect that since the suit is governed for the purpose of Court-fees by section 7(iv)(f) of the Court-Fees
Act, 1870, therefore, he has the absolute right to put on the plaint any value he wishes to and the Court has no jurisdiction to examine the matter, observed, in view of decisions of the Supreme Court in Meenakshisundaram Chettiar v. Venkalachalam Chettiar, MANU/SC/0016/1979 : AIR 1979 SC 989 and Smt. Tara Devi v. Thakur Radha Krishan Maharaj, MANU/SC/0054/1987 : (1987) 4 SCC 69, that the plaintiff cannot arbitrarily and deliberately undervalue the relief and where he manifestly and deliberately underestimates the relief the court is entitled to examine the correctness of the valuation given by the plaintiff and revise the same if it is patently arbitrary or unreasonable. The Court also referred to certain High Court judgments, whose opinion on this issue was not found to be uniform. Therefore, while following the aforementioned judgments of the Apex Court, the law was laid down as mentioned above and the following mentioned contention of the counsel for appellant was upheld:
"Mr. Kacker, the learned counsel for the appellant, has contended that it is manifest that relief to the tune of lakhs of rupees has been claimed by the plaintiff in the suit. He said that the plaintiff has laid claim to a sum of Rs. 1,26,796.72 besides another sum of over Rs. 84,000 as his share in the profit or a particular period by reference to the proceeding of the Income Tax Department mentioned in paragraph 11 of the plaint, and it is, therefore, preposterous on his part to suggest in paragraph 19 of the plaint that it could be tentatively valued at Rs. 50 only. According to the defence case, which is challenged as incorrect by the plaintiff, the plaintiff requested for and was allowed a larger share in the
well-established and reputed business of auctioneer known as "Russell Exchange" and its assets and goodwill as well as the amount lying in the Habib Bank, Karachi Branch, solely and absolutely. The "Russell Exchange" building is a very valuable property near Park Street in the city of Calcutta. A copy of the Profit and Loss Account for the calendar year 1979 attached by the plaintiff to the additional affidavit filed on his behalf before this Court mentions figures in lakhs."
Hence, on the basis of materials on record placed before the court at considerable length it was held that the valuation put by the plaintiff Respondent on the plaint was arbitrary and unacceptable. Therefore, the matter was remitted back for reconsideration by the Trial Court and it was directed that while examining the issue it would be open to the Trial Court to take into consideration the statement in the plaint that the plaintiff has been ousted from the partnership business. Further, it was also directed that if the Court comes to the conclusion that the tentative valuation of the suit would be beyond its pecuniary jurisdiction, it shall pass appropriate order under Order VIII of the CPC. Accordingly, the appeal was allowed with costs payable by the plaintiff respondent.
Commercial Aviation and Travel Co. v. Vimla Pannalal, MANU/SC/0299/1988 : (1988) 3 SCC 423: AIR 1988 SC 1636
Question of law decided: For the first time in the cases falling under
section 7(iv) of the Court-Fees Act, 1870, which we have discussed earlier, a test of "objective standards" was laid down in such like matters and held that where there are objective standards of valuation or, in other words, the plaintiff or the court can reasonably value the relief correctly on certain definite and positive materials, the plaintiff will not be permitted to put an arbitrary valuation de hors such objective standards or material.
Facts of the case: The Respondent, who is the plaintiff, has filed a suit against the appellants, inter alia, for dissolution of partnership and for accounts. The suit has been valued for the purpose of jurisdiction at Rs. 25 lakhs and at Rs. 500 for the purpose of Court-fee.
The appellants filed an application wherein a preliminary objection was raised as to the valuation of the suit. It was contended by them that the relief sought for in the suit had been grossly undervalued and the court should reject the plaint under Order VII, rule 11(b) of the Code of Civil Procedure. The learned single Judge of the High Court overruled the said preliminary objection and held that the suit was not undervalued. On appeal by the appellants, a Division Bench placed reliance upon and followed a Full Bench decision of the same High Court in Smt. Sheila Devi v. Kishan Lal Kalra, ILR (1974) 2 Del 491, where it has been observed, inter alia, that paragraph (iv) of section 7 of the Court-Fees Act, 1870 gives a right to the plaintiff in any of the suits mentioned in the clauses of that paragraph to place any value that he likes on the relief he seeks, subject, however, to any rule made under section 9 of the Suits Valuation Act, 1887 and the court has no power to interfere with the plaintiff's valuation. The Division Bench felt itself bound by the said Full Bench decision and, accordingly, it dismissed the appeal of the appellants. Hence this appeal.
Decision of the Court: It was held that so far as suits coming under
section 7(iv) of the Court-Fees Act, 1870 are concerned, the legislature has left the question of valuation of the relief sought in the plaint or memorandum of appeal to the plaintiff. The reason is obvious. The suits which are mentioned under section 7(iv) are of such nature that it is difficult to lay down any standard of valuation. Indeed, the legislature has not laid down any standard of valuation in the Court-Fees Act, 1870. Under section 9 of the Suits Valuation Act, 1887, the High Court may with the previous sanction of the State Government, frame rules for the valuation of the suits referred to in section 7(iv) of the Court-Fees Act. Although the Punjab High Court has framed rules under section 9 of the Suits Valuation Act, 1887 which are applicable to the Union Territory of Delhi, such rules do not lay down any standard of valuation with regard to suits coming under section 7(iv) of the Court-Fees Act, 1870. It has already been noticed that under rule 4(i) of the Punjab High Court Rules, the value of suit for accounts for purposes of Court-fee will be as determined by the Court-Fees Act, 1870, which means that the valuation of the relief will have to be made by the plaintiff under section 7(iv)(f) of the Court-Fees Act, 1870.
In a suit for accounts it is almost impossible for the plaintiff to value the relief correctly. So long as the account is not taken, the plaintiff cannot say what amount, if at all, would be found due to him on such accounting. The plaintiff may think that a huge amount would be found due to him, but upon actual accounting it may be fond that nothing is due to the plaintiff. A suit for accounts is filed with the found hope that on accounting a substantial amount would be found due to the plaintiff. But the relief cannot be valued on such hope, surmise or conjecture.
In this connection reference was made to the provision of Order VII,
rule 11(b) of the Code of Civil Procedure, 1908, which provides, inter alia, that the plaint shall be rejected where the relief claimed is undervalued and the plaintiff, on being required by the Court to correct the valuation within a time to be fixed by the Court, fails to do so. It is manifestly clear from the provision of Order VII, rule 11(b) that a court has to come to a finding that the relief claimed has been undervalued, which necessarily means that the court is able to decide and specify proper and correct valuation of the relief and, after determination of the correct value of the relief, requires the plaintiff to correct his valuation within a time to be fixed by the court. If the plaintiff does not correct the valuation within the time allowed, the plaint is liable to be rejected. The question is whether in a suit for accounts simpliciter, the court can come to a finding as to the proper and correct value of the relief until the final determination is made. The Court observed that, ordinarily it is not possible at a preliminary stage to determine the value of the relief in a suit for accounts simpliciter. If the Court is itself unable to say what the correct valuation of the relief is, it cannot require the plaintiff to correct the valuation that has been made by him. Indeed, in a suit for accounts it is also difficult for the court to come to a finding even as to the approximate correct valuation of the relief. In such a case, the court has no other alternative than to accept plaintiff's valuation tentatively.
While observing that there is divergence of judicial opinion amongst various High Courts on the issue, reference was made to the Constitution Bench of the Apex Court in S. Rm. Ar. S. Sp. Sathappa Chettiar v. S. Rm. Ar. Rm. Ramanathan Chettiar, MANU/SC/0003/1957 : AIR 1958 SC 245, wherein it has been laid down that the legislature has left it to the option of the plaintiff to value his claim for the
Court-fees in suits falling under section 7(iv)(b), which is a departure from the other kinds of suits. It was further observed that it is true that the court in that case did not consider whether the plaintiff has been given an absolute right or option to place any valuation whatever on his relief under the provisions of section 7(iv) of the Court-Fees Act, 1870, but the difficulty that would be felt by the court in exercising its power under Order VII, rule 11(b) of the Code of Civil Procedure, 1908 is that if it is unable to determine the correct value of the relief, it cannot direct the plaintiff to correct the valuation. Order VII, rule 11(b) contemplate correct valuation and not approximate correct valuation and such correct valuation of the relief has to be determined by the court. If the court cannot determine the correct valuation of the relief claimed, it cannot require the plaintiff to correct the valuation and, consequently, Order VII, rule 11(b) will not be applicable. But, there, may be cases under section 7(iv) where certain positive objective standard may be available for the purpose of determination of the valuation of the relief. If there be materials or objective standards for the valuation of the relief, and yet the plaintiff ignores the same and puts an arbitrary valuation, the court is entitled to interfere under Order VII, rule 11(b) of the Code of Civil Procedure, 1908, for the court will be in a position to determine the correct valuation with reference to the objective standards or materials available to it.
While referring to yet another case the Supreme Court held that in Nalini Nath Mallik Thakur case, it has been observed that although a satisfactory valuation may not be possible in the majority of the cases falling under
section 7(iv), when once the court has formed the opinion that the plaintiff's estimate is wrong, it becomes the duty of the court to estimate a correct and reasonable valuation of the relief claimed and it is for the court to decide on the merits of each particular case whether the provisions of section 8C should be invoked for the purpose of revising the plaintiff's valuation. Further, it has been observed that if the relief claimed is impossible to value, the Court is, of course, not in a position to say that such relief has been wrongly valued and there is consequently no scope for the operation of section 8C, but in a suit where it is sought to set aside a decree, such valuation, although difficult, is not impossible. In a suit to set aside a decree prima facie the value of the relief claimed by the plaintiff would be the value of the decree and the onus would clearly lie on him to show that the relief should be valued at some smaller amount. It thus follows from the above decision that if the court is of the opinion that the plaintiff's estimate is wrong, it becomes the duty of the court to estimate a correct and reasonable value of the suit. If, however, the court is not in a position to decide the correct value of the suit, it has to accept the value that has been put by the plaintiff on the relief claimed. In Nalini Nath Mallik Thakur case, there was an objective standard of valuation, namely, the decree which was sought to be set aside. Thus where there are objective standards of valuation or, in other words, the plaintiff or the court can reasonably value the relief correctly on certain definite and positive materials, the plaintiff will not be permitted to put an arbitrary valuation de hors such objective standards or materials.
The Court, while relying upon Meenakshisundaram Chettiar v. Venkatchalam Chettiar, (1979) 3 SCR 385; Tara Devi v. Sri Thakur Radha Krishna Maharaj, MANU/SC/0054/1987 : (1987) 4 SCC 69 and Abdul Hamid Shamsi v. Abdul Majid, MANU/SC/0003/1988 : (1988) 2 SCC 575 laid down as under:
"The plaintiff cannot whimsically choose a ridiculous figure for filing the suit most arbitrarily where there are positive materials and/or objective standards of valuation of the relief appearing on the face of the plaint. These materials or objective standards will also enable the court to determine the valuation for the purpose of Order VII, rule 11(b) of the Code of Civil Procedure, 1908. Indeed, in Abdul Hamid Shamsi's case, it has been noticed by the Supreme Court that the plaintiff has laid a claim to a sum of Rs. 1,26,796.72, besides another sum of over Rs. 84,000 as his share in the profit for a particular period by reference to the proceeding of the Income Tax Department mentioned in paragraph 11 of the plaint. Further a copy of the profit and loss account for the calendar year 1979 was annexed by the plaintiff to the additional affidavit filed on his behalf before the Court, which also gave positive indication as to the valuation of the relief. The plaintiff in that case valued the suit without making any reference whatsoever to those materials or objective standards available to him and in the context of these facts, this Court made the above observation. But if there be no material or objective standard, the plaintiff's valuation has to be accepted."
While applying the aforementioned principles of law to the facts of the present case, the court referred to paragraph 33 of the plaint where it has been stated by the plaintiff that on rendition of accounts, the plaintiff estimates that approximately a sum of Rs. 25-30 lakhs would become due to her share. It was submitted on behalf of the appellant that in view of such a statement in the plaint the respondent should have valued the relief for rendition of accounts at Rs. 25 lakhs. However, the contention was rejected and it was observed that the statement did not constitute any objective standard of valuation or a positive material from which it could be said with any amount of certainty that the valuation of the relief for accounts should be at the sum of Rs. 25 lakhs. The respondent was not required to make such a statement in the plaint, which was found to be a wishful thinking of the plaintiff that on account being taken, she would be entitled to such a huge amount. It was also observed that the respondent had not given in the plaint any material in support of the estimate of Rs. 25-30 lakhs to her share. This is no material at all, the court observed, on which reliance could be placed for the purpose of valuation of the relief.
Hence, the court after considering the facts and circumstances of the case and the legal position held that the valuation of the relief for the rendition of the accounts under section 7(iv)(f) of the Court-Fees Act, 1870 is neither unreasonable nor is demonstratively arbitrary.
Gopal Chandra Jena v. Laxmi Narayan Bijo Maura Alava, MANU/OR/0021/1990 : AIR 1990 Ori 98
Question of law decided: The present case carries forward the law laid down in the earlier cases with regard to the suits to which section 7(iv)(c) applies inasmuch as a suit to which section 7(v)(c) applies, the plaintiff has the option to state the amount at which he values the relief. The provision is different from that of section 7(v) which applies to suits for possession of lands, houses and gardens where valuation is to be made in accordance with the subject-matter. The said section also contains the provisions as to how the value of the subject-matter is to be determined under different circumstances. Inasmuch as the legislature has made distinction between the suits coming under sections 7(iv) and 7(v), which is an indication to show that the valuation to be made by the plaintiffs under section 7(iv)(c) is not on the basis of valuation of the subject-matter and an objection cannot be raised that the suit must fail if the plaintiff does not value the relief on the basis of the market value of the land.
Facts of the case: In this revision, the defendant assails an order passed by the Munsif overruling his objection regarding the valuation of the suit for the purpose of jurisdiction and the Court-fee paid by the plaintiffs in the suit for a declaration that the deed of gift executed by petitioners No. 2 on 6-3-1984 was void inasmuch as the defendant, her husband's younger brother, practised fraud upon her to get the gift deed executed in his favour in the garb of execution of a power-of-attorney by her. His submission is that since in essence and substance, the relief claimed by the plaintiffs is for cancellation of the deed and depriving the defendant of his title in the property conveyed under the gift deed, the suit has to be valued on the valuation of the property and ad valorem Court-fee has to be paid as required under section 7(iv)(c) of the Court-Fees
Act, 1870 ('the Act'). It is further submitted that the valuation of the property being more than Rs. 50,000, the Munsif, in whose Court the suit was filed, did not have the pecuniary jurisdiction to try the suit and that the suit should have been filed before the Subordinate Judge.
Decision of the Court: It is the contention of the counsel for the opposite parties/plaintiff that the suit is essentially one for a declaration that the deed was null and void as having been obtained by fraud and hence payment of a declaratory Court-fee and consequent filing of the suit in the Court of Munsif, who had jurisdiction to try such kind of suits, are not illegal. In this regard the court observed that the Court-fee payable on a suit is not merely dependent upon the way of drafting the plaint or the reliefs claimed but that the substance of the plaint has to be looked into to determine the real relief claimed in the suit. In this background, coming to the facts of the case, it was observed that, there is no dispute that the deed of gift itself recited the valuation of the property conveyed to be Rs. 2,000. But the submission was that since the present market value of the property is Rs. 50,000 the valuation of the suit has to be made accordingly and Court-fee paid thereon. The court further laid down as under:
"Since the opposite parties came before the court with the pleadings that fraud was practised upon plaintiff No. 2 in execution of the
power-of-attorney and the deed of gift is one which apparently has been executed and registered and such a deed of gift is to be declared void through the suit, learned counsel for the petitioner is correct in his submission that, in essence, the relief sought for by the opposite parties is one for cancellation of the deed and not for a mere declaration of fraud having been practiced upon plaintiff No. 2. As a matter of fact, a mere declaration of fraud having been practiced upon her would not have the effect of avoiding the deed unless the declaration is to the effect that due to such fraud, the deed is vitiated which, in effect, is the other way of saying that the deed is ineffective and therefore cancelled. In the context the cancellation of the deed arises as a necessary consequence of the declaration and hence while the relief of declaration is the substantive relief claimed, cancellation thereof is the necessary consequential relief arising therefrom since without getting a declaration that the deed is vitiated by fraud, the cancellation cannot be sought for independently. I would thus hold the suit to be one for relief of declaration with consequential relief and is to be governed by section 7(iv)(c) of the Act.
Next is the question as to what valuation is to be put by the plaintiffs on the plaint for the purpose of Court-fee and jurisdiction, inasmuch as the suit is one to which section 7(iv)(c) of the Act applies and the valuation is the same for the purpose of jurisdiction and Court-fee as provided under section 8 of the Suits Valuation Act, 1887."
While following and confirming the question of law, as laid down in various cases and mentioned above, the Supreme Court observed that considering the scheme in the Act for computation of fees payable in suits covered by different sub-sections of section 7, it would be clear that in respect of suits falling under sub-section (iv), a departure has been made and liberty has been given to the plaintiff to value his claim for the purposes of Court-fees and that the theoretical basis of this provision appears to be that in cases in which the plaintiffs is given the option to value his claim, it is really difficult to value the claim with any precision or definiteness.
While the plaintiffs are free to put their own valuation on the relief claimed by them, yet it is consensus of law that the valuation cannot be arbitrary so as to bring it within the jurisdiction of any particular Court but that the valuation has to be reasonable and based upon some nexus or criteria though it need not necessarily be the market value. In Jhara Padhamuni v. Bhagirathi Padhan, ILR (1976) Cut 707 the very conclusion was reached that the valuation made is to have some nexus with the market value of the property, but however ordinarily the valuation put by the plaintiff in respect of the relief claimed would be accepted. In Krishna Prasanna Roy v. Satyabati Roy, MANU/BH/0029/1976 : AIR 1976 Pat 106 the Court held that though the court has the power to revise the valuation of the plaint in appropriate cases, yet it does not mean that merely because the value could be higher than that put by the plaintiff, the valuation must necessarily be revised and that if there is some rationale indicating the reasonableness of the value stated by the plaintiff, which cannot be said to be capricious or arbitrary, the court will refuse the same. Similar view was also expressed by the Patna High Court in 1968 Pat LJR 578.
The foregoing discussion would show that in suits as the present one, the plaintiff has the right to put his own valuation on the relief claimed and that such valuation is to be accepted unless it is wholly arbitrary, unreasonable and without any rational basis. But, however, merely because the relief is not valued at the market value, it does not become arbitrary or unreasonable and if the plaintiff can support the valuation on any rational basis, the same has to be accepted.
While following the law laid down in Mt. Rupia v. Bhatu Mahton, MANU/BH/0106/1943 : AIR 1944 Pat 17 (FB), the court held that in the present case also the plaintiffs have come with the averment of continuing in possession of land but only seeking a declaration that the deed of gift was vitiated by fraud and as has been noticed earlier, the substantive relief claimed by them was that of declaration with cancellation of the deed as the consequential relief. Thus, the essential
subject-matter of the suit is not the property purported to be conveyed, but challenging the action of the petitioner in getting the deed executed by practicing fraud. That being so, the suit has to be valued accordingly. Hence, the plaintiffs, having not valued the suit under section 7(iv)(c) and having merely valued it as a declaratory one, were directed to be given an opportunity to value the suit under the said provision and comply with the requirements of law.
In view of this the revision was disposed off.
Ram Narain Prasad v. Atul Chander Mitra, (1994) 4 SCC 349
For questions on this case see the earlier cases on the same issue.
Question of law decided: The Court followed and affirmed the law laid down in a series of judgments, as mentioned earlier, including Sathappa Chettiar v. Ramanathan Chettiar, MANU/SC/0003/1957 : AIR 1958 SC 245 that the question of Court-Fees had to be considered in the light of the allegations made in the plaint and its decision could not be influenced either by the pleas in the written statement or by the final decision of the suit on the merits. For the purposes of valuation of the suit for determination of the Court-fees payable thereon, what is relevant is the plaint. The averments made and relief sought in the plaint determines the character of the suit for the purposes of the Court-fees payable thereon. What is stated in the written statement is not material in this regard. The view has also been taken by many High Courts.
Facts of the case: The appellants were the plaintiffs in a suit filed against the first respondent in the Court of the Munsif 1st, Gaya (being TS No. 278 of 1971). It was alleged in the plaint that the appellants were the sons and daughters of one Jaikishun Lal who died on 1-7-1962, leaving them behind as his sole heirs. The late Jaikishun Lal had purchased the suit property from the defendant under a registered sale deed dated 30-4-1960. After the late Jaikishun Lal became the owner of the property, the first respondent had requested him to let the suit property to him on a monthly rental of Rs. 90. The proposal was accepted and the first respondent was inducted as a tenant on 1-5-1960. On 18-5-1960, the first respondent had executed a "Kirayanama" in favour of the late Jaikishun Lal in the aforementioned terms. The first respondent paid some rent to the later Jaikishun Lal and thereafter to the plaintiffs, the last of such payments having been made on 7-8-1962. The first appellant was a minor when Jaikishun Lal died. Upon attaining majority the first appellant had filed a petition for mutation of the Municipal Register in respect of the suit property. The first respondent had filed objections thereto, which had been rejected. The appellants were the owners of the suit property, the first respondent was their tenant and he was in arrears of rent. Being a defaulter he was liable to be evicted from the suit property. The appellants needed the suit property for personal use. For the purposes of jurisdiction and Court-fees, the suit was "valued at Rs. 1080 being the monthly rent of the house in suit for 12 months" and the appellants, on payment of Court-fees of Rs. 157.50, prayed for the following reliefs:-
"(i) That a decree for ejectment of the defendant from the house in suit be passed.
(ii) That the defendant be ordered to vacate the house in suit within the period fixed by the court failing which the plaintiffs be put in possession over the house in suit through the processes of the court."
The first respondent filed a written statement in which he claimed that in April 1960 he was in need of money and had approached the late Jaikishun Lal for a loan. The late Jaikishun Lal had insisted that the security for the loan should be in the form of a sale deed with a clause for re-conveyance as also a "Kirayanama" showing a monthly rent for the suit property of Rs. 90. The first respondent being in urgent need of money had executed these documents under undue influence and compulsion. The first respondent denied that there was a relationship of landlord and tenant between the appellants and himself.
The first respondent moved a petition in the Trial Court averring that the court "in view of the pleadings of the parties has to decide in respect of the title not incidentally but in a full-fledged manner" and, therefore, the appellants could not proceed with the suit unless ad valorem Court-fees on the market value of the suit property were paid. Reliance was placed upon the judgment reported in Sheo Shanker Prasad v. Barhan Mistry, 1985 PLJR 358. Upon this petition, the Trial Court ordered thus:
"In view of the pleadings of the parties, I am of the opinion that the Court has to decide title, not incidentally but in a full-fledged manner. Under such circumstances, in view of the reported decision in Sheo Shanker Prasad v. Barhan Mistry, the plaintiffs have to pay ad valorem Court-fee on the market value of the suit property. Accordingly the plaintiffs are directed to pay ad valorem Court-fee on the market value of the suit property. If the plaintiffs are so advised, they may file petition for amendment of the plaint in the light of declaration of their title to the suit property."
The appellants carried the matter to the Patna High Court by way of a civil revision application. The same was dismissed in limine. From the order thereon the appellants have preferred this appeal by special leave.
Decision of the Court: The Court observed that section 7 of the Court-Fees Act, 1870, lays down how Court-Fees are to be computed upon certain suits. By reason thereof, on a suit between a landlord and a tenant for recovery of rent of the immovable property from the tenant, the Court-Fees are to be paid "according to the amount of the rent of the immovable property to which the suit refers, payable for the year next before the date of presenting the plaint".
While affirming the law, as laid down in Sathappa's case, ratio of which is mentioned above, it was held that the plaint in the present case sought the relief of eviction of the first respondent from the suit property upon the averments that the appellants were the landlords and the first respondent was their tenant and he was in arrears of rent. The suit could only be valued as an eviction suit, regardless of the fact that the first respondent had denied the appellant's title to the suit so that this became an issue in the suit.
Accordingly, the appeal was allowed, while setting aside the impugned order of the High Court dismissing the civil revision application of the plaintiffs and the order of the Trial Court allowing the first respondent's petition for seeking payment of ad valorem Court-fees on the market value of the suit property.
Chief Inspector of Stamps v. Indu Prabha Vachaspati, MANU/SC/1414/1998 : (1998) 9 SCC 157
Question of law decided: No question of law was decided in the present case. Merely on the basis of facts it was held that the valuation of the claim in the present case for the purposes of Court-Fees has been rightly done by negativing the contention of the appellant.
Facts of the case: This is a cross-appeal filed by the Chief Inspector of Stamps in respect of a judgment of the High Court of Allahabad dated 10-4-1979 in CR No. 559 of 1972. The appeal filed by the respondent in respect of the same judgment regarding valuation, on a question which was decided against her by the High Court has been allowed by the Supreme Court.
Decision of the Court: In the present appeal, the appellant contends that prayer (c) of the plaint has been wrongly valued for the purposes of Court-Fees. Prayer (c) is as follows:-
"that the plaintiff's one-third share in the properties left by late
Dr. B.N. Prasad as detailed in Schedule 'A' attached to the plaint be partitioned and the plaintiff be put in separate possession of her share (valued at Rs. 1,03,880. 25p)."
According to the appellant, the plaintiff must be presumed to have parted with possession of the property in question and hence Court-fees should have been paid on the full value of her share, in the property instead of 1/5th value of her share as has been done by her. This contention, according to the Apex Court, has been rightly negatived by the High Court. Valuation of a claim for the purposes of Court-fees depends on the prayers in the plaint. In paragraph 10 of the plaint, the plaintiff had clearly stated that the immovable properties in question are at present in the occupation of tenants and the plaintiff had got constructive possession of the same. Hence the High Court was said to have rightly held that the plaint did not disclose anywhere that the plaintiff had divested herself of the possessory right in the said properties or that she was out of possession after the execution of the documents which were impugned in the plaint. The plaintiff's case was that she was in constructive possession through her tenants. Therefore, it was further laid down that the High Court had rightly held that the Court-Fees would be payable on the 1/5th value of her share as had been done by her.
Accordingly the appeal was dismissed.
Satheedevi v. Prasanna, Civil Appeal No. 4347 of 2010 (Arising out of S.L.P. (C) No. 3597 of 2009), decided On: 7-5-2010
Question of law decided: When there is a special rule in the Act for valuing the property for the purpose of court-fee, that method of valuation must be adopted in preference to any other method. Besides this it was also held with regard to specific instances as under:
(A) when the suit is for cancellation of a decree or other document for money, then the value of the subject-matter of the suit will be:-(i) the whole amount for which the decree was passed or the document was executed, if what is sought to be cancelled is the whole of the decree or the whole of the document; and (ii) such part of the amount for which the decree was passed or the document was executed, if only part of the decree or part of the document is sought to be cancelled;
(B) when the suit is for cancellation of a decree or other document for a property having money-value, then, the value of the subject-matter of the suit will be:-(i) if the whole of the decree or the document is sought to be cancelled - the value of the property covered by the decree or the document; and (ii) if only part of the decree or of the document is to be cancelled; value of such part of the property in respect of which the decree was passed or the document was executed and to which extent such decree or such document is to be cancelled.
Facts of the case: This appeal filed for setting aside order dated 21-7-2008 passed by the learned Single Judge of Kerala High Court in Writ Petition No. 21820 of 2008 whereby he declined to interfere with the direction given by Sub Judge, Palakkad (hereinafter described as 'the trial Court') to the appellant to pay court-fee on the market value of the plaint schedule property raises an important question of law relating to interpretation of section 40 of the Kerala Court-Fees and Suits Valuation Act, 1959 (for short, 'the Act').
The appellant owned 9.98 acres rubber plantation. She executed power-of-attorney No. 376/2006 in favour of her own daughter (respondent No. 1 herein). After sometime, respondent No. 1 transferred the property to her husband (respondent No. 2 herein) by registered sale deed No. 1784/2007. The appellant filed O.S. No. 231/2007 for cancellation of the power-of-attorney by alleging that respondent No. 1 had misused the same and sold the property to her husband. By an order dated 21-5-2008, the trial Court directed the appellant to pay court-fees on the market value of the plaint schedule property. The appellant challenged that order in Writ Petition No. 17032/2008 (C) which was disposed of by the learned Single Judge of Kerala High Court vide his order dated 26-6-2008, the relevant portion of which reads as under:
"The learned Counsel appearing for the petitioner further submitted that in view of the contentions raised in the plaint, petitioner has to file an application for amendment of the plaint modifying the relief sought for. In the nature of the contentions raised in the plaint, an amendment of the relief is definitely necessary, as found by the learned Sub-Judge. In such circumstances, Writ Petition is disposed granting liberty to the petitioner to amend the plaint and to pay the necessary court-fee payable on such pleading. It is made clear that the fact that a time limit is fixed by this Court will not prevent the court from granting amendment, as it is necessary for an appropriate adjudication of the dispute involved in the suit. It is made clear that the actual court-fee payable by the plaintiff is to be decided by the trial Court afresh, taking into consideration the relief sought for in the plaint, in the light of the amendment of the pleading."
In furtherance of the direction given by the High Court, the appellant applied for and she was granted permission to amend the plaint and to incorporate prayer for cancellation of the sale deed executed by respondent No. 1 in favour of respondent No. 2. In the amended plaint, value of the property was shown as Rs. 7,00,000 and accordingly, the court fees was paid. However, by an order dated 3-7-2008, the trial Court directed the appellant to pay court-fee on the market value of the plaint schedule property which was assessed at Rs. 12 lakhs per acre.
Writ Petition No. 21820/2008 filed by the appellant against the above mentioned order was dismissed by the learned Single Judge, who referred to the judgments of the Division Bench in Krishnan Damodaran v. Padmanabhan Parvathy, (1972) KLT 774; P.K. Vasudeva Rao v. Hari Menon, MANU/KE/0005/1982 : AIR 1982 Ker 35 and Pachayammal v. Dwaraswamy Pillai, (2006) 3 KLT 527 and held that in terms of section 40 of the Act, the writ petitioner is required to pay court fees on market value of the property and not on the value specified in the sale deed.
Decision of the Court: The Court took into consideration sections 7(1), (2), (3), (3A), (4), 25(a), (b), 27(a), 29, 30, 37(1)(3), 38, 40, 45 and 48 of the Act, which had bearing on the issue raised by the appellant, and which read as under:
7. Determination of market value.-
(1) Save as otherwise provided, where the fee payable under this Act depends on the market value of any property, such value shall be determined as on the date of presentation of the plaint.
(2) The market value of agricultural land in suits falling under
section 25(a), 25(b), 27(a), 29, 30, 37(1), 37(3), 38, 45 or 48 shall be deemed to be ten times the annual gross profits of such land where it is capable of yielding annual profits minus the assessment if any made to the Government.
(3) The market value of a building shall in cases where its rental value has been entered in the registers of any local authority, be ten times such rental value and in other cases the actual market value of the building as on the date of the plaint.
(3A) The market value of any property other than agricultural land and building falling under sub-sections (2) and (3) shall be the value it will fetch on the date of institution of the suit. (4) Where the subject-matter of the suit is only a restricted or fractional interest in a property, the market value of the property shall be deemed to be the value of the restricted or fractional interest and the value of the restricted or fractional interest shall bear the same proportion to the market value of the absolute interest in such property as the net income derived by the owner of the restricted or fractional interest bears to the total net income from the property.
25. Suits for declaration.-
In a suit for a declaratory decree or order, whether with or without consequential relief, not falling under section 26,-
(a) where the prayer is for a declaration and for possession of the property to which the declaration relates, fee shall be computed on the market value of the property or on rupees one thousand whichever is higher;
(b) where the prayer is for a declaration and for consequential injunction and the relief sought is with reference to any immovable property, fee shall be computed on one-half of the market value of the property or on rupees one thousand, whichever is higher.
27. Suits for injunction.-In a suit for injunction-
(a) Where the reliefs sought is with reference to any immovable property, and
(i) where the plaintiff alleges that his title to the property is denied, or
(ii) where an issue is framed regarding the plaintiff's title to the property,
fee shall be computed on one-half of the market value of the property or on rupees five hundred, whichever is higher.
29. Suits for possession under the Specific Relief Act, 1877.-In a suit for possession of immovable property under section 9 of the Specific Relief Act, 1877 (Central Act 1 of 1877), fee shall be computed on one-third of the market value of the property or on rupees one hundred and fifty, whichever is higher.
30. Suits for possession not otherwise provided for.-
In a suit for possession of immovable property not otherwise provided for, fee shall be computed, on the market value of the property or on rupees one thousand, whichever is higher.
37. Partition suits
(1) In a suit for partition and separate possession of a share of joint family property or of property owned, jointly or in common, by a plaintiff who has been excluded from possession of such property, fee shall be computed on the market value of the plaintiff's share.
(2) xxx xxx xxx
(3) Where, in a suit falling under sub-section (1) or sub-section (2), a defendant claims partition and separate possession of his share of the property, fee shall be payable on his written statement computed on half the market value of his share or at half the rates specified in
sub-section (2), according as such defendant has been excluded from possession or is in joint possession.
38. Suits for joint possession
In a suit for joint possession of joint family property or of property owned, jointly or in common, by a plaintiff who has been excluded from possession, fee shall be computed on the market value of the plaintiff's share.
40. Suits for cancellation of decrees, etc
(1) In a suit for cancellation of a decree for money or other property having a money value, or other document which purports or operates to create, declare, assign, limit or extinguish, whether in present or in future, any right, title or interest in money, movable or immovable property, fee shall be computed on the value of the subject-matter of the suit, and such value shall be deemed to be-
if the whole decree or other document is sought to be cancelled, the amount or value of the property for which the decree was passed or other document was executed;
if a part of the decree or other document is sought to be cancelled, such part of the amount or value of the property.
(2) If the decree or other document is such that the liability under it cannot be split up and the relief claimed relates only to a particular item of property belonging to the plaintiff or to the plaintiff's share in any such property, fee shall be computed on the value of such property, or share or on the amount of the decree, whichever is less.
Explanation.-A suit to set aside an award shall be deemed to be a suit to set aside a decree within the meaning of this section.
45. Suits under the Survey and Boundaries Act
In a suit under
section 14 of the Madras Survey and Boundaries Act, 1923, section 13 of the Travancore Survey and Boundaries Act of 1094, or section 14 of the Cochin Survey Act, II of 1074, fee shall be computed on one-half of the market value of the property affected by the determination of the boundary or on rupees one thousand, whichever is higher.
48. Interpleader suits
(1) In an interpleader suit, fee shall be payable on the plaint at the rates specified in section 50.
(2) Where issues are framed as between the claimants, fee shall be payable computed on the amount of the debt or the money or the market value of other property, movable or immovable, which forms the subject-matter of the suit. In levying such fee, credit shall be given for the fee paid on the plaint; and the balance of the fee shall be paid in equal shares by the claimants who claim the debt or the sum of money or the property adversely to each other.
(3) Value for the purpose of determining the jurisdiction of Courts shall be the amount of the debt, or the sum of money or the market value of other property to which the suit relates.
9. Section 7(iv), (ivA) (as inserted by Madras Act of 1922) and (v) of the Court-fees Act, 1870 (for short, the Court-Fees Act'), which have been considered in various judgments of Madras High Court relied upon by learned Counsel for the respondents reads as under:
7. Computation of fees payable in certain suits
The amount of fee payable under this Act in the suits next hereinafter mentioned shall be computed as follows:
xxx xxx xxx
(iv) In suits for movable property of no market-value.-(a) for moveable property where the subject-matter has no market-value, as, for instance, in the case of documents relating to title, to enforce a right to share in joint family property.- (b) to enforce the right to share in any property on the ground that it is joint family property, for a declaratory decree and consequential relief.- (c) to obtain a declaratory decree or order, where consequential relief is prayed, for an injunction.-(d) to obtain an injunction, for easements.-(e) for a right to some benefit (not herein otherwise provided for) to arise out of land, and for accounts.-(f) for accounts according to the amount at which the relief sought is valued in the plaint or memorandum of appeal; In all such suits the plaintiff shall state the amount at which he values the relief sought.
(iv-A) In a suit for cancellation of a decree for money or other property having a money value or other document securing money or other property having such value, the valuation should be according to the value of the subject-matter of the suit and such value shall be if the whole decree is sought to be cancelled, the amount or value of the property for which the decree was passed, and if a portion of the decree is sought to be cancelled, such part of the amount or value of the property. (added by Madras Act of 1922).
for possession of land, houses and gardens.-(v) In suits for the possession of land, houses, and gardens - according to the value of the subject-matter; and such value shall be deemed to be where the subject-matter is land, and,-
(a) where the land forms an entire estate, or a definite share of an estate, paying annual revenue to Government, or forms part of such an estate and is recorded in the Collector's register as separately assessed with such revenue; and such revenue is permanently settled - ten times the revenue so payable;
(b) where the land forms an entire estate, or a definite share of an estate, paying annual revenue to Government, or forms part of such estate and is recorded as aforesaid; and such revenue is settled, but not permanently - five times the revenue so payable;
(c) where the land pays no such revenue, or has been partially exempted from such payment, or is charged with any fixed payment in lieu of such revenue, and net profits have arisen from the land during the year next before the date of presenting the plaint - fifteen times such net profits; but where no such net profits have arisen therefrom - the amount at which the Court shall estimate the land with reference to the value of similar land in the neighbourhood;
(d) where the land forms part of an estate paying revenue to Government, but is not a definite share of such estate and is not separately assessed as above-mentioned - the market-value of the land:
Before proceeding further, we may notice two well recognized rules of interpretation of statutes. The first and primary rule of construction is that the intention of the legislature must be found in the words used by the legislature itself. If the words used are capable of one construction, only then it would not be open to the courts to adopt any other hypothetical construction on the ground that such hypothetical construction is more consistent with the alleged object and policy of the Act. The words used in the material provisions of the statute must be interpreted in their plain grammatical meaning and it is only when such words are capable of two constructions that the question of giving effect to the policy or object of the Act can legitimately arise -Kanai Lal Sur v. Paramnidhi Sadhukhan, MANU/SC/0097/1957 : 1958 SCR 360. The other important rule of interpretation is that the Court cannot rewrite, recast or reframe the legislation because it has no power to do so. The Court cannot add words to a statute or read words which are not therein it. Even if there is a defect or an omission in the statute, the Court cannot correct the defect or supply the omission. - Union of India v. Deoki Nandan Aggarwal, 1992 Supp (1) SCC 323; Shyam Kishori Devi v. Patna Municipal Corporation, (1966) 3 SCR 366.
It was observed that section 7 of the Act lays down different modes for determination of the market value of the property for the purpose of payment of court-fee. Sub-section (1) of section 7 begins with the expression "Save as otherwise provided" and lays down that where the fee payable under the Act depends on the market value of any property, such value shall be determined as on the date of presentation of the plaint. From the plain language of
section 7(1), it is evident that it merely specifies the methodology for determination of the market value of the property where the court-fee payable under some other provisions of the Act depends on the market value of the property which is subject-matter of the suit. Sections 25, 27, 29, 30, 37, 38, 45 and 48 deal with different kinds of suit i.e., suits for declaration, suits for injunction, suits for possession under the Specific Relief Act, 1877, suits for possession not otherwise provided for, partition suits, suits for joint possession, suits under the Survey and Boundaries Act and interpleader suits. These sections provide for payment of court-fee computed on the market value of the property. Sub-section (2) of section 7 lays down that the market value of the agricultural land in suits falling under sections 25(a), 25(b), 27(a), 29, 30, 37(1), 37(3), 38, 45 and 48 shall be deemed to be ten times the annual gross profits of such land where it is capable of yielding annual profits minus the assessment, if any, made by the Government. In terms of sub-section (3), the market value of a building in cases where its rental value has been entered in the registers of any local authority, shall be ten times such rental value and in other cases, the actual market value of the building as on the date of the plaint. Clause (a) of sub-section (3) lays down that market value of any property other than agricultural land and building shall be the value it will fetch on the date of institution of the suit. Sub-section (4) lays down that where subject-matter of the suit is only a restricted or fractional interest in a property, the market value of the property shall be deemed to be the value of the restricted or fractional interest. Section 40 deals with suits for cancellation of decrees etc., which are not covered by other sections. If this section is interpreted in the light of the expression 'save as otherwise provided' used in section 7(1), it becomes clear that the rule enshrined therein is a clear departure from the one contained in section 7 read with sections 25, 27, 29, 30, 37, 38, 45 and 48 which provide for payment of court-fee on the market value of the property. In that sense,
section 40 contains a special rule. Section 40(1) lays down that in a suit for cancellation of a decree for money or other property having a money value, or other document which purports or operates to create, declare, assign, limit or extinguish, whether in present or in future, any right, title or interest in money, movable or immovable property, fee shall be computed on the value of the subject-matter of the suit and further lays down that such value shall be deemed to be if the whole decree or other document sought to be cancelled, the amount or value of the property for which the decree was passed or other document was executed. If a part of the decree or other document is sought to be cancelled, such part of the amount or value of the property constitute the basis for fixation of court-fee. Sub-section (2) lays down that if the decree or other document is such that the liability under it cannot be split up and the relief claimed relates only to a particular item of the property belonging to the plaintiff or the plaintiff's share in such property, fee shall be computed on the value of such property, or share or on the amount of the decree, whichever is less. The deeming clause contained in the substantive part of section 40(1) makes it clear that in a suit filed for cancellation of a document which creates any right, title or interest in immovable property, the court-fees is required to be computed on the value of the property for which the document was executed. To put it differently, the value of the property for which the document was executed and not its market value is relevant for the purpose of court-fee. If the expression 'value of the subject-matter of the suit' was not followed by the deeming clause, it could possibly be argued that the word 'value' means the market value, but by employing the deeming clause, the legislature has made it clear that if the document is sought to be cancelled, the amount of court-fee shall be computed on the value of the property for which the document was executed and not the market value of the property. The words "for which" appearing between the words "property" and "other documents" clearly indicate that the court-fee is required to be paid on the value of the property mentioned in the document, which is subject-matter of challenge.
It was further observed that if the legislature intended that fee should be payable on the market value of the subject-matter of the suit filed for cancellation of a document which purports or operates to create, declare, assign, limit or extinguish any present or future right, title and interest, then it would have, instead of incorporating the requirement of payment of fees on value of subject-matter, specifically provided for payment of court-fee on the market value of the subject-matter of the suit as has been done in respect of other types of suits mentioned in sections 25, 27, 29, 30, 37, 38, 45 and 48. The legislature may have also, instead of using the expression "value of the property for which the document was executed", used the expression "value of the property in respect of which the document was executed". However, the fact of the matter is that in section 40(1) the legislature has designedly not used the expression `market value of the property'.
The court came to the conclusion as under:
"If the interpretation placed by the trial Court and the High Court on the expression "value of the property for which the document was executed" is accepted as correct then the word `value' used in section 40(1) of the Act will have to be read as `market value' and we do not see any compelling reason to add the word `market' before the word `value' in section 40(1) of the Act.
We may now advert to the judgments relied upon by the learned Counsel for the parties and some other judgments of different High Courts in which section 40(1) of the Act and similar provisions of other State legislations have been interpreted.
In Venkata Narasimha Raju v. Chandrayya, MANU/TN/0131/1926 : AIR 1927 Mad 825, the Division Bench of Madras High Court interpreted section 7(v)(a) of the Court-Fees Act as amended by Madras Act of 1922 and observed:
One point raised is whether the market value of the property should not be taken for the purpose of this valuation, or whether the statutory value should be adopted. We think the latter is the proper course as there is nothing in the Act to show that the market value is the value contemplated in section 7(iv)(a). When there is in the Act itself a special rule as to valuing property in suits for Court-fees, we think it is proper to take that method of valuation in preference to any other method to get the value where there is no indication that any other method should be adopted. (emphasis supplied)
In Balireddi v. Khatipulal Sab, MANU/TN/0053/1935 : AIR 1935 Mad 863, the learned Single Judge of the High Court considered the question whether in a suit for setting aside mortgage deeds and sale deeds, the plaintiff is required to pay court-fees on the market value of the property and answered the same in affirmative. The learned Judge referred to two earlier judgments in Venkata Narasimha Raju v. Chandrayya, (supra) and Venkatasiva Rao v. Satyanarayanamurthi, MANU/TN/0074/1932 : AIR 1932 Mad 605 but disagreed with the ratio of those judgments and held:
"The amount of court-fee payable depends upon "the value of the subject-matter of the suit," that is what the section says. Where a document securing money is sought to be cancelled, the section goes on to say, that the value of the subject-matter shall be deemed to be "the amount for which the document is executed." In the case of a mortgage instrument therefore the court-fee has to be computed on the amount for which the instrument is executed, in other words, the principal amount secured by it. This is the plain effect of the words of the section, and I fail to see how the method of computation fixed in section 7(v) can possibly be applied. Now as regards the sale-deed, the question arises, is the value referred to in the section, the actual value of the property, that is to say, its market value or the artificial value prescribed by section 7(v)? The last mentioned section deals with suits for possession and the legislature has expressly enacted that in such suits the value shall be determined in a particular manner. Clause (ivA) refers simply to "the value of the property," which means "value" as generally understood, whereas clause (v) prescribes an artificial method of valuation. There is no reason to construe clause (ivA) in the light of clause (v) which deals with a specific matter; indeed, when the legislature intends to prescribe an artificial method, it says so in express terms, as clause (ivc) also shows. I am therefore of the opinion that in the case of the sale-deeds, the amount of court-fee payable must be computed on the market value of the properties with which they deal."
In Kutumba Sastri v. Sundaramma, (supra), the Full Bench of Madras High Court interpreted paragraph (ivA) of section 7 of the Court-fees Act. The Full Bench referred to the earlier judgments in Venkata Narasimha Raju v. Chandrayya, (supra); Venkatasiva Rao v. Satyanarayanamurthi, (supra), Balireddi v. Khatipulal Sab, (supra) and approved the view expressed by the learned Single Judge in Balireddi v. Khatipulal Sab, (supra) by making the following observations:
"We consider that the view taken by Venkatasubba Rao J. in 59 Mad 240 is preferable to that taken in 53 MLJ 267. Para (ivA) deals with suits where it is necessary for the plaintiff to seek the cancellation of a decree or of a deed. Para (v) relates merely to suits for possession. In a suit for possession it is not always necessary to set aside a decree or a document. Where a suit is merely for possession the Act says how the value of the subject-matter shall be arrived at. When adding para (ivA) to
section 7 the Legislaturedid not say that in a suit falling within the new paragraph the valuation of the subject-matter should be arrived at in accordance with the method indicated in para (v). It said that a suit within para (ivA) should be valued according to the value of the property, and the value of the property, unless there is an indication to the contrary, must mean to its market value. By the Amending Act of 1922 para (ivC) was also amended. Before the amendment, this paragraph provided that in a suit to obtain a declaratory decree or order where a consequential relief was prayed, the value should be according to the value of the relief sought by the plaintiff. The Amending Act inserted the Proviso to the effect that in a suit coming under this paragraph in a case where the relief sought is with reference to immovable property the valuation shall not be less than half the value of the immovable property calculated in the manner provided for by paragraph (v). There the Legislature expressly provided that the method of calculation was to be in accordance with para (v) but in adding para (ivA) no such direction was given. The court-fee is to be calculated on the amount or the value of the property and to give the wording of para (ivA) its plain meaning the valuation must be the valuation based on the market value of the property at the date of the plaint. (emphasis supplied)"
In Navaraja v. Kaliappa Gounder, (1967) 80 MLW 19 (SN), the learned Single Judge noted that in the earlier suit, the properties were valued at Rs. 4000, referred to section 40(1) of the Madras Court-fees and Suits Valuation Act, 1955, which is pari materia to the section 40 of the Act and observed:
"...that as the decree itself specified the value of the property it will fall within the language of section 40(1), namely, the amount or value of the property for which the decree was passed and ordered that the court-fee has to be paid calculated on the sum of Rs. 4000, which is the value given in the decree, and not the market value of the properties on the date of the filing of the plaint. (emphasis supplied)"
In Arunachalathammal v. Sudalaimuthu Pillai, (1968) 83 MLW 789, another learned Single Judge examined the correctness of order passed by the Subordinate Judge, Tirunelveli, who had allowed the plaintiff to pay the
court-fee for the cancellation of settlement deed on the value of the document i.e. Rs. 3500. While dismissing the revision filed by the defendants, the learned Judge referred to section 40(1) of the Madras Act, distinguished the Full Bench judgment in Kutumba Sastri v. Sundaramma, (supra) and observed:
"It will be seen that the section provides for suits (1) relating to cancellation of a decree for money, (2) cancellation of a decree for other property having a money value, and (3) cancellation of other document which purports or operates to create, declare, assign, limit or extinguish rights in moveable or immoveable property. The sub-section provides that fee shall be computed on the value of the subject-matter of the suit. Then it proceeds to state how such value should be calculated. It provides that if the whole decree is sought to be cancelled, the amount or value of the property for which the decree was passed should be taken into account. In the case of other document which purports or operates to create, declare, assign, limit or extinguish rights in moveable or immoveable property, the value shall be deemed to be the value of the property. It is not clear as to whether the words "the amount or value of the property for which the decree was passed" are applicable to the cancellation of a document which creates or declares rights in movable or immoveable property. In the case of suits for cancellation of either documents, apart from suits for cancellation of a decree for money or other property, the above clause would be certainly applicable. This would mean that in the case of suits for cancellation of other documents, the value of the subject-matter of the suit shall be deemed to be the amount for which the documents was executed. It was submitted on behalf of the defendants that even in the case of a suit for cancellation of other documents, the value shall be deemed to be the value of the property. But this contention would ignore the effect of the words "value of the property for which the decree was passed". Even conceding that the value of the property should be taken into account in suits for cancellation of other documents, there are two modes provided for to compute the value of the subject-matter of the suit, (1) the value of the property and (2) the amount for which the document was executed."
Mr. Venugopalachari, learned Counsel for the petitioners, submitted that this view is opposed to the one taken in the decision in Kutumba Sastri v. Sundaramma where the Full Bench held that in a suit for cancellation of a deed of conveyance the valuation must be the valuation based on the market value of the property at the date of the plaint. The Full Bench was considering the question as to the Court-fee payable in a suit for cancellation of a deed of conveyance and for possession of the property covered by the deed. The court held that the plaintiff should value his relief in accordance with the provisions of section 7(4)(A), and not according to section 7(V) of the old Court-Fees Act, 1870. After referring to the difference of opinion between the various decisions, the Full Bench preferred the view taken in Bali Reddi v. Khatifulal Sab, 59 Mad 240, followed in Venkatakrishniah v. Ali Sahib, 48 LW 277. Section 7(4A), of the old Act is slightly differently worded and it runs as follows:
"In a suit for cancellation of a decree for money or other property having a money value, or other document securing money or other property having such value, according to the value of the subject-matter of the suit, and such value shall be deemed to be-if the whole decree or other document is sought to be cancelled, the amount or the value of the property for which the decree was passed or the other document executed, if a part of the decree or other document is sought to be cancelled, such part of the amount or value of the property.
It will be seen that the above section relates to a suit for cancellation of a decree for money or other property having a money value, or other document securing money or other property having such value. There was some doubt whether the third part of the section relating to either document securing money would include sales. In Balireddy v. Abdul Sattar, Venkatasubba Rao, J. referring to his earlier decision in Doraiswami v. Thangavelu held that sale deeds would come within the meaning of this section. Whether this sub-section includes sale deeds or need not detain us, as section 40(1) of the Madras Act XIV of 1955 is differently worded and there can be no doubt that it brings within its purview sale deeds as it relates to other documents which purports or operates to create, declare, assign, limit or extinguish any right in moveable or immoveable property, section 7(ivA) of the old Act states that the value be deemed to be "if the whole decree or other document is sought to be cancelled, the amount or the value of the property for which the decree was passed or the other document executed". The same words are used in section 40(1) of the New Act. In construing this sub-clause in section 7(ivA) of the old Act, the Full Bench pointed out in the decision cited above that the suit within the meaning of the above section should be valued according to the value of the property, unless there is an indication to the contrary, must mean its market value. It may be noted that the court was considering the value of the property and does not appear to have taken note of the words "the other document executed".
As already pointed out, section 7(ivA) of the old Act as well as
section 40(1) of the present Act deal with suits for cancellation of a decree for money, cancellation of a decree for other property having a money value and suit for cancellation other document. In the case of other documents, the clause "the amount or the value of the property for which the decree was passed" cannot be held to be applicable and the only clause that can be properly applied is only the value for which the document was executed. In the third category in section 40(1), to the words other document, the words `which purports or operates to create, declare, assign, limit or extinguish' rights in moveable or immoveable property are included. Obviously in suits for cancellation of other documents referred to in section 40(1) of the New Act the valuation should be the value of the other document executed. In Balireddy v. Abdul Satar the court refers to the section which says that the value of the subject-matter shall be deemed to be the amount for which the document is executed. But it confined its discussion to the actual value of the property and held that it referred only to the market value. This decision also does not refer to the valuation of the document on the basis of the amount for which the document is executed. (emphasis supplied)
In Appikunju Meerasayu v. Meeran Pillai (supra), the learned Single Judge of Kerala High Court relied on the judgment of Madras High Court in Narasamma v. Satyanarayana, MANU/TN/0250/1951 : AIR 1951 Mad 793 and observed:
"As I have pointed out earlier, the emphasis in section 40(1) of the Court-Fees Act is regarding the subject-matter of this suit and in respect of that subject-matter which admittedly is immovable property it will have to be valued on the amount or valued as the property which was no doubt covered by the decree in O.S. 21/1125. But the value or amount must certainly be the market value as on the date of the filing of the suit."
The same view was reiterated by another learned Single Judge of the Kerala High Court in Uma Antherjanam v. Govindaru Namboodiripad, (supra).
In Sengoda Nadar v. Doraiswami Gounder, (supra), the learned Single Judge of Madras High Court referred to earlier judgments but disagreed with the view expressed by the other learned Single Judges in Navaraja v. Kaliappa Gounder, (supra) and Arunachalathammal v. Sudalaimuthu Pillai (supra) and followed the ratio of Full Bench judgment by recording the following observations:
"With respect, I need hardly add that this is not the correct reading of the Full Bench decision. He has concluded by stating that obviously in suits for cancellation of "other documents" referred to in section 40(1) of the present Act, the valuation should be the value of the other document executed. I have already pointed out that in the documents just as in the case of decrees, the distinction is between those that dealt with money and those that dealt with property. The amount mentioned in the decree or the document is relevant only when the question is with regard to the decree for money or document securing money. But in the case of decrees or documents dealing with property of money value, the value of the subject-matter of the suit should be computed on the value of the property for which the decree was passed or the document was executed. I need not repeat that the valuation in respect of the property dealt with by the decree or document should be the market value and such a market value should be as on the date of suit."
In S. Krishna Nair v. N. Rugmoni Amma (supra), another learned Single Judge followed the ratio of Sengoda Nadar v. Doraiswami Gounder (supra) and held that in a suit for cancellation of decree, the property is to be valued under section 40(1) of the Tamil Nadu Court Fees and Suits Valuation Act, 1955 and the court fee is required to be paid on the market value of the property as on the date of the plaint.
In Krishnan Damodaran v. Padmanabhan Parvathy (supra), the Division Bench of Kerala High Court reiterated the views expressed in Kutumba Sastri v. Sundaramma (supra); Appikunju Meerasayu v. Meeran Pillai (supra) and Sengoda Nadar v. Doraiswami Gounder (supra) and held that court-fee is payable on the market value of the property covered by the document and not on the basis of the valuation given in the document.
In P.K. Vasudeva Rao v. Hari Menon (supra), the Division Bench of the Kerala High Court held as under:
"True, as contended for on behalf of the plaintiff-revision petitioner, section 40 nowhere uses the expression `market value'. But it is clear therefrom that the legislative intent is to levy court-fee on the just equivalent in money of the `other property' comprised in the decree or portion thereof sought to be set aside; or dealt with in the `other document' or part thereof sought to be cancelled. The section opens by saying that `in a suit for cancellation of a decree for money or other property having a money value' (emphasis supplied) `fee shall be computed on the value of the subject-matter of the suit'. `Money value' of a property is its worth in terms of the currency of the land or in other words, is such money-equivalent thereof in open market; and not any amount less than that as where it is overvalued at a fancy-price. It cannot be that when, what is sought to be cancelled is a decree or part thereof for `other property', i.e., property other than money, the value of such property for computation of court-fees is its `money-value', and when, what is sought to be cancelled is a document or part thereof in respect of `other property', the value of such property for such computation is not its `money-value'. Value of the subject-matter, namely, value of the `other property' in both cases is its money-value."
The object of the second and the third paras in sub-section (1) of section 40 is not to introduce any fiction but to provide for two situations, namely, (i) where the decree or the document as a whole is sought to be cancelled and (ii) where only part thereof is sought to be cancelled. In the first situation, the value of the subject-matter is the amount for which the decree was passed or the document was executed; or the value of the property concerning which the decree was passed or the document was executed. In the second class of cases, the value of the subject-matter of the suit is such part of the amount for which the decree was passed or the document was executed, in respect of which part, the decree or the document is sought to be cancelled; or the value of such part of the property concerning which the decree was passed or the document was executed, in respect of which part, the decree or the document is sought to be cancelled."
Therefore, it was laid down that, section 40(1) has to be read as a whole. So read: (A) when the suit is for cancellation of a decree or other document for money, then the value of the subject-matter of the suit will be:-(i) the whole amount for which the decree was passed or the document was executed, if what is sought to be cancelled is the whole of the decree or the whole of the document; and (ii) such part of the amount for which the decree was passed or the document was executed, if only part of the decree or part of the document is sought to be cancelled; (B) when the suit is for cancellation of a decree or other document for a property having money-value, then, the value of the
subject-matter of the suit will be:- (i) if the whole of the decree or the document is sought to be cancelled - the value of the property covered by the decree or the document; and (ii) if only part of the decree or of the document is to be cancelled; value of such part of the property in respect of which the decree was passed or the document was executed and to which extent such decree or such document is to be cancelled. Court was not impressed with the submission that there is a distinction between the expressions 'the value of the property for which the decree was passed or other document was executed' and 'the value of the property in respect of which the decree was passed or other document was executed' for the purpose of computation of court-fees. The scheme of section 40 is to make court-fees leviable on the sum of money or portion thereof, when what the plaintiff seeks is to get rid of his obligation and liability therefore or part thereof under a decree passed or a document executed by cancellation thereof, and on the money-equivalent of the property or portion thereof, when what he seeks to get rid of is his obligation and liability in relation to that property or portion thereof under a decree passed or a document executed in respect of it by cancellation thereof.
In R. Rangiah v. Thimma Setty, (1963) 1 Mys LJ 67, the Division Bench of Mysore High Court interpreted section 4(iv)(A) of the Mysore Court-Fees Act, which is substantially similar to section 40 of the Act and held that:
"Now, one thing which is very clear from the paragraphs 1 & 2 of section 4(iv)A is that in a suit brought for the cancellation of a document executed for the purpose of securing property, the Court Fee payable is on the value of such property. Although those paragraphs do not refer in terms to the market value of the property, as some of the other parts of the Act do, I have no doubt in my mind that the word `value' occurring in those paragraphs has reference to no other value than the market value. The word `value' when it occurs in an enactment like the Court Fees Act, has to my mind, particularly known and definite meaning. That word has reference to the price which the property will fetch when exposed to the test of competition."
It was also held that the counsel had to admit that the word 'value' occurring in the first paragraph would have to be understood as the market value if paragraphs 2 and 3 did not exist in section 4(iv)A. If, therefore, the word 'value' occurring in the first paragraph means market value, I see nothing in paragraphs 2 and 3 on which Mr. Gopivallabha Iyengar strongly relied which can persuade me to take the view that the word 'value' occurring in the first paragraph which, as ordinarily understood, is the market value, should be understood differently.
Paragraph 2 does no more than to merely provide that, if a document is sought to be cancelled in its entirety, the Court-Fee is payable on the value of the whole of the property in respect of which the document is executed. Likewise paragraph 3 merely provides that where the cancellation sought is a partial cancellation, Court Fee is payable only on the value of the property in respect of which cancellation is sought. It is for that purpose that the words "value shall be deemed to be" are used by the Legislature in the first paragraph of the clause and not for the purpose of assigning to the word `value' occurring in the first paragraph a meaning different from that which has to be ordinarily given to it.
It is no doubt true that the second paragraph of section 4(iv)A directs that the Court-Fee payable in a suit brought for the cancellation of a document is the Court-Fee on the value of the property 'for which' the document was executed. Ordinarily the expression 'for which' occurring in that paragraph might have justified the interpretation that the amount on which the Court-Fee has to be paid is the amount specified in the document. But, that, that would not be correct way of understanding those words occurring in paragraph 2 of that clause is clear from the fact that section 4(iv)A does not provide merely for cancellation of a document executed for a specified consideration such as a sale deed, but also provides for the payment of Court Fee even in suits brought for cancellation of other documents such as a deed of settlement, a gift deed or a trust deed. In the latter category of cases it would not be appropriate to regard those documents as executed for a consideration or a specified amount and those cases would not be cases in which there would be any value 'for which the document is executed.
The second paragraph which requires the payment of Court-Fee on the value of the property 'for which' the document was executed, does not, when properly understood, direct the payment of such Court-Fee on the value for which the document was executed, but on the value of the property for which it was executed. In other words, the words 'for which' occurring in that paragraph do not refer to the value but to the property to which the document relates. The words 'for which occurring in that paragraph, in my opinion, mean 'for securing which', so that what that paragraph directs is the payment of Court-Fee on the value of the property for securing which the document is executed.
That, that is the correct interpretation is indicated by the word 'securing' occurring in the first paragraph of the clause in the context of a document of which cancellation is sought. It therefore follows that what is relevant for the purpose of section 4(iv)A is not the value of the property specified in the document but its real and actual value when the suit is brought. It is on that value that the Court-fee has to be paid if the suit is for the cancellation of a document recording a transaction involving such property.
In Pachayammal v. Dwaraswamy Pillai (supra), another Division Bench of Kerala High Court interpreted sections 7 and 40 of the Act and held:
"Section 7 of the Act though deals with determination of market value, it starts with a saving clause. A reading of section 7(1) makes it clear that if there is a specific provision in the Act for valuing the suit, the
sub-sections (2) to (4) of section 7 can have no application. According to the counsel for the petitioners, section 40 is an independent provision for valuation of suits for cancellation of decrees and documents and in view of section 7(1), market value of the property is not a criteria at all. Whenever market value of the property is to be taken into account, it is specifically stated in the statute. Sections 25, 27, 29, 30, 37, 38, 45 & 48 etc., specifically provide that market value of the property involved in the suit is to be taken as basis for valuation. But, the word 'market' is conspicuously absent in section 40. When the section is plain and unambiguous, courts should not venture to add words to it to give an entirely different scope to the said provisions never intended by the legislature. Therefore, it was argued that concept of "market value of the property' cannot be brought into section 40. Learned Counsel invited our attention to the decisions of the Apex Court in Gurudevdatta VKSSS Maryadit v. State of Maharashtra, MANU/SC/0191/2001 : (2001) 4 SCC 534 (Paragraph 26) and Padma Sundara Rao (Dead) v. State of Tamil Nadu, MANU/SC/0182/2002 : (2002) 3 SCC 533 (Paragraphs 14 and 15). It is true that when the words of a statute are clear, plain or unambiguous, i.e., they are reasonably susceptible to only one meaning, the courts are bound to give effect to that meaning irrespective of consequences. The rule stated by TINDAL, C.J. in Sussex Peerage case, (1844) 11 Cl & F 85 (143) is in the following form: "If the words of the statute are in themselves precise and unambiguous, then no more can be necessary than to expound those words in their natural and ordinary sense. The words themselves do alone in such cases best declare the intent of the lawgiver".
Court observed that here, the question is what is clearly stated in section 40 as the criteria for valuation of suit filed for cancellation of a document. section 40 of the Act mandates that if a suit is filed for cancelling a document which creates, assigns or extinguishes the right, title or interest in an immovable property, if the whole document is to be cancelled, the value of the property for which the document was executed and if plaint is only to cancel part of the document, such part of the value of property for which document was executed is the basis for suit valuation. Therefore, value depends on the value of property for which document was executed and sought to be cancelled and not the value mentioned in the document. Here, a gift deed is sought to be cancelled. Then on a plain meaning of section 40, suit should be valued at the value of the property for which gift deed was executed and not the value of the document or value mentioned in the document. If a gift deed is executed out of love and affection, which is a valid consideration, suit valuation depends upon not on estimation of value of love and affection or null value, but, on the value of the property covered by the gift deed. Then the question is what is the value of property at the time of filing the suit. In legal terms value of property means market value of property and when valuation is considered with regard to suit valuation, it can only be market value of property at the time of filing the suit and nothing else. Section 7(1) clearly states that except otherwise provided, court-fee payable under the Act depends on the market value determined on the date of presentation of plaint. No contrary indication is made in section 40.
In Smt. Narbada v. Smt. Aashi, MANU/RH/0040/1987 : AIR 1987 Raj 162, the learned Single Judge of Rajasthan High Court followed the ratio of the Division Bench of Kerala High Court in P.K. Vasudeva Rao v. Hari Menon (supra) and held that in a suit for cancellation of decree, the court-fee is required to be paid on the market value of the property.
In Andalammal v. B. Kanniah, (1971) II MLJ 205, the learned Single Judge considered the question relating to court-fee in the context of a suit filed for cancellation of a settlement deed on the ground that the same had been procured by fraudulent misrepresentation. In the settlement deed, the property was valued at Rs. 10,000. The learned trial Court held that the suit should be valued on the market value of the property as on the date of plaint and not on the basis of the value of suit in the settlement deed and accordingly directed the plaintiff to pay deficit court-fee after furnishing the market value of the property. The learned Single Judge referred to section 40 of the Madras Act and held:
"It is important to mark the words "the amount or value of the property for which the document was executed". If the Legislature had said "the amount or value of the property in respect of which the document was executed", it would be reasonable to hold that the basis shall be the market value of the property, regardless of what the document says it is. But as the section refers to "the amount or value of the property for which the document was executed", the legislative intent is clear that the basis for the purpose of valuation shall be the amount or value mentioned in the document itself. Evidently, the intention of the Legislature is that when a person seeks to cancel a document executed by himself, he shall pay Court-fee upon the value which he has chosen to put upon the property in the document he seeks to cancel. The word "value" ordinarily connotes the price set on a thing, and when the Legislature directs that the value of the subject-matter shall be deemed to be the amount or value of the property for which the document was executed, I see no warrant for ignoring the plain language or the section and holding that the value shall be the market value of the property. In fact, the Legislature has expressly used the words "market value" in twelve other sections of the Act in contra distinction to the word "value" used in section 40(1) of the Act. I, therefore, hold that the Court-fee paid by the petitioner upon the basis of the value of the property as given in the settlement deed is correct."
In Allam Venkateswara Reddy v. Golla Venkatanarayana, MANU/AP/0093/1975 : AIR 1975 AP 122, a learned Single Judge of Andhra Pradesh High Court construed section 37 of the Andhra Pradesh Court-fees and Suits Valuation Act, which is pari materia to section 40 of the Act, and held:
"Section 37(1) contemplated two kinds of suits, viz., suits for cancellation of decrees, whether they are for money or for property having a money value and suits for cancellation of documents creating or extinguishing rights whether in money, movable or immovable property. It is stated therein that for the purpose of payment of court-fee in the suit the fee shall be computed on the basis of the value of the subject-matter of the suit and that such value shall be deemed to be the one indicated in clause (a) of section 37(1) wherein it is mentioned that if the whole decree or other document is sought to be cancelled, the amount or value of the property for which the decree was passed or other document was executed shall be deemed to be the value for computation of court-fee . From this it is very clear that for cancellation of a document regarding a property the value shall be deemed to be the amount for which the document regarding a property the value shall be deemed to be the amount for which the document sought to be cancelled was executed with regard to the property. In the present case, the two sale deeds in question were executed for a sum of Rs. 18,000. Therefore, the court-fee has to be paid on that amount and not on the present market value of the properties which are the subject-matter of the two sale deeds. A reading of section 37 does not show that the court-fee has to be computed on the basis of the present market value of the document sought to be cancelled."
Finally Court laid down as under:
"In view of our analysis of the relevant statutory provisions, it must be held that the judgments of the Division Bench of Madras High Court and of the learned Single Judges in Venkata Narasimha Raju v. Chandrayya (supra); Navaraja v. Kaliappa Gounder (supra); Arunachalathammal v. Sudalaimuthu Pillai (supra) and Andalammal v. B. Kanniah (supra) as also the judgment of the learned Single Judge of Andhra Pradesh High Court in Allam Venkateswara Reddy v. Golla Venkatanarayana (supra) lay down correct law. In the first of these cases, the Division Bench of Madras High Court rightly observed that when there is a special rule in the Act for valuing the property for the purpose of court-fee, that method of valuation must be adopted in preference to any other method and, as mentioned above, section 40 of the Act certainly contains a special rule for valuing the property for the purpose of court-fee and we do not see any reason why the expression `value of the property' used in
section 40(1) should be substituted with the expression `market value of the property'.
The judgment of the learned Single Judge of Madras High Court in Balireddi v. Khatipulal Sab (supra), which was approved by the Full Bench of that Court in Kutumba Sastri v. Sundaramma (supra) turned primarily on the interpretation of section 7(ivA) of the Court Fee Act as amended by Madras Act which refers to the value of the property simpliciter and the Court interpreted the same as market value. Neither the learned Single Judge nor the Full Bench were called upon to interpret a provision like section 40 of the Act. Therefore, the ratio of those judgments cannot be relied upon for the purpose of interpreting section 40 of the Act. In Arunachalathammal v. Sudalaimuthu Pillai (supra), the learned Single Judge rightly distinguished the judgment of the Full Bench by making a pointed reference to the language employed in section 40(1) of the Madras Act No. XIV of 1955, which is identical to section 40 of the Act. In Sengoda Nadar v. Doraiswami Gounder (supra) and S. Krishna Nair v. N. Rugmoni Amma (supra), the other learned Single Judges did not correctly appreciate the ratio of the judgment of the coordinate Bench in Arunachalathammal v. Sudalaimuthu Pillai (supra) and distinguished the same without assigning cogent reasons. We may also observe that if the learned Single Judges felt that the view expressed by the co-ordinate Bench was not correct, they ought to have referred the matter to the larger Bench. The judgments of the Division Benches of Kerala High Court in Krishnan Damodaran v. Padmanabhan Parvathy (supra), P.K. Vasudeva Rao v. Hari Menon (supra) and Pachayammal v. Dwaraswamy Pillai (supra) and of the learned Single Judges in Appikunju Meerasayu v. Meeran Pillai (supra) and Uma Antherjanam v. Govindaru Namboodiripad (supra) also do not lay down correct law because the High Court did not appreciate that the legislature has designedly used different language in section 40 of the Act and the term 'market value' has not been used therein. The same is true of the judgments of the learned Single Judges of Mysore and Rajasthan High Courts noticed hereinabove."
In the result, the appeal was allowed. The impugned order of the learned Single Judge of Kerala High Court as also the order passed by the trial Court directing the appellant to pay court-fee on the market value of the property, in respect of which the sale deed was executed by respondent No. 1 in favour of respondent No. 2, was set aside. The trial Court was directed to proceed with the case and decide the same in accordance with law. The parties were left to bear their own costs.
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