In a suit for cancellation of sale deed which was executed for a specified amount, the Court Fee has to be paid on that amount and not on the basis of the market value of the property at the presentation of the plaint. Section 37 of the Court Fees Act which deals with the suits for cancellation of decrees etc. if interpreted in the light of the expression “save as otherwise provided” used in Section 7 of the Court Fees Act, it becomes clear that the rule enshrined therein is a clear departure from the one contained in Section 7 read with Sections 24, 26, 28, 29, 34, 35, 42 and 45, which provide for payment of Court Fee on the market value of the property. Section 37 is stand alone provision, wherein the legislature has designedly not used the expression “market value of the property”. Section 37 of the Court Fees Act contains a special rule for valuing the property for the purpose of Court Fee and jurisdiction and thus the expression “value of the property” used in Section 37 cannot be substituted with the expression “market value of the property”.
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOS. 2456-2457 OF 2014
Polamrasetti Manikyam Vs Teegala Venkata Ramayya & Anr.
Citation;2014 (2) ALL MR92, SC 2014III AD (S.C.) 426, AIR2014SC1286, 2014(2) AKR 189, 2014 (103) ALR 687, 2014(2)ALT56, 2014(2)CTC458, 2014-2-LW534, 2014(2)SCALE523
Dated;February 19, 2014.
K. S. RADHAKRISHNAN, J.
1. Leave granted.
2. We are, in this case, concerned with the
interpretation of Section 37 of the Andhra Pradesh
Court Fees and Suits Valuation Act, 1956 (for short “the
Court Fees Act”) as to whether it authorizes the
valuation of the suit on the basis of the sale
consideration mentioned in the sale deed or to be
valued on the basis of the market value of the property
as on the date of presentation of the plaint for the
purpose of Court Fee and jurisdiction.
3. Learned Single Judge of the Andhra Pradesh High
Court in the impugned judgment placing reliance on the
Full Bench judgment of the Madras High Court in
Kolachala Kutumba Sastri v. Lakkaraju Bala
Tripura Sundaramma & Ors. AIR 1939 Mad. 462, and
the Division Bench Judgment of the Andhra Pradesh
High Court in Lakshminagar Housing Welfare
Association v. Syed Sami @ Syed Samiuddin &
Ors. (2010) 5 ALT 96, held that in a suit for
cancellation of sale deed, Court Fee has to be
determined on the market value of the property as on
the date of presentation of the plaint and not the value
shown in the registered sale deed, the legality of which
is under challenge in these appeals.
4. The Appellants/Plaintiffs filed O.S. No.114 of 2008
on 21.7.2008 before the Court of Junior Civil Judge,
Kothavalasa, seeking, inter alia, the following reliefs :-
“(a) to cancel the alleged sale deed dated
2.8.2002 which was got registered as
No.2496/05 by the Sub-Registrar,
Kothavalasa on dt. 30 July, 2005 as the
orders of District Registrar dt. 26.07.2005 as
it was obtained fraudulently;
(b) direct the defendants to pay the cost of the
suit.”
5. Value of the suit for the purposes of Court Fee and
jurisdiction was shown as the value of the deed to be
cancelled i.e. Rs.1 lakh. Court Fee of Rs.3,426/- was
paid under Section 37 of the Court Fees Act, deposited
vide Challan No.4239075 dated 29.7.2008. The
Appellants/Plaintiffs filed I.A. No.374 of 2008 under
Order IX Rule 1 and 2 CPC for grant of temporary
injunction restraining the Respondents therein from
interfering with peaceful possession and enjoyment of
the property and also filed I.A. No.375 of 2008 and
sought an order restraining the Respondents from
operating the sale deed until the disposal of the suit.
During enquiry in I.A. No.375 of 2008, the
Appellants/Plaintiffs got market value certificate dated
4.10.2002 as Exh.A-6 showing the market value of the
property as Rs.19,36,000/- by the year 2002 and
contended that the alleged sale for Rs.1 lakh was a
fraudulent transaction. The Respondents raised an
objection that the Civil Judge has no jurisdiction to
entertain the suit since the Plaintiff’s case is that the
market value of the property is more than Rs.1 lakh. It
was contended that for cancellation of sale deed, Court
Fee has to be calculated on the current market value,
but not as per value shown on the document. Reliance
was placed on the judgment of the Madras High Court
in Kolachala Kutumba Sastri (supra) and T.S.
Rajam Ammal v. V.N. Swaminathan & Ors. AIR
1954 Mad. 152, wherein it was held that in a suit for
cancellation of sale deed, Court Fee payable is on the
market value of the property involved as on the date of
the plaint and not on the consideration recited in it.
6. Learned Civil Judge vide his order dated
25.11.2008 took the view that the Court Fee has to be
calculated as per the market value on the date of
presentation of the plaint and not as per the value
shown on the document. Consequently, it was held
that the Court has no pecuniary jurisdiction to entertain
the suit and the plaint was returned under Order 7 Rule
10 CPC for presentation before the proper Court.
7. The Appellants/Plaintiffs, aggrieved by the said
order, filed C.M.A. No.2 of 2009 in the Court of the
Judge, Family Court-cum-District and Sessions Judge,
Vizianagaram. The appellate Court dismissed the
appeal vide its order dated 29.10.2009 holding that the
Court below has no jurisdiction to entertain the suit and
the plaint was correctly returned for presentation
before the appropriate Court holding that the Court Fee
has to be calculated as per the market value of the
property as on the date of presentation of the plaint
and not on the value shown in the registered sale deed.
8. The Appellant, aggrieved by the said order, filed
Civil Revision Petition No.2539 of 2010 before the High
Court of Andhra Pradesh, Hyderabad. The learned
Single Judge of the Andhra Pradesh High Court, as
already stated, placing reliance on the judgment of the
Madras High Court in T.S. Rajam Ammal (supra) and
also the Full Bench decision of the Madras High Court in
Kolachala Kutumba Sastri (supra) and also a Division
Bench judgment of the Andhra Pradesh High Court in
Lakshminagar Housing Welfare Association
(supra), took the view that under Section 37 of the
Court Fees Act, for cancellation of the sale deed the suit
has to be valued on the basis of the market value of the
property governed by the sale deed on the date of
presentation of the plaint for the purposes of Court Fee
and jurisdiction and not on the basis of sale
consideration mentioned in the sale deed. The
appellants then filed a review petition being Review
CRP No.6557 of 2010 seeking review of the judgment
based on the Judgment of this Court in Satheedevi v.
Prasanna and another (2010) 5 SCC 622. The review
petition was, however, dismissed on 19.1.2011.
Aggrieved by the same, these appeals have been
preferred.
9. We are, in this case, concerned with the
interpretation of Section 37 of the Court Fees Act, which
reads as follows :-
“37. 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 :-
(a) 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;
(b) If a part of the decree or other
document is sought to be cancelled, such
part of the amount or of the 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 for cancellation
of a decree within the meaning of this
section.”
10. When the matter came up for hearing, the learned
counsel for either side brought to our knowledge a
judgment of this Court in Satheedevi (supra) and
submitted that a similar issue came up for
consideration in the above-mentioned case while
interpreting Section 40 of the Kerala Court Fees and
Suit Valuation Act, 1959, which is pari materia with
Section 37 of the Andhra Pradesh Court Fees and Suits
Valuation Act, 1956. While interpreting the scope of
Section 40 of the Kerala Act, this Court had occasion to
examine the ratio laid down by Full Bench of the
Madras High Court in Kolachala Kutumba Sastri
(supra) and took the view that in the said the
interpretation of Section 7(iv-a) of the Court Fee Act, as
case, the Madras High Court was primarily concerned
with amended by the Madras Act, which refers to the
value of the property simplicitor and the Court
interpreted the same as market value. It was pointed
out that the Full Bench was not called upon to interpret
a provision like Section 40 of the Act. Consequently, it
was held that the ratio of that judgment cannot be
relied upon for the purpose of interpretation of Section
40 of the Act. While doing so, the Court also opined
that the Division Bench judgment of the Kerala High
Court in Krishnan Damodaran v. Padmanabhan
Parvathy 1972 KLT 774, P.K. Vasudeva Rao v. K.C.
Hari Menon AIR 1982 Ker 35, Pachayammal v.
Dwaraswamy Pillai 2006 (3) KLT 527 and the learned
Single Judge judgments in Appikunju Meerasayu v.
Meeran 1964 KLT 895 and Uma Antherjanam v.
Govindaru Namboodiripad 1966 KLT 1046 do not lay
down the correct law since the High Court had failed to
appreciate that the legislature has designedly used a
different language in Section 40 of the Act and the term
“market value” has not been used therein.
11. We have already indicated that Section 40 of the
Kerala Act and Section 37 of the Court Fees Act are pari
materia provisions. Consequently, the reasoning of
this Court in Satheedevi (supra) could be safely
applied when we interpret Section 37 of the Court Fees
Act.
12. In Satheedevi (supra), this Court while
interpreting Section 40 of the Kerala Act held as
follows :-
“17. 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.
18. 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 the 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.
19. 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 fee
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 the subject-matter
of challenge.
20. 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 the 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”.
13. Applying the above reasoning, this Court in
Satheedevi (supra) upheld the view expressed by
learned Single Judge of the Andhra Pradesh High Court
in Allam Venkateswara Reddy v. Golla
Venkatanarayana AIR 1975 AP 122 and the Division
Bench judgment of the Madras High Court in Venkata
Narasimha Raju v. Chaandrayya AIR 1927 Mad 825,
Navaraja v. Kaliappa Gounder (1967) 80 Mad LW 19
(SN) and Arunachalathammal v. Sudalaimuthu
Pillai (1968) 83 Mad LW 789 and ruled that those
judgments have laid down the correct law.
14. This Court in Satheedevi (supra), therefore, gave
its seal of approval to the judgment of learned Single
Judge of the Andhra Pradesh High Court in Allam
Venkateswara Reddy (supra), wherein learned Single
Judge took the view that in a suit for cancellation of sale
deed which was executed for a specified amount, the
Court Fee has to be paid on that amount and not on the
basis of the market value of the property at the
presentation of the plaint.
15. The Andhra Pradesh High Court in the impugned
judgment, while interpreting Section 37 of the Court
Fees Act, placed reliance on the Division Bench
judgment in Lakshminagar Housing Welfare
Association (supra), wherein the Bench, as already
indicated, placed reliance on the Full Bench judgment
of the Madras High Court in Kolachala Kutumba
Sastri (supra), though a reference was made to the
learned Single Judge Bench judgment in Allam
Venkateswara Reddy (supra). Since we are in
agreement with the reasoning in Satheedevi (supra),
which has given its seal of approval to the reasoning of
the learned Single Judge judgment of the Andhra
Pradesh High Court in Allam Venkateswara Reddy
(supra), the judgment of the Division Bench in
Lakshminagar Housing Welfare Association
(supra) is no more good law.
16. We are of the view, Section 37 of the Court Fees
Act, which deals with the suits for cancellation of
decrees etc. is not governed by other Sections of the
Court Fees Act, such as Section 7 and other related
provisions. If Section 37 of the Court Fees Act is
interpreted in the light of the expression “save as
otherwise provided” used in Section 7 of the Court Fees
Act, it becomes clear that the rule enshrined therein is
a clear departure from the one contained in Section 7
read with Sections 24, 26, 28, 29, 34, 35, 42 and 45,
which provide for payment of Court Fee on the market
value of the property. In that context, we are also of
the view that Section 37 is stand alone provision,
wherein the legislature has designedly not used the
expression “market value of the property”. Section 37
of the Court Fees Act, therefore, contains a special rule
for valuing the property for the purpose of Court Fee
and jurisdiction and we do not see any reason why the
expression “value of the property” used in Section 37
be substituted with the expression “market value of the
property”.
17. In such circumstances, we are inclined to set aside
the judgment of the High Court and allow these
appeals. Consequently, the orders passed by the
appellate Court as well as the High Court would stand
quashed. The trial Court is directed to proceed with
the suit in accordance with law and the declaration
made by this Court.
18. The Appeals are, accordingly, allowed. However,
there will be no order as to costs.
……………………………..J.
(K. S. Radhakrishnan)
……………………………..J.
(Vikramajit Sen)
New Delhi,
February 19, 2014.
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