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Saturday, February 22, 2014

Sec.37 of A.P.C.F&S.V. Act - court fee on cancellation of sale deed - Court fee has to be paid on the value of the document but not on the value of market present at the time of filing of suit - as there is a specific word " for which" the document was executed - Apex court set aside the judgments of High court and lower courts =Polamrasetti Manikyam & Anr. .. Appellants Versus Teegala Venkata Ramayya & Anr. .. Respondents = 2014(Feb.Part) judis.nic.in/supremecourt/filename=41238

Sec.37 of A.P.C.F&S.V. Act - court fee on cancellation of sale deed - Court fee has to be paid on the value of the document but not on the value of market present at the time of filing of suit - as there is a specific word " for which" the document was executed - Apex court set aside the judgments of High court and lower courts =

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.

  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.       =

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. =
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.”

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.
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.

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.
2014(Feb.Part) judis.nic.in/supremecourt/filename=41238
               K.S. RADHAKRISHNAN, VIKRAMAJIT SEN                                           

REPORTABLE


                        IN THE SUPREME COURT OF INDIA
                        CIVIL APPELLATE JURISDICTION
                     CIVIL APPEAL NOS. 2456-2457 OF 2014
                [Arising out of SLP (C) Nos.16353-54 of 2012)




      Polamrasetti Manikyam & Anr.            .. Appellants


                                   Versus


      Teegala Venkata Ramayya & Anr.          .. Respondents






                               J U D G M E N T






      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.






                                                    eard Hear……………………………..J.
                                         (K. S. Radhakrishnan)






                                                    eard Hear……………………………..J.
                                        (Vikramajit Sen)
      New Delhi,
      February 19, 2014.

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