Court Must Intervene When Party Tries To Undervalue Substantive Relief Sought In Plaint For The Purpose Of Paying Court Fees: MP High Court

The Gwalior Bench of Madhya Pradesh High Court held that the valuation of suits must be based on the relief sought and the substance of the plaint and not merely on the words used in the plaint.In doing so, the Court said that where a plaintiff attempts to under-value a suit, the Court has to intervene to ascertain whether the relief sought has real money value.Referring to Subhash Chand Jain Vs. Chairman, MPEB and Others (2001), Justice Milind Ramesh Phadke observed, “…the allegations in the plaint including the substantive relief claimed must be the basis for settling the Court fee payable by the plaintiff. But where the plaintiff attempts to under-value the plaint and reliefs, the Court has to intervene. In doing so, concept of real money value forms integral part of Court enquiry where relief sought has real money value, which can be objectively ascertained. In this connection, Sub-section (iv)(c) of Section 7 of the Act which relates to computation of court fees payable in certain suits, envisages that "to obtain a declaratory decree or order, where consequential relief is prayed.”As per the factual matrix of the case, the plaintiff had filed a suit for declaration and permanent injunction against the respondents alleging that defendant No.1 had rented out a shop to petitioner/plaintiff. After some time, defendants entered into an agreement to sell the disputed shop to plaintiff for a consideration of Rs. 11,05,000/- but in absence of mutation in favour of defendants, sale deed could not be executed. Petitioner and respondents with their consent had executed an agreement in which Rs. 8,55,000/- was paid to the petitioner and remaining amount of Rs.2,50,000/- was agreed to be paid after mutation at the time of execution of sale deed. A compromise was arrived at in property dispute between the family members of the defendants and the disputed property fell into the share of defendant No.1. However, the mutation was not done since the compromise decree cannot take effect until its registered. (Bhoop Singh Vs. Ram Singh (1996))Thereafter, the defendants were trying to sell the disputed shop. Therefore, the plaintiff had filed a suit for declaration and permanent injunction in which the defendant No. 1 had filed an application under Order 7 Rule 11 CPC wherein it was prayed that plaintiff be directed to pay court-fees on Rs. 11,05,000/-.The plaintiff responded to the application by stating that he did not file a suit for enforcement of contract but only declaration and injunction was sought regarding not selling the shop. Therefore, it was contended that paying any court fees is not necessary in the present matter. However, the trial Court allowed the application and directed the petitioner/plaintiff to pay court fees on the basis of valuation of Rs. 11,05,000/-. The counsel for the petitioner contended the relief mentioned in the plaint is that defendants should be directed not to alienate the disputed shop to any other person which as per agreement is in possession of the plaintiff. However, cognizance of such relief was not been taken while passing order of any kind of adjudication.It was further contended that the Trial Court accepted the suit as for specific performance of agreement and directed the petitioner to pay court fees on it. However, since the petitioner had no right to file suit for specific performance of agreement, he had filed a suit for declaration and permanent injunction. Thus, order directing the plaintiff to pay court fees on the basis of valuation of Rs. 11,05,000/- was not sustainable in the eyes of law.Countering the arguments advanced by the petitioner, the counsel for the Respondents No. 1 to 3 submitted that mere drafting of the plaint and words used in the plaint are not sufficient to decide the Court fee. The Court has to look into the relief sought for and the substance of the plaint. It was submitted that the allegations in the plaint including the substantive relief claimed must be the basis for settling the court fees payable by the plaintiff.After hearing the parties, the Court referred to Subhash Chand Jain Vs. Chairman, MPEB and others AIR 2001 M.P. 88 (FB) which had considered the question of valuation and court fees. Noting the observations in the aforesaid matter, the Court opined that where the plaintiff attempts to under-value the plaint and reliefs, the Court has to intervene. The Court further referred to Sub-section (iv)(c) of Section 7 of the Act which relates to computation of court fees payable in certain suits, envisages that "to obtain a declaratory decree or order, where consequential relief is prayed".The Court noted that in the present case, the petitioner had sought declaration for protection of possession on the basis of agreement to sell. Though not titled as a suit for specific performance, it carried real money value.“The relief for such declaration is an independent relief and connected with the relief of title, meaning thereby, the relief sought...

Court Must Intervene When Party Tries To Undervalue Substantive Relief Sought In Plaint For The Purpose Of Paying Court Fees: MP High Court

Anukriti Mishra

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