Whether Ad-Valorem Court Fees Of Entire Sale Consideration Amount Is Required To Be Paid In Plea Seeking Cancellation Of Agreement To Sell, P&H HC Answers

The Punjab & Haryana High Court has made it clear that when the suit is only for rescinding the agreement to sell & forfeiting earnest money, the court fees should only be on the earnest money, not the full sale consideration.Justice Sureshwar Thakur and Justice Sudeepti Sharma said, "court fees ad valorem to the asked for forfeited earnest money, but is required to be affixed on the plaint, than court fees ad valorem to the entire sale consideration, which however has not yet passed from the defendant to the plaintiff, rather becoming insisted to be affixed on the plaint."The Court was hearing a reference since there was a difference of opinion on the issues, some of the Benches have taken a view that if the plaintiff seeks declaration to the effect that the agreement to sell has come to an end, thereupon, he is required to pay ad-valorem court fee on the total sale consideration, whereas, some Benches have reached at a conclusion that agreement to sell is not an instrument of title, and, therefore, ad-valorem court fee is not payable on the plaint.In the main case the petitioner had filed a civil revision seeking to quash an order dated passed by the Additional Civil Judge ( Senior Division), who directed him to pay ad-valorem court fees on a civil suit where they sought cancellation of agreement to sell. The civil suit was filed under 27 of the Specific Relief Act,1963, seeking to rescind a contract/agreement to sell executed on 07/05/2010 for land measuring 10 kanals 1 marla and the total sale consideration was over Rs. 79.4 lakh.The main question was whether the petitioners were liable to pay ad-valorem court fees on the sale consideration amount when seeking cancellation of an agreement to sell.It was argued that the petitioner only sought to rescind the contract due to the respondent's failure to perform contractual obligations and was not seeking a declaration that the contract was null and void.In the Trial Court the respondent had filed an application under Order 7 Rule 11 CPC, arguing that ad- valorem court fees must be paid on the agreement's total sale consideration.Hence, the Petitioners were directed to pay court fees on Rs. 79.4 lakh.After hearing the submissions, the Court noted that the Petitioner did not claim the agreement was void or illegal but only sought rescission u/s 27 of SRA. The bench observed that, "if in an suit for declaration becoming filed by the non executant, vis-a-vis the registered deed of conveyance or the agreement to sell, wherebys, he claims the rendition of a decree for quashing and setting aside the respectively drawn registered deed of conveyance or the agreement to sell, therebys, if he is in possession of the subject properties, therebys, he is not required to be affixing, on the said suit, court fees ad valorem to the subject property, as the said suit is a simpliciter suit for declaration without the consequential relief for possession."However, when in the said suit, the apposite non executant claims the consequential relief that possession of the subject property be delivered, thereupon, he is required to be affixing court fees ad valorem to the market value of the subject property, it added.The Court also clarified that "even if there is a deficiency in the affixing of ad valorem court fees, yet merely on the said ground the plaint cannot be rejected rather the said deficiency can asked to be made good at the time of the pronouncement of the decree. In other words, the same is a curable defect."Mr.G.C.Shahpuri,Advocate for the petitioners.Mr. Harmanjit Singh, Advocate for the respondent.Mr. P.P.Chahar, Advocate (Amicus Curiae).Title: Anil Kumar and Others v. Maninderbir SinghClick here to read/download the order

Whether Ad-Valorem Court Fees Of Entire Sale Consideration Amount Is Required To Be Paid In Plea Seeking Cancellation Of Agreement To Sell, P&H HC Answers

Aiman J. Chishti

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Whether Ad-Valorem Court Fees Of Entire Sale Consideration Amount Is Required To Be Paid In Plea Seeking Cancellation Of Agreement To Sell, P&H HC Answers

Aiman J. Chishti

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