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2020 Supreme(Kar) 1373

IN THE HIGH COURT OF KARNATAKA AT BENGALURU (DHARWAD BENCH)
Suraj Govindaraj, J.
Husensab - Appellant
Versus
Basayya - Respondent
Civil Revision Petition No. 100033 of 2019
Decided On : 30-09-2020

Advocates Appeared:
Mrutyunjay Tata Bangi, Advocate

The plaintiff cannot artificially inflate the valuation of the suit to change the jurisdiction of the court. The valuation for specific performance should be based on the consideration amount in the agreement of sale, and any additional items like the cost of issuance of legal notice should not be included to increase the valuation.

Headnote:

Valuation of Suit - Specific Performance - Karnataka Court Fees and Valuation Act, 1958 - Section 50 - The court held that the plaintiff cannot artificially inflate the valuation of the suit to change the jurisdiction of the court. The valuation for specific performance should be based on the consideration amount in the agreement of sale, and any additional items like the cost of issuance of legal notice should not be included to increase the valuation. The court also emphasized that the court fees act needs to be strictly followed to ascertain the jurisdiction of the court. The court set aside the order of the trial court and remanded the matter for necessary orders in compliance with the provisions of Order VII Rule 10A of the CPC.

Fact of the Case:

The petitioner sought to set aside the order rejecting the application filed under Order VII Rule 10 of the CPC, contending that the suit was overvalued and filed in the wrong forum. The plaintiff had valued the suit at Rs.5,01,000/-, including the cost of issuance of a legal notice, to bring it within the pecuniary jurisdiction of the Principal Senior Civil Judge, Jamkhandi.

Finding of the Court:

The court found that the plaintiff cannot artificially inflate the valuation of the suit to change the jurisdiction of the court. The valuation for specific performance should be based on the consideration amount in the agreement of sale, and any additional items like the cost of issuance of legal notice should not be included to increase the valuation. The court set aside the order of the trial court and remanded the matter for necessary orders in compliance with the provisions of Order VII Rule 10A of the CPC.

Issues: The issues involved were whether the plaintiff can artificially inflate the valuation of the suit to change the jurisdiction of the court, whether the valuation for specific performance should be based on the consideration amount in the agreement of sale, and what would be the role of the court in the event of an artificial increase in the valuation altering the jurisdiction of the court.

Ratio Decidendi: The plaintiff cannot artificially inflate the valuation of the suit to change the jurisdiction of the court. The valuation for specific performance should be based on the consideration amount in the agreement of sale, and any additional items like the cost of issuance of legal notice should not be included to increase the valuation.

Final Decision: The court set aside the order of the trial court and remanded the matter for necessary orders in compliance with the provisions of Order VII Rule 10A of the CPC.

JUDGMENT

Suraj Govindaraj, J. - The petitioner is before this Court seeking for setting aside the Order dated 19.02.2019 passed on I.A.No.V by the Principal Senior Civil Judge, Jamkhandi in O.S.No.74/2012 rejecting the application filed under Order VII Rule 10 of the Code of Civil Procedure, 1908 ('the CPC' for short) and consequently allow the said application.

2. The case of the petitioner is that;

    2.1 Respondent No.1 had instituted a suit for specific performance of agreement of sale dated 27.06.2006 alleging that the deceased husband of the defendant No.1 i.e., respondent No.2 herein, had executed an agreement of sale agreeing to sell the suit schedule property for a sum of Rs.5,00,000/- and received an earnest money of Rs.4,50,000/- at that time, leaving a balance of Rs.50,000/- to be paid at the time of registration of the sale deed.

      2.2 In regard thereto a notice was issued on 14.07.2010 calling upon the deceased husband of the 1st defendant to execute the sale deed. However, by the time the Suit was filed, the deceased husband of the 1st defendant had already executed a sale deed in respect of the middle portion of the property on 28.07.2009 in favour of defendant No.4 i.e., respondent No.6 herein and defendants No. 2 and 3 had instituted a suit for partition and separate possession in O.S.No.50/2010. Hence, all of them were arrayed as parties in the Suit when filed.

        2.3 At the time of filing of a suit for specific performance, the Plaintiff respondent No.1 herein had valued the Suit at Rs.5,01,000/-, Rs.5,00,000/- being the consideration mentioned in the agreement of sale and Rs.1,000/- being the cost of issuance of notice. Hence the same came to be instituted before the Principal Senior Civil Judge, Jamakhandi on account of the fact that any suit above Rs.5,00,000/- had to be instituted in such Court.

          2.4 Defendant No.3 petitioner herein had filed a written statement contending inter alia that the Suit is over-valued, the proceedings have been filed in a wrong forum inasmuch as the valuation of the Suit could only be Rs.5,00,000/- being the valuation of the property, in the agreement of sale. The Plaintiff has inflated the valuation by adding Rs.1,000/- as cost of legal notice so as to bring it within the pecuniary jurisdiction of the Principal Senior Civil Judge, Jamakhandi. It is for this reason, the petitioner-defendant No.3 had also filed an application in I.A.No.V under Order VII Rule 10 of the CPC for return of the plaint to be presented before the appropriate Court having pecuniary jurisdiction.

            2.5 The said application was opposed by the Plaintiff therein and the trial Court by its Order dated 19.02.2019 rejected /dismissed the application by holding that it was open to the Plaintiff to value the Suit and make payment of court fee thereon. The plaintiff-respondent No. 1 had valued the Suit at Rs.5,01,000/- and made payment of court fee thereon.

              2.6 The Court further held whether the Plaintiff was entitled to the reliefs or not could be decided after trial, since the Plaintiff had paid the court fee as per the valuation made and the said valuation would require it to be filed before the Principal Senior Civil Judge, there was nothing wrong in the same and dismissed the said application under Order VII Rule 10 of CPC.

                2.7 It is aggrieved by the same that the petitionerdefendant No.3, who was the applicant, is before this Court.

                3. Sri. Mrutyunjaya Tata Bangi, learned counsel appearing for the petitioner, would submit that;

                  3.1 The Plaintiff has deliberately altered the valuation so as to be able to file the same before the principal Senior Civil Judge Jamkhandi, since the said amount of Rs.1,000/- towards cost of legal notice if were not be included, the same would not have come before the said Court. This he submits is a kind of forum hunting or choosing of the forum, which needs to be deprecated by this Court.

                    3.2 He submits that by overvaluing the Suit, the Suit has been filed before the Principal Senior Civi

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