JUDGMENT :

The petitioner is the 6th plaintiff in O.S.No.232 of 2013 of the Additional Sub Court-II, Kottayam. The suit was filed for realisation of amounts due from the defendants. The dispute was settled amicably, pursuant to a reference to the Lok Adalat under Section 89(1) (c) of the Code of Civil Procedure. Thereupon, Ext.P1 award, incorporating the terms of the settlement, was passed by the District Legal Services Authority, Kottayam. As per Clause 4.6 of the award, the court fee paid in the suit was to be returned to the petitioner and the other plaintiffs. Accordingly, the petitioner submitted Exts.P2 application seeking refund of an amount of Rs.5,042/- paid in excess of the court fee payable and P3, for refund of Rs.44,98,400/- paid towards court fee. By Ext.P4 certificate, an amount of Rs.41,83,512 was ordered to be refunded after deducting Rs.3,14,888/-. This original petition is filed aggrieved by the deduction of Rs.3,14,888/-, which according to the petitioner is without authority and hence, illegal.

2. Adv. Harish Abraham, learned Counsel for the petitioner, contended that Section 21 of the Legal Services Authorities Act, 1987 (‘the Act’, for short) read with Section 16 of the Court-Fees Act, 1870, makes it obligatory to refund the entire amount of court fee paid. To bolster the contention, reliance is placed on the decision in Vasudevan V. A. v. State of Kerala and others [AIR 2004 Kerala 43].

3. Learned Government Pleader contended that the practice being followed is to deduct 7% of the court fee, even in matters settled before the Adalat.

4. In the report was called for from the learned Sub Judge to ascertain the reason for deducting 7% of the court fee, it is stated that deduction was made in tune with the proviso to Rule 14 of the Kerala Court Fees & Suits Valuation (Board of Revenue) Rules, 1960. It is stated that the printed form in ‘Civil Register 69 (Rule 373)’, dealing with refund of court fees contain a column for deducting 7%. Moreover, the usual practice followed in the civil courts at Kottayam is to deduct 7% from the court fees, even if the dispute is settled before the Lok Adalat.

5. Section 89 (1) (c) empowers the civil courts to refer the terms of a possible dispute for judicial settlement through Lok Adalat. As per section 89(2) (b), such reference shall be in accordance with the provisions of sub-section (1) of Section 20 of the Act. Upon such reference, all other provisions of the Act will apply in respect of the dispute referred to the Lok Adalat. As per Section 21 (1), every award of the Lok Adalat shall be deemed to be a decree of a civil court and when a compromise or settlement is arrived at by a Lok Adalat, in a case referred to it under Section 20 (1), the court fee paid in such case shall be refunded in the manner provided under the Central Court Fees Act, 1870. Section 16 of the Central Court Fees Act, 1870, being the corresponding provision is extracted hereunder;

“16. Refund of fee - Where the court refers the parties to the suit to any one of the mode of settlement of dispute referred to in Section 89 of the Code of Civil Procedure, 1908 the plaintiff shall be entitled to a certificate from the court authorizing him to receive back from the Collector, the full amount of the fee paid in respect of such plaint.”

6. From a conjoint reading of the above provisions it is apparent that, when a dispute in a pending civil case is referred to the Lok Adalat and settled, the entire court fees paid is liable to be refunded. The settlement of dispute, passing of award and consequential refund of court fees being governed by the provisions of the Legal Services Authorities Act and the Court Fees Act respectively, deduction of 7% of the court fee paid by placing reliance on the Kerala Court Fees and Suits Valuation (Board of Revenue) Rules, 1960 is clearly unsustainable. The legal position in this regard is laid down in Vasudevan V.A.(supra), reads as under;

“On a careful reading of the above provisi