( 1 ) THIS is an appeal from a decree passed against the State Government for the recovery of Rs. 22,141/11/5 in favour of the respondent. The plaintiff was the jagirdar of Rajhogarh. The Jagir vested in the State of Madhya Bharat on december 4, 1952, by virtue of the M. B. Abolition of Jagir Act, 1952. The plaintiff was entitled to recover Rs. 19843/12/- on account of excise duty on liquor and Rs. 5,678/13/- on account of Ganja, Bhang and opium; total Rs. 24,622/- which had been realised by the State Government on behalf of the Jagirdar for the period between 1-4-49 and 31-3-51. There is no dispute that this amount was clue to the plaintiff from the State Government. The defendant resisted the claim on the sole ground that he was not liable to pay that sum because the Government had already adjusted the sum of Rs. 20,415/11/5 which was payable by the plaintiff to it. The balance of Rs. 4206/13/7 thus remaining due to the plaintiff had already been deposited in the treasury and subsequently in the trial Court. And that sum was paid to the plaintiff through the Court.

( 2 ) WE are called upon to determine two questions in this appeal. Firstly, whether the defendant State was bound to pay court-fee on the amount of Rs. 20,415/11/5 and whether the amount was really due and recoverable and The State government was entitled to adjust' it in the dues payable to the plaintiff.

( 3 ) THE defendant asserted that the said sum of Rs. 20,415/11/5 was due by the plaintiff on account of cesses for the Samvat years 1996-2007. The defendant state did not claim any decree for this amount nor did it plead a set off. The defence was that the plaintiff was not entitled to that sum which he claimed in the suit inasmuch as the only amount payable to the plaintiff was Rs. 4206/ 13/7court-fee is payable under Article I, Schedule I of the Court-fees Act, if it is a claim of set off or counter claim.

( 4 ) HERE the defendant State was already in possession of adequate money to pay itself out of that payable to the plaintiff. In other words, it was a plea of adjustment. When two persons have certain accounts and monies are payable by each to the other, they are both entitled to mutual adjustments of the monies provided they are really due and recoverable. The distinction between payment and adjustment is that payment is made to the creditor while the adjustment is made by the debtor himself. Although it is not called 'payment' in common parlance yet it undoubtedly partakes the character of payment. At all events, it cannot be called a claim for set off, nor can it be said to be a counter-claim as the defendant does not seek enforcement of his claim, and, therefore, court-fee is not due. We are supported in this view by the decisions reported in Ramanujdas v. Ram Samukh Das, AIR 1940 All 393 Punjab Electric Power Co. , Ltd. v. Suraj kishan, AIR 1937 Lah 62, D. Konda v. Chenchu, (S) AIR 1955 Hyd 176 and balchand v. Nandlal, Madh B LJ 1955 HCR 1442.

( 5 ) THE liability of the plaintiff to pay the cesses arose from the Sanad itself which was granted to Raja Balbhadra Singh by the Ruler of Gwalior State. According to the terms of the Sanad, the plaintiff was liable to pay to the State Government cesses called Sarkana (road cess) and Madarsana (school cess ). The amount payable every year is also specified in the Sanad as Rs. 1208/ -. These facts are not in dispute. The plaintiff really claims exemption from the cesses on the ground that he was himself maintaining the schools and the roads within his Jagir. It is asserted that in the case of those Jagirdars who maintained their roads and schools, they were exempted from the payment of cesses. Reliance is placed on the Durbar Policy of His late Highness Maharaja Madhorao Scindia Vol. II at p. 50, and also on Vol. 4 at page 37. The sum and substance of those passages in the durbar Policy is that on principle a Jagirdar is to be exempted from the payment of the road cess if he was himself construc