( 1 ) THIS revision under Section 115 of the Civil Procedure Code is by the defendants against the order, dated, 20-8-1963, passed by Shri Devendrasingh, Civil Judge class I, Khargone in Civil Suit No. 20-A of 1962, demanding court-fees on Rs. 2201/- on the ground that the defendants were claiming the said amount by way of a counter claim.

( 2 ) THE first respondent, Purshottam filed a suit for redemption of the mortgage, dated, 38-1-1909 for a consideration of Rs. 1000/- alleging that the period for redemption was fixed at 21 years; and that the plaintiff being successor-in-interest of the original mortgagor, was entitled to redeem the same. The heirs of the original mortgagor had executed gift deeds in favour of the Gaud Malviya Brahmin sakal Panch Khargone on 18-11-1961 and 19-12-1961. The plaintiff, therefore, sued in his capacity as manager of the said institution.

( 3 ) THE defendants in their defence alleged that they were entitled to Rs. 2000/- as damages on account of a breach of a contract of sale of the mortgaged property, made by Sunderbai and Shankar. In lieu of the same, an amount of Rs. 201/- had been paid as earnest money. Therefore, the mortgagees were entitled to claim the two items on the basis of the agreement of sale executed in the year 1949. As the original agreement was missing, the mortgagees filed an affidavit about the agreement having been executed. ( 4 ) THE question, therefore, arises whether the mortgagees are liable to pay court-fees on the two items of Rs. 2000/- and Rs. 201 claimed as damages, as also towards refund of consideration upon a breach of the contract of sale. The learned judge of the trial Court, relying on Vithaldas Gulabdas v. Hyderabad Spinning and weaving Co. Ltd. AIR 1923 Rom. 24, held that the two items amounted to a counter claim on which the mortgagees were liable to pay ad valorem court-fees.

( 5 ) AS against this, the learned counsel for the mortgagees urged that this would be a question of adjustment of the redemption amount in the mortgage decree. Therefore, they were not liable to pay any court-fees. Reliance is placed on anthony Salvador Dias v. A. Sivarama Rao, AIR 1947 Mad 435.

( 6 ) IN this connection, it is to be noted that in a suit for redemption any item claimed upon an account of the mortgage claim being taken would certainly not be liable to payment of court-fees. But the essential condition is that the rights and liabilities should arise out of the mortgage contract. In this conection, I may refer to the observations in Girdharilal v. Surajmal Chauthmal, ILR (1941) Nag 753: (AIR 1940 Nag 177), wherein the learned Judge observed that a legal set off must be presented in a written statement which shall have the same effect as plaint, and it must be shown that it is an ascertained sum of money legally recoverable by the defendant from the plaintiff, and that both parties fill the same character as they fill in the plaintiff's suit. So far as an equitable set-off is concerned, it cannot be claimed as a matter of right. The Court can refuse to go into the question when a protracted enquiry becomes necessary. The learned Judge further opined that under Article 1, Schedule 1 of the Court-fees Act, the court-fees must be paid on the full amount of the set-off, and not only on the amount claimed in excess of that claimed by the plaintiff. The Court is debarred from going into the question of set-off if ad valorem court fee is not paid and an appellate Court cannot make an order for the payment of an additional court-fee when no fee at all has been paid.

( 7 ) FROM the observations of the learned Judge, it is clear that if the parties fill different character or capacity in the matter of set-off, the court-fees would be payable on an equitable set-off. However, in respect of a legal set-off, it is to be noted that so far as redemption suit is concerned, it would not be necessary to pay court- fees in respect of items which would accrue on taking account