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2024 Supreme(Online)(Bom) 7116
HIGH COURT OF BOMBAY
Anil L. Pansare, J
Akhilesh Mohansingh Thakur – Appellant
Versus
Hari Haribhau Shankar Masram – Respondent
WRIT PETITION NO. 764 OF 2021
For the Appellants/Petitioners: Ramaswamy Sundaram
For the Respondents: Reynold T. Anthony
A suit or counter-claim for recovery of possession between a licensor and licensee, regardless of its framing as a trespass claim, must be adjudicated by the designated statutory authority, as civil courts are barred from such disputes.
Headnote:(A) Recovery of Possession - Licensor-Licensee Relationship - Jurisdiction - Civil court jurisdiction is barred in matters where the Competent Authority is empowered to act under special legislation relating to the recovery of possession between a licensor and licensee. (Paras 7, 9, 11)
(B) Valuation - Court Fees - The valuation of a counter-claim and the payment of ad-valorem court fees are determined by the nature of the reliefs sought in the pleadings, not on the ultimate success of the claim. (Paras 12, 13)
(C) Substance over Form - Courts must look to the real substance of the suit rather than legal drafting; where the underlying relationship is that of a licensor and licensee, the claim for recovery of possession falls within the exclusive domain of the designated statutory forum. (Paras 15, 20-21)
Facts of the case:
The petitioner approached the court for specific performance. The opposition party filed a counter-claim alleging that a leave and license agreement existed, asserting that the possession held by the petitioner was that of a trespasser and seeking restitution. The petitioner challenged the jurisdiction of the civil court and the valuation of the counter-claim through an application, which was rejected by the lower court.
Findings of Court:
The court determined that the lower court erred in isolating the prayer for declaration of trespass from the underlying averments, which clearly established a licensor-licensee arrangement. Since the statutory framework mandates that such disputes be settled by a competent authority, the civil court lacked the power to entertain the counter-claim.
Issues: The central questions were whether a civil court possesses the jurisdiction to adjudicate a recovery of possession claim between a licensor and licensee, and whether the trial court correctly assessed the valuation and court fee requirements of the counter-claim.
Ratio Decidendi: Any proceeding between a licensor and licensee concerning the recovery of immovable property, irrespective of how it is phrased (such as alleging trespass), falls within the exclusive jurisdiction of the authority designated under the relevant legislation. The court's jurisdiction is determined by the substance of the claim rather than the terminology used in the relief sought.
Result: Petition allowed. The lower court's order is quashed and set aside. The counter-claim is returned for presentation to the appropriate authority.
| Table of Content |
|---|
| 1. nature of dispute involving leave and license agreement. (Para 1 , 2 , 3) |
| 2. lower court's reasoning for rejecting order vii rule 11 plea. (Para 4 , 5) |
| 3. court jurisdiction exclusion under maharashtra rent control act. (Para 6 , 7 , 8 , 9 , 10 , 11) |
| 4. requirement of proper valuation and court fee payment. (Para 12 , 13) |
| 5. substance of the suit prevails over drafted legal terminology. (Para 14 , 15 , 16) |
| 6. setting aside order and directing return of counter-claim. (Para 17 , 18) |
ORAL JUDGMENT
.
Heard. Issue Rule returnable forthwith. The learned Counsel for Respondent waives service of Rule on behalf of the Respondent. With consent of the learned Counsel for the parties, the Petition is taken up for final hearing.
2. This Petition arises out of the rejection of application filed by the Petitioner under Order VII Rule 11 of the Code of Civil Procedure, 1908 (for short ‘the Code’) together with registration of the counter-claim without payment of Ad-veloram Court Fees.
3. The Petitioner/Original Plaintiff filed a suit against the Respondent/Original Defendant for specific performance of contract. The Respondent filed a written statement with counter-claim seeking declaration and possession of the suit property. The counter-claim is based on the premise that the Respondent was in financial crisis and required a sum of Rs.4,50,000/- for repayment of loan due to the Bank. Accordingly, he requested the Petitioner to extend finance to pay loan amount. The Petitioner agreed to do so on the condition of Respondent providing the block of first floor of the suit property on leave and license basis for monthly license fees of Rs.10,000/-. This license fee was to be adjusted towards repayment of finance and upon full discharge, the Petitioner was to vacate the premises. According to Respondent, the finance of Rs.4,50,000/- was fully adjusted on or about 15/4/2012, and therefore, the Petitioner ought to have vacated the suit premises. Having not done so, the Respondent sought declaration of the Petitioner being a trespasser and to restore possession.
4. The Petitioner filed application (Exhibit-49) under Order VII Rule 11 of the Code on two counts. One is that, the counter-claim is barred in view of Section 33 read with Section 47 of the Maharashtra Rent Control Act, 1999 (for short, ‘the Act of 1999’); and the second is, the counter-claim was neither properly valued nor the Court Fees paid in terms of the reliefs sought. According to the Petitioner, since the Respondent is claiming possession and compensation, the suit ought to have been valued accordingly.
5. The trial court, opined that the Respondent has sought declaration of the Petitioner being a trespasser and not a tenant and that the claim of compensation is in the form of damages towards mesne profit and not license fees, and therefore, the provisions of the Act of 1999 will not apply on the point of payment of Ad-veloram Court Fees. The trial court held that the question, whether Petitioner’s possession over the suit property is that of a trespasser, has been not yet decided and unless the same is decided, the entitlement of Respondent for mesne profit cannot be ascertained. The trial court, accordingly, held that once these questions are answered in favour of the Respondent, then only he will be required to pay requisite Court Fees. Accordingly, the trial court rejected the application.
6. In my view, the trial court committed serious error of law in deciding both the questions involved in the case. It is well settled that the counter-claim is treated as plaint and the questions as regards jurisdiction and payment of Ad-veloram Court Fees are wholly dependent on the pleadings made in the counter-claim. As stated earlier, the Respondent, while filing counter-claim, has made certain averments which were relevant to decide the jurisdiction of the court. The Respondent averred that the parties entered into an agreement of leave and license with an understanding tha
