SUPREME COURT OF INDIA
Mohan M. Shantanagoudar, Vineet Saran, JJ.
The High Court of Judicature at Madras Rep. by its Registrar General – Petitioner
Versus
M.C. Subramaniam & ors. – Respondents
Special Leave Petition (CIVIL) NOS. 3063-3064 OF 2021
Decided On : 17-02-2021
Tamil Nadu Court Fees and Suit Valuation Act, 1955 - Section 69-A - Code of Civil Procedure, 1908 - Section 151 and 89 - Purchased two vehicles – Agreements - Instalments - Respondent No.1 purchased two vehicles from Respondent No. 2 vide two separate hire purchase agreements dated, under which Respondent No.1 was principal debtor/hirer, and Respondents Nos. 3 and 4 were the sureties to Agreements - As per the terms of Agreements, Respondent No.1 was to pay a sum in stipulated instalments to Respondent No. 2 for each of the two vehicles - It suffices to note for our purposes that Respondent No. 2 brought Original Suits Nos. and against Respondents Nos. 1, 3 and 4 before Additional District Munsif Court, Coimbatore (hereinafter, ‘Munsif Court’) and Additional District and Sessions Court, Coimbatore (hereinafter, ‘District Court’) respectively - Whether refund of court fee was permissible under the relevant rules, High Court considered Section 69-A of the Tamil Nadu Court Fees and Suit Valuation Act, 1955 – Held, in Court view, High Court was correct in holding that Section 89 of CPC and Section 69-A of 1955 Act be interpreted liberally - In view of this broad purposive construction, Court affirm High Court’s conclusion, and hold that Section 89 of CPC shall cover, and benefit of Section 69-A of 1955 Act shall also extend to, all methods of out-of-court dispute settlement between parties that Court subsequently finds to have been legally arrived at - This would, thus, cover present controversy, wherein a private settlement was arrived at, and a memo to withdraw appeal was filed before High Court - In such a case as well, appellant, i.e., Respondent No. 1 herein would be entitled to refund of court fee - Petitions are accordingly dismissed.
JUDGMENT :
Mohan M. Shantanagoudar, J.
These special leave petitions arise out of common order and judgment of the High Court of Madras (hereinafter, ‘High Court’) dated 8.01.2020. By the impugned judgment, the High Court allowed Civil Miscellaneous Petitions Nos. 26742 & 26743 of 2019 filed by the Respondent No.1 herein praying for refund of the court fees deposited by him in Appeal Suits Nos. 876/2012 and 566/2013 filed by him before the High Court.
2. The facts leading to these petitions are as follows: Respondent No.1 purchased two vehicles from Respondent No. 2 vide two separate hire purchase agreements (hereinafter, ‘Agreement-I’ and ‘Agreement-II’; collectively, ‘the Agreements’) dated 10.06.1996, under which Respondent No.1 was the principal debtor/hirer, and Respondents Nos. 3 and 4 were the sureties to the Agreements. As per the terms of the Agreements, Respondent No.1 was to pay a sum of Rs.10,08,000/- in stipulated instalments to Respondent No. 2 for each of the two vehicles.
3. It suffices to note for our purposes that Respondent No. 2 brought Original Suits Nos. 66/2003 and 76/2003 against Respondents Nos. 1, 3 and 4 before the Additional District Munsif Court, Coimbatore (hereinafter, ‘Munsif Court’) and the Additional District and Sessions Court, Coimbatore (hereinafter, ‘District Court’) respectively. In the two suits, Respondent No.2 alleged nonpayment of Rs.6,64,000/- and Rs.5,97,200/- towards the instalments stipulated in Agreement-I and Agreement-II respectively, and sought recovery of the balance amounts along with interest thereon. Both the Original Suits Nos.66/2003 and 76/2003 were partly decreed by the Munsif Court and District Court, by judgments dated 13.02.2004 and 31.01.2005 respectively.
4. Aggrieved, Respondent No.1 preferred Appeal Suits Nos. 876/2012 and 566/2013 before the High Court, against the judgments in O.S. No. 66/2003 and O.S. No.76/2013, respectively. While the appeals were still pending consideration before the High Court, the parties entered into a private out-of-court settlement, thus resolving the controversy between them. In view of this, Respondent No. 1 filed a memo before the High Court, seeking permission to withdraw Appeal Suits Nos. 876/2012 and 566/2013. Such permission, along with a direction to refund the court fee deposited by Respondent No.1, was granted by orders dated 16.09.2019 and 18.09.2019 in A.S. Nos.566/2013 and A.S. Nos. 876/2012 respectively.
5. Despite the above stated orders of the High Court, the Registry orally refused Respondent No.1’s request for refund of court fees, on the ground that such refund is not authorised by the relevant rules. Left without recourse, on 25.12.2019, Respondent No.1 filed Civil Miscellaneous Petitions Nos. 26742/2019 and 26743/2019 under Section 151, Code of Civil Procedure, 1908 (hereinafter, ‘CPC’), praying for refund of the court fees paid by him in A.S. Nos. 876/2012 and 566/2013 respectively, in terms of the orders dated 18.09.2019 and 16.09.2019 therein.
6. By the impugned common judgment and order dated 8.01.2020, the High Court has allowed the aforementioned Civil Miscellaneous Petitions, and directed the Registry to refund the full court fee to Respondent No. 1 herein.
7. In addressing the question of whether the refund of court fee was permissible under the relevant rules, the High Court considered Section 69-A of the Tamil Nadu Court Fees and Suit Valuation Act, 1955 (hereinafter, ‘1955 Act’), which reads as follows:
“69-A. Refund on settlement of disputes under section 89 of Code of Civil Procedure.—Where the Court refers the parties to the suit to any of the modes of settlement of dispute referred to in section 89 of the Code of Civil Procedure, 1908 (Central Act V of 1908), the fee paid shall be refunded upon such reference. Such refund need not await for settlement of the dispute.” (emphasis supplied)
Considering, appeal suits to be continuation of original suits, and therefore falling within the ambit of ‘suits’ as pro
Court fees should be refunded even when cases settle out of court, promoting private dispute resolution methods, which supports judicial efficiency.
The court affirmed the right to court fee refunds upon referral to arbitration, emphasizing that such a referral entitles plaintiffs to refunds irrespective of arbitration outcomes.
The court recognized that out-of-court settlements enable parties to claim court fee refunds, treating them equitably with formal dispute resolution methods, thus promoting judicial efficiency.
The judgment establishes the principle that Section 89 of CPC and Section 16 of Court Fees Act should be interpreted liberally to encourage out-of-court settlements and provide incentives for parties....
The court emphasized a purposive interpretation of statutory provisions to ensure equitable treatment for parties settling disputes privately, allowing for court fee refunds.
Court Fee - provisions under Section 69A of the Kerala Court Fees and Suit Valuation Act, 1959 regarding refund of court fee in case where the dispute is settled under Section 89 of the Code of Civil....
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