@JUDGMENTTAG-ORDER
Hon''ble Mr. M.Y. Eqbal, Chief Justice
1. In view of the conflicting decisions of this Court on the issue as to whether payment of court fee on the plaint being a jurisdictional issue has to be decided as a preliminary issue, the matter has been referred to the file of the Chief Justice for constituting a larger bench in order to settle the law. Since all the decisions on this issue have been rendered by learned single Judges of this Court, the matter has been listed before the Division Bench for answering the reference.
2. In the order of reference, the learned single Judge has pointed out the conflicting views taken by different courts, which can be summarized here in below.
3. In one set of decisions, viz. 2003 (1) C.T.C. 87
4. The first category of decisions are discussed hereunder :-
i) In the case of E. Pushpalatha vs. C. Shanmughasundaram reported in 2003 (1) C.T.C. 87, a suit for partition, the defendant raised an objection to the effect that the market value of the suit property is Rs. 93,000/-, which would be beyond the pecuniary jurisdiction of the trial court. The defendant/petitioner filed a petition to take up the issue regarding pecuniary jurisdiction as a preliminary issue. Although the learned single Judge took notice of the provisions of Section 12(2) of the Tamil Nadu Court Fees and Suits Valuation Act, 1955 (in short, the State Act), proceeded on the basis of the provisions contained in Order XIV, Rule 2 of the CPC and held thus :-
15. The above provisions would provide a mandate on the Court that notwithstanding that a case may be disposed of on a preliminary issue, the Court has to pronounce judgment on all the issues. The only exception to this is contained in Sub-rule (2). This sub-rule also relaxes the mandate to a limited extent by conferring a discretion upon the Court. Therefore, it is for the trial Court to decide the jurisdictional issue, which is a mixed question of law and fact and such an issue is not required to be answered as preliminary issue.
ii) In the case of Solaiammal vs. Rajarathinam reported in 2003 (4) C.T.C. 268, in a suit for declaration and permanent injunction, the defendants in their written statement disputed the valuation of the suit properties given in the plaint and by filing a separate application contended that the District Munsif has no pecuniary jurisdiction, and prayed to the Court to decide the valuation and pecuniary jurisdiction of the Court of District Munsif as the preliminary issue. The said application was opposed by the plaintiff on the ground that the issue with regard to valuation cannot be decided as a preliminary issue. The learned single Judge elaborately discussed the provisions of Order XIV, Rule 2, C.P.C. prior to and after the amendment made therein. The learned single Judge held that the question with regard to deciding an issue as a preliminary issue is purely discretionary and not mandatory and observed as under :
17. We may at once point out that even in cases relating to valuation, there might be instances of cases which require factual enquiry about the Market Value and that issue cannot be tried as Preliminary Issue. Where the valuation involves enquiry, recording of evidence, involving consideration of law and facts, in those cases issue of valuation cannot be determined in isolation as Preliminary Issue. Necessarily in those, cases valuation and question of Pecuniary Jurisdiction would have to be determined with the rest of the issues.
18...In the instant case, the valuation is apparent on the plaint averments in the plaint. On the application by the defendants, the learned District Munsif has rightly exercised the discretion in determining the issue of valuation and the question of Pecuniary Jurisdiction as the Preliminary Issue. The trial Court would have fallen into error, if it had declined to take up the issue of valuation of the suit and Pecuniary Jurisdiction as the Preliminary Issue.
iii) In the case of V.S. Jagadeesan vs. Madar Saheb reported in 2005 (2) T.L.N.J. 102, the learned Judge referred to the decision rendered in
iv) In the case of A. Chinnaraj vs. Saroja Ammal reported in (2008) 1 M.L.J. 75, a similar view has been taken by the learned single Judge holding that the issue of jurisdiction is not a pure question of law, but depends upon the evidence and hence cannot be decided as a preliminary issue. In that case, the learned Judge referred to Order XIV, Rule 2, C.P.C. and held as follows :
5. On a perusal of the aforesaid provision, it is clear that ordinarily the court should try all the issues together and an issue may be taken up as a preliminary issue only if it relates to the question of jurisdiction and it is based purely on a question of law. In other words, where for deciding a particular issue relating to jurisdiction evidence would be necessary, such issue should not be considered as a preliminary issue. 6. In the present case, the question raised by the defendants is dependant upon evidence to be taken and is not a pure question of law relating to jurisdiction of the Court and therefore the trial court was right in observing that the issue need not be taken as a preliminary issue. However, once such a conclusion was reached, the trial court should not have made any observation which may prima facie indicate as if the trial court has also decided the questions raised on merit.
5. The other category of judgments, in which a contrary view has been taken, are discussed here in below:-
i) In the case of Laljivora vs. Srividya reported in 2001 (2) C.T.C. 411, a suit was filed for declaration of the sale deeds executed by the defendant as invalid and not binding on the plaintiff. The suit was valued u/s 25(d) of the State Act. The defendant challenged the valuation of the suit on the ground, inter alia, that the suit ought to have been valued u/s 40 of the Act and the court fee should be paid on the market value. In the event the suit is properly valued, the Court shall have no jurisdiction to decide the suit. The Court held that the trial court ought to have allowed the application and decided the question of payment of court fee on the relief as a preliminary issue before proceeding with the other issues. However, the Court observed as under :
5. In the present case also the petitioner has allowed the plaintiff to examine herself as P.W. 1 and the evidence of P.W. 2 has also been recorded as could be seen from paragraph 3 of the counter affidavit dated 15.3.2001 filed by the 1st plaintiff in the civil revision petition. Therefore, I am of the considered view that no useful purpose would be served to try the jurisdictional issue as preliminary issue at this belated stage as the trial of the suit have already been completed. However, it is seen that even though arguments were advanced before this Court as if the issue of payment of court fee should be decided as preliminary issue, the petition filed u/s 12(2) of the Act read with Section 151 of C.P.C. seeks for a direction to frame an additional issue if necessary relating to the valuation and court fee in the suit and hear arguments. When the petitioner has allowed the Court to frame issues already and filed written statement and subsequently after filing additional written statement and also allowed the Court to take the case for trial to examine P.W. 1 and P.W. 2, it is not now open to the revision petitioner to seek for such a direction for framing an additional issue. The attempt on the part of the revision petitioner in filing the application is nothing but a dilatory tactics to prolong the litigation. Therefore, I hold that the attempt on the part of the petitioner in seeking for a direction to frame an additional issue with regard to the valuation of the suit is nothing but a dilatory tactics and the same cannot be entertained especially when the Court has also examined P.W. 1 and P.W. 2.
ii) In the case of V.R. Gopalakrishnan vs. Andiammal reported in 2002 (2) C.T.C. 513, a similar question was raised by the defendant for deciding the issue of court fee and valuation as a preliminary issue. The issue raised was whether the plaintiff has valued the suit property and paid correct court fee?. The learned single Judge elaborately discussed the provisions of Order XIV, Rule 2, C.P.C. and also Section 12(2) of the State Act and summarized the legal position as under :
19. To sum up, the legal position is
(a) As per the amended Order-14 Rule- 2, though a case may be capable of being disposed of on a preliminary issue, the Court is given a mandate to try all the issues together.
(b) However, an exception is made to this mandate by giving discretion to try an issue as to jurisdiction or a statutory bar to the suit as a preliminary issue.
(c) In a given case, the Court may decline to try even an issue relating to its jurisdiction or to a statutory bar to the suit as a preliminary issue if it considers expedient to do so.
(d) The discretion vested with the court has to be exercised judiciously.
(e) The parties will be at liberty to adduce such evidence as they may desire only in relation to that issue.
(f) Ordinarily, no revision u/s 151 CPC will be entertained against the order of the trial court once such a discretion is used. But however, it is not an absolute one and in exceptional cases, the Court can entertain Revision and interfere.
(g) When the defendant comes forward with an application disputing the valuation of the property or contends that the suit has not been properly valued, the Court has to consider the same. Such consideration shall be as per Section 12(2) of the Tamil Court Fees and Suits Valuation Act and the Court cannot choose to decide that issue along with other issues. This provision viz., Section 12(2) of the Tamil Nadu Court Fees and Suits Valuation A ct 1955, which is a substantial law shall prevail over Order 14 Rule 2 CPC which is a procedural law.
(h) In the course of considering a preliminary issue, the Court is empowered to record such evidence as parties desire to let in only in relation to that issue/aspect.
(i) The allegations in the plaint have to be taken as a basis and the claim must be read as a whole. The accepted Rule is that substance alone matters and not the form.
(j) When a suit is filed seeking a decree to set aside the sale, Court Fee has to be paid on the market value of the property on the date of filing of the suit.
(k) But however, if a plea is raised that the signature was obtained in a blank paper or that some misrepresentation was made and thereby fraud was played on the executor, then Court fee need not be paid for setting aside the same.
iii) In the case of Abdul Suban vs. Syed Tharu Hussain reported in 2006 (5) C.T.C. 341, the Court observed that Order XIV, Rule 2, C.P.C. confers jurisdiction upon the Court to decide the issue relating to the jurisdiction of the Court on bar of suit as a preliminary issue.
6. From the aforesaid decisions, it reveals that the learned judges have arrived at the conclusion after considering the provisions of Order XIV Rule 2 of the Code Civil Procedure and Section 12(2) of the Tamil Nadu Court Fees and Suits Valuation Act, 1955 (in short State Act).
7. We have heard the learned counsel appearing for the petitioners and the respondents. We have also heard Mrs. Chitra Sampath, learned counsel who assisted the Court, on our request.
8. Mrs. P.T. Asha, learned counsel for the petitioner in C.R.P. No. 2050 of 2008, by relying upon Section 12 of the Tamil Nadu Court Fees and Suits Valuation Act, 1955, especially in the light of the specific clauses contained therein that where any defendant, in his written statement which is filed either before the first hearing or before the evidence is recorded on merits, pleads that the suit has not been properly valued or that the fee paid is insufficient, then all questions arising out of such plea shall be heard and decided before evidence is recorded, affecting such defendants, on the merits of the claim. If the court comes to the conclusion that the suit has either not been valued properly or that the court fee paid is insufficient, then the court shall fix a date within which time the plaintiff rectifies such defects, and if despite such time being granted, the plaintiff fails to amend the plaint or pay the deficit court fee, the plaint shall be rejected and the court shall pass an appropriate order regarding the costs of the suit. The petitioners contend that Section 12 of the State Act is a special provision, wherein the stage at which the plea regarding court fee has to be taken is provided for, the duty that is cast upon the court when such a question is raised is also provided for, and the consequences if the subject matter of the suit is not properly valued or the insufficient fee is paid are also dealt with, and such provisions do not find place in the Central Act. According to the petitioners, the object of the aforesaid provision is to ensure that no plaintiff undervalues the subject matter of the suit or pays insufficient court fee and also to save a defendant from full-fledged trial of the suit on merits in a case where the subject matter itself is not properly valued or where the court fee paid is insufficient. The petitioners contend that a reading of the aforesaid provisions clarifies the position that the question of undervaluation or insufficient court fee has to be necessarily dealt with in the manner provided in Section 12(2) of the Act and the provisions of Order XIV, Rule 2, C.P.C. would have no bearing on the issue, inasmuch as the Act itself is a self-contained provision, making it obligatory on the part of the court to decide the issue of under-valuation and insufficiency of court fee before any evidence is recorded on merits. Sub-clause (3) of Section 12 even meets the eventuality of case, where issues have already been framed and a newly impleaded defendant raises this issue in his written statement, it is made obligatory for the court to decide this issue before evidence is recorded. In view of such unequivocal terms contained in the Act, which is a substantial law, as opposed to the Civil Procedure Code, which is a procedural law, it is the case of the petitioners that the substantial law would prevail over the procedural law. Therefore, the contention of the petitioners is that the instant case, which is sought to be agitated u/s 12(2) of the State Act with reference to a property which is neither a Trust property nor is the defendant a Trustee thereof, is squarely covered by the provisions of the State Act, which has to be decided first before evidence is recorded.
9. MR. V. Raghavachari, learned counsel for the petitioner in C.R.P. No. 452 of 2009 and respondents in C.R.P. Nos. 3620 of 2007 and 170 of 2008, on the other hand, drew our attention to Section 21 and Order XIV of the Code of Civil Procedure, Rules 3(6) of the Civil Rules of Practice and Sections 12 and 13 of the Tamil Nadu Court Fees and Suits Valuation Act and submitted that if the issue of court fee is to be determined by recording evidence, then the same cannot be tried as a preliminary issue. However, the learned counsel submitted that the defendant nevertheless would be entitled to raise the issue of court fee before filing of written statement, provided he can bring it within the four corners of Order VII, Rule 11, C.P.C. According to the learned counsel, an interlocutory application, before the filing of written statement by the defendant, would attract Section 21, C.P.C. and can be rejected on that ground alone.
10. Mrs. Chitra Sampath, learned counsel, arguing as Amicus Curiae, submitted that the Court Fees Act cannot be a substantive law determining the rights of parties, but can only act as an adjective law, supplementing the provisions of the Code of Civil Procedure, which is a procedural enactment governing the administration of justice by courts and tribunals. The provisions of the State Act have, therefore, to be read into the provisions of the C.P.C., which view is supported by the Full Bench decision of the Allahabad High Court in the case of
11. Learned counsel submitted that the scheme of C.P.C. poses a check on the valuation and payment of court fee even at the time of presentation of the plaint and pointed out that the similarities between the CPC and the Court Fees Act. Section 10 of the Court Fees Act, which stipulates filing of a statement in the prescribed form of particulars of the subject matter of the suit and its valuation, is similar to Order VII, Rule 1, C.P.C. Section 12(1) of the Act, which calls upon the courts to decide the proper fee payable before registering the plaint is akin to Order VII, Rule 1 as well as Order VII, Rules 11(b) and (c) of the Code.
12. From the above provision, it is submitted that, it is the duty of the court to collect the appropriate court fee payable under the Court Fees Act and in order to arrive at the correct valuation, the court is empowered to conduct such inquiry under Sections 19 and 20 of the Act. Besides, the court is also bound to correct any errors upon determination of the correct court fee payable, by the Court Fee Examiners appointed by the High Court u/s 18 of the Act. According to the learned counsel, valuation of suits and determination of court fee is akin to the duty finding of facts enjoined upon the courts, to facilitate collection of appropriate court fee on the plaint before it. Even if the court of first instance has committed a mistake as to the payment of the court fee or its valuation, the appellate forum can still decide it and call upon the parties to pay the correct court fee, for which provision is made in the Act, the overall object being that the courts have to ensure collection of correct court fee due to the State. In the whole exercise, the defendant has no say whatsoever except assisting the court to determine the appropriate court fee and leave the decision to the subjective satisfaction of the court.
13. According to Mrs. Chitra Sampath, the scope of enquiry u/s 12(2) of the State Act has always been held to be in pari materia with the scope of an enquiry contemplated under Order VII, Rule 11, C.P.C. When a defendant files an application under Order VII, Rule 11, C.P.C., the consistent view of the courts has been to look into the plaint allegations alone and not the defence, in order to decide the question of rejection of plaint. Thus, when an enquiry u/s 12(2) of the Act is contemplated, the courts have treated it at par with Order VII, Rule 11, C.P.C. and held that a decision on the proper valuation of the suit has to be based on the allegations in the plaint and not on the basis of those made in the written statement, as held by the Supreme Court in
14. Similarly, it is submitted, in the case of court fee also, if the enquiry requires evidence to be recorded as to valuation and nature of relief to be claimed, then it ceases to be an issue of law, but a mixed question of law and fact. Even though the issue regarding valuation may affect the jurisdiction of the court, it can be decided as a preliminary issue only if it is an issue of law alone and not a mixed question of fact and law. Invariably, all issues as to under-valuation involve an enquiry by the court on the contentions raised by the parties with reference to documents and hence, they cease to be an issue of law. Therefore, according to the learned counsel, in view of the amended provision of Order XIV, Rule 2 C.P.C., the question of court fee is not triable as a preliminary issue. It is the duty of the court to collect appropriate court fee which it can do so independently if it is satisfied that the subject matter had not been properly valued or has been under-valued and it cannot give a right to the defendant to decide the modality of a trial of the case, since as per the decision in
15. By drawing reference to the observations of the Supreme Court in
(1) Courts shall first satisfy itself as to the proper valuation under the appropriate provision of the Court Fees Act of the reliefs claimed in the suit and the payment of court fee thereon.
(2) If the defendant raises an issue of jurisdiction of the court due to under-valuation or improper valuation of the relief claimed by the plaintiff by way of his written statement or by an application u/s 12(2) of the Tamil Nadu Court Fees and Suits Valuation Act, then the court shall proceed to decide the same based on the allegations in the plaint alone for computing the proper valuation of the relief claimed.
(3) If the court is satisfied that there has been gross under-valuation affecting the jurisdiction of the court in regard to the subject matter of the suit based on the allegations in the plaint, it can order the return of the plaint for being present to the appropriate court having jurisdiction in the subject matter of the suit.
(4) If the court is of the opinion that an enquiry as to the correct valuation of the subject matter of the suit under Sections 19 or 20 of the Court Fees Act is necessary for deciding the jurisdiction of the court, then it can conduct such enquiry.
(5) If the court proceeds with the trial of the issues accepting the valuation as adopted in the plaint, but comes to the correct conclusion at the end of the trial of the issues that the relief claimed in the suit had been camouflaged to pay less court fee, then it can dismiss the suit as not maintainable.
(6) If the court had proceeded with the trial of all the issues and disposed of the suit including jurisdiction as against the defendant, then the remedy of the defendant can be as provided u/s 21, C.P.C. and Section 54 of the Tamil Nadu Court Fees and Suits Valuation Act.
(7) If the court is of the opinion that the issue as to valuation and payment of court fee cannot be decided without recording evidence on the said issue, it can proceed with the trial of the suit on all issues and cannot decide the same as a preliminary issue.
(8) If the court has unlimited jurisdiction and the valuation or payment of court fee may not affect the jurisdiction of the court, then the court is bound to decide the same along with the trial of the suit.
16. Order XIV Rule 2 of the CPC confers power upon the Court to pronounce judgment on all the issues. But there is an exception to that general rule i.e., where issues both of law and fact arise in the same suit, and the Court is of the opinion that the case or any part thereof may be disposed of on the issue of law, it may try that issue first if that issue relates to the jurisdiction of the Court or a bar to the suit created by any law. For better appreciation Order XIV Rule 2 is quoted herein below :-Rule 2. Court to pronounce judgment on all issues
(1) Notwithstanding that a case may be disposed of on a preliminary issue, the court shall, subject to the provision of sub-rule (2), pronounce judgment on all issues.
(2) Where issues both of law and fact arise in the same suit, and the court is of opinion that the case or any part thereof may be disposed of on an issue of law only, it may try that issue first if that issue relates to
(a) the jurisdiction of the court, or
(b) a bar to the suit created by any law for the time being in force, and for that purpose may, if it thinks fit, postpone the settlement of the other issues until after that issue has been determined, and may deal with the suit in accordance with the decision on that issue.
17. Order XIV Rule 2 of the CPC as it existed earlier reads as under:-
Order XIV, R. 2 Issues of law and of fact. Whether issues both of law and of fact arise in the same suit, and the Court is of opinion that the case or any part thereof may be "disposed of on the issues of law only, it shall try those issues first and for that purpose may, if it thinks fit, postpone the settlement of the issues of fact until after the issues of law have been determined.
18. A comparative reading of the said provision as it existed earlier to the amendment and the one after amendment would clearly indicate that the consideration of an issue and its disposal as preliminary issue has now been made permissible only in limited cases. In the unamended Code, the categorization was only between issues of law and of fact and it was mandatory for the Court to try the issues of law in the first instance and to postpone the settlement of the issues of fact until after the issues of law had been determined. On the other hand, in the amended provision there is a mandate to the Court that notwithstanding that a case may be disposed of on a preliminary issue, the Court has to pronounce judgment on all the issues. The only exception to this is contained in sub--rule (2). This sub--rule relaxes the mandate to a limited extent by conferring a discretion upon the Court that if it is of opinion that the case or any part thereof may be disposed of "on an issue of law only", it may try that issue first. The exercise of this discretion is further limited to the contingency that the issue to be so tried must relate to the jurisdiction of the Court of a bar to the suit created by a law in force.
19. Section 12 of the Tamil Nadu Court Fees and Suits Valuation Act, 1955 reads as under :-
12. Decision as to proper fee in other courts
(1) In every suit instituted in any court other than the High Court, the Court shall, before ordering the plaint to be registered, decide on the materials and allegations contained in the plaint and on the materials contained in the statement, if any, filed u/s 10, the proper fee payable thereon, the decision being however subject to review, further review and correction in the manner specified in the succeeding sub- Sections.
(2) Any defendant may, by his written statement filed before the first hearing of the suit or before evidence is recorded on the merits of the claim but, subject to the next succeeding sub-Section, not later, plead that the subject matter of the suit has not been properly valued or that the fee paid is not sufficient. All questions arising on such pleas shall be heard and decided before evidence is recorded affecting such defendant, on the merits of the claim. If the court decides that the subject matter of the suit has not been properly valued or that the fee paid is not sufficient, the court shall fix a date before which the plaint shall be amended in accordance with the courts decision and the deficit fee shall be paid. If the plaint be not amended or if the deficit fee be not paid within the time allowed, the plaint shall be rejected and the court shall pass such order as it deems just regarding costs of the suit.
(3) A defendant added after issues have been framed on the merits of the claim may, in the written statement filed by him, plead that the subject matter of the suit has not been properly valued or that the fee paid is not sufficient. All questions arising on such pleas shall be heard and decided before evidence is recorded affecting such defendant, on the merits of the claim, and if the court finds that the subject matter of the suit has not been properly valued or that the fee paid is not sufficient, the court shall follow the procedure laid down in sub-Section (2).
Explanation Nothing in this sub-Section shall apply to a defendant added as a successor or a representative in interest of a defendant who was on record before issues were framed on the merits of the claim and who had an opportunity to file a written statement pleading that the subject matter of the suit was not properly valued or that the fee paid was not sufficient.
(4) (a) Whenever a case comes up before a court of appeal, it shall be lawful for the court, either on its own motion or on the application of any of the parties, to consider the correctness of any order passed by the lower court affecting the fee payable on the plaint or in any other proceeding in the lower court and determine the proper fee payable thereon.
Explanation A case shall be deemed to come before a court of appeal even if the appeal relates only to a part of the subject-matter of the suit.
(b) If the court of appeal decides that the fee paid in the lower court is not sufficient, the court shall require the party liable to pay the deficit fee within such time as may be fixed by it.
(c) If the deficit fee is not paid within the time fixed and the default is in respect of a relief which has been dismissed by the lower court and which the appellant seeks in appeal, the appeals shall be dismissed, but if the default is in respect of a relief which has been decreed by the lower court, the deficit fee shall be recoverable as if it were an arrear of land revenue.
(d) If the fee paid in the lower court is in excess, the court shall direct the refund of the excess to the party who is entitled to it.
(5) All questions as to value for the purpose of determining the jurisdiction of courts arising on the written statement of a defendant shall be heard and decided before evidence is recorded affecting such defendant, on the merits of the claim. Explanation In this Section, the expression merits of the claim refers to matters which arise for determination in the suit, not being matters relating to the frame of the suit, mis-joinder of parties and causes of action, the jurisdiction of the Court to entertain or try the suit or the fee payable but inclusive of matters arising on pleas of res judicata, limitation and the like.
20. The Tamil Nadu Court Fees and Suits Valuation Act, 1955 was enacted by Act XIV of 1955. The relevant portion of the Statement of Objects and Reasons as published in Part IV-A of the Fort St. George Gazette Extraordinary, dated 10th May, 1954 is quoted herein below:-
Statement of Objects and Reasons
The Court Fees Act, 1870 was enacted more than 80 years ago, conditions have materially changed since then and litigation has grown enormously in variety and complexity. The application of the old rules to altered facts and the extension of the rules to cover new cases have resulted in a jumble of statutory and case law which, at many points, is indefensible on principle and is a source of all-round inconvenience. The Suits Valuation Act, 1887 (Central Act VII of 1887), makes its own contribution to the incongruities with which this branch of the law abounds. Rationalization of the law relating to court-fees and suits valuation has, for the last 20 years, been regarded as an urgent measure of judicial reform. This Bill seeks to achieve that object.
Rules relating to court-fees and rules relating to valuation of suits are so interlocked that it is considered expedient to have both sets of rules enacted as parts of a single Act. The method of valuing suits forms one Chapter in this Bill.
The main purpose of this Bill is to place the law relating to court-fees and suits valuation on an ordered basis. It should not be left to the choice of a party whether a suit would be decided by a District Munsif or in a superior Court. Nor should it be easy for the litigant to determine what court-fee he would pay, by merely manipulating allegations and finding adroit language for relief.
The Bill would apply to all proceedings in courts and officers in this State, subject to two exceptions. The first exception relates to the Presidency Court of Small Causes. The Presidency Small Cause Courts Act, 1882 (Central Act XV of 1882), contains specific provisions regarding fee payable in proceedings in the Presidency Small Causes Courts. It has been considered proper to leave that Court untouched. The second exception relates to proceedings under any special Act, where such Act itself specifies the fee payable. Chapter II of the Bill formulates liability to pay fee. Chapter III prescribes the procedure by which questions arising in relation to fee shall be determined.
Chapter IV prescribes the method of computation of fee. Various classes of suits are dealt with independently in separate clauses and there is residuary clause relating to suits not otherwise provided for. Fee is made payable not merely by a plaintiff who seeks and obtains relief but also by a defendant who seeks and obtains affirmative relief. In prescribing rates of fee, care is taken to see that mere alteration in language of allegations or relief do not result in any difference in the rate of fee payable. Further, the rules are so framed that, on disputes of equal value, fees of equal amount are paid. If a person institutes a suit for a building worth of Rs. 10,000/-, he has to institute it in a District Court or Sub-Court and pay court-fee computed on Rs. 10,000/-. The same rules are made applicable where such a persons institutes a suit for land worth Rs. 10,000/-. Fee is payable in appeals on the same principles as in suits.
Chapter V provides for valuation of suits. The rules are so framed as to give finality to litigation on any subject-matter. At present, if three persons own in common properties of the value of Rs. 21,000/-, and the value of one persons share is Rs. 3,000/-, of another persons Rs. 6,000/- and, of the other persons Rs. 12,000/-, a suit for partition and separate possession has to be instituted in the Court of the District Munsif, if the person whose share is worth Rs. 3,000/- happens to be the plaintiff. The result is that, if the shares of the other two persons are not separated in such suit and those other two persons have to institute a suit later for partition, such suit would have to be instituted in a Sub-Court or a District Court and decisions given in the earlier suit in the District Munsif''s Court may not have binding effect on the ground of res judicata in the later suit. The decision of suits of large value by courts of limited jurisdiction and consequent inconvenience are avoided by prescribing that the value of the suit in a case such as the one considered above would be the value of the entire estate. The suit in that case would have to be instituted in a Sub-Court or District Court whether the person who institutes the suit is the person whose share is worth of Rs. 3,000/- or the person whose share is worth of Rs. 6,000/- or the person whose share is worth Rs. 12,000/-. Similar provisions are made in regard to partnership suits, administration suits and the like.
It has been made obligatory on the Court to determine issues regarding court-fee and valuation before proceeding to frame issues on the merits of the claim.
21. The aforesaid Act received the assent of the President on the 13th May, 1955, which was published in the Fort St. George Gazette Extraordinary on 16th May, 1955. The object of the Act is to amend and consolidate the laws relating to the court fee and valuation of suits in the State of Tamil Nadu.
22. The moot question, therefore, that falls for consideration is as to whether Courts shall be guided by the provisions of Order XIV Rule 2 of the CPC or Section 12(2) of the Tamil Court Fees and Suits Valuation Act, 1955, in the matter of deciding the objection with regard to valuation of the suit and the payment of court-fee, as preliminary issue.
23. Indisputably, the subject of civil procedure, including all matters included in the Code of Civil Procedure, is placed under Entry 13 in the Concurrent List of the VII Schedule appended to the Constitution of India. The Tamil Nadu Court Fees and Suits Valuation Act has been brought into force after obtaining the assent of the President of India. Since, there is inconsistency between the provisions contained in Order XIV Rule 2 of CPC and the aforesaid Act enacted by the State Legislature, necessarily we have to take the help of Article 254 of the Constitution of India, which reads as under :-
254. Inconsistency between laws made by Parliament and laws made by the Legislatures of States.
(1) If any provision of a law made by the Legislature of a State is repugnant to any provision of a law made by Parliament which Parliament is competent to enact, or to any provision of an existing law with respect to one of the matters enumerated in the Concurrent List, then, subject to the provisions of clause (2), the law made by Parliament, whether passed before or after the law made by the Legislature of such State, or, as the case may be, the existing law, shall prevail and the law made by the Legislature of the State shall, to the extent of the repugnancy, be void.
(2) Where a law made by the Legislature of a State with respect to one of the matters enumerated in the Concurrent List contains any provision repugnant to the provisions of an earlier law made by Parliament or an existing law with respect to that matter, then, the law so made by the Legislature of such State shall, if it has been reserved for the consideration of the President and has received his assent, prevail in that State: Provided that nothing in this clause shall prevent Parliament from enacting at any time any law with respect to the same matter including a law adding to, amending, varying or repealing the law so made by the Legislature of the State.
24. As noticed above, Section 12(2) of the State Act is a complete departure from the procedure provided under Order XIV Rule 2 of the Code of Civil Procedure.
Notwithstanding the inconsistency contained in the Act of the Parliament viz., the CPC and the provisions contained in Section 12(2) of the State Act, having regard to the fact that the assent of the President was received, the provisions of the said Section has to be complied with and can be held to be a valid legislation.
25. In the case of
8. It would be seen that so far as clause (1) of Article 254 is concerned it clearly lays down that where there is a direct collision between a provision of a law made by the State and that made by Parliament with respect to one of the matters enumerated in the Concurrent List, then, subject to the provisions of clause (2), the State law would be void to the extent of the repugnancy. This naturally means that where both the State and Parliament occupy the field contemplated by the Concurrent List then the Act passed by Parliament being prior in point of time will prevail and consequently the State Act will have to yield to the Central Act. In fact, the scheme of the Constitution is a scientific and equitable distribution of legislative powers between Parliament and the State Legislatures. First, regarding the matters contained in List I, i.e. the Union List to the Seventh Schedule, Parliament alone is empowered to legislate and the State Legislatures have no authority to make any law in respect of the Entries contained in List I. Secondly, so far as the Concurrent List is concerned, both Parliament and the State Legislatures are entitled to legislate in regard to any of the Entries appearing therein, but that is subject to the condition laid down by Article 254(1) discussed above. Thirdly, so far as the matters in List II, i.e. the State List are concerned, the State Legislatures alone are competent to legislate on them and only under certain conditions Parliament can do so. It is, therefore, obvious that in such matters repugnancy may result from the following circumstances:
1. Where the provisions of a Central Act and a State Act in the Concurrent List are fully inconsistent and are absolutely irreconcilable, the Central Act will prevail and the State Act will become void in view of the repugnancy.
2. Where however a law passed by the State comes into collision with a law passed by Parliament on an Entry in the Concurrent List, the State Act shall prevail to the extent of the repugnancy and the provisions of the Central Act would become void provided the State Act has been passed in accordance with clause (2) of Article 254.
3. Where a law passed by the State Legislature while being substantially within the scope of the entries in the State List entrenches upon any of the Entries in the Central List the constitutionality of the law may be upheld by invoking the doctrine of pith and substance if on an analysis of the provisions of the Act it appears that by and large the law falls within the four corners of the State List and entrenchment, if any, is purely incidental or inconsequential.
4. Where, however, a law made by the State Legislature on a subject covered by the Concurrent List is inconsistent with and repugnant to a previous law made by Parliament, then such a law can be protected by obtaining the assent of the President under Article 254(2) of the Constitution. The result of obtaining the assent of the President would be that so far as the State Act is concerned, it will prevail in the State and overrule the provisions of the Central Act in their applicability to the State only. Such a state of affairs will exist only until Parliament may at any time make a law adding to, or amending, varying or repealing the law made by the State Legislature under the proviso to Article 254.
So far as the present State Act is concerned we are called upon to consider the various shades of the constitutional validity of the same under Article 254(2) of the Constitution.
26. In U.P. Electricity Supply Co. Ltd. Vs. R.K. Shukla reported in AIR 1970 237 the inconsistency and the repugnancy was found in between the Industrial Disputes Act, 1947 and U.P. Industrial Disputes Act insofar as Section 6-R(2) incorporated by the U.P. Act 1 of 1957. Their Lordships observed :-
9. Competence of the State Legislature to enact Section 6-R(2) is not denied. Act of 1957 received the assent of the President and by virtue of Article 254(2) of the Constitution Section 6-R(2) of the U.P. Act prevails, notwithstanding any prior law made by the Parliament. The provisions of the U.P. Act including Section 6-R(2) therefore apply in determining the rights and obligations of the parties in respect of retrenchment compensation. The observations to the contrary made by this Court in
27. In the case of
9. The question, therefore is, when the Legislature directs that objection with regard to jurisdiction is to be decided as a preliminary issue at the time of hearing of the application for grant of interim relief or for vacating interim relief or for appointing Receiver, whether the parties should be permitted to lead evidence. In our view, this question is to be considered in the light of Order XIV, Rule 2 of Civil Procedure Code.
Order XIV, Rule 2 of the CPC reads as under:
Sub-Rule (1) of Rule 2 specifically provides that Notwithstanding that a case may be disposed of on a preliminary issue, the Court shall, subject to the provisions of sub-rule (2), pronounce judgment on all issues. The man-date of Order XIV, Rule 2 is to decide, as far as possible, all the issues and pronounce judgment on all issues. However, it is subject to sub-rule (2), which gives discretion that if the Court is of the opinion that the case or any part thereof can be disposed of on the issue of law only, it may "try" that issue first, if that issue relates to the jurisdiction of the Court or bar to the suit. As against this, section 9-A specifically gives a mandate that notwithstanding anything contained in the Code or in any other law for the time being in force, if the objection to jurisdiction of the Court to entertain such suit is taken by any of the parties to the suit, the Court is required to determine the issue as to jurisdiction as a preliminary issue before granting or setting aside the order of interim relief.
13. In the result we hold that if section 9-A is not added, then at interim stage, the Court is not required to decide the issue of jurisdiction finally and the Court by referring to the averments made in the plaint, would ordinarily determine whether or not the Court has jurisdiction to try the suit. However, it is apparent that section 9-A is added with a specific object to see that objection with regard to jurisdiction of the Court is decided as a preliminary issue. According to the Legislature, the practice of granting injunctions without going into the question of jurisdiction even though raised, has led to grave abuse. Hence the said section is added to see that issue of jurisdiction is decided as a preliminary issue notwithstanding anything contained in the Civil Procedure Code, including Order XIV, Rule 2. Once the issue is to be decided by raising it as a preliminary issue, it is required to be determined after proper adjudication. Adjudication would require giving of opportunity to the parties to lead evidence, if required.
28. In Sri Manicklal Verma vs. Smt. Jamanadevi reported in AIR 2002 Karnataka 332 the suit was for possession of the suit property, which has been valued at Rs. 14 lakhs u/s 29 of the Karnataka Court Fees and Suits Valuation Act, 1958. The defendant disputed the valuation of the said suit property. The Trial Court after examining the valuation given by the Registered Valuer and taking into account the age of the building found that the court-fee paid on the plaint was sufficient. In revision the defendant took the stand that the Trial Court has miserably erred in determining the market value of the subject matter of the suit by not taking into consideration the relevant factors, and further, by not holding proper enquiry as required u/s 11(2) of the Act. The relevant portion of the judgment reads as under:-
5. Section 11(2) of the Act reads as under :
11. Decision as to proper fee in Courts.-
(1) xxx
(2) Any defendant may, by his written statement filed before the first hearing of the suit or before evidence is recorded on the merits of the claim but, subject to the next succeeding sub-section not later, plead that the subject-matter of the suit has not been properly valued or that the fee paid is not sufficient. All questions arising on such pleas shall be heard and decided before evidence is recorded affecting such defendant, on the merits of the claim. If the Court decides that the subject-matter of the suit has not been properly valued or that the fee paid is not sufficient, the Court shall fix a date before which the plaint shall be amended in accordance with the Court''s decision and the deficit fee shall be paid. If the plaint be not amended or if the deficit fee be not paid within the time allowed, the plaint shall be rejected and the Court shall pass such order as it deems just regarding costs of the suit.
6. With reference to the above provision contained in sub-section (2) of Section 11 of the Act, this Court has consistently held that if any defendant pleads in his written statement that the subject-matter has not been properly valued or the Court fee paid is not sufficient, then it is mandatory on the part of the Trial Court to decide the issue so raised before recording of the evidence. [See Umarabba v. Pathunni and Ors. 1981(2) Kar. LJ. 97
10. Another aspect of law which is of fundamental importance in a case like the present one is that the issue pertaining to valuation of the subject-matter of the suit, which in turn has direct relevance to the amount of the Court fee payable and the pecuniary jurisdiction of the Court, always gives rise to a mixed question of fact and law and therefore necessitates an enquiry as contemplated u/s 11(2) of the Act. Therefore, such an issue cannot by its very nature be decided as a preliminary issue within the meaning of Order 14, Rule 2(2) of the CPC which confers discretion in the Court to decide the issue of law only as a preliminary issue and that too, if it touches upon the jurisdiction of the Court or institution of such a suit is barred by any law.
11. On the other hand, Section 11(2) of the Act, like Order 14, Rule 2(2) of the CPC, does not confer mere discretion on the Court but it mandates that the issue of valuation of the subject-matter of the suit both for the purposes of Court fee and jurisdiction has to be decided before evidence is recorded. It is also to be borne in mind that once the issue of valuation is decided by the Trial Court in the manner provided under the Act, the remedy available to any aggrieved party against such an order will be only to raise grievance on this score is a Court of appeal as provided u/s 11(4)(a) of the Act. As a necessary consequence any remedy by way of preferring revision u/s 115 of the CPC cannot be said to be maintainable.
29. In R.C. Sundravalli vs. T.D. Shakila reported in AIR 2002 Madras 82 a single Judge of this Court observed:-
6. Section 12(2) of the Court Fees Act reads thus:
xxx
(Only Section 12(2) is quoted herein)
7. That the defendant has the right to take an objection regarding the improper valuation of the suit or insufficiency of Court fees even by a petition supported by an affidavit and not necessarily by the written statement has been decided in the decision reported in
9. If the words "First hearing of the suit" is so understood, then u/s 12(2) of the Tamil Nadu Court Fees Act, the defendant can plead either by written statement or otherwise the defence relating to improper valuation of suit or insufficiency of Court fee before the first hearing of the suit. In this case the issues have been settled, therefore, the first stage before which the defendant could have raised his objection has passed. The Section provides for another stage when a defendant could plead as above. This is before the evidence is recorded on the merits of the claim. Therefore, after evidence is commenced on the merits of the claim, a reading of the Section indicates that the defendant does not have any further opportunity to plead either that the suit has not been properly valued or that the fees paid is not sufficient. In this case, both the stages have passed. The issues have been settled and even as per the admission of the petitioner, the additional issues have also been framed and it is also seen from a perusal of the judgment that trial had already started.
10. Section 12(2) of the Act also requires the Court to hear and decide these questions before evidence is recorded affecting such defendant on the merits of the claim. In this case since evidence has also been recorded, the procedure set down in Section 12(2) of the Act cannot be adopted. The learned counsel for the petitioner submitted that the Court should not have postponed this question, but ought to have decided the same and if the Court had found that the valuation is not correct, then, the Court should have directed the respondent to amend the plaint in accordance with the Court''s decision and for payment of deficit Court fee and if the petitioner had committed default in either amending the plaint or in payment of deficit fee within the stipulated time the plaint should have been rejected. In this case, the Court below rejects the application on the ground that this question had been raised by the petitioner when the evidence was in progress and therefore, it was highly belated.
30. After giving our anxious consideration to the matter and having regard to the law discussed hereinabove, the reference is answered as under :-
(1) The Tamil Nadu Court Fees and Suits Valuation Act, 1955 (Section 12) enacted by the State Legislature on a subject covered by the Concurrent List, albeit inconsistent with the provisions of the CPC (Order XIV, Rule 2) and being in compliance with the requirement of Article 254 of the Constitution of India, having been given assent by the President of India, shall prevail over the provisions of the Code of Civil Procedure.
(2) When a defendant comes forward with a case pleaded in the written statement questioning the correctness of the valuation of the suit property and payment of court fee and asks the Court, by an application, to decide it first before deciding the suit on merits, then a duty is cast upon the Court u/s 12(2) of the State Act to first decide the objection before deciding the suit on merits.
(3) However, before proceeding to decide the objection with regard to valuation and court fee as provided u/s 12(2) of the State Act, the Court shall prima facie satisfy itself, on perusal of the pleadings of the parties and the materials brought on record, that the objection raised by the defendant has substance.
(4) Such objection with regard to improper valuation of the suit and insufficiency of court fee shall be entertained by the Court only before the hearing of the suit on merits commences and witnesses are examined. Section 12(2) of the State Act makes it clear that such objection shall be heard and decided before evidence is recorded on the merits of the case.
(5) Exercise of right by the defendant as contained in Section 12(2) of the Act must be bona fide and not with an ulterior motive of dragging the suit on this issue. Hence, the Court shall not grant unnecessary adjournments in hearing of such application, and in the event the Court finds that the defendant is not diligent or co-operating with the Court in the disposal of such objection expeditiously, then the Court shall proceed with the hearing of the suit on merits and decide all issues, including the one relating to the valuation of the suit and the adequacy or otherwise of court fee, together.
In the light of the law discussed hereinabove, we are answering the reference as above. Consequently, the contrary view taken by the learned single Judges cannot stand as good law. Hence, the decisions rendered in E. Pushpalatha vs. C. Shanmughasundaram, 2003 (1) C.T.C. 87 and A. Chinnaraj vs. Saroja Ammal, 2008 (1) M.L.J. 75 stand overruled. Further, the decision rendered in
