JUDGMENT
S. Sankarasubban, J.
1. This R.F.A. is filed against the judgment and decree in O.S. No. 479 of 1999 of the Sub Court, Ernakulam. The suit was filed by respondents 1 and 2 for specific performance of an agreement. Appeal is filed by respondents 3 to 9 who got themselves impleaded in the suit. According to the plaintiffs, defendants 1 and 2 executed an agreement in their favour for the sale of the plaint schedule property. The amount under the sale is fixed as Rs. 75 lakhs. So, the suit was filed paying the court fee on Rs. 75 lakhs. Respondents 3 onwards got themselves impleaded as additional defendants. It was contended by them that they have attached the above property before judgment in suits filed against defendants 1 and 2. According to them, decrees have been obtained against defendants 1 and 2 and hence, they prayed for dismissal of the suit. The Court below by the impugned judgment rejected the case of the appellants and granted a decree as prayed for by the plaintiffs. It is against the above judgment and decree that the appeal has been filed.
2. In paragraph 11 of the appeal memorandum, it is stated as follows:
“The valuation of the 4 items of plaint schedule properties, as given in the plaint is Rs. 75 lakhs which is excessive. Court fee has been paid in the suit for the said amount of Rs. 75 lakhs. The amounts due to the appellants from respondents 3 and 4 would come to more than Rs. 20 lakhs, as per the decrees in the suits O.S.663/96, 533/98, 40/97, 555/98, 102/97, 101/97 and 10/99 mentioned above. The appellants are to realise the said amount from the plaint schedule properties, which belong to respondents 3 and 4. However the claim is limited to Rs. 20 lakhs, for the purpose of the above appeal and payment of court fee and accordingly court fee is being paid for the said amount. Under such circumstances, the claim is limited to Rs. 20 lakhs, charged on the plaint schedule properties. Thus the subject matter of the appeal is confined to plaint schedule property to the extend of Rs. 20 lakhs, which amount the appellants are to get from respondents 3 and 4 and to be realised from the plaint schedule property belonging to them”.
Accordingly, the appellants have paid court fee on Rs. 20 lakhs. When the matter came up for admission, learned counsel for respondents 1 and 2 contended that court fee paid is not correct. Court fee ought to have been paid on Rs. 75 lakhs.
3. We heard learned counsel for the appellants Shri. M.C. Cherian, learned counsel for respondents 1 and 2 Shri. M.A. Firoz and Advocate Shri. V. Giri as Amicus Curiae.
4. After hearing the parties, I am of the view that proper court fee has been paid in the appeal. It is true that in the Court below the appellants took the contention that the suit should be dismissed and no decree should be given for specific performance. In the appeal, now they say that they should be given a decree for Rs. 20 lakhs charged on the plaint schedule property. Whether a decree can be granted or not will depend upon the evidence adduced in the case. But it cannot be said that the appellants cannot limit their claim to be lesser than what they wanted in Court below. So far as payment of court fee is concerned, Section 52 of the Kerala Court Fees and Suits Valuation Act says that the fee payable in an appeal shall be the same as the fee that would be payable in the court of first instance on the subject matter of the appeal. Explanation 4 states that where the relief prayed for in the appeal is different from the relief prayed for or refused in the Court of first instance, the fee payable in the appeal shall be the fee that would be payable in the Court of first instance on the relief prayed for in the appeal. According to me, there is nothing to prevent the appellants from confining their claim to Rs. 20 lakhs, even though in the Court below they prayed for dismissal of the entire suit.
In the above view of the matter, I am of the view that court fee paid is correct. Ordered accordingly.
A.K. Basheer, J.
1. I have had the privilege of reading the order prepared by my esteemed brother, His Lordship Justice S. Sankarasubban. But with great respect, I may say that I am not in a position to agree with the views expressed by His Lordship for the following reasons:
2. The preliminary question raised is regarding the correctness of the jurisdiction value shown, and sufficiency of the court fee paid by the appellants on the memorandum of appeal.
3. A brief reference to some essential facts is necessary to consider the interesting question that has cropped up in this case.
4. The appellants are defendants 3 to 9 in a suit for specific performance (hereinafter, the parties will be referred to as they were arrayed in the trial Court). The plaintiffs filed the suit for specific performance of four agreements for sale in respect of four shop rooms “with all easements and other similar rights appurtenant thereto” and also with “the proportionate share in the common area and common facilities in the basement floor”. Initially, the suit was laid down by defendant Nos. 1 and 2 who alone were on the party array. According to the plaintiffs, the agreements for sale were executed by defendant Nos. 1 and 2 on September 28, 1996 for a total consideration of Rs. 75 lakhs. Pursuant to the execution of the above agreements, the plaintiffs were put in physical possession of the plaint schedule properties. The monthly rent in respect of the buildings was being collected by the plaintiffs. The plaintiffs had availed credit facilities alongwith defendants 1 and 2 from the Tynampet (Chennai) Branch of Central Bank of India (for short, the Bank). For this purpose an equitable mortgage was created in respect of the plaint schedule property. The original title deeds of the property and the sale agreements were deposited with the Bank by the plaintiffs and defendants 1 and 2. Though several requests were made by the plaintiffs to defendants 1 and 2 to execute the assignment deeds, they had failed to do so. It was in the above circumstances that the suit was filed on September 1, 1999 for a direction “to defendants 1 and 2 to effect the sale of plaint A, B, C and D properties in favour of the first plaintiff by a duly registered deed of conveyance.” In the alternative, it was also prayed that the defendants may be directed “to return to the first plaintiff a sum of Rs. 75 Lakhs with interest thereon at the rate of 12% per annum from the defendants personally and charged on the A, B, C and D schedule properties.
5. Defendants 1 and 2 remained absent and they were set ex parte.
6. On applications made by defendants 3 to 9, they were impleaded in the suit. Though their impleadment was challenged by the plaintiffs before this Court, the order passed by the trial Court was upheld.
7. The gist of the contentions raised by additional defendants 3 to 9 in their written statements was that the alleged sale agreements between the plaintiffs and defendants 1 and 2 were fictitious and sham transactions without consideration and without any legal validity. It was further contended that these documents were the result of conclusion between the plaintiffs and defendants 1 and 2 to defraud and defeat the interests and claims of additional defendants.” The attempt of the plaintiffs was only to snatch away the legitimate rights and claims of additional defendants over plaint schedule properties against defendants 1 and 2 by means of collusion with them. Defendants 3 to 9 further averred that each of them had obtained decree against the defendants 1 and 2 for various sums of money in separate suits filed by them. It was also specifically averred by defendant No. 3 that the plaint schedule property was got attached before judgment in the suit filed by him in O.S. No. 663/1996 on the file of the Subordinate Judge’s Court, Ernakulam. The attachment was effected on November 26, 1996. Thus, the defendants contended that even assuming that the alleged agreements were executed by defendants 1 and 2, they were only fictitious and sham documents. These were transactions without consideration and without any legal validity. The said agreements were created with the ulterior motive of illegally protecting the interests and property of defendants 1 and 2. Thus, it was contended that the plaintiffs were not entitled to get any reliefs in the suit. They had no manner of right to get the plaint schedule properties assigned in their favour, nor were they entitled to get any amount from defendants Land 2.
8. The Central Bank of India which was impleaded as additional defendant No. 10 produced the original deeds of title in respect of the plaint schedule property as well as the original agreements for sale between plaintiffs and defendants 1 and 2 as directed by the Court. In the written statement the Bank contended that the equitable mortgage created in their favour in respect of the plaint schedule property was still subsisting and that the Bank had first charge over the property. Hence, they were entitled to be the custodian of the original documents till the mortgage was redeemed by plaintiffs and defendants 1 and 2.
9. Several witnesses were examined on both sides including defendants 3, 4 and 7. A large number of documents were also marked by the plaintiffs and defendants 3 to 9.
10. The trial Court held that they plaintiffs were entitled to get the sale deeds executed in their favour pursuant to the agreements for sale in respect of the plaint schedule property. It was also held that the order of attachment issued by the Court in O.S. 663/1996 was after the execution of the sale agreements. Therefore, defendants 3 to 9 had no attachable right over the plaint schedule property. It was also held that the equitable mortgage in favour of the Bank was valid and legal. In short, all the contentions raised by defendants 3 to 9 were repelled and the suit was decreed as prayed for.
11. The above decree and judgment are under challenge in the appeal filed by defendants 3 to 9. The jurisdiction value for the purpose of valuation has been shown by the appellants as Rs. 20 lakhs and court fee has been calculated accordingly. One third of the court fee has been remitted by the appellants. In paragraph 11 of the memorandum of appeal defendants 3 to 9/appellants have stated thus:
“The valuation of the 4 items of plaint schedule properties, as given in the plaint is Rs. 75 lakhs which is excessive. Court fee has been paid in the suit for the said amount of Rs. 75 lakhs. The amounts due to the appellants from respondents 3 and 4 would come to more than Rs. 20 lakhs as per the decrees in the suit………..The appellants are to realise the said amount from the plaint-schedule properties, which belong to respondents 3 and 4 (D1 and D2 in the suit.) However the claim is limited to Rs. 20 lakhs, for the purpose of the above appeal and payment of court fee and accordingly court fee is being paid for the said amount. Under the circumstances, the claim is limited to Rs. 20 lakhs, charged on the plaint-schedule properties. Thus the subject matter of the appeal is confined to plaint-schedule property, to the extent of Rs. 20 lakhs, which amount the appellants are to get from respondents 3 and 4 (D1 and D2 in suit) and to be realised from the plaint-schedule property belonging to them.”
12. The short question is whether the appellants are entitled to “confine the subject matter of the appeal” to the extent of Rs. 20 lakhs and pay court fee accordingly.
13. It is contended by learned counsel for the appellants that it is always open to the appellants to confine or restrict the relief which the appellants seek, in an appeal though the decree under challenge might have granted larger reliefs. It is further contended that the appellants are not interested in entire subject matter of the suit. The appellants had obtained separate decrees for realisation of money against defendants 1 and 2. As per those decrees, defendants 1 and 2 are liable to pay “about Rs. 20 lakhs”. Therefore, the appellants are interested only to realise the said amount of Rs. 20 lakhs; nothing more and nothing less. Though subject matter of the suit was valued at Rs. 75 lakhs by the plaintiffs, and though court fee was paid by them for the said sum of Rs. 75 lakhs, the appellants are not interested in the entire subject matter of the suit. Thus, there is nothing illegal in confining or restricting the appellants’ claim to the amount which they are entitled to realise from defendants 1 and 2.
14. Section 52 of the Kerala Court Fees and Suit Valuation Act, 1959 deals with fee
payable in appeals. It provides that the fee payable in an appeal shall be the same as
the fee that would be payable in the Court of first instance on the subject matter of the
appeal. According to learned counsel, Explanation (4) to Section 52 is applicable in this case,
which reads as hereunder:
“Where the relief prayed for in the appeal is different from the relief prayed for or refused in the Court of first instance, the fee payable in the appeal shall be the fee that would be payable in the Court of first instance on the relief prayed for in the appeal.”
15. The contention of the learned counsel is that since the relief prayed for in the appeal is different from the claim in the Court of first instance, the appellant need pay court fee only “on the relief prayed for in the appeal. In other words, it is urged by the learned counsel that since the relief prayed for in the appeal is “to set aside the decree and judgment to the extent of Rs. 20 lakhs worth of plaint schedule property”, the appellants are bound to pay court fee only on the said amount.
16. In my view, the above contention is totally untenable. It has to be noted that defendants 3 to 9/appellants had not raised any counter claim, nor had they paid any court fee. They had not raised any claim either against the plaintiff or defendants 1 and 2. They had the luxury of a contest without any threat of suffering a decree against them; and that too without any price being paid. Their contention in the suit was only that the plaintiffs were not entitled to get a decree against defendants 1 and 2, since according to them, the agreements for sale were fraudulent and vitiated and that they were not supported by any consideration. The challenge against the impugned decree in the appeal remain the same. The relief sought is not different. Obviously therefore appellants/defendants 3 to 9 are not entitled to rely on Explanation (4).
17. On the other hand it is contended by the learned counsel for the plaintiffs that Explanation (1) to Section 52 is applicable in the case which provides that whether the appeal is against the refusal of a relief or against the grant of the relief, the fee payable in the appeal shall be the same as the fee that would be payable on the relief in the Court of first instance. Though defendants 3 to 9 had challenged grant of any decree to the plaintiffs no relief was granted to them. Therefore when the above decree is challenged in the appeal, the appellants are liable to pay court fee on the entire subject matter as in the Court of first instance.
18. It is not in dispute that the plaint schedule property (4 shop rooms and easements and other similar rights attached thereto) were agreed to be sold by defendants 1 and 2 for a total consideration of Rs. 75 lakhs. Though it is vaguely contended by the appellants that the valuation shown by the plaintiffs in the suit is excessive, there is nothing on record to show that the plaintiffs have purposefully overvalued the suit property. It is an admitted fact that the plaint schedule property is situated in a most “commercially potential area” in one of the busiest roads in Ernakulam city. It is also on record that the plaint schedule properties have been equitably mortgaged in favour of the Central Bank of India (additional 10th defendant) by deposit of original title deeds as well as the agreements for sale.
19. The trial Court had framed issues in the suit on the basis of the contentions raised by defendants 3 to 9. In this context, it is profitable to refer to some of the issues raised by the Court below:
Issue No. 4
Whether the defendants 1 and 2 have entered into an agreement for sale of plaint schedule property on 28.9.96, if so, whether the agreement was supported with consideration?
Issue No. 7
Whether the agreements were vitiated by fraud and collusion between plaintiffs and defendants 1 and 2 as against the additional defendants?
Issue No. 8
Whether the agreements in question create any valid claim or right to the plaintiff over the plaint schedule property as against the additional defendants?
Issue No. 10
Whether the additional defendants had any legal right or interest or attachable right on the plaint schedule property after execution of sale agreement on 28.9.96?
Issue No. 11
Whether the plaintiffs are entitled to get any rights and claims over the plaint schedule properties against the said properties?
20. As mentioned earlier, the Court below had decreed the suit holding inter alia that the sale agreements were not vitiated by fraud or collusion. It was found that they were supported by consideration and also that the plaintiffs were entitled to get the sale deeds executed in their favour. Thus, all the contentions raised by the appellants were negatived. It is in the above background that the question whether the appellants can file an appeal restricting the value of the subject matter to only Rs. 20 lakhs, has to be considered.
21. There is no dispute that the appellant in an appeal can give up a portion of his claim and confine his challenge to the extent to which the restricts the subject matter of the appeal. Under normal circumstances, the subject matter of the appeal might be the same as it was shown in the suit. In Nemi Chand and Anr. v. The Edward Mills Co. Ltd. and Anr. (AIR 1953 SC 28) a question arose whether the appellant could give up one of the two reliefs that were sought for in the suit, while challenging the decree passed by the trial Court. The suit was laid, for a declaration that the appointment of defendant No. 2 as Chairman and Managing Director was illegal, invalid and ultra vires. The second relief was for appointment of a receiver to take charge of the management of the company until a properly qualified Chairman and Managing Director was duly appointed. The suit was dismissed by the trial Court. In the appeal, the relief was restricted to only for a decree of declaration with regard to the appointment of defendant No. 2 as Chairman and Managing Director. On an objection raised about the deficiency in court fee, the Judicial Commission directed the appellant to pay court fee for the other relief also. The Judicial Commission took the view that since the plaintiff had earlier conceded that the relief for the receivership was consequential to the relief for declaration, the appellants were liable to pay the same court fee as paid by them in the trial Court. But Supreme Court allowed the appeal and held thus:
“It is always open to the appellant in an appeal to give up a portion of his claim and to restrict it. It is further open to him, unless the relief is of such a nature that it cannot be split up to relinquish a part of the claim and to bring it within the amount of court fee already paid.”
It can be noticed from the above decision that the appeal was filed by the plaintiff in the suit. Though the plaintiff had prayed for two reliefs in the suit, he had later on restricted his claim to only one of the two reliefs. It was in the above facts and circumstances that their Lordships of the Supreme Court held that it is always open to the appellant in an appeal to give up a portion of his claim and to restrict it. But significantly, their Lordships observed that the appellant could relinquish a part of the claim if the relief is of such a nature that it could be “split up”. In other words, if the relief is not severable, such a splitting up cannot be possible.
22. There is yet another aspect of the matter. The distinction between an appeal filed by the plaintiff who has had his suit dismissed and that of an unsuccessful defendant had always been recognised. The observations of His Lordship Horwill, J. In Re Kantheewaram Ekanthalingaswamy Koil (AIR 1937 Mad. 46) is illuminating. His Lordship observed as follows:
“It is however necessary to maintain a distinction between an appeal by a plaintiff, who has had his suit dismissed and that of an unsuccessful defendant. The latter has to rid himself of the decree and therefore everything that has been granted to the plaintiff in the decree and against which he wishes to appeal must be the subject matter of the appeal, even though more has been given in the decree (by way of interest of ascertained mesne profits, for example) than was due to the plaintiff at the time of filing his suit. But the plaintiff who has had his suit dismissed is in fact told that he had no cause of action against the defendant at the time of filing his suit, and it is against this adverse finding that he has to appeal. After having his suit dismissed he goes to the appellate court in the same position as at the time of filing his suit. Even so long as 10 M.L.J. 144, this distinction between the position of a defendant-appellant and plaintiff-appellant was considered so obvious as not to require discussion, and this distinction has always since between maintained.”
23. It is pertinent to note that the appellants were not parties to the suit originally. They had got themselves impleaded at a later stage on their own volition. There was no transaction between the plaintiffs and defendants 3 to 9. The plaintiffs had sought for a decree only against defendants 1 and 2 who had entered into the agreements for sale in respect of the plaint schedule property. Obviously, therefore, there was no prayer for any “decree or relief against defendants 3 to 9/appellants in the suit. However, in the written statement, defendant 3 to 9 had raised all conceivable objections against the grant of a decree in favour of the plaintiffs. The challenge raised by defendants 3 to 9 pertained to the very substratum of the claim made by the plaintiffs in the suit. The trial Court had framed issues on the basis of these pleadings. All the contentions raised by defendants 3 to 9 with regard to the competence of the plaintiffs to institute the suit, the execution of sale agreements and consideration therefor, etc. were considered by the trial Court elaborately. The plaintiffs had necessarily to adduce evidence in the light of these contentions.
24. But the larger issue that was thrown up in the suit was whether the agreements for sale were vitiated by fraud, collusion, etc. and whether they were intended to defeat and defraud the creditors like defendants 3 to 9. It was only because of the contentions raised by defendants 3 to 9, that all these issues had cropped up. The decree was passed by the trial Court after considering all these contentions. Therefore the question is whether defendants 3 to 9 can now turn round and say that they are not interested in the entire subject matter of the suit; but they are now restricting their relief to only Rs. 20 lakhs worth of plaint schedule property”, which according to them is the amount payable by defendants 1 and 2. The answer is undoubtedly in the negative.
25. It may be true that in appeal the appellant has the right to decide the subject matter of the appeal depending on the extent to which the decree is sought to be challenged. But can that choice be exercised by the appellants in the above facts and circumstances?
26. In my view, the appellants cannot. They simple reason is that in the nature of the challenge raised by defendants 3 to 9, it can never he said that the relief that is now sought to be claimed in the appeal is severable. If the appellants have to succeed in the appeal, they have to necessarily establish that the four agreements for sale were not executed and that they were vitiated by fraud or collusion and also that they were not supported by any consideration. Thus, in effect, it means that the challenge is against the entire decree. In the nature of the decree, it cannot be said that it is severable. The reliefs cannot be split up or segregated. The appellants cannot contend that they are entitled to challenge the impugned decree to the extent of “only Rs. 20 lakhs worth of plaint schedule property” because the amount payable by defendants 1 and 2 under the separate decrees obtained by them is only Rs. 20 lakhs. Therefore, in my view, the appellants have to pay court fee on the subject matter of the suit, viz. Rs. 75 lakhs. The objection raised by respondents 1 and 2 plaintiffs in this regard is legally valid and sustainable.
27. It is therefore held that the appellants have to pay court fee on the entire subject matter of the suit. If court fee is not paid, on that basis, the appeal shall be rejected.
S. Sankarasubban and A.K. Basheer, JJ.
In the light of the difference of opinion on the question of court fee to be paid, we direct the Registry to place the papers before the Hon’ble Chief Justice for getting the decision of a third Judge.
