Judgment :- 1. In these C. R. Ps. which arise out of the proceedings in O. S. No. 87 of 1973 on the file of the First Additional Sub Court, Trivandrum, the defendant in the suit is the petitioner. The suit is one for arrears of ren'. One of the contentions of the petitioner is that the plaintiffs cannot claim any rent in view of the agreement between the plaintiffs and the defendant to pay interest at the rate of 12% for the amount lent and spent by him towards the cost of re-construction of the building concerned. The defendant could claim back the principal amount so advanced only at the time of eviction and not before The petitioner states that the amount spent by him will come to more than Rs 11/2 lakh. As regards bis prayer for adjustment of the amount due to the defendant by way of interest to the plaintiffs' claim for rent, such amount being only periodical and unascertained the defendant paid court fee as per S.50 of the court Fees Act. The plaintiffs objected to the above valuation and after hearing the parties the court below passed an order directing the defendant to pay court fee on the amount which he seeks to set off against the plaint claim. The court further stated that since the amount is alleged to cover the plaint claim the court fee has to be paid on an amount equal to the plaint claim. It is from this order that CRP. No. 1117 of 1976 has been filed. 2. The petitioner had also sought the issue of a commission for ascertaining the value of improvements. This was dismissed by the court below on the ground that a Commission need be issued if necessary only after the decision of the question whether the defendant is entitled to adjust the claim by him and in that view the trial can be proceeded with and if it is found that the defendant is entitled to adjust towards the rent claimed, interest on amounts spent by him, if any, exceeding Rs. 20,000/- a preliminary decree can be passed directing the taking of accounts regarding the amount due to the defendant. The court below pointed out that a final decree can thereafter be passed in the suit. It is from these two orders that the revision petitions have been filed. 3. 20,000/- a preliminary decree can be passed directing the taking of accounts regarding the amount due to the defendant. The court below pointed out that a final decree can thereafter be passed in the suit. It is from these two orders that the revision petitions have been filed. 3. In regard to the question of payment of court fee, what is contended on behalf of the petitioner is that the contention in the written statement is that if what is due from the plaintiffs to the defendant are calculated, no tent is payable, the rent payable, being according to the calendar month and the interest also accrues in the same manner and therefore adjustment takes place at the end of every month. For understanding the case it will be necessary to look into the contentions in the written statement. It is the allegation therein that would settle whether the court fee is payable on the claim or not. I will quote herein below the relevant portions in the written statement: "The plaintiffs went through the plan of the proposed reconstruction and they fully approved of it and persuaded this defendant to build the new structure and promised this defendant that any additional amount required for such construction would be paid at the time of the termination of the tenancy A supplementary agreement was also executed on 29 51969 in respect of the reconstruction. xx A sum of Rs. 1,50,464.46 was spent by this defendant for the reconstruction and for the construction of the cycle stand. This amount was spent by this defendant bona fide and the plaintiffs also know that it was not spent by defendant gratuitously. xx "It is also stipulated that this defendant will be entitled to interest at the rate of 12 per cent per annum over the amount additionally lent and spent and such interest being payable to this defendant after 3 months from the date of the beginning of the work. xx The amount spent by this defendant as stated above should be ascertained and this defendant is entitled to charge 12 per cent interest on the said sum. If that is calculated it will be seen that nothing is due to the plaintiffs from this defendant on the contrary amounts will be found due form the plaintiffs to this defendant only. If that is calculated it will be seen that nothing is due to the plaintiffs from this defendant on the contrary amounts will be found due form the plaintiffs to this defendant only. xx The plaintiffs are not entitled to file this suit for alleged arrears only. The defendant is entitled to appropriate and adjust the rent falling due against the above said interest for the past months and for future also till the entire amount due to this defendant is paid off." 4. If the above could be taken as a plea of adjustment, no court fee is payable. On the other hand, if it is a case of set off or a counter claim, court fee would be payable. A set off is a statutory defence to a plaintiff's action. The counter claim is substantially a cross action. Whether on the particular facts of a case the claim of the defendant is to be treated as a plea of adjustment or as a set off or a counter-claim, is first to be determined and judged by reference to the pleadings in the case and then also by reference to the nature and character of the plea. (See (1951) 88 Cal. L. J. 90). In the case of a counter claim, a court has got the power to treat the counterclaim in the plaint as a cross suit and bear the two together, if the counter claim is properly stamped In the case of counter claim and set off court fee will have to be paid. 5. I would refer to certain decisions on the point. In State of M. P. v. Balbhadra Singh (AIR. 1964 M. P. 231) the plaintiff was a Jagirdar whose jagir vested in the State of Madhya Bharat on December 4,1952, by virtue of the M. B. Abolition of Jagir Act, 1952. The plaintiff was entitled to recover Rs. 19,843.12 on account of excise duty on liquor and Rs. 5,678.13 on account of Ganja, Bhang and opium. Thus a total amount of Rs. 24,622 which had been realised by the State Government on behalf of the Jagirdar for the period from 141949 to 3131951 was due to the plaintiff-Jagirdar. There was no dispute that this amount was due to the plaintiff from the State Government. 5,678.13 on account of Ganja, Bhang and opium. Thus a total amount of Rs. 24,622 which had been realised by the State Government on behalf of the Jagirdar for the period from 141949 to 3131951 was due to the plaintiff-Jagirdar. There was no dispute that this amount was due to the plaintiff from the State Government. The defendant resisted the claim on the sole ground that he was not liable to pay that sum because the Government had already adjusted the sum which was payable by the plaintiff to it The balance of Rs 4,206-13 annas-7 ps. remaining due to the plaintiff was deposited in the treasury and subsequently in the trial court. The question that arose in the case was whether the defendant-State was bound to pay court fee on the amount of Rs. 20,415-11 Anas-5 ps. The Madhya Pradesh High Court said: "Here the defendant State was already in obsession of adequate money to nay itself out of that payable to the plaintiff. In other words, it was a plea of adjustment. When two persons have certain accounts and monies are payable by each to the other, they are both entitled to mutual adjustments of the monies provided they are really due and recoverable The distinction between payment and adjustment is that payment is made to the creditor while the adjustment is made by the debtor himself Although it is not called 'payment' in common parlance yet it undoubtedly partakes the character of payment. At all events, it cannot be called a claim for set off. nor can it be said to be a counter-claim as the defendant does not seek enforcement of his claim, and, therefore court-fee is not due. We are supported in this view by the decisions reported in Ramanujdas v. Ram Samukh Das, AIR. 1940 All 393, Punjab Electric Power Co Ltd. v Suraj Kishan, AIR 1937 Lah 62. D. Konda v. Chenchu, (S) AIR 1955 Hyd 176 and Balchand v Nandlal, Madh B. L J 1955 HCR 1442 6. In Chandra Dutt v. Shantiram (AIR 1967 Patna 358) Misra J. said: "Set-off" has rightly been distinguished from the plea of 'payment' to several decisions, which is to the effect that where the defendant pleads adjustment or payment of certain amount to the plaintiff towards his dues prior to the date of the suit, it is adjustment or plea of payment. It is only when the defendant pleads that a certain amount, which the plaintiff owes to him, or, which he is under an obligation to pay to the defendant, should be adjusted towards his dues by the Court and which he himself had not already specified as payment to the plaintiff and communicated to him; then and then only it would be regarded as a set-off." 7. The distinction between the pleas of adjustment, set off and counter claim have been well pointed out in Munshi Ram v. Radha Kishan (AIR 1975 Punjab & Haryana 112) by a learned judge of that Court. "The pleas which are open to a defendant to defeat the relief sought by a plaintiff in a suit may be of adjustment, set-off and counter-claim. However, the scope, nature etc. of these pleas are different. The pleas of adjustment and set off are primarily of defence. No court-fee is required on a plea of adjustment, but court fee is payable on pleas of set-off and counter-claim. A set off may be legal or equitable. In a legal set off, it is not necessary that the amount claimed should be ascertained. Plea of legal set off is recognised by the provisions contained in R.6 of Order VIII, Civil Procedure Code. The said rule, however, does not take away from the parties right to claim equitable set off. which I think is recognised in this country apart from the aforesaid provision Plea of legal set off, having been recognised by the aforesaid provision, can be raised as of right and the Court is bound to entertain and adjudicate upon it. when raised, in the same suit. But equitable set off cannot be claimed as a matter of right and the Court has a discretion to adjudicate upon a plea of equitable set off in the same suit or to order it to be dealt with in a separate suit A set off is a statutory defence to a plaintiff's action, whereas a counter claim is substantially a cross-action. To put it differently, a set-off is aground of defence,a shield and not a sword, which if established would afford an answer to the plaintiff's claim wholly or pro tanto, while a counter-claim as such affords no defence to a plaintiff's claim, but is a weapon of offence which enables a defendant to enforce a claim against the plaintiff effectually as an independent action. A counter-claim may beset up only in respect of claim as to which the party can bring independent action in the Court in which the counter action is brought. Yet it (counter-claim) need not be an action of the same nature as the original action or even analogous thereto Though there is no provision in the Code of Civil Procedure for making a counter claim, a Court has got the power to treat the counter-claim as a cross-suit and hear the original suit and the counter-claim together if the latter (counter-claim) is properly, stamped. I am supported in this view by Laxmidas Dayabhai Kabrawal v. Nanabhai Chuni Lal Kabrawala AIR 1964SC 11, and Ghulam v. Ghulam Ahmdad AIR. 1956 J. and K 38 Besides the other varying considerations that may apply to a set off and a counter-claim, the point of time for purposes of limitation would be different in both the cases In the case of set off. the relevant time for considering whether the claim of the defendant put forth as set off, legal or even equitable, is barred by limitation or not, is the date of the institution of the suit and not the date when the written statement claiming the set off was put in. It is otherwise in the case of counterclaim. In that case (i. e , in the case of counter-claim) the material point of time would be the date when the written statement was filed and not the date of suit. In other words, it has to be considered as to whether the counter claim is within time or not on the date when the written statement containing it was filed, and not when the suit was instituted by the plaintiff. In other words, it has to be considered as to whether the counter claim is within time or not on the date when the written statement containing it was filed, and not when the suit was instituted by the plaintiff. It may be noted here that when a defendant claims in a suit an amount from the plaintiff below or up to the plaint claim, it is a claim for set off stricto sensu, but when the counter-claim is for an amount larger than the plaint claim, the claim for the excess over the plaint claim has to be considered as counter-claim. Similar view was taken in Govindiji Jevat and Co. v. Cannanore Spinning and Weaving Mills Ltd, MR. 1968 Ker 310." A plea of adjustment or payment or in a suit for accounts a pleading that money would be due to the defendant and praying that only a decree for the balance could be had require no court fee. 8. In Re Popular Bank Ltd. (1958 KLT. 749) a question arose whether an affidavit filed by a debtor of an insolvent banking company under rule i5 of the Travancore-Cochm Banking R.1955, in reply to a list filed by the liquidator under S 45D (2) of the Banking Companies Act, 1949, wherein he claims that money is due to him from the company and that an account should be taken, is a written statement pleading a set off within the meaning of the Court Fees Act. Raman Nayar J. said that he did not think it is, even if it is assumed that such an affidavit is a written statement. He further proceeded to state: "For, under S.529 of the Companies Act 1956 read with S.47 of the Kerala Insolvency Act, in the case of mutual dealings an account has to be taken and only the balance of the account can be claimed by the one party or the other, as the case may be. It is only this balance if it is in favour of the company, that the liquidator is entitled to claim, and an affidavit by a debtor claiming credit for money due to him and asking for an account to be taken is not a written statement claiming a set off under 0.8, R.6 CPC. It is only this balance if it is in favour of the company, that the liquidator is entitled to claim, and an affidavit by a debtor claiming credit for money due to him and asking for an account to be taken is not a written statement claiming a set off under 0.8, R.6 CPC. (the law having already effected a set off) but is analogous to a written statement by a defendant in a suit on accounts claiming credit for sums not allowed by the plaintiff. Now when the affidavit is filed in answer to a claim made against the debtor, can it be regarded as a petition to the court. I therefore hold that such affidavits are not liable to court fee." 9. A Division Bench of the Orissa High Court held in Tata Iron & Steel Co. v. R. N. Gupta (AIR. 1963 Orissa 174) that "a plea of satisfaction or extinguishment of a debtor a claim, set up merely by way of defence is very different from a plea of sit-off. A plea of payment necessarily refers to a satisfaction or extinguishment of a debt effected prior to the stage of the defence, whereas a plea of sit-off is in the nature of a cross claim and in effect it prays for a satisfaction, or extinguishment of a claim, to be made in the future after the date when the plea has been set up. If it were held to be merely a plea regarding adjustment of accounts and no more, no court fee would be payable on the amount mentioned in such a plea." 10. A Division Bench of the Hyderabad High Court in Konda Pentiah v. Chehchu Rangiah (AIR. 1955 Hyderabad 176) said: "A plea of adjustment must be distinguished from a plea of set off. The plea of adjustment or satisfaction premises that the extinction of the plaintiff's claim or satisfaction took place prior to the date on which the defence was raised in the suit. By a claim for set-off, on the other hand, the defendant prays that the Court should enter satisfaction in respect of the plaintiff's dues from the outstanding dues owed by the plaintiff to the defendant. It is implicit in such a plea that the mutual indebtedness has not been adjusted till that date and adjustment is sought in the suit itself." 11. It is implicit in such a plea that the mutual indebtedness has not been adjusted till that date and adjustment is sought in the suit itself." 11. The distinction between set-off on the one hand and payment or adjustment on the other has been discussed in Halsbury's Laws of England, 3rd Edition, Vol. 34, page 395,396 (paragraphs 669 and 672). Halsbury says: "Where there has been payment, the party against whom the claim is brought pleads payment or accord and satisfaction which, in effect, alleges that the claim no longer exists. The plea of set-off on the other hand, in effect, admits the existence of the claim and sets up a cross-claim as being the ground on which the person against whom the claim is brought is excused from payment and entitled to judgment on the plaintiff's claim " 12. In Punjab Electric Power Co. Ltd. v. Suraj Kishun (AIR 1937 Lahore 62) where in a suit for recovery of money the defendant had pleaded that the plaintiff was indebted to him and his dues were adjusted with the claim in the suit leaving a little balance, the Lahore High Court held that the plea was not a set-off but only one of adjustment. 13. In the light of these when one examines the pleadings of the defendant in this case it would appear that the prayer of the defendant is not for sitting off the amounts due to him from the plaint claim; it is not a counter claim also demanding the payment of excess amount to the defendant. It is really a prayer for declaring his right to get the rent falling due adjusted to the interest, that will be due to the defendant. Reading the written statement as a whole one gets the impression that the defendant's plea is that the rent that had fallen due had got itself adjusted towards the interest that is due from the plaintiffs to the defendant. That is why he says that he is entitled to appropriate and adjust the rent falling due against the interest for the past months and for future also till the entire amount due to him is paid off. That is why he says that he is entitled to appropriate and adjust the rent falling due against the interest for the past months and for future also till the entire amount due to him is paid off. Though the pleading in the case is not very properly worded I think it can be taken to be in effect a plea of adjustment having already been effected with regard to the rent that has fallen due against the interest that had accrued till then and for such future adjustment also. If that be so, I do not think the defendant was wrong in not paying court fee ad valorem on the amount which would be due to him towards interest as such The court below was wrong in stating that it is a case of setting off of that amount against the plaint claim. Therefore I would set aside the order directing the defendant to pay court fee on an amount equal to the plaint claim. I would make it clear that on the pleadings the defendant would not be entitled to claim. a set off or for making a counterclaim if his prayer for entitlement for an adjustment is disallowed. 14. In regard to the issue of a Commission I do not think the court below has erred as such. The lower court has not committed any jurisdictional error in stating that the trial can be proceeded with and if it is found that the defendant is entitled to adjust towards the rent claimed, interest on amounts spent by him if any, exceeding Rs. 20,000/- a preliminary decree can be passed directing the taking of accounts regarding the amount due to the defendant and a final decree thereafter can be passed in the suit. In that view the Commission need be issued only after the question whether the defendant is entitled to adjust the claim by him is decided. Therefore I allow C.R.P. No. 1117 or 1976 and dismiss C.R.P. No. 1471 of 1976. There will be no order as to costs.