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2000 DIGILAW 510 (KAR)

Syndicate Bank v. Cantreads Private Limited

2000-07-20

T.N.VALLINAYAGAM

body2000
ORDER T.N. Vallinayagam, J.—This Civil Revision Petition is directed against the order in Miscellaneous Case No. 18 of 1997 passed by the Prl. Civil Judge (Senior Division) Mangalore, rejecting an application under Section 66 of the Karnataka Court Fees and Suits Valuation Act, 1958 praying for refund of half court fee. 2. The facts that led to filing of the above petition before the trial Court was that a suit was filed in O.S. 247 of 1991 by the Syndicate Bank for recovery of money and under the provisions of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (Act No. 51 of 1993), a suit was transferred to the Debt Recovery Tribunal constituted in Bangalore and accordingly the matter stood transferred to the Tribunal for recovery of the amount. Ultimately the said proceedings i.e., O.A. 942 of 1995 on the file of the Debt Recovery Tribunal Bangalore was dismissed as settled out of Court. In view of the settlement out of the Court and when the Tribunal was not called upon to exercise any powers in the discharge of administration of justice, the applicant applied for refund of half court fee. The Petitioner also relied upon a decision reported in 1992 (2) LW 110 and sought refund of Court fee. The trial Court distinguished that decision and holding that when the matter was transferred to the competent Court, the Civil Court has no right to pass any order, much less, the order for refund of Court fee paid. Thus, the petition came to be dismissed. Feeling aggrieved by the same, the Petitioner has come forward with the present revision. 3. It is contended by Mr. K. Radesh Prabhu that the Civil Court has got power to review of retransfer to the Court a suit transferred to the Tribunal for the purpose of doing justice and that power cannot be denied by a self denial by the learned Prl. Civil Judge. The finding that once a suit is transferred and disposed of by the Tribunal, it is not possible for the Civil Court to exercise its jurisdiction is not proper, according to the learned Counsel. It is also submitted that by operation of law when the suit has been transferred, the Tribunal does not require payment of any additional court fee. The finding that once a suit is transferred and disposed of by the Tribunal, it is not possible for the Civil Court to exercise its jurisdiction is not proper, according to the learned Counsel. It is also submitted that by operation of law when the suit has been transferred, the Tribunal does not require payment of any additional court fee. In fact the Court fee payable to the Tribunal was much less and consequently he is entitled to refund of the entire court fee except the fee chargeable by the Tribunal for recovery of such sums of money. In a separate application under the provisions of Act 51 of 1993. The refusal to exercise jurisdiction is against the provisions of Sections 17 and 18 of the Central Act 51 of 1993. Section 17 confers on the Debt Recovery Tribunal power and jurisdiction to decide the application of the Bank and Financial Institutions for recovery of debts due to them. While Section 31 provides for transfer of pending suit from the Civil Court to the Debt Recovery Tribunal and confers powers to decide such suits by treating them by its application there is no provision made out regarding court fee already paid. The Court fee having been paid before the Civil Court under the Karnataka Act 16 of 1958, it is the Civil Court that is competent to grant the relief as prayed for by the Petitioner-Bank. It is further submitted that when the Court is empowered to collect the Court fee after the disposal of the case from the parties, the power to refund the Court fee collected excess is deemed to have been impliedly available to the courts and such jurisdiction has not been properly exercised by the trial Court. It is further submitted that neither the Tribunal nor the Court nor the State of Karnataka be permitted to retain the amounts collected as the Court fee without rendering necessary services to the parties. 4. As against this submission, the learned Government Advocate Mr. Satish submitted that once the case gets transferred to the Tribunal, there is no power for the Tribunal to transfer back to the Civil Court or the Tribunal has power to direct refund of the Court fee. 4. As against this submission, the learned Government Advocate Mr. Satish submitted that once the case gets transferred to the Tribunal, there is no power for the Tribunal to transfer back to the Civil Court or the Tribunal has power to direct refund of the Court fee. According to him, the Civil Court has become functus officio once the transfer has taken place and the Tribunal constituted under the Act has taken over the control of the case. 5. I have considered the submissions made by the respective Counsel. 6. Refund of Court fee is governed under Chapter VII of the Karnataka Courts Fees and Suits Valuation Act. Section 66 which speaks about refund of the Court fee on settlement before hearing reads as follows: Refund on settlement before hearing: Whenever by an agreement of parties- (a) any suit is dismissed as settled out of Court before any evidence has been recorded on the merits of the claim; or (b) any suit is compromised ending in a compromise decree before any evidence has been recorded on the merits of the claim; or (c) any appeal is disposed of before the commencement of hearing of such appeal; half the amount of all fees paid in respect of the claim or claims in the suit or appeal shall be ordered by the Curt to be refunded to the parties by whom the same have been respectively paid. 7. The word 'suit' has been defined under Section 2(10) of the Act 9 of 1908; under Section 3(2) of Act 22 of 1886, as follows: Prosecution or pursuit of some claim, demand or request; the act of suing, the process by which one endeavours to gain an end or subject; attempt to attain a certain result; the act of suing; the process by which one gains an end or subject, an action or process for the recovery of a right or claim; the prosecution of some demand in a court of justice; any proceeding in a court of justice in which Plaintiff pursues his remedy to recover a right or claim; the mode and manner adopted by law to redress civil injuries; a proceeding in a Court of justice for the endorsement of a right. A suit is any proceeding in a Court of justice on which a Plaintiff pursues his remedy to recover a right or claim. A suit is any proceeding in a Court of justice on which a Plaintiff pursues his remedy to recover a right or claim. The word 'suit' embraces action of law as well ad equity cases. The term 'suit' is a very comprehensive one, and is said to apply to any proceeding in a Court of justice by which an individual pursues that remedy which the law affords him. The modes of proceeding may be various, but if the right is litigated between the parties in the Court of justice, the proceeding in a suit. In fact in Vally Mohamad Haji Gunny Vs. Nederland S. Navigation Co. and Another, AIR 1924 Cal 173, it is held that "the word 'suit' in the last clause of para 2, Section 11 of the Court Fees Act, does not mean the entire suit. It can fairly be construed as a suit or claim in respect of the mesne profits". In AIR 1930 Oudh 468, it is held that "there is nothing to prevent the Court from treating a suit as an application". In (Haji) Vali Mohomed Ayoob Vs. Shamdeo Gopiram, AIR 1930 Cal 774, it is held "use of the word 'cases' instead of 'suit' in Section 115 Code of Civil Procedure shows that the section contemplates the legal proceedings which are not stated in the strict sense but which are governed by the provisions of the Code of Civil Procedure. 8. The fact that a suit was filed in O.S. 247 of 1991 on the file of the Civil Court is not in dispute and the further fact that at the time when the suit was transferred Court fee due under Section 24 has been paid. 9. Now after the advent of Recovery of Debts Due to Banks and Financial Institutions Act, 1993, namely, Act 51 of 1993, under Section 31 the pending cases on the file of the Civil Court are transferred. 9. Now after the advent of Recovery of Debts Due to Banks and Financial Institutions Act, 1993, namely, Act 51 of 1993, under Section 31 the pending cases on the file of the Civil Court are transferred. Section 31 reads as follows: Transfer of pending cases.-1) Every suit or other proceeding pending before any Court immediately before the date of establishment of a Tribunal under this Act, being a suit or proceeding the cause of action whereon it is based is such that it would have been, if it had arisen after such establishment, within the jurisdiction of such Tribunal, shall stand transferred on that date to such Tribunal: Provided that nothing in this Sub-section shall apply to any appeal pending as aforesaid before any Court. (2) Where any suit or other proceeding stands transferred from any Court to a Tribunal under Sub-section (1): (a) the Court shall, as soon as may be after such transfer, forward the records of such suit or other proceeding to the Tribunal; and (b) the Tribunal may, on receipt of such records, proceed to deal with such suit or other proceeding, so far as may be, in the same manner as in the case of an application made under Section 19 from the stage which was reached before such transfer or from any earlier stage as the Tribunal may deem fit. In fact the word used in the above section, "is suit or other proceeding", when such a suit is transferred, the same is numbered as an application within the meaning of Section 19 of the Act. Section 19(3) reads as follows: Every application under Sub-section (1) or Sub-section (2) shall be in such form and accompanied by such documents or other evidence and by such fee as may be prescribed: Provided that the fee may be prescribed having regard to the amount of debt to be recovered. Provided further that nothing contained in this Sub-section relating to fee shall apply to cases transferred to the Tribunal under Sub-section (1) of Section 31. From the above section it is clear that no further fee is payable in respect of transferred cases. Provided further that nothing contained in this Sub-section relating to fee shall apply to cases transferred to the Tribunal under Sub-section (1) of Section 31. From the above section it is clear that no further fee is payable in respect of transferred cases. In fact for filing any application before the Debt Recovery Tribunal, Rule 7 fixes the application fee as follows: Application fee- (1) Every application under Section 19, interlocutory application or application for review of decision of Tribunal shall be accompanied with a fee provided in Sub-rule (2) and such fee may be remitted either in the form of crossed demand draft drawn on a nationalised bank in favour of the Registrar and payable at the station where the Registrar's office is situated or remitted through a crossed Indian Postal Order drawn in favour of the Registrar and payable in Central Post Office of the station located at any place within local limits of the jurisdiction of a Tribunal. (2) The amount of fee payable shall be as follows:- S. No. Nature of application Amount of fees payable 1. Application for recovering of debts due : (a) Where amount of debt due is 10 lakhs. Rs. 12,000/- (b) Where amount of debt due is Rs. 12,000/- plus above Rs. 10 lakhs Rs. 1,000/- for every one lakh of debt due or part thereof in excess of Rs. 10 lakhs, subject to a maximum of Rs. 1,50,000/- 2. Application for review Rs. 50 per cent of the fee paid 3. Application for review Rs. 10/- 4. Vakalathnama Rs. 5/- 10. So the maximum fee prescribed is Rs. 1.5 lakhs (in the present case the fee paid is Rs. 21,92,544/-). There is no express provision made in the Act as to what should happen to the excess Court fee paid on a suit, which stood transferred under Section 31 of the Act on the coming into force of the Act. Prima facie it is seen that on the date on which the application was transferred to the Tribunal, applying Section 7 of the Act, there is excess payment of Rs. 20,42,544/-. This amount which was paid under the Court Fees Act must be deemed as excess fee paid. In fact Section 67 of the Karnataka Court Fees and Suits Valuation Act, 1958, deals with the refund of Court fee paid by mistake or inadvertence. 20,42,544/-. This amount which was paid under the Court Fees Act must be deemed as excess fee paid. In fact Section 67 of the Karnataka Court Fees and Suits Valuation Act, 1958, deals with the refund of Court fee paid by mistake or inadvertence. Section 67 reads as" the fee paid by mistake or inadvertence shall be ordered to be refunded". But for the new Act constituting DRT, if the Bank were to file a suit by way of application before the Tribunal, the payment of such a large sum as Court fee must be taken as a mistake or inadvertence. There ought to have been a provision either in Act 51 of 1993 or in the Court Fees and Suits Valuation Act itself to meet such a situation and contingency. But there has been no provision made so far. 11. In my opinion, once an application gets transferred to the Tribunal as the Tribunal is called upon to act on the payment of Court fee prescribed under Rule 7, the excess fee paid by any litigant/Plaintiff or bank must be directed to be refunded. 12. Coming to the present case at hand, there has been settlement reported and as rightly pointed out by the learned Counsel the Court/Tribunal cannot be permitted to refund the amount collected as Court fees without rendering necessary service to the parties. According to him, interest of justice requires that the amount collected as fees cannot be retained even when there was no service rendered by the Civil Court. My attention is drawn to Section 2(2) of the Karnataka Act 16 of 1958, which reads as follows: Where any other law contains provisions relating to the levy of fee in respect of proceedings under such other law, the provisions of this Act relating to the levy of fee in respect of such proceedings shall apply subject to the said provisions of such other law. But in this case so far as the other Act is concerned, there is no provision contained therein. 13. It is to be, noted hat it is by operation of law and statute the suit is transferred and not at the request of the Plaintiff or the party. But in this case so far as the other Act is concerned, there is no provision contained therein. 13. It is to be, noted hat it is by operation of law and statute the suit is transferred and not at the request of the Plaintiff or the party. As rightly pointed by the learned Counsel the proviso to Section 19(3) makes it clear that" nothing contained in Sub-section relating to fee shall apply to the cases transferred to the Tribunal under Sub-section (1) of Section 31. Once the Court fee is paid in a Civil Court and the regulation of payment of fee is made by the other Act separately, Section 2(2) of the Karnataka Court Fees and Suits Valuation Act ceases to have any force. Admittedly here the Court which is defined under Section 3(ii) is a Court which receives the Court fees at the time of the presentation of the plaint and payment has been made under the provisions of the Karnataka Court Fees and Suit Valuation Act by the competent Court. Within the meaning of General Clauses Act, the power to receive equally contemplates the power to refund as well, otherwise there will be a fallacy and lacuna created under which the Court fee paid by the bank is not utilised for the purpose of rendering service by the Civil Court and at the same time it is not also to be utilised by the Tribunal which really renders service of disposing of the case. 14. In this view, I feel that Section 66 of the Court Fees Act is directly applies to the facts of this case. It is also significant to point out that the Tribunal has declined to pass an order for refund on the ground that it has no power or jurisdiction. Thus, the applicant is compelled to go before the trial Court and move an application under Section 66 of the Court Fees Act. 15. Another point to be noted is that the Government who is supposed to be the guardian of the payment of the Court fee has not chosen to raise a little finger by way of objection before the trial Court and even here. It is unfortunate that this Court is denied of any valid objections by the Government. 15. Another point to be noted is that the Government who is supposed to be the guardian of the payment of the Court fee has not chosen to raise a little finger by way of objection before the trial Court and even here. It is unfortunate that this Court is denied of any valid objections by the Government. In fact the case has been adjourned on several times to enable the Government to have the services of the Advocate General so that the point in issue may be enlightened for the benefit of the Court, in such circumstance and in the interest of equity, I feel that the application must be allowed. 16. As already pointed supra, the word 'suit' includes an application and the application is a nomenclature given to a suit before the Tribunal and really a suit within the meaning of any definition the law gives to the word suit. 17. In the result, the Civil Revision Petition is allowed and the refund of the Court fee as prayed is ordered.