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2021 DIGILAW 126 (KER)

State Bank Of India, Asset Recovery Management Branch, Ernakulam v. Niyas

2021-02-10

A.HARIPRASAD, T.V.ANILKUMAR

body2021
ORDER : T.V. ANILKUMAR, J. This is an unnumbered appeal posted by the Registry before us at the request made by the appellant-Bank for a decision on the question of adequacy of court fee payable by it in the appeal. The objection raided by the appellant is that it is not liable to pay court fee at the rate valued by the plaintiff in the suit before the court below. 2. The appellant is a third party to the suit and is aggrieved by the decree granted by the court below declaring Ext. A2 sale deed executed by the plaintiff in favour of the sole defendant in the suit as sham and void and directing the defendant to execute a deed of re-conveyance to the plaintiff in relation to the plaint schedule property and also to hand over possession thereof and also for consequential prohibitory injunction. 3. The suit was valued under sections 25(b) and 30 and 27(c) of the Kerala Court Fees and Suits Valuation Act, 1959 (for short, ‘the Act’) for the purpose of computation of court fee, adopting the market value of the property. It appears that being a multifarious suit, the court fee was computed on the aggregate value of all the aforesaid four reliefs. 4. The objection raised by the learned counsel for the appellant to the computation of the court fee is two fold viz., (1) The suit was valued for consequential reliefs also, though as a matter of law the fee was chargeable only for the main relief and (2) The proper court fee payable was only under section 40 of the Act and that too, on the value of property mentioned in Ext.A2 sale deed. 5. The reliefs mentioned in the suit are extracted below : (a) pass a decree declaring that the sale deed bearing No. 53/2012 of SRO, Edappally is a sham and void document and not binding upon the plaintiff (b) pass a decree in favour of the plaintiff permitting him to recover the possession of the plaint schedule property from the defendant. (c) pass a decree directing the defendant to execute a deed of reconveyance in respect of the plaint schedule property in favour of plaintiff. Failing which the plaintiff may be permitted to get the reconveyance deed executed through process of court. (c) pass a decree directing the defendant to execute a deed of reconveyance in respect of the plaint schedule property in favour of plaintiff. Failing which the plaintiff may be permitted to get the reconveyance deed executed through process of court. (d) pass a decree of permanent prohibitory injunction restraining the defendant, his men and agents from trespassing to the plaint schedule property. 6. On hearing the learned counsel for the appellant and having regard to the nature of the reliefs claimed, we accept his argument that plaint should have been chargeable with fee only on the main relief as others are only ancillary. 7. Though section 6 of the Act provides a general rule for levy of court fee on the aggregate value of the separate and distinct reliefs arising out of the same cause of action, under the proviso thereof, the plaint shall be chargeable only on the value of the main relief, if any other relief claimed is only ancillary to the main relief. The rationale for the proviso is that main relief embraces every relief for which the suit is laid before the court. An ancillary relief means a dependent or a mere consequential relief. It cannot survive without the main relief being granted in the suit. The real test to distinguish between an ancillary relief and a main relief is to see whether one could sustain without the other being granted. We hold, having regard to the nature of reliefs claimed, that court fee chargeable was only on the main relief claimed in the plaint. 8. It is next contended by the learned counsel for the appellant that even though relief (a) in the plaint happens to be in a declaratory form seeking Ext.A2 sale deed to be frowned upon as sham and void and also as not binding on the plaintiff, it has nevertheless the effect of seeking a cancellation of Ext.A2 sale deed. The gist of the learned counsel’s submission is that the plaintiff’s attempt in either way is to get rid of the sale deed which he admits to have executed. Once a decree declaring a document as void is secured, it would be practically a decree canceling the document also. The gist of the learned counsel’s submission is that the plaintiff’s attempt in either way is to get rid of the sale deed which he admits to have executed. Once a decree declaring a document as void is secured, it would be practically a decree canceling the document also. It is, therefore, submitted that in such an event, the plaint (a) relief ought to be valued only in terms of section 40 of the Act which provides for payment of court fee on the value of the subject matter of suit as contra-distinguished from the market value of the suit property. 9. It is a fact that the value of suit property mentioned in Ext.A2 is far less than the market value adopted in the plaint. We do not have any doubt in our mind that once section 40 applies, the fee chargeable is only on the value of subject matter in the suit as distinct from the market value of the property as held in Mathew Varghese v. M. Amritha Kumar & Others [ (2014) 5 SCC 610 ], Satheedevi V. Prasanna and Another [ (2010) 5 SCC 622 ] and Suhrid Singh Alias Sardool Singh v. Randhir Singh and Others [ (2010) 12 SCC 112 ] 10. The learned counsel for the appellant, relying on Chellakannu v. Kolanji [2005 (5) CTC 190] and J. Vasanthi and Others v. N. Ramani Kanthammal and Others [ (2017) 11 SCC 852 ], has submitted that when a party to a deed impugns it and seeks a declaration that the deed is void, the suit ought to be reckoned as one brought for implied cancellation of the deed which is liable to be valued only under Section 40 of the Act, notwithstanding the language of relief being couched in a declaratory form. The argument is no doubt sound; but legal position canvassed does not fit in with the facts on hand. 11. Looking at the plaint allegations as a whole, we find it difficult to consider the instant suit as one brought for an implied cancellation of Ext. A2 sale deed, despite plaint (a) relief containing a prayer for declaring the sale deed as sham and void and not binding on the plaintiff. 12. 11. Looking at the plaint allegations as a whole, we find it difficult to consider the instant suit as one brought for an implied cancellation of Ext. A2 sale deed, despite plaint (a) relief containing a prayer for declaring the sale deed as sham and void and not binding on the plaintiff. 12. The suit was originally institute in 2015 with reliefs for declaration, recovery of possession and prohibitory injunction, which was subsequently amended in 2017 to incorporate a new relief (c) already extracted in the early party of this judgment. 13. Had the suit proceeded with original reliefs in the unamended plaint before relief (c) being added to the plaint, the proper feed chargeable on the plaint would have certainly been as per Section 40 of the Act, as in the cases of a suit for cancellation. But, having due regard to the entirety of allegations disclosed by the plaint, it is very difficult to regard (c) relief in the plaint to be only ancillary or consequential. On the other hand, we have serious concern that plaint (a) and (c) reliefs conflict with each other and can hardly go hand-in-hand because legal implication of a void document is that it neither creates any interest in favour of a party not divest any interest existing in a party. So much so, a reconveyance becomes unnecessary in a legal sense. 14. The plaintiff’s case as disclosed by the amended plaint is that he borrowed a sum of Rs. 23,00,000/- from the defendant and executed in the latter’s name Ext.A2 sale deed offering plaint schedule property as a mere security for repayment of loan on a mutual understanding between parties that the property shall be reconveyed to plaintiff upon the liability of the plaintiff towards loan amount being discharged. According to plaintiff, though he discharged the liability and demanded execution of deed of reconveyance, it was not acceded to and consequentially, the suit was filed. 15. As held in P.J. Mathai V. C.P. Scharia [ 1969 KLJ 696 ], it is legally open to the court which decides upon the question as to adequacy of court fee payable, to go behind the language which is used by the plaintiff in the plaint to couch his prayer, to see what is, in substance and effect of the relief claimed in the plaint. On a reasonable reading and perception of the pleadings in the plaint, what is gatherable is that plaintiff’s suit in effect and substance is for a decree of execution of reconveyance deed, despite it being laid for declaring the sale deed as sham and void. It is stated in the plaint that execution of the sale deed was intended only to guarantee repayment of loan rather than to effect transfer of rights in the property. 16. The plaintiff, as a matter of law, cannot claim that the sale deed executed is in substance, a security on account of the bar executed by Section 92 of the Indian Evidence Act, 1872. It may, of course, be open to parties to the deed to contend that the document was only sham and did not take effect for which bar under section 92 does not operate. 17. A deed is usually considered to be sham or nominal when nothing could come out of it. A sham or nominal document is wholly inoperative and incapable of creating any rights in the property in favour of the purported assignee or transferee. 18. The allegations in the plaint when taken in its entirety are hardly sufficient to make out a case that the sale deed in favour of the defendant is sham or nominal. On the other hand, the clear pleading in the plaint indicates that there was mutual understanding between parties at the time of execution of sale deed that the defendant would execute a deed of reconfeyance in faour of the plaintiff on the latter discharging the loan liability. 19. A learned judge of this Court held in Moosa v. Moideen [2001 KHC 72] that a suit for declaring sale deed as sham or void in similar circumstances is not maintainable and the appropriate remedy open to the aggrieved is to sue for execution of deed for re-conveyance of property as in the case of a suit for specific performance. Paragraph Nos. 7 and 9 of the above said decision are extracted below : “7. Ext. A1 is clearly a sale in terms of S. 54 of the Transfer of Property Act. The recitals show a conveyance of property for a price paid. Thus the definition of sale is clearly satisfied. Ext. A1 also shows that possession was transferred to the transferee on the date of the transaction. Ext. A1 is clearly a sale in terms of S. 54 of the Transfer of Property Act. The recitals show a conveyance of property for a price paid. Thus the definition of sale is clearly satisfied. Ext. A1 also shows that possession was transferred to the transferee on the date of the transaction. It also contains the usual covenant for title and quite enjoyment. It also contains an assurance by the transferor of the non-existence of encumbrance over the property. Coupled with this is the admission in the plaint that the income from the property was being taken by the plaintiff subsequent to the transaction Ext.A1 is a sale and nothing but a sale. Even assuming that the plaintiff has the right to show that notwithstanding the fact that Ext. A1 is a sale it was intended only to be a security in view of the proviso to S. 92 of the Indian Evidence Act, this is a clear case where clear evidence was needed on the side of the plaintiff to establish that face. We cannot also forget the case set up in the plaint that the agreement was that on the sum of Rs. 2000 being repaid, the property would be reconveyed to the plaintiff by the defendant. What one can understand on a reasonable reading of the plaint is that what the plaintiff has set up is a case of an agreement for reconveyance by the defendant to the plaintiff. The very plea in my view implies that there is an admission that the title to the property has been conveyed to the defendant by the transaction Ext. A1. Otherwise there would be no question of the defendant having agreed to execute a reconveyance on receipt of the money which allegedly the plaintiff had borrowed. The fact that an agreement for re-conveyance is set up by the plaintiff itself reinforces the fact title under Ext. A1 had been conveyed to the defendant. 8. xxx xxx xxx 9. I shall first consider the contention that the suit as framed is not maintainable which is framed as one of the substantial questions of law arising for decision in this second Appeal. On a reading of the plaint it is clear that what the plaintiff has set up in a case of an agreement to reconvey the property on his paying a sum of Rs. On a reading of the plaint it is clear that what the plaintiff has set up in a case of an agreement to reconvey the property on his paying a sum of Rs. 2000 recited as consideration for the sale in Ext. A1. In the context of the plea raised by him what the plaintiff had to sue for is for specific performance of the agreement to reconvey. If the plaintiff has a case that no time for execution of the reconveyance was fixed in the agreement, he could have pronounced the theory of demand and refusal to bring the suit within time. Clearly time was of the essence of the contract in an agreement for reconveyance. Having specifically pleaded that the defendant insisted on a sale deed being executed and a sale deed was executed and having set up a parol agreement outside the sale transaction to the effect that the defendant had agreed to reconvey the property to the plaintiff on payment to him of the amount due, the plaintiff was bound to include a prayer for the relief of specific performance in the plaint. In the absence of such a prayer for specific performance, clearly the suit as framed is not maintainable.” [underlines supplied] 20. A demand being made to the defendant in the suit for execution of deed of reconveyance of property must necessarily imply the plaintiff’s admission as to the transfer of his rights to the defendant in the past. The expression ‘reconveyance’ denotes a demand made for re-transfer of rights which has already taken effect through a deed in favour of the transferee. A suitor cannot blow hot and cold that the conveyance has not taken effect and yet he is entitled to reconveyance of rights. Such a contention is mutually contradictory and cannot go in tandem. A plaintiff having pleaded in his plaint that defendant agreed to reconvey the property on receipt of loan amount back, is estopped by his act from contending the sale deed executed by him was not intended to take effect and was therefore sham. No. Court will be in position to declare a sale deed executed in such circumstances to be sham or nominal. 21. No. Court will be in position to declare a sale deed executed in such circumstances to be sham or nominal. 21. In view of the factual and legal position occurring in this case, we are of the view that relief (a) in the plaint cannot be valued for the purpose of computation of court fee. In other words, only those reliefs which are chargeable with fee are reliefs (b) to (d) in the plaint. The relief (c) being the main relief, we find that the plaint is chargeable with court fee only for the said relief. 22. Then arises the question as to the provision under which plaint (c) relief is liable to be valued. A suit for execution of deed re-conveyance is in effect a suit for specific performance of a promise or agreement. The relevant section in the Act that applies to the facts of the case is Section 42(e). This clause provides that the suit is liable to be valued on the market value of consideration for the promise made. In our view, the consideration for promise made by the defendant so far as the present suit is concerned, is the amount of loan received by the plaintiff from defendant. The defendant’s promise to re-convey the property is based on the said consideration of the loan amount. In the result, we hold that the amount of court fee which the appellant is liable to pay in the unnumbered appeal is on the loan amount of Rs. 23,00,000/- which the plaintiff claims to have repaid to the defendant as condition for execution of promise for re-conveyance. All pending interlocutory application will stand closed