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REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NOS. 2456-2457 OF 2014 [Arising out of SLP (C) Nos.16353-54 of 2012)  

Polamrasetti Manikyam & Anr. .. Appellants

Versus

Teegala Venkata Ramayya & Anr. .. Respondents

J U D G M E N T

K. S. RADHAKRISHNAN, J.

1. Leave granted.

2. We  are,  in  this  case,  concerned  with  the  

interpretation  of  Section  37  of  the  Andhra  Pradesh  

Court Fees and Suits Valuation Act, 1956 (for short “the  

Court  Fees  Act”)  as  to  whether  it  authorizes  the  

valuation  of  the  suit  on  the  basis  of  the  sale

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consideration  mentioned  in  the  sale  deed  or  to  be  

valued on the basis of the market value of the property  

as  on  the  date  of  presentation  of  the  plaint  for  the  

purpose of Court Fee and jurisdiction.   

3. Learned Single Judge of the Andhra Pradesh High  

Court in the impugned judgment placing reliance on the  

Full  Bench  judgment  of  the  Madras  High  Court  in  

Kolachala  Kutumba  Sastri  v.  Lakkaraju  Bala  

Tripura Sundaramma & Ors. AIR 1939 Mad. 462, and  

the  Division  Bench  Judgment  of  the  Andhra  Pradesh  

High  Court  in  Lakshminagar  Housing  Welfare  

Association  v.  Syed Sami  @ Syed Samiuddin  &  

Ors.  (2010)  5  ALT  96,   held  that  in  a  suit  for  

cancellation  of  sale  deed,  Court  Fee  has  to  be  

determined on the market value of the property as on  

the date of presentation of the plaint and not the value  

shown in the registered sale deed, the legality of which  

is under challenge in these appeals.

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4. The Appellants/Plaintiffs filed O.S. No.114 of 2008  

on  21.7.2008  before  the  Court  of  Junior  Civil  Judge,  

Kothavalasa, seeking, inter alia,  the following reliefs :-

“(a) to  cancel  the  alleged  sale  deed  dated  2.8.2002  which  was  got  registered  as  No.2496/05  by  the  Sub-Registrar,  Kothavalasa  on  dt.  30  July,  2005  as  the  orders of District Registrar dt. 26.07.2005 as  it was obtained fraudulently;  

(b) direct the defendants to pay the cost of the  suit.”

5. Value of the suit for the purposes of Court Fee and  

jurisdiction was shown as the value of the deed to be  

cancelled i.e.  Rs.1 lakh.  Court Fee of Rs.3,426/- was  

paid under Section 37 of the Court Fees Act, deposited  

vide  Challan  No.4239075  dated  29.7.2008.    The  

Appellants/Plaintiffs  filed  I.A.  No.374  of  2008  under  

Order  IX  Rule  1  and  2  CPC  for  grant  of  temporary  

injunction  restraining  the  Respondents  therein  from  

interfering with peaceful possession and enjoyment of  

the  property  and  also  filed  I.A.  No.375  of  2008  and

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sought  an  order  restraining  the  Respondents  from  

operating the sale deed until the disposal of the suit.  

During  enquiry  in  I.A.  No.375  of  2008,  the  

Appellants/Plaintiffs got market value certificate dated  

4.10.2002 as Exh.A-6 showing the market value of the  

property  as  Rs.19,36,000/-  by  the  year  2002  and  

contended  that  the  alleged sale  for  Rs.1  lakh  was  a  

fraudulent  transaction.    The  Respondents  raised  an  

objection  that  the  Civil  Judge  has  no  jurisdiction  to  

entertain the suit since the Plaintiff’s case is that the  

market value of the property is more than Rs.1 lakh.  It  

was contended that for cancellation of sale deed, Court  

Fee has to be calculated on the current market value,  

but not as per value shown on the document.   Reliance  

was placed on the judgment of the Madras High Court  

in  Kolachala  Kutumba  Sastri  (supra)  and  T.S.  

Rajam  Ammal  v.  V.N.  Swaminathan  &  Ors.  AIR  

1954 Mad. 152, wherein it was held that in a suit for  

cancellation of sale deed, Court Fee payable is on the

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market value of the property involved as on the date of  

the plaint and not on the consideration recited in it.   

6.  Learned  Civil  Judge  vide  his  order  dated  

25.11.2008 took the view that the Court Fee has to be  

calculated  as  per  the  market  value  on  the  date  of  

presentation  of  the  plaint  and  not  as  per  the  value  

shown on the document.   Consequently,  it  was held  

that the Court has no pecuniary jurisdiction to entertain  

the suit and the plaint was returned under Order 7 Rule  

10 CPC for presentation before the proper Court.   

7. The  Appellants/Plaintiffs,  aggrieved  by  the  said  

order,  filed  C.M.A.  No.2  of  2009  in  the  Court  of  the  

Judge,  Family  Court-cum-District  and  Sessions  Judge,  

Vizianagaram.   The  appellate  Court  dismissed  the  

appeal vide its order dated 29.10.2009 holding that the  

Court below has no jurisdiction to entertain the suit and  

the  plaint  was  correctly  returned  for  presentation  

before the appropriate Court holding that the Court Fee  

has to  be calculated as  per  the market  value of  the

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property as on the date of presentation of the plaint  

and not on the value shown in the registered sale deed.

8. The Appellant, aggrieved by the said order, filed  

Civil Revision Petition No.2539 of 2010 before the High  

Court  of  Andhra  Pradesh,  Hyderabad.    The  learned  

Single  Judge  of  the  Andhra  Pradesh  High  Court,  as  

already stated, placing reliance on the judgment of the  

Madras High Court in  T.S. Rajam Ammal (supra) and  

also the Full Bench decision of the Madras High Court in  

Kolachala Kutumba Sastri (supra) and also a Division  

Bench judgment of the Andhra Pradesh High Court in  

Lakshminagar  Housing  Welfare  Association  

(supra),  took  the  view  that  under  Section  37  of  the  

Court Fees Act, for cancellation of the sale deed the suit  

has to be valued on the basis of the market value of the  

property  governed  by  the  sale  deed  on  the  date  of  

presentation of the plaint for the purposes of Court Fee  

and  jurisdiction  and  not  on  the  basis  of  sale  

consideration  mentioned  in  the  sale  deed.   The  

appellants  then  filed  a  review  petition  being  Review

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CRP No.6557 of 2010 seeking review of the judgment  

based on the Judgment of this Court in Satheedevi v.  

Prasanna and another (2010) 5 SCC 622.  The review  

petition  was,  however,  dismissed  on  19.1.2011.  

Aggrieved  by  the  same,  these  appeals  have  been  

preferred.

9. We  are,  in  this  case,  concerned  with  the  

interpretation of Section 37 of the Court Fees Act, which  

reads as follows :-

“37. Suits  for  cancellation  of  decrees,  etc. – (1) In a suit for cancellation of a decree  for money or other property having a money  value, or other document which purports or  operates  to create,  declare,  assign,  limit  or  extinguish,  whether  in  present  or  in  future,  any right, title or interest in money, movable  or  immovable  property,  fee  shall  be  computed on the value of the subject matter  of the suit, and such value shall be deemed  to be :-

(a) If the whole decree or other document is  sought  to  be  cancelled,  the  amount  or  value of the property for which the decree  was  passed  or  other  document  was  executed;

(b) If  a  part  of  the  decree  or  other  document is sought to be cancelled, such

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part of the amount or of the value of the  property.

(2) If the decree or other document is such  that the liability under it cannot be split up  and  the  relief  claimed  relates  only  to  a  particular item of property belonging to the  plaintiff or to the plaintiff’s share in any such  property, fee shall be computed on the value  of such property, or share or on the amount  of the decree, whichever is less.

Explanation :  A suit to set aside an award  shall be deemed to be a suit for cancellation  of  a  decree  within  the  meaning  of  this  section.”

10. When the matter came up for hearing, the learned  

counsel  for  either  side  brought  to  our  knowledge  a  

judgment  of  this  Court  in  Satheedevi  (supra)  and  

submitted  that  a  similar  issue  came  up  for  

consideration  in  the  above-mentioned  case  while  

interpreting Section 40 of  the Kerala  Court  Fees and  

Suit  Valuation  Act,  1959,  which  is  pari  materia  with  

Section 37 of the Andhra Pradesh Court Fees and Suits  

Valuation Act,  1956.   While interpreting the scope of  

Section 40 of the Kerala Act, this Court had occasion to  

examine  the  ratio  laid  down  by  Full  Bench  of  the

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Madras  High  Court  in  Kolachala  Kutumba  Sastri  

(supra)  and  took  the  view  that  in  the  said  the  

interpretation of Section 7(iv-a) of the Court Fee Act, as  

case, the Madras High Court was primarily concerned  

with amended by the Madras Act, which refers to the  

value  of  the  property  simplicitor  and  the  Court  

interpreted the same as market value.  It was pointed  

out that the Full Bench was not called upon to interpret  

a provision like Section 40 of the Act.  Consequently, it  

was  held  that  the  ratio  of  that  judgment  cannot  be  

relied upon for the purpose of interpretation of Section  

40 of the Act.   While doing so, the Court also opined  

that  the  Division Bench judgment  of  the Kerala  High  

Court  in  Krishnan  Damodaran  v.  Padmanabhan  

Parvathy 1972 KLT 774, P.K. Vasudeva Rao v. K.C.   

Hari  Menon  AIR  1982  Ker  35,  Pachayammal  v.  

Dwaraswamy Pillai 2006 (3) KLT 527 and the learned  

Single Judge judgments in  Appikunju Meerasayu v.  

Meeran  1964  KLT  895  and  Uma  Antherjanam  v.  

Govindaru Namboodiripad 1966 KLT 1046 do not lay

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down the correct law since the High Court had failed to  

appreciate that the legislature has designedly used a  

different language in Section 40 of the Act and the term  

“market value” has not been used therein.

11. We have already indicated that Section 40 of the  

Kerala Act and Section 37 of the Court Fees Act are pari  

materia provisions.    Consequently,  the  reasoning  of  

this  Court  in  Satheedevi (supra)  could  be  safely  

applied when we interpret Section 37 of the Court Fees  

Act.  

12. In  Satheedevi (supra),  this  Court  while  

interpreting  Section  40  of  the  Kerala  Act  held  as  

follows :-

“17. Section  40  deals  with  suits  for  cancellation  of  decrees,  etc.  which  are  not  covered by other  sections.  If  this  section is  interpreted  in  the  light  of  the  expression  “save as otherwise provided” used in Section  7(1), it becomes clear that the rule enshrined  therein  is  a  clear  departure  from  the  one  contained in Section 7 read with Sections 25,  27, 29, 30, 37, 38, 45 and 48 which provide  for payment of court fee on the market value

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of  the  property.  In  that  sense,  Section  40  contains a special rule.

18. Section 40(1) lays down that in a suit for  cancellation of a decree for money or other  property  having  a  money  value,  or  other  document  which  purports  or  operates  to  create,  declare,  assign,  limit  or  extinguish,  whether in the present or in future, any right,  title  or  interest  in  money,  movable  or  immovable property,  fee shall  be computed  on the value of the subject-matter of the suit  and further lays down that such value shall  be deemed to be, if the whole decree or other  document  sought  to  be  cancelled,  the  amount or value of the property for which the  decree was  passed or  other  document  was  executed.  If  a  part  of  the  decree  or  other  document  is  sought  to  be  cancelled,  such  part of the amount or value of the property  constitute the basis for fixation of court fee.  Sub-section (2) lays down that if the decree  or  other  document  is  such that  the liability  under  it  cannot  be  split  up  and  the  relief  claimed relates  only  to  a particular  item of  the property belonging to the plaintiff or the  plaintiff’s share in such property, fee shall be  computed on the value of such property, or  share  or  on  the  amount  of  the  decree,  whichever is less.

19. The  deeming  clause  contained  in  the  substantive  part  of  Section  40(1)  makes  it  clear that in a suit filed for cancellation of a  document  which  creates  any  right,  title  or  interest in immovable property, the court fee  is required to be computed on the value of  the  property  for  which  the  document  was  executed. To put it  differently,  the value of

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the  property  for  which  the  document  was  executed and not its market value is relevant  for the purpose of court fee. If the expression  “value of the subject-matter of the suit” was  not followed by the deeming clause, it could  possibly  be  argued  that  the  word  “value”  means the market  value,  but  by employing  the deeming clause, the legislature has made  it clear that if the document is sought to be  cancelled,  the amount of court fee shall  be  computed on  the  value  of  the  property  for  which the document  was executed and not  the market value of the property. The words  “for  which”  appearing  between  the  words  “property”  and  “other  documents”  clearly  indicate that the court fee is required to be  paid on the value of the property mentioned  in the document, which is the subject-matter  of challenge.

20. If the legislature intended that fee should  be  payable  on  the  market  value  of  the  subject-matter  of  the  suit  filed  for  cancellation of a document which purports or  operates  to create,  declare,  assign,  limit  or  extinguish  any  present  or  future  right,  title  and interest,  then it  would have, instead of  incorporating the requirement of payment of  fees  on  the  value  of  subject-matter,  specifically provided for payment of court fee  on the market value of the subject-matter of  the suit as has been done in respect of other  types of suits mentioned in Sections 25, 27,  29,  30,  37,  38,  45  and  48.  The  legislature  may  have  also,  instead  of  using  the  expression “value of the property for which  the  document  was  executed”,  used  the  expression “value of the property in respect  of  which  the  document  was  executed”.

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However,  the  fact  of  the  matter  is  that  in  Section 40(1) the legislature has designedly  not used the expression “market value of the  property”.

13. Applying  the  above  reasoning,  this  Court  in  

Satheedevi (supra)  upheld  the  view  expressed  by  

learned Single Judge of the Andhra Pradesh High Court  

in  Allam  Venkateswara  Reddy  v.  Golla  

Venkatanarayana  AIR 1975 AP 122 and the Division  

Bench judgment of the Madras High Court in Venkata  

Narasimha Raju v. Chaandrayya  AIR 1927 Mad 825,  

Navaraja v. Kaliappa Gounder (1967) 80 Mad LW 19  

(SN)  and  Arunachalathammal  v.  Sudalaimuthu  

Pillai  (1968)  83  Mad  LW  789  and  ruled  that  those  

judgments have laid down the correct law.   

14. This Court in Satheedevi (supra), therefore, gave  

its seal of approval to the judgment of learned Single  

Judge  of  the  Andhra  Pradesh  High  Court  in  Allam  

Venkateswara Reddy (supra), wherein learned Single  

Judge took the view that in a suit for cancellation of sale  

deed which was executed for a specified amount, the

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Court Fee has to be paid on that amount and not on the  

basis  of  the  market  value  of  the  property  at  the  

presentation of the plaint.  

15. The Andhra Pradesh High Court in the impugned  

judgment,  while  interpreting  Section  37  of  the  Court  

Fees  Act,  placed  reliance  on  the  Division  Bench  

judgment  in  Lakshminagar  Housing  Welfare  

Association (supra),  wherein  the  Bench,  as  already  

indicated, placed reliance on the Full Bench judgment  

of  the  Madras  High  Court  in  Kolachala  Kutumba  

Sastri (supra),  though a  reference was  made to  the  

learned  Single  Judge  Bench  judgment  in  Allam  

Venkateswara  Reddy  (supra).    Since  we  are  in  

agreement with the reasoning in  Satheedevi (supra),  

which has given its seal of approval to the reasoning of  

the  learned  Single  Judge  judgment  of  the  Andhra  

Pradesh High Court  in  Allam Venkateswara Reddy  

(supra),  the  judgment  of  the  Division  Bench  in  

Lakshminagar  Housing  Welfare  Association  

(supra) is no more good law.  

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16. We are of the view, Section 37 of the Court Fees  

Act,  which  deals  with  the  suits  for  cancellation  of  

decrees etc. is not governed by other Sections of the  

Court  Fees  Act,  such  as  Section  7  and other  related  

provisions.    If  Section  37  of  the  Court  Fees  Act  is  

interpreted  in  the  light  of  the  expression  “save  as  

otherwise provided” used in Section 7 of the Court Fees  

Act, it becomes clear that the rule enshrined therein is  

a clear departure from the one contained in Section 7  

read with Sections 24, 26, 28, 29, 34, 35, 42 and 45,  

which provide for payment of Court Fee on the market  

value of the property.  In that context, we are also of  

the  view  that  Section  37  is  stand  alone  provision,  

wherein  the  legislature  has  designedly  not  used  the  

expression “market value of the property”.   Section 37  

of the Court Fees Act, therefore, contains a special rule  

for valuing the property for the purpose of Court Fee  

and jurisdiction and we do not see any reason why the  

expression “value of the property” used in Section 37

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be substituted with the expression “market value of the  

property”.

17. In such circumstances, we are inclined to set aside  

the  judgment  of  the  High  Court  and  allow  these  

appeals.    Consequently,  the  orders  passed  by  the  

appellate Court as well as the High Court would stand  

quashed.   The trial Court is directed to proceed with  

the  suit  in  accordance  with  law  and  the  declaration  

made by this Court.    

18. The Appeals are, accordingly, allowed.  However,  

there will be no order as to costs.  

……………………………..J.     (K. S. Radhakrishnan)

……………………………..J.      (Vikramajit Sen)

New Delhi, February 19, 2014.