Case Laws: Status of court fee in cases where sale deed has been executed through power of attorney and case has been filed to declare that sale deed null & void by the person who issued that special power of attorney

Section 7(iv)(c) of court fees act, 1870 provides that in suits for a declaratory decree with consequential relief, the court fee shall be computed according to the amount at which the relief sought is valued in the plaint.

1. Balwan Singh v. Premo Devi

(High court Of Punjab And Haryana) | 16-05-2017

In this case, it was observed by the court that in the present case, the suit is for cancellation of sale deed and as such, it is not covered by Section 7(iv)(c) of the Act and the only provision applicable is Article I, Schedule I of the Act. In order to bring the case under Section 7(iv)(c) of the Act, the main and substantive relief should be that of a declaration and the consequential relief should be ancillary thereto. In case, no consequential relief is claimed or could be claimed in the suit, then Section 7(iv)(c) of Court fee act will not be attracted. Section 7(iv) (c) clearly contemplates suits to obtain the declaratory decree or order where consequential relief is prayed.

Relevant Para is as follows:-

“14. In the present case, the relief is for permanent injunction restraining the defendants from dispossessing the plaintiff from the suit property on the basis of alleged agreement which has been executed by the defendants under threat and in an illegal manner, with a decree for mandatory injunction directing the defendants to return the agreement to sell of property of plaintiff.

15. Same issue was there in judgment of this Court in case Harbans Kaur v. Amrik Singh @ Beer Singh 2015 (4) RCR (Civil) 770.

16. In said case also, it was held that the suit was for declaration and transfer deed was executed by way of fraud and no consideration was passed. Plaintiff filed a suit for declaration but has not sought the relief of possession. It was held that the plaintiff was not required to affix ad valorem Court fee.

17. Same observations were made in the judgments of this Court in cases Zora Singh v. Kehar Singh, 1981 (1) RLR 491 and Shakuntla v. Rohtas Singh, 2008 (4) RCR (Civil).

2. Omwati And Another v. Rambir Singh And Others

(High court Of Punjab And Haryana) | 09-10-2013

In this case, court explained the status of court fees through an example i.e. if A, the executant of the deed, seeks cancellation of the deed, he has to pay ad-valorem court fee on the consideration stated in the sale deed. If B, who is a non-executant, is in possession and sues for a declaration that the deed is null or void and does not bind him or his share, he has to merely pay a fixed court fee of Rs. 19.50 under Article 17(iii) of Second Schedule of the Act. But if B, a non- executant, is not in possession, and he seeks not only a declaration that the sale deed is invalid, but also the consequential relief of possession, he has to pay an ad-valorem court fee as provided u/s 7(iv)(c) of the Act.

Relevant Para is as follows:-

“6. Where the executant of a deed wants it to be annulled, he has to seek cancellation of the deed. But if a non-executant seeks annulment of a deed, he has to seek a declaration that the deed is invalid, or non-est, or illegal or that it is not binding o n him. The difference between a prayer for cancellation and declaration in regard to a deed of transfer/conveyance, can be brought out by the following illustration relating to A and B — two brothers. A executes a sale deed in favour of C. Subsequently A wants to avoid the sale. A has to sue for cancellation of the deed. On the other hand, if B, who is not the executant of the deed, wants to avoid it, he has to sue for a declaration that the deed executed by A is invalid/void and non-est/illegal and he is not bound by it. In essence both may be suing to have the deed set aside or declared as non-binding. But the form is different and court fee is also different. If A, the executant of the deed, seeks cancellation of the deed, he has to pay ad-valorem court fee on the consideration stated in the sale deed. If B, who is a non-executant, is in possession and sues for a declaration that the deed is null or void and does not bind him or his share, he has to merely pay a fixed court fee of Rs. 19.50 under Article 17(iii) of Second Schedule of the Act. But if B, a non- executant, is not in possession, and he seeks not only a declaration that the sale deed is invalid, but also the consequential relief of possession, he has to pay an ad-valorem court fee as provided u/s 7(iv)(c) of the Act. Section 7(iv)(c) provides that in suits for a declaratory decree with consequential relief, the court fee shall be computed according to the amount at which the relief sought is valued in the plaint. The proviso thereto makes it clear that where the suit for declaratory decree with consequential relief is with reference to any property, such valuation shall not be less than the value of the property calculated in the manner provided for by clause(v) of Section 7.

7. In this case, there is no prayer for cancellation of the sale deeds. The prayer is for a declaration that the deeds do not bind the “co-parcenery” and for joint possession. The plaintiff in the suit was not the executant of the sale deeds. Therefore, the court fee was computable u/s 7(iv)(c) of the Act. The trial court and the High Court were therefore not justified in holding that the effect of the prayer was to seek cancellation of the sale deeds or that therefore court fee had to be paid on the sale consideration mentioned in the sale deeds.”

3. Suhrid Singh @ Sardool Singh v. Randhir Singh

(Supreme Court of India) | 29-03-2010

In this case, apex court mentioned that if `A, the executant of the deed, seeks cancellation of the deed, he has to pay ad-valorem court fee on the consideration stated in the sale deed. If `B, who is a non-executant, is in possession and sues for a declaration that the deed is null or void and does not bind him or his share, he has to merely pay a fixed court fee of Rs. 19.50 under Article 17(iii) of Second Schedule of the Act. But if `B, a non-executant, is not in possession, and he seeks not only a declaration that the sale deed is invalid, but also the consequential relief of possession, he has to pay an ad-valorem court fee as provided under Section 7(iv)(c) of the Act. Section 7(iv)(c) provides that in suits for a declaratory decree with consequential relief, the court fee shall be computed according to the amount at which the relief sought is valued in the plaint. The proviso thereto makes it clear that where the suit for declaratory decree with consequential relief is with reference to any property, such valuation shall not be less than the value of the property calculated in the manner provided for by clause (v) of Section 7.

And court further held that in this case, there is no prayer for cancellation of the sale deeds. The prayer is for a declaration that the deeds do not bind the “co-parcenery” and for joint possession. The plaintiff in the suit was not the executant of the sale deeds. Therefore, the court fee was computable under section 7(iv)(c) of the Act

Relevant Para is as follows:-

“5. Court fee in the State of Punjab is governed by the Court Fees Act, 1870 as amended in Punjab (`Act for short). Section 6 requires that no document of the kind specified as chargeable in the First and Second Schedules to the Act shall be filed in any court, unless the fee indicated therein is paid. Entry 17(iii) of Second Schedule requires payment of a court fee of Rs.19/50 on plaints in suits to obtain a declaratory decree where no consequential relief is prayed for. But where the suit is for a declaration and consequential relief of possession and injunction, court fee thereon is governed by section 7(iv)(c) of the Act

The second proviso to section 7(iv) of the Act will apply in this case and the valuation shall not be less than the value of the property calculated in the manner provided for by clause (v) of the said section. Clause (v) provides that where the relief is in regard to agricultural lands, court fee should be reckoned with reference to the revenue payable under clauses (a) to (d) thereof; and where the relief is in regard to the houses, court fee shall be on the market value of the houses, under clause (e) thereof.

6. Where the executant of a deed wants it to be annulled, he has to seek cancellation of the deed. But if a non-executant seeks annulment of a deed, he has to seek a declaration that the deed is invalid, or non-est, or illegal or that it is not binding on him. The difference between a prayer for cancellation and declaration in regard to a deed of transfer/conveyance, can be brought out by the following illustration relating to `A and `B – two brothers. `A executes a sale deed in favour of `C. Subsequently `A wants to avoid the sale. `A has to sue for cancellation of the deed. On the other hand, if `B, who is not the executant of the deed, wants to avoid it, he has to sue for a declaration that the deed executed by `A is invalid/void and non- est/ illegal and he is not bound by it. In essence both may be suing to have the deed set aside or declared as non-binding. But the form is different and court fee is also different. If `A, the executant of the deed, seeks cancellation of the deed, he has to pay ad-valorem court fee on the consideration stated in the sale deed. If `B, who is a non-executant, is in possession and sues for a declaration that the deed is null or void and does not bind him or his share, he has to merely pay a fixed court fee of Rs. 19.50 under Article 17(iii) of Second Schedule of the Act. But if `B, a non-executant, is not in possession, and he seeks not only a declaration that the sale deed is invalid, but also the consequential relief of possession, he has to pay an ad-valorem court fee as provided under Section 7(iv)(c) of the Act. Section 7(iv)(c) provides that in suits for a declaratory decree with consequential relief, the court fee shall be computed according to the amount at which the relief sought is valued in the plaint. The proviso thereto makes it clear that where the suit for declaratory decree with consequential relief is with reference to any property, such valuation shall not be less than the value of the property calculated in the manner provided for by clause (v) of Section 7.

7. In this case, there is no prayer for cancellation of the sale deeds. The prayer is for a declaration that the deeds do not bind the “co-parcenery” and for joint possession. The plaintiff in the suit was not the executant of the sale deeds. Therefore, the court fee was computable under section 7(iv)(c) of the Act. The trial court and the High Court were therefore not justified in holding that the effect of the prayer was to seek cancellation of the sale deeds or that therefore court fee had to be paid on the sale consideration mentioned in the sale deeds.”