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PETITIONER: STATE OF MAHARASHTRA

       Vs.

RESPONDENT: MISHRI LAL TARACHAND LODHA ANDOTHERS

DATE OF JUDGMENT: 15/11/1963

BENCH: DAYAL, RAGHUBAR BENCH: DAYAL, RAGHUBAR GAJENDRAGADKAR, P.B. SUBBARAO, K. WANCHOO, K.N. SHAH, J.C.

CITATION:  1964 AIR  457            1964 SCR  (5) 230  CITATOR INFO :  RF         1976 SC1503  (6)  RF         1978 SC1765  (11)

ACT: Bombay  Court Fees Act, 1959 (36 of 1959), Art, 1, Sch.   I- "Value   of  the  subject-matter  in  dispute   in   appeal- Construction   of--Award  of  interest  pendente  lite   not specifically challenged-Court fees, if Payable.

HEADNOTE: The  plaintiff-respondent  No.  1  instituted  a  suit   for recovery  of the amount lent to the defendant with  interest upto  the date of the suit.  His claim was decreed in a  sum of Rs. 13,033-6-6 with future interest from the date of suit till  realisation  at 4 % per annum on a sum  of  Rs.10,120. Against this decree the defendant appealed to the High Court and  valued  the  appeal  at Rs.  13,033-6-6  and  paid  the requisite  court  fee on that amount.  All  his  grounds  of appeal  related to the merits of the plaintiff’s claims  and did  not  deal  with  the correctness  of  the  trial  court awarding future pendente lite interest on the rate at  which it  was to be calculated.  The Taxing Officer  directed  the defendant  to  pay the deficit court fee of Rs.  70  on  the memorandum  of  appeal  as he was of the  opinion  that  the appeal  was against the whole decree and that the amount  of value of the subject-matter in dispute for purpose of  court fee was Rs. 14,036.80nP. as the amount of interest from  the date  of the suit till the date of the decree on Rs.  10,120 came to Rs. 1,033.40nP. 231 The  defendant challenged this order in revision before  the High Court under s. 5(2) of the Bombay Court-fees Act, 1959. The High Court set aside the order of the Taxing Officer and the learned Judge expressed the view: "The subjectmatter in appeal is the real matter in  dispute between  the parties and not something which must  stand  or fall with the decision on it.  In other words, it must  mean the right which is in dispute between the parties". In this Court the appellant State challenged the correctness

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of the said view of the High Court and relied mainly on  the construction put by courts on expression " value or subject- matter  in dispute," in the relevant provisions relating  to the  High  Court’s  giving  leave to  appeal  to  the  Privy Council. Held:(i)  That  the  expression  ’amount  or  value  of  the subjectmatter in dispute’ in art.  1 of Schedule 1 of  the Bombay  Court fees Act, cannot be construed in the light  of the  construction  placed on a similar  expression  for  the purposes of considering whether the case had come within the rule  allowing the High Courts to give leave for  appeal  to the  Privy  Council.  The Act is a taxing  statute  and  its provisions  have to be construed strictly, in favour of  the subject-litigant. Gooroopersad  Khoond  v.  Juggutchunder, 8  M.I.A.  166  and Doorga Doss Chowdry v. Ramanauth Chowdry, 8 M.I.A. 262, held in applicable. (ii)Claims not based on any asserted right but dependent on the decision of the disputed right and reliefs in regard  to which are in the discretion of the court do not come  within the purview of the expression ’subject-matter in dispute  in plaint or memo of appeal’. (iii)The  amount of pendente lite interest  decreed  is not  to be included in the ’amount or value of the  subject- matter in dispute in appeal’ for the purposes of art.  1  of Sch.   1  of  the  Act  unless  the  appellant  specifically challenges  the correctness of the decree for the amount  of interest  pendente  lite independently of the claim  to  set aside that decree. In  the  present case, the decree in that  respect  was  not specifically  challenged and therefore the view of the  High Court must be held to be correct. Mitthu  Lal v. Chameli, 57 All. 7 1, Keolapati Mst. v.  B.N. Varma,  I.L.R. 12 Luck. 466 and Ashutosh v. Satindra  Kumar, 54 C.W.N.380, referred to.

JUDGMENT: CIVIL APPELLATE JURISDICTION: Civil Appeal No. 587 of 1962. Appeal  by special leave from the judgment and  order  dated April  12, 1961, of the Bombay High Court in Civil  Revision Application No. 441 of 1961. 232 S.V.  Gupte, Additional Solicitor-General of India and  R.H. Dhebar, for the appellant. S.G. Patwardhan and A.G. Ratnaparkhi, for respondent No. 1. The  Judgment of the Court was delivered by RAGHUBAR DAYAL J. This appeal, by special leave, raises  the question  whether  the amount of interest  decreed  for  the period subsequent to the institution of a suit comes  within the  expression  ’amount or value of the  subject-matter  in dispute’  in art.  1 of Schedule 1 of the Bombay  Court-fees Act,  1959,  hereinafter  called the Act,  for  purposes  of court-fee payable on the memorandum of appeal. The plaintiff-respondent No. 1 instituted Special Suit No. 5 of 1957 in the Court of the Civil Judge (Senior Division) at Ahmedabad  to recover Rs.13,205 on account of the  principal lent  to defendant No. 7 and interest up to the date of  the suit  at the rate of 9 % per annum.  On July 18,  1960,  his claim  was  decreed in a sum of Rs. 13,033-6-6  with  future interest  from the date of suit till realization at 40%  per annum on a sum of Rs. 10, 120. Defendant  No.  7  appealed to the High  Court  against  the decree.  In the memorandum of appeal, defendant No. 7 valued

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the claim for purposes of jurisdiction and court-fee at  Rs. 13,033-6-6 and his grounds Nos.  1 and 48 of appeal were  as follows: 1.   That the lower Court erred in decreeing the plaintiff’s suit. 48.  That  the  decree is otherwise  erroneous,  unjust  and illegal and therefore deserves to be set aside." The  remaining  46  grounds related to  the  merits  of  the plaintiff’s  claim and did not deal with the correctness  of the  trial Court awarding future pendente site  interest  on the rate at which it was to be calculated. The  Taxing  Officer  was of opinion  that  the  appeal  was against the whole decree and that the amount of value of the subject-matter in dispute for purposes 233 of court-fee was Rs. 14,036. 80nP. as the amount of interest from the date of the suit till the date of the decree on Rs. 10,120 came to Rs. 1,033.40 nP. and it bad been conceded  by the  counsel for the defendant-appellant that  the  subject- matter  of  the appeal was the decree passed  by  the  trial Court.  He therefore directed the defendant-appellant to pay the deficit court-fee of Rs. 70 on the memorandum of  appeal and to amend the claim accordingly. The  defendant-appellant then filed a revision to  the  High Court under s. 5(2) of the Act.  His objection was upheld by the learned Judge who expressed the view: "The subject-matter in appeal is the real matter in  dispute between  the parties and not something which must  stand  or fall with the decision oil it.  In other words, it must mean the right which is in dispute between the parties." He accordingly set aside the order of the Taxing Officer and held that the amount of court-fee paid on the memorandum  of appeal  was the proper court-fee.  The State of  Maharashtra has filed this appeal by special leave against this order. Mr.  Gupta, for the appellant State, contends that the  view expressed  by  the learned Judge is not correct  and  mainly relies on the construction put by Courts on the expression ’ value   or  subject-matter  in  dispute’  in  the   relevant provisions  relating  to the High Court’s  giving  leave  to appeal to the Privy Council. In  Gooroo persad Khoond v. Juggutchunder (1)  the  Judicial Committee  said, in connection with the requirements of  the directions  in the Order-in-Council of April 10, 1938,  with respect  to the conditions for granting leave to  appeal  to the  Privy Council, that leave to appeal was to be given  in cases where the value of the matter in dispute in the appeal amounted to the specified sum of Rs. 10,000 and that in (1)  8 M.I.A. 166. 234 determining such value, the amount of interest decreed up to the  date of the decree be included to the   amount  of  the principal. Doorga Doss Chowdry v. Ramanauth Chowdry (1) is an authority for the proposition that the costs of a suit are no part  of the subject-matter in dispute.  Their Lordships of the Privy Council said: sum claimed, it would be in the power of every litigant,  by swelling  the costs, to bring any suit up to the  appealable value." It may also be said that a litigant’s conduct may lead to  a protracted  trial  and consequently to the increase  in  the amount  of pendente lite interest which may raise the  value of the subject-matter in dispute in appeal to the appealable value. We do not consider it correct that the expression in the Act

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be  construed in the light of the construction placed  on  a similar  expression for the purposes of considering  whether the  case had come within the rule allowing the High  Courts to give leave for appeal to the Privy Council.  The Act is a taxing  statute  and  its provisions therefore  have  to  be construed strictly, in favour of the subject-litigant.   The other  provisions are for the purpose of allowing the  party feeling aggrieved against the decision of the High Court  to take up his case to the next higher Court. the Privy Council and therefore the relevant provisions in that regard had  to be given a liberal construction. In  the  present  case we have to  construe  the  expression ’value  of the subject-matter in dispute in appeal’ for  the purposes  of  determining the amount of Court fee due  on  a memorandum of appeal and not for determining such  valuation for preferring an appeal to this Court. The  relevant provision governing the question of  court-fee to  be  paid on the memorandum of appeal filed  in  a  Civil Court is contained in art.  1 of Sche- (1)8 M.I.A. 262. 235 dule 1 of the Act. it is to be paid ad valorem according  to the  amount or value of the subject-matter in dispute.   The rates  applicable  with respect to the various  amounts  are mentioned in the article.  The maximum amount of  court-fee, however, is Rs. 15,000. The  amount of court-fee payable, therefore, depends on  the amount or value of the subject-matter in dispute in  appeal. The  defendant-appellant valued his claim at Rs.  13,033-6-6 and  paid  the requisite court-fee on that  amount.   It  is obvious  therefore that he disputes in appeal that  part  of the  decree  which  awarded Rs. 13,033-6-6  against  him  on account of principal and interest due up to the date of  the institution  of the suit.  He did not dispute, according  to the  value of his claim, the amount of interest which  could be  found on calculation for the period between the date  of the suit and the date of the decree at 4% per annum on a sum of Rs. 10,120 as had been awarded under the decree.  Whether his  appeal is competent or not without his  including  this amount in his claim in appeal, is a question different  from that relating to the value of the subject-matter in  dispute in  appeal.  He does not dispute the decree for that  amount and  therefore the Court has not to decide about it  and  so this amount cannot be included in the amount of the subject- matter  in  dispute  in  appeal  covered  by  the   relevant expression.    None   of  his  grounds  of   appeal   refers specifically to this amount of interest between the date  of the suit and the date of the decree.  This makes it  further plain that he does not question the propriety of awarding of future interest or the rate at which it was awarded or  even the amount on which it could be awarded.  It is not possible to  say,  in  these circumstances, that  the  value  of  the subject-matter  in dispute in the appeal must  include  this amount of interest between the date of the suit and the date of the decree. Mr. Gupta has rightly conceded that it is well settled  that the plaintiff has to value his appeal against the  dismissal of  his suit on the amount of the claim he had made  in  the plaint and has not to include 236 the  interest  due on the amount claimed up to the  date  of instituting  the  appeal,  that the defendant  has  not   to include  that  amount of future interest subsequent  to  the date of the decree till the institution of the appeal in the valuation  of the appeal for the purposes of  court-fee  and

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that  no  court-fee is to be paid on  the  amount  of  costs decreed in the suit when the party aggrieved appeals against the decree. On  what principle are these amounts not treated as  forming part  of  the  value of the  subject-matter  in  dispute  in appeal?   Such value is to be determined on the  substantial allegation in the plaint or from the pleas in the memorandum of appeal with respect to the points in dispute between  the parties and sought to be determined by the Court.  Such  are necessarily  the points affecting the rights of the  parties sought to be adjudicated by the Court.  Claims not based  on any  asserted  right but dependent on the  decision  of  the disputed  right  and reliefs in regard to which are  in  the discretion  of the Court do not come within the  purview  of the expression ’subject-matter in dispute in plaint or  memo of appeal’. There  appears no good reason to make a distinction  between the  decreed  amount  of costs and  that  of  pendente  lite interest  for the purpose of determining the amount  of  the subject-matter in dispute in appeal.  It is true that  costs of  suit  arise independently of the claim  and  are  really those  which are incurred by the plaintiff while the  decree for the amount of pendente lite interest is directly related to  the  plaintiff’s claim though its award  is  within  the discretion  of  the  Court, but this will  not  justify  the distinction.   The costs too, and particularly the costs  on account  of court-fee and counsel’s fee, arise  directly  on account  of  the  claim put forward in  Court.   The  reason really  is that it is the value of the right claimed in  the suit or appeal which is covered by the expression ’amount or value of subject-matter in dispute in art. 1, Schedule 1, of the  Act and that the plaintiff’ has no right to get any  of these  amounts from the defendant though the Court  may,  in its discretion, allow future interest 237 and costs according to the circumstances of the suit in view of  ss. 34 and 35 C.P.C. This principle equally  applies  to the  non-inclusion of the decreed amount’ of  pendente  lite interest  in  evaluating the subjectmatter  in  dispute  in appeal  as  that  too  is awarded in  the  exercise  of  its discretion  by  the Court an the plaintiff has no  right  or claim for that amount against’ the defendant. It  is obvious that if the defendant-appellant  succeeds  in establishing to the satisfaction of the appellate Court that the decree for the principal and interest up to the date  of the  suit is bad in whole or in part, that will itself  lead the appellate Court to exercise its discretion with  respect to  the  amount of costs and future interest in such  a  way that  if the plaintiff’s claim is dismissed in too, he  will not be awarded any future interest or any costs of the  suit or  appeal and that in case his claim succeeds in part,  the amount  of future interest and costs decreed in  his  favour would be appropriately modified by the appellate Court.  The defendant-appellant  has  therefore  no  reason  to   appeal against  the  decree  for costs or  the  decree  for  future interest   unless  he  disputes  those  amounts  wholly   or partially for certain reasons.  If he disputes expressly the propriety  or correctness of the decree with respect to  the costs  or pendente lite interest independently of the  claim to the subject-matter in the Trial Court he will have to pay court-fee on the amounts challenged as in that case he  does dispute those amounts in appeal and therefore those  amounts do  come within the expression ’value of the subjectmatter in  dispute  in  appeal’.  This has been the  basis  of  the various decisions of the Courts in which court-fee has  been

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demanded on the amount of costs or future interest. In  Mitthu Lal v. Chameli (1) it was held that  no  courtfee was  to  be paid on interest pendente lite  granted  by  the lower  Court  unless  the awarding of  it  was  specifically challenged in appeal.  It was said at p. 76: 57 All. 71. 238 "Interest  pendente lite is awarded under section 34 of  the Civil  Procedure Code.  The Court may award it  whether  the plaintiff  claims  it or not.  In this respect  the  court’s power stands on the same footing as its power to award costs to  a  successful party.  It is well-settled  rule  that  no court  fee  is payable on the amount of costs awarded  by  a decree appealed from, if no ground is specifically  directed against the award of costs......................... The same principle is applicable to interest pendente lite which  the Court  may award in the exercise of its power under  section 34.   On  a  proper reading of the  appellant’s  grounds  of appeal  in the lower appellate court we are  satisfied  that the  subjectmatter  of  his appeal to  that  court  was  the principal amount and interest up to the date of the suit." In Keolapati, Mst. v. B.N. Varma "I it was held that  unless the  appellant  expressly  challenges the  award  of  future interest,  no  court-fee  is to be paid  on  the  amount  of interest accruing from the date of the suit till the date of the filing of the appeal. In Ashutosh v. Satindra Kumar (2) it was said at at p. 382: "Costs  are  not regarded as being any part  of  a  subject- matter  in dispute either in the suit or in the appeal.   In the  appeal, the appellant does not in such an event  really dispute  the order as to costs for it is the  natural  order that  is  ordinarily made following the decision as  to  the main subject-matter in dispute and if he himself succeeds in the   appeal   in  regard  to   the   main   subject-matter, automatically  he will expect to succeed with regard to  the costs." We therefore hold that the amount of pendente lite  interest decreed is not to be included in the ’amount or value of the subject-matter  in  dispute in appeal’ for the  purposes  of art.   1  of  Schedule 1 of the  Act  unless  the  appellant specifically challenges the cor- (1) I.L.R. 12 Luck. 466. (2) 54 C.W.N. 380. 239 rectness  of the decree for the amount of interest  pendente lite  independently of the claim to set aside  that  decree. The  appellant  here  has not  specifically  challenged  the decree in that respect and therefore the High Court is right in  holding  the memorandum of appeal  to  be,  sufficiently stamped.  The appeal T. is therefore dismissed with costs. Appeal dismissed.