Allowed

Sri N S Honneshkumar v. Sri T Paramesh

Karnataka HC6 Aug 2014WP/12294/2014

Case brief

AI extract

What is this about?

The High Court allowed a writ petition seeking a full refund of court fees. The court held that even if parties settle a dispute out of court without utilizing Section 89 CPC mechanisms, they are entitled to a full refund, relying on the objective of encouraging settlements established in A. Sreeramiah.

What did the court decide?

The Court below is directed to refund the entire Court Fee paid by the petitioner.

Sri N S Honneshkumar Vs Sri T Paramesh — Civil Procedure and Limitation | Karnataka HC (2014)

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IN THE HIGH COURT OF KARNATAKA AT BANGALORE

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DATED THIS THE 6^th DAY OF AUGUST 2014

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BEFORE

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THE HON’BLE MR. JUSTICE ANAND BYRAREDDY

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WRIT PETITION NO.12294 OF 2014 (GM-CPC)

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Between:

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Shri N.S.Honneshkumar S/o late H.Siddalingaiah Age: 41 years R/at Neralapura Village Gulur Hobli Tumkur Taluk Tumkur – 572 101 … Petitioner

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(By Shri K.R.Ramesh, Advocate)

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And:

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Shri T.Paramesh S/o late Thopaiah

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Age: 48 years

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Smt.Mahadevamma W/o T.Paramesh Age: 40 years

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Bharathi P. D/o T.Paramesh

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Age: 24 years

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Dinesh S/o T.Paramesh

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Age: 20 years

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R1 to R4 are R/o Inapura Village, K.G.Halli Post Gulur Hobli Tumkur Taluk & Dist. – 572 101

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State of Karnataka

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Rep. by its Secretary Dept. of Finance Vidhana Soudha Bangalore – 560 001 (amended v/o dt.15.7.14) … Respondents

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(Notice to R1 to R4 is dispensed with Shri Vasanth V.Fernandes, HCTP for R5)

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This Writ Petition is filed under Articles 226 and 227 of the Constitution of India, praying to issue a writ of certiorari quashing the impugned order dated 11.9.2013 passed in O.S.No.21/13 passed by Prl.Sr.Civil Judge and CJM, Tumkur vide Ann-C insofar as it relates to refunding only half of the Court fee paid by the petitioner in O.S.No.21/13 and etc.

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This Petition coming on for Preliminary Hearing this day, the Court made the following:-

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O R D E R

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Notice to respondent Nos.1 to 4 is dispensed with, in view of

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the fact that this is a situation which involves the interest of the

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State and does not in any manner involve the interest of the private parties.

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The present petition is heard and disposed of at the stage of preliminary hearing.

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The short point involved is that the petitioner who was the plaintiff has filed a civil suit which was settled as between the parties at the very initial stage and the suit was disposed of on a joint memo to the effect that the matter was settled out of Court and the Court had directed refund of half of the Court Fee paid as prescribed under Section 66 of the Karnataka Court Fees and Suits Valuation Act, 1958 (hereinafter referred to as ‘the KCFSV Act’, for brevity). However, the learned counsel for the petitioner is before this Court relying on the Division Bench decision of this Court in the case of ‘A.SREERAMAIAH v. THE SOUTH INDIAN BANK LTD., BANGALORE & ANOTHER’ (ILR 2006 KAR 4032. In that case, the parties before the Court were the plaintiff and the defendant, wherein the plaintiff had filed a suit for recovery of money and there was a judgment and decree, against which an

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appeal had been filed. The Court, after noticing the rival contentions, had observed that there was an element of a possible settlement and had suggested the terms of settlement and accordingly, the parties did settle the matter out of Court and had reported the same and thereafter, the counsel had sought that the full Court Fee be refunded on the footing that in a settlement arrived at in terms of Section 89 of the Code of Civil Procedure, 1908 (hereinafter referred to as ‘the CPC’, for brevity), a party would be entitled to refund of full Court Fee under Section 16 of the Court Fees Act, 1870 and it is this circumstance, which was addressed by the Division Bench and ultimately it was concluded thus:

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“Considering the object behind the Amendment Act 1999 inserting Section 89 of CPC and also the insertion of Section 16, it is clear, that the object of providing of refund of full court fees, is to encourage the settlement of the disputes in terms of Section 89 of CPC. In this case, the parties agreed for settlement in terms suggested by the Court and accordingly, they have settled their dispute outside the Court. The judicial settlement is also one of the

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alternative method of settlement of the disputes. As such, in our considered view, in any settlement arrived in terms of Section 89 of CPC including the judicial settlements at the intervention and on term suggested by the Court, the appellant is entitled for refund of full court fees, as otherwise, it would be meaningless if the provisions of Section 16 are not applied for settlement of dispute by the parties under Section 89. Section 89 does provide for settlement of dispute at any stage of the proceeding, whether it is by way of method referred to therein or by judicial settlement as contemplated under Section 89 Sub-section (1). As such, we are of the opinion that if the parties come forward to settle their dispute before the Court itself, they should not be denied of refund of full court fees on the ground that they have not settled the dispute before any of the four methods provided under Section 89 of CPC. The object behind Section 89 is to encourage the parties to arrive at settlement and if that object is sought to be achieved by means of referring the matter to any of the four methods mentioned in Section 89, then even the settlement arrived at the earliest stage before the Court would also be one of the method provided under Section 89 Sub-section (1). Hence,

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we feel it as just and appropriate to order for full refund of court fees in the case of parties settling their dispute before the Court as well as before any of the Forum mentioned under Section 89 of the CPC. No party should be discriminated in the matter of refund of court fees mainly on the ground that they have settled the dispute at the earliest stage before the Court without recourse to any of the methods mentioned under Section 89 of the CPC. Hence, appellant is entitled for refund of full court fees.”

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It is the above observations which the learned counsel for the

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petitioner seeks to press into service.

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The learned Government Pleader would point out that the

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Court did observe apart from the several modes of settlement contemplated under Section 89 of CPC, if there was a settlement by intervention of the Court, it would also be a settlement contemplated under Section 89 of the CPC and therefore, directed full refund of Court fee. In the present case on hand, the Court below has merely applied the letter of Section 66 of the KCFSV Act as it stands. In terms of Section 66 if the parties have settled

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the matter out of Court and report the same, the Court can only direct refund of half the Court Fee. Therefore, there is no fault to be found in the Court below having directed refund of half the Court Fee.

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The question however, is whether the line of reasoning adopted by the Division Bench of this Court would extend to a situation where the parties have settled the matter out of Court and seek the full refund notwithstanding the language and tenor of Section 66 of the KCFSV Act. It is to be noticed that in arriving at the conclusion, the Division Bench was drawing inspiration from the language of Section 16 of the Court Fees Act, 1870 as amended by Act 46 of 1999 with effect from 1.7.2002, which reads as follows:

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“16. Refund of fee.—Where the Court refers the parties to the suit to any one of the mode of settlement of dispute referred to in section 89 of the Code of Civil Procedure, 1908 (5 of 1908) the plaintiff shall be entitled to a certificate from the Court authorising him to receive back from the

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collector, the full amount of the fee paid in respect of such plaint.”

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In any case, the intent is plain from the reasoning of the Division Bench of this Court that a settlement arrived at between the parties in whatever manner, before a particular stage, as is referred to in Section 89 of the CPC would entitle the parties to full refund of the Court Fee and there is not much difference, if even without intervention of the Court, the parties have settled the matter fully and finally and seek to have the suit disposed of on that footing. Therefore, even though the decision of the Division Bench does not in so many words state that even if the matter should be settled out of Court, the parties would be entitled to a full refund of Court Fee, it would also be a circumstance which was in the contemplation of the Division Bench, when it has expressed thus:

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“No party should be discriminated in the matter of refund of court fees mainly on the ground that they have settled the dispute at the earliest stage before the Court without recourse to any of the methods mentioned under Section 89 of the CPC. Hence, appellant is entitled for refund of full court fees.”

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