IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:
THE HONOURABLE MR.JUSTICE THOMAS P.JOSEPH
THURSDAY, THE 10TH DAY OF JANUARY 2013/20TH POUSHA 1934
OP(C).No. 4101 of 2012 (O)
-------------------------AGAINST THE ORDER IN IA NO.4560/2010 IN OS.449/2008 PRINCIPAL SUB JUDGE, IRINJALAKUDA
PETITIONER(S):
--------------------------
NITHYANANDA PAI, AGED 59 YEARS, S/O.LATE RAJANANDA PAI, "SYAMRAJ",KEEZHTHITTIL HOUSE,METHALA KODUNGALLUR,THRISSUR DISTRICT.
BY ADVS.SRI.RENJITH THAMPAN (SENIOR ADVOCATE) SMT.P.R.REENA
RESPONDENT(S):
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1. SAROJINI PRABHU, AGED 68 YEARS, W/O.SWARGATHU MADATHIL LATE REJAGOPALA PRABHU, ARAKKULAM DESOM,METHALA VILLAGE,KODUNGALLUR TALUK.
2. SREEKUMAR, AGED 40 YEARS, S/O.SWARGATHU MADATHIL LATE REJAGOPALA PRABHU ARAKKULAM DESOM,METHALA VILLAGE,KODUNGALLUR TALUK.
3. SREEKANTH, AGED 38 YEARS, S/O.SWARGATHU MADATHIL LATE REJAGOPALA PRABHU ARAKKULAM DESOM,METHALA VILLAGE,KODUNGALLUR TALUK.
4. SMT.VALSALA, W/O.LATE RAJANANDA PAI, SHYAMRAJ HOUSE, KEETHOLI DESOM,METHALA VILLAGE,KODUNGALLUR TALUK.
5. SATCHITHANANDA PAI, S/O.LATE RAJANANDA PAI, SHYAMRAJ HOUSE,KEETHOLI DESOM,METHALA VILLAGE KODUNGALLUR TALUK
6. SMT.SHYLAJA ANANDA KUMAR, D/O.LATE RAJANANDA PAI, SHYAMRAJ HOUSE,KEETHOLI DESOM,METHALA VILLAGE KODUNGALLUR TALUK PRESENTLY RESIDING AT PRAGATHI VIHARHOSTEL LODHI ROAD,NEW DELHI - 03.
R1 TO R3 BY ADV. SRI.K.V.SADANANDA PRABHU
THIS OP (CIVIL) HAVING BEEN FINALLY HEARD ON 10-01-2013, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
OP(C) NO.4101/2012
## APPENDIX
PETITIONER'S EXHIBITS:
EXT.P1 TRUE COPY OF THE AGREEMENT DATED 26.1.2007 EXECUTED BETWEEN THE PETITIONER AND RESPONDENTS
EXT.P2 TRUE COPY OF THE PLAINT IN OS. NO.449/2008 OF SUB COURT, IRINJALAKUDA
EXT.P3 TRUE COPY OF THE WRITTEN STATEMENT FILED BY THE DEFENDANTS IN OS NO.449/2008 OF THE SUB COURT, IRINJALAKUDA
EXT.P4 TRUE COPY OF THE ARGUMENT NOTE SUBMITTED ON BEHALF OF THE DEFENDANTS DATED 29.10.2012 IN OS NO.449/2008
EXT.P5 TRUE COPY OF THE ORDER IN IA NO.4560/2010 IN OS NO.449/2008 DATED 01.11.2012 OF THE PRINCIPAL SUBORDINATE JUDGE, IRINJALAKUDA.
RESPONDENTS' EXHIBITS:
EXT.R2(A) A TRUE PHOTOCOPY OF THE PLAINT IN OS NO.748/2009 OF SUB COURT, IRINJALAKUDA DATED 19.12.2009
//TRUE COPY//
## **THOMAS P. JOSEPH, J.**
**-------------------------------------O.P.(C). No.4101 of 2012 -------------------------------------Dated this the 10[th] day of January, 2013.**
## **JUDGMENT**
Ext.P5, order dated 01.11.2012 on I.A.No.4560 of 2010 in O.S.No.449 of 2008 passed by the learned Principal Sub Judge, Irinjalakuda holding that court fee is payable in the suit under Sec.42(e) of the Court Fees and Suits Valuation Act (for short, “the Act”) is under challenge at the instance of the petitioner/2[nd] defendant.
2. There was a partnership between Rajananda Pai (father of the petitioner and respondents 5 and 6 and husband of the 3[rd] respondent and respondents 4) and respondents 4 to 6 on the one side and respondents 1 to 3/plaintiffs on the other side for business in petroleum products. According to respondents 1 to 3, after the death of Rajananda Pai there was a settlement reached between the petitioner and respondents 4 to 6 on the one side and respondents 1 to 3 on the other side regarding continuance of the partnership business which resulted in Ext.P1, agreement dated 26.01.2007. The terms and conditions of the settlement are mentioned in Ext.P1, agreement. Respondents 1 to 3 filed the suit contending that they have performed their part of the contract as per Ext.P1 but, the petitioner and respondents 4 to 6 have refused to execute a deed of conveyance with respect to an item of property by name vynthala property in the name of respondents 1 to 3 and hence they sued
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for specific performance of Ext.P1, agreement to that effect. The suit was valued under Sec.42(e) of the Act at `2,28,871/- and court fee was paid accordingly.
3. The petitioner and respondents 4 to 6 while resisting the suit on various grounds including that they have not executed any agreement like Ext.P1, contended that valuation of the suit is not correct. The petitioners filed I.A.No.4560 of 2010 for a decision on the issue regarding court fee. The learned Sub Judge by Ext.P5, order held that court fee is payable under Sec.42(e) of the Act as done in the case. Challenging that order, this original petition is filed.
4. The learned Senior Advocate for the petitioner contends that assuming that court fee is payable under Sec.42(e) of the Act, consideration for execution of conveyance deed in respect of vynthala property is the release of right of respondents 1 to 3 over undakadavu parambu in favour of the petitioner and respondents 4 to 6, that release of undakadavu parambu being the consideration for the promise to execute the conveyance deed in respect of vynthala property, consideration for the promise has a market value and that market value should be market value of undakadavu parambu. It is further contended that in view of the above, the market value has to be assessed under Sec.7(3A) of the Act on the value undakadavu parambu will fetch on the date of institution of the suit. It is argued that as per the fair value fixed by the Government for undakadavu parambu, its market value would come to `57,74,703/- and hence respondents 1 to 3 are liable to pay court fee on the said
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amount. It is also argued by the learned Senior Advocate that since release of the rights of respondents 1 to 3 over undakadavu parambu in favour of the petitioner and respondents 4 to 6 is a condition precedent for executing the conveyance deed in respect of vynthala property, it amounts to an exchange of property falling under Sec.42(d) of the Act and therefore, the suit is to be valued on the ground of consideration or, on the market value of the properties sought to be exchanged.
5. The learned counsel for respondents 1 to 3 contends that undakadavu parambu belonged to the petitioner and respondents 4 to 6 and as per Ext.P1, agreement obligation on the part of respondents 1 to 3 is only to release security over that property with the Lord Krishna Bank, that obligation has no market value to be assessed and hence respondents 1 to 3 were in fact liable to value the suit only in accordance with the latter portion of Sec.42(2) of the Act in which case, court fee payable was only as per the rate fixed in Sec.50 of the Act which is much less than the court fee now paid. It is argued that in the above circumstances, Sec.7(3A) of the Act has no application. It is also argued that Sec.42 (d) of the Act has no application since the question of exchange does not arise.
6. So far as due execution of Ext.P1, agreement is concerned, that is a matter to be decided by the trial court and presently I have to decide the controversy based on Ext.P1, agreement as it now is. Sec.42(d) of the Act
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deals with cases of contract or exchange where fee is payable on the amount of the consideration or as the case may be on the market value of the property sought to be got in exchange.
7. As per averments in paragraph 2 of the plaint, of course reproducing the terms and conditions of Ext.P1, agreement it would appear that as per the version of respondents 1 to 3, undakadavu parambu described in the agreement was purchased out of funds of the partnership. When a property is purchased during continuance of the partnership with its funds, the property comes into the partnership. By Ext.P1, agreement, it is agreed between the parties thereto that undakadavu parambu will go to the petitioner and respondents 4 to 6. It is not necessary that there must be a separate deed of conveyance with respect to transfer of partnership property since at the time of dissolution or reconstitution of the partnership it is open to the parties to deal with the properties of the partnership by the deed of dissolution/reconstitution as held in **George v. George (2010 (2) KLT 692)** . No question of exchange of undakadavu parambu and vynthala property is involved as per Ext.P1. As per Ext.P1, respondents 1 to 3 are to release security over undakadavu parambu Therefore, the contention that the transaction amounts to an exchange between undakadavu parambu and vynthala property coming under Sec.42 (d) of the Act cannot be accepted.
8. Then the next question is whether Sec.42(e) of the Act would apply?
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9. In Ext.P1, agreement it is stated that on respondents 1 to 3 releasing security of undakadavu parambu with the Lord Krishna Bank, the petitioner and respondents 4 to 6 shall execute conveyance with respect to their right in vynthala property in favour of respondents 1 to 3.
10. Sec.42(e) of the Act reads as under:
## In a suit for specific performance,
whether with or without possession, fee shall be payable -
## xxxxxxxxxx
(e) in other cases, where the consideration for the promise sought to be enforced has a market value, computed on such market value, or where such consideration has no market value, at the rates specified in Section 50.”
11. The argument of the learned Senior Advocate for the petitioner is that consideration for the promise of the petitioner and respondents 4 to 6 executing a deed of conveyance with respect to vynthala property is that respondents 1 to 3 will convey their right over the undakadavu parambu in favour of petitioner and respondents 4 to 6 and therefore, the consideration for the promise of executing deed of conveyance for vynthala property is the release of
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right of respondents 1 to 3 with respect to the undakadavu parambu in favour of petitioner and respondents 4 to 6. Therefore, in view of Sec.7(3A) of the Act, court fee is payable on the value undakadavu parambu would fetch at the time of institution of the suit. It is thus that the learned Senior Advocate would come to the fair value of undakadavu parambu.
12. The learned counsel for respondents would however argue that the consideration for the promise sought to be enforced is the clearance of liability over undakadavu parambu and that cannot be computed in terms of market value. It is argued that when the consideration cannot be assessed in terms of market value, the obligation of respondents 1 to 3 was only to pay court fee under Sec.50 of the Act which is much less than the court fee already paid.
13. I have extracted Sec.42(e) of the Act above. What is stated is that where the consideration for the promise sought to be enforced has a market value, then court fee is payable on such market value. The consideration for the promise sought to be enforced by Ext.P2, plaint is that respondents 1 to 3 shall release the security over undakadavu parambu. I am not inclined to think that the said consideration can have a market value. For, the promise made by respondents 1 to 3 pursuant to which the petitioner and respondents 4 to 6 have agreed to convey their right over vynthala property is that respondents 1 to 3 will release security over undakadavu parambu. The learned Senior Advocate would invite my attention to Clause (4) of the agreement that respondents 1 to 3 agreed that with respect to undakadavu parambu they shall not make any further
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claim. For the reasons stated above, execution of deed of conveyance with respect to undakadavu parambu by respondents 1 to 3 in favour of the petitioner and respondents 4 to 6 is not required for. In the light of the above I am inclined to accept the contention of the learned counsel for respondents 1 to 3 that consideration for execution of conveyance deed with respect to vynthala property being the release of security over undakadavu parambu, that consideration cannot have a market value. Hence the latter part of Sec.42(e) of the Act would apply.
14. Respondents 1 to 3 have paid court fee under Sec.42(e) on the market value of vynthala property which is more than what is payable in view of what I have stated above. Hence it is not necessary to fall back upon Sec.7(3A) of the Act.
The original petition is therefore dismissed making it clear that I have not expressed any opinion as to the enforceability or due execution of Ext.P1, agreement.
All pending interlocutory applications will stand dismissed.
**THOMAS P.JOSEPH, Judge.**
**cks**
