Shanya Developers & Realtors (P) Ltd. v. George & Father Andrews Chalil

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE THOMAS P.JOSEPH MONDAY, THE 4TH OCTOBER 2010 / 12TH ASWINA 1932 WP(C).No. 31604 of 2009(O) -------------------------CMA NO.46/2006 OF I ADDL.DISTRICT COURT, ERNAKULAM OS.723/2006 of II ADDL.SUB COURT,ERNAKULAM .................... PETITIONER(S): --------------- SHANYA DEVELOPERS & REALTORS (P) LTD., REP. BY AND ACTING THROUGH ITS MANAGING DIRECTOR RANGANATH JAWAHAR SHANKAR @ R.J.SHANKAR, RESIDING AT FLAT NO.5C, REGENT GARDEN, HOSPITAL ROAD, OPP:KALYAN SILKS, KOCHI-11. BY ADV. SRI.T.G.RAJENDRAN RESPONDENT(S): --------------- 1. GEORGE, S/O.CHACKO, KIZHAKKAKATTU PARAMBIL, PALATHURUTHU DESOM, ERNAKULAM VILLAGE, KANAYANNUR TALUK, ERNAKULAM, KOCHI-20. 2. FATHER ANDREWS CHALIL, S/O.ANTHROYOSE, AGED ABOUT 68 YEARS, KADUTHURUTHI VILLAGE, VALANCHINAKARA, VAIKOM TALUK, 1867 TOTTAR, STRAPS 14, 48507 OCHTRUP, GERMANY. ADV. SRI.JIMMY JOHN VELLANIKARAN FOR R1 & R2 THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 04/10/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: WP(C) NO.31604/2009 ## APPENDIX PETITIONER'S EXHIBITS: EXT.P1 TRUE COPY OF THE PLAINT AND APPLICATION FOR INTERIM INJUNCTION IN OS 723/2006 ON THE FILE OF THE SUBORDINATE JUDGE, ERNAKULAM EXT.P2 TRUE COPY OF THE JUDGMENT IN CMA 46/2007 ON THE FILE OF THE DISTRICT JUDGE, ERNAKULAM EXT.P3 TRUE COPY OF JUDGMENT IN WP(C) 23399/2007 OF THIS COURT EXT.P4 TRUE COPY OF THE ORDER OF ISSUES IN OS 723/2006 OF SUB COURT, ERNAKULAM //TRUE COPY// **THOMAS P. JOSEPH, J. -------------------------------------W.P.(C) No.31604 of 2009 -------------------------------------Dated this the 4[th] day of October, 2010.** ## **JUDGMENT** This Writ Petition is in challenge of Ext.P4, order accepting contention of respondents/defendants that reliefs prayed for in the plaint are liable to be valued under Section 25(d)(i) of the Kerala Court Fees and Suits Valuation Act (for short, “the Act”) . 2. Short facts necessary for a decision of this petition are: Respondents are owners in possession of 4.35.70 acres of land at three places and they entered into three agreements with the petitioner as per which petitioner, a builder agreed to develop the property by constructing multi-storied buildings. It is not disputed that one of the terms of agreement was that on completion of the construction, petitioner will have the right to sell 50% of undivided share in each of schedule items 1 to 3 (4.35.70 acres) at a price mutually agreed between petitioner and the respective buyers and the balance 50% of the undivided share along with the super built up area with apartments shall be retained by the respondents/land owners. In terms of the agreement petitioner paid Rs.25 lakhs as security to the respondents. A cheque for a further sum of Rs.15 lakhs was given to the respondents. But according to the respondents that cheque was dishonoured. Petitioner had represented and made them believe that it is a company having 30 years' experience in the field **WP(C) No.31604/2009** 2 of construction, it has business of 100 crores and has branches in three foreign countries . On enquiry respondents learnt that those statements were untrue. Thereon for the said reason and other reasons and claiming that the agreements are invalid and non est respondents issued notice to the petitioner. On receipt of notice petitioner proceeded to institute the suit in the court of learned Sub Judge, Ernakulam seeking the following reliefs: “a) For a decree of declaration holding and declaring that the 3 agreements two of them dated 22.9.05 and the other dated 2.11.05 that the defendants have entered into with the plaintiff in regard to the entrustment to the plaintiff as Builder along with Powers of Attorneys for implementation of the agreement that are executed by the defendants in favour of the plaintiff, are still alive and are valid and subsisting and remain in force and are enforceable also. b) And for a consequential decree of perpetual prohibitory injunction restraining the defendants, their men and supporters from either terminating the same or treating that the 2 agreements dated 22.9.05 and the one dated 2.11.05 that were entered into between the plaintiff and **WP(C) No.31604/2009** 3 defendants stand cancelled or that the notice dated 28.3.06 has brought about cancellation of the 3 agreements and also restraining the defendants, their men and supporters by a like perpetual injunction from interfering with the construction activities as well as other activities that are being done, conducted and carried on by the plaintiff including marketing and allied activities in respect of the property detailed in the schedule herein. c) Consequential like perpetual injunction restraining the defendants, their agents, men and supporters from alienating all or any portion of the properties detailed in the schedule herein and from inducting any third parties into possession of all or any portion of the properties detailed in the schedule herein without the junction of the plaintiff. d) Directing the defendants to pay the plaintiff the costs of this suit and e) Granting such other reliefs that the plaintiff prays for and this Hon'ble Court deem fit to grant in the circumstances of the case.” **WP(C) No.31604/2009** 4 3. Petitioner valued relief of declaration and injunction at Rs.1,10,000/- under Section 25(d)(ii) of the Act (as if subject matter is not capable of valuation). Respondents filed written statement contending that valuation made and court fee paid are not correct. It is contended that in the nature of reliefs prayed for, court fee is payable under Section 25(d)(i) of the Act. Learned Sub Judge vide Ext.P4, order has accepted that contention relying on the decisions in **Kuriakose v. Joseph (1988 (2) KLT 958) and Sreekumaran v. State of Kerala & Others (1996(2) KLT 21)** . Learned counsel for petitioner contends that Ext.P4, order is erroneous in that declaration is only regarding binding nature of the agreements and has no reference to immovable property involved and that relief not being capable of valuation petitioner is entitled to give his own estimate of valuation of relief prayed for under Section 25(d)(ii) of the Act. Hence court fee paid is correct and learned Sub Judge was wrong in holding otherwise. Learned counsel for respondents contend that court fee had to be paid under Section 25(b) of the Act since it is with reference to immovable property that declaration is prayed for. Reliance is placed apart from the decisions relied on by the learned Sub Judge, on the decision of the Supreme Court in **Shamsher** ## **Singh v. Rajinder Prashad and others (AIR 1973 SC 2384)** . 4. Before deciding the issue it is apposite to refer to the relevant clauses in the Act. Going by Section 25(b) of the Act in a suit for a declaratory decree or order, whether with or without consequential relief not **WP(C) No.31604/2009** 5 falling under Section 26 where the prayer is for a declaration and for consequential injunction and the relief sought is with reference to any immovable property, fee shall be computed on one-half of the market value of the property or on rupees one thousand whichever is higher. Sub-section (d) states that in other cases - (i) where the subject matter of the suit is capable of valuation, fee shall be computed on the market value of the property and (ii) where the subject matter of the suit is not capable of valuation fee shall be computed on the amount at which relief sought is valued in the plaint or on rupees one thousand whichever is higher. I have extracted the reliefs prayed for in the plaint which is as if the declaration prayed for is concerning validity and binding nature of the agreements in question and that petitioner is entitled to implement terms of the agreements which remain alive. Relief (b) onwards related to consequential injunction to restrain respondents and their men from terminating the said agreements or treating the same as cancelled. The Supreme Court in **Shamsher Singh** **v. Rajinder Prashad and others** was dealing with a case where a mortgage was created on behalf of a minor by his father alleging family necessity and a decree was passed based on the mortgage. Later minor on attaining majority filed a suit for declaration that the mortgage was not for family necessity and the decree is not binding on him. The Supreme Court in paragraph No.4 of the decision observed that on the question as to court fee payable on the plaint court should look into the allegations in the plaint to see what is the substantive relief that is asked for and mere astuteness in **WP(C) No.31604/2009** 6 drafting the plaint will not be allowed to stand in the way of court looking at the substance of relief asked for. **Kuriakose v. Joseph** was a case where a declaration sought for concerned a prize winning lottery. There was a prayer for a declaration and consequential injunction restraining custodian of the amount from releasing the amount to the defendants in the suit. This Court considered the question whether court fee is payable under Section 25 (d) of the Act. It was held that effect of declaration and injunction was that custodian of the amount under the prize winning lottery, if declaration and injunction were granted, was bound to deliver the amount to the plaintiff. It was held that it cannot be said that the relief is not capable of valuation and accordingly plaintiff was directed to pay court fee under Section 25(d) (i) read with Section 11 of the Act. In **Sreekumaran v. State of Kerala & Others** challenge was to a notice under the Revenue Recovery Act which called upon plaintiff to pay a certain amount. Plaintiff wanted a declaration that he is not liable to pay the amount and a consequential injunction. It was held that the word 'property' in clause (i) of Sub-section (d) of Section 25 of the Act would mean money, as well as right to property or a liability and that the declaration was capable of valuation and hence plaintiff was liable to pay court fee under Section 25(d) (i) of the Act. 5. Back to the facts of the present case. True that declaration prayed for is as regards as validity and binding nature of the agreements in question and, prima facie, it could be said that what petitioner claims is only a declaration as against the stand of respondents in the notice issued to the **WP(C) No.31604/2009** 7 petitioner that the agreements remain in force and are valid. But, in deciding the provisions of law under which court fee is payable as Supreme ## Court held in **Shamsher Singh v. Rajinder Prashad and others** one cannot have a mere look at the relief alone. Instead entire averments in the plaint as also the relevant documents are to be considered. Properties which are the subject matter of the agreements in question have been scheduled in Ext.P1, plaint. It is not disputed and, it is revealed from the agreements that in terms of the agreement once the construction is completed by the petitioner it gets the right to sell 50% of the undivided share in each of the scheduled items 1 to 3 at a price mutually agreed upon to by the promoters with the prospective buyers and the balance 50% of the undivided share in the land along with super built up area of the apartments goes to the respondents. When building is constructed it forms part of immovable property as something embedded in the land. Hence as per the agreement petitioner gets right over immovable property. Enforcement of the agreements therefore means that the right of petitioner to proceed with construction of the building and sell 50% of the undivided share of each of the scheduled items is declared. That declaration has reference to immovable property. In that view of the matter court fee payable is not under Section25(d)(i) or (ii) but, under Section 25(b) of the Act. Learned Sub Judge was wrong in holding that petitioner is liable to pay court fee under Section **WP(C) No.31604/2009** 8 25(d)(i) of the Act. Instead it should have been found that the petitioner is liable to pay court fee under Section 25(b) of the Act on half of market value of the properties. Resultantly, this Writ Petition is disposed of with the modification that petitioner is found liable to pay court fee on the relief of declaration and consequential injunction prayed for on half of the market value of schedule properties or on Rupees one thousand whichever is higher as provided under Section 25(b) of the Act. Computing the market value as provided under Section 7 of the Act petitioner shall file a statement of particulars as provided under Section 10 of the Act in the trial court within forty five (45) days from this day. **THOMAS P.JOSEPH, Judge.** **cks**