Andhra Pradesh High Court – Amravati
Gaddam Jithendra Kumar vs Kovvuri Srinivasa Reddy on 9 May, 2025
IN THE HIGH COURT OF ANDHRA PRADESH :: AMARAVATI
FRIDAY ,THE NINTH DAY OF MAY
TWO THOUSAND AND TWENTY FIVE
PRESENT
THE HONOURABLE SRI JUSTICE RAVI NATH TILHARI
AND
THE HONOURABLE DR JUSTICE Y. LAKSHMANA RAO
l-A No.1 of 2025
IN/AND
APPEAL SUIT NO: 472 OF 2024
Appeal under Section 96 R/w Order 41 Rule 1 of C.P.C. against the
decree dated 08-04-2024 of III Additional Civil Judge, Nellore, SPSR Nellore
District in Original Suit No.78 of 2019 and sets forth.
Between:
Gaddam Jithendra Kumar, S/o. Late. Anjaneyulu, aged 52 years, R/o.
D.No.
27-1-1646, Balaji Nagar, Nellore City.
...Appellant/Defendant No.2
AND
1. Kovvuri Srinivasa Reddy, S/o. Rama Reddy, aged 37years R/o. D.No.
7-51, Eye doctor street, Old town, Anaparthy Post and Mandal East
Godavari District.
2. Nallamilli Siva Reddy, S/o. Ramakrishna Reddy aged 36 years, R/o.
D.No. 6-240, Seshagirirao pet, Anaparthy Post and Mandal, East
Godavari District.
3. Padaia Veera Venkata Satyanarayana Reddy S/o. Satyanarayana
Reddy, aged 49 years, R/o. D.No. 6-303, Seshagirirao pet, Anaparthy
post and Mandal, East Godavari District.
4. Kowuri Naga raja reddy, S/o. Satyanarayana Reddy, aged 29 years
R/o. D.No. 1-3-6
vedurupaka village, Rayavaram Mandal East
Godavari District.
...Respondents/Plaintiffs 1 to 4
5. Gaddam Prasanna Kumar, S/o. Late Anjaneyulu, aged about 54 years
R/o.D.No.27-1-1646, Balaji Nagar, Nellore City
lA NO: 1 OF 9n9A
Petition under Section 151 CPC praying that in the circumstances
stated in the affidavit filed i
in support of the petition, the High Court may be
pleased to stay the impugned Decree and judgment dated 8/4/2024 passed
in O.S. No. 78 of 2019
on the file of III Additional District Court. Nellore
during pendency of the appeal before the Hon'ble Court
lA NO: 1 OF 2n?.ii
Petition under Section 151 CPC praying that JrLlhe circumstances
stated in the affidavit filed i
in support of the petition, the High Court may be
pleased to Pass an order to Refund of Court Fee an amount of Rs.80,526/-
(Erghty thousand five hundred twenty six only) paid by the Petitioner/
Appellant at the time of filing this Appeal in the account of Registrar
Judicial, A.P. High Court
on 29-08-2024 in A.S. 472 of 2024 against the
Judgment in O.S.No. 78 of 2019, dated 08-04-2024 on the file of III
Additional District Court, Nellore.
Counsel for the Appellant: Sri Rosedar S.R.A
Counsel for the Respondents: -
The Court made the following:
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THE HONOURABLE SRI JUSTICE RAVI NATH TILHARI
AND
THE HONOURABLE DR JUSTICE Y. LAKSHMANA RAO
LA-No-j of 2025
In/and
FIRST APPEAL NO: 472/2024
ORDER :
(per Hon’ble Sri Justice Ravi Nath Tilhari)
Heard Sri Rosedar S.R.A., learned counsel for the petitioner
/appellant.
I . Facts
2. Respondents 1 to 4/plaintiffs filed O.S. No. 78 of 2019 on the
file of the III Additional District Judge, Nellore, against the 5*’^ respondent
(Defendant No.1) and the petitioner/appellant (Defendant No.2), seeking a
preliminary decree directing payment of the suit amount of Rs.78,00,000/-
along with interest at 24% per annum from the date of the suit, and
thereafter a final decree in terms of the preliminary decree. They also
sought a personal decree in the event the sale proceeds of the schedule
property were insufficient to satisfy the decretal amount.
3. After contesting the suit, a preliminary decree was passed on
08.04.2024, directing the 5’^ respondent to pay the suit amount with
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interest at 12% per annum from the date of the suit till the date of decree,
and thereafter at 6% per annum until the date of realization, on the
principal amount of Rs.30,00,000/-, granting three months time for
redemption.
4. Challenging the preliminary decree dated 08.01.2024, the
present A.S.No.472 of 2024 has been filed by the petitioner/appe llant.
5. On 04.11.2024, this Court granted interim stay in I.A. No. 1 of
2024, subject to the condition that the petitioner/appellant deposits the suit
costs within a period of six (06) weeks, which was duly complied with, and
a memo to that effect was also fifed.
6. During the pendency of the appeal, the appellant/defendant
No.2 and the respondents/plaintiffs resolved their dispute out of Court. On
21.10.2024, the petitioner paid an amount of Rs.56,00,000/- to the
respondents/plaintiffs towards full and final settlement, and a Full
Satisfaction Memo to that effect had been filed before the learned III
Additional District Judge, Nellore, in I.A. No. 623 of 2024 in O.S. No. 78 of
2019, which was allowed, and the execution proceedings were terminated.
II . I.A-No-I of 2025 for refund of Court Fee
7. The petitioner/appellant filed I.A. No. 1 of 2025 in the present
appeal, supported by an affidavit containing the aforesaid averments, with
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a prayer for refund of the Court Fee amount of Rs.80,526/- paid in this
appeal.
Ill. Submission of learned counsel for the appellant
8. Learned counsel for the appellant submitted that the dispute
between the parties has been resolved out of Court and that the decree
has been satisfied. The same has also been recorded by the learned
Execution Court. In view of the full and final settlement, nothing survives
for adjudication in the appeal, and the same may be dismissed as
withdrawn.
9. Learned counsel for the appellant further prayed for a refund
of the Court Fee. He placed reliance in the following judgments;
1. Polyprint Private Limited and Others V. Canara
Bank and Another^
2. Dayaram V. Smt.Laxmi AgrawaP
3. High Court of Judicature at Madras, represented by
its Registrar General V. M.C.Subramaniam and
Others^
10. Learned counsel for the respondents/plaintiffs did not appear.
‘ 1997 (4) ALD 281 (D.B)
” 2022 see On-line MP 6004
“(2021) 3 see 560
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IV . Submission of learned counsel for the appellant
11. The following points arise for our consideration and
determination :
A. “Whether in view of the out of Court
settlement, without reference to any of modes
of Alternative Dispute Resolution under
Section 89 CPC, and in view thereof, the
appeal being withdrawn, the Court fee paid in
this appeal deserves to be refunded ?
B. If the answer to Point A is, yes, to what
amount of Court Fee ?"
V . Consideraton / Analysis
Point 'A':-
12. We have considered the aforesaid submissions advanced by
the learned counsel for the appellant, and perused the material on record.
13. The Appeal Suit is dismissed as withdrawn, as the decree
has been satisfied, as stated in the affidavit, and such satisfaction has
been recorded by the Execution Court.
14. Insofar as the refund of Court Fee paid in the appeal is
concerned, it is relevant to refer to the provisions of Sections 63 to 66-A of
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the Andhra Pradesh/Telangana Court Fees and Suit Valuation Act, 1956
(hereinafter referred to as the ‘Act’), which provide as follows:
“63. Refund in cases of rejection of plaint,
etc., for delay.
(1) Where a plaint or memorandum of appeal is rejected
on the ground of delay in its representation or where the
fee paid on a plaint or memorandum of appeal is
insufficient and the deficit fee is not paid within the time
allowed by the Court, or the delay in payment of the
deficit fee is not condoned, and the plaint or
memorandum of appeal is consequently rejected, the
Court may, in its discretion, direct the refund to the
plaintiff or the appellant, of the fee, either in whole or in
part, paid on the plaint or memorandum of appeal which
was rejected.
(2) Where a memorandum of appeal is rejected on the
ground that it was not presented within the time allowed
by the law of limitation, one-half of the fee shall be
refunded.
64. Refund in cases of remand.
(1) Where a plaint or memorandum of appeal rejected by
the lower Court is ordered to be received, or where a suit
is remanded in appeal for a fresh decision by the lower
Court, the Court making the order or remanding the
appeal may direct the refund to the appellant of the full
amount of fee paid on the memorandum of appeal; and,
it the remand is on second appeal, also on the
memorandum of appeal in the first appellate Court and if
the remand is in Letters Patent Appeal, also on the
memorandum of second appeal and memorandum of
appeal in the first appellate Court.
12] Where an appeal is remanded in Second Appeal or
Letters Patent Appeal for a fresh decision by the lower
appellate Court, the High Court remanding the appeal
may direct the refund to the appellant of the full amount
offee paid on the memorandum of Second Appeal if the
remand is in Second Appeal, and of the full amount of
fee paid on the Memorandum of Second Appeal and the
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Memorandum of Letters Patent Appeal if the remand is
in Letters Patent Appeal:
Provided that no refund shall be ordered if the remand
was due to the fault of the party who would otherwise
be entitled to a refund :
Provided further that, if the order of remand does not
cover the whole of the subject- matter of the suit, the
refund shall not extend to more than so much fee as
would have been originally payable on that part of the
subject-matter in respect whereof the suit has been
remanded.
65. Refund in cases of review.
Where an application for a review of judgment is
admitted on the ground of some mistake or error
apparent on the face of the record and on rehearing, the
Court reverses or modifies its former decision on that
ground, it shall direct refund to the applicant of so much
of the fee paid on the application as exceeds the fee
payable on any other application to such Court under
Article 11 (g) and (u) of Schedule 11.
66. Refund of fee paid by mistake or inadvertence.
– The fee paid by mistake or inadvertence shall be
ordered to be refunded.
66A. 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 (Central
Act No.5 of 1908), the plaintiff shall be entitled to a
certificate from the Court authorizing him to receive
back from the Collector, the full amount of the fee paid
in respect of such plaint.”
15. As per Section 63 (1) of the Act, where a plaint or
memorandum of appeal is rejected on the ground of delay in its
representation or where the fee paid on a plaint or memorandum of appeal
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is insufficient and the deficit fee is not paid within the time allowed by the
Court, or the delay in payment of the deficit fee is not condoned, and the
plaint or memorandum of appeal is consequently rejected, the Court may
in its discretion, direct the refund to the plaintiff or the appellant, of the fee.
either in whole or in part, paid on the plaint or memorandum of appeal
which was rejected. As per Section 63 (2) of the Act, where a
memorandum of appeal is rejected on the ground that it was not presented
within the time allowed by the law of limitation, one-half of the fee shall be
refunded.
16. Section 64 of the Act provides for refund in cases of remand.
Section 65 of the Act provides for refund in cases of review. Section 66 of
the Act provides for refund of fee paid by mistake or inadvertence.
17. Section 66-A of the Act provides for 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
(Central Act No.5 of 1908). In such a case, the plaintiff shall be entitled to
a certificate from the Court authorizing him to receive back from the
Collector, the full amount of the fee paid in respect of such plaint.
18. The present case is admittedly not one involving rejection of
the memorandum of appeal on the ground of delay in its representation, or
on account of insufficient or deficit court fee not being paid within the time
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allowed, as contemplated under Section 63 of the Act. Furthermore,
Section 64 of the Act, pertains to refund of court fee in cases of remand.
and Section 65, relates to refund in cases of review, are also not attracted
in the present case, it not being a case of remand or review. Similarly, it is
not the case of the petitioner that the court fee was paid due to any
mistake or inadvertence so as to attract Section 66 of the Act.
19. The refund of court fee under Section 66-A of the Act is
permissible in cases where the Court refers the parties to any one of the
modes of settlement of dispute referred to in Section 89 of the Code of
Civil Procedure, 1908. In such cases, the plaintiff is entitled to a certificate
from the Court authorizing him to receive back from the Collector the full
amount of the fee paid in respect of such plaint. The present case is also
not one where the parties were referred to any of the modes of settlement
of dispute under Section 89 CPC.
20. Learned counsel for the petitioner/appellant has not been
able to point out any provision under the Act, apart from the
aforementioned provisions, that permits refund of court fee in cases where
the parties have entered into a compromise outside the Court and, as a
result, the decree has been fully satisfied, either in part or in full, through
such settlement. He, however, placed reliance in the cases (supra) to
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contend that the Court Fee can be directed to be refunded also in a case
of the present situation/circumstances.
21. In Polyprint Private Limited (supra), a Co-ordinate
Bench of this Court, where a preliminary decree in a mortgage suit, was
satisfied with the decree and a compromise was entered into between the
parties, and the appeal was dismissed as withdrawn, on the request of the
appellants, this Court permitted refund of the Court fee paid in the appeal,
though the request for refund of the Court fee fell outside the provisions of
Sections 63 to 66 of the Act, observing that there was power inherent in
this law Court as a Court of Record, which was not only a Court of law but
also a Court of Justice and Equity to see and weigh in each case as to
whether the Court fee was liable to be refunded or not. Paragraph No.3 of
Polyprint Private Limited (supra), reads as under:
“3..Having heard the arguments of the learned
Counsel for the appellants, we also apply the principle
incidental to the facts of the case as the request for
refund of Court Fee falls outside the provisions of
Sections 63 to 66 of the A.P. Court Fees and SuitsValuation Act. There is the power inherent in this law
Court as a Court of Record, which is not only a Court of
law but also a Court of Justice and Equity to see and
weigh in each case as to whether the Court fee is liable
to be refunded or not. Such inherent power has to be
exercised having regard to the facts and circumstances
of the case and only in the cases where there is equity in
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I.A.NO.l OF 2025 IN/AND A.S. N0.472 OF 2024)favour of the appellant withdrawing the appeal. In the
instant case, having regard to the facts and
circumstances, we find the equity in favour of the
appellants and as such the Court fee paid in this appeal
shall be refunded to the appellants by the Registry. We
may also make it clear that the refund of this Court fees
will not be deprived of the fees payable to the learned
Counsel appearing for the plaintiff- Bank. The plaintiff-
bank has to pay his fees in accordance with their
understanding and in accordance with the provisions of
the A.P. Advocates’ Fees Rules, 1990.”
22. In Dayaram (supra), the Madhya Pradesh High Court
opined that even if the matter was settled between the parties outside the
Court without invoking the provisions of Section 89 CPC, the appellant
while withdrawing his first appeal, was entitled to the refund of full Court
fees as provided under Section 16 of the Court Fees Act, 1870. (hereinafter
referred as ‘Court Fee Act‘).
23. Section 16 of the Court Fees Act, 1870, reads as under:
“16. Refund of fee [Section 16 repealed by Act 5 of 1908
and again inserted by Act 46 of 1999, Section 34.]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 authorizing him to receive back from
11(RNT,j & DR.YLR,J
I.A.NO.l OF 2025 IN/ANO A.S. N0.472 OF 2024)the Collector, the full amount of the fee paid in respect
of such plaint.”
24. The Section 66-A of the Andhra Pradesh/Telangana Court
Fees and Suit Valuation Act,1956, is the same as was Section 16 of the
Court Fee Act,1870.
25. In Dayaram‘s case (supra), reliance was placed in the
judgments of the Karnataka High Court in A.Sreeramaiah V. South
Indian Bank Limited“^ and in Kamalamma V. Honnali Taluk
Agricultural Produce Co-operative Marketing Society Limited^.
Both the judgments of the Karnataka High Court, were referring to the
provisions of Section 89 of CPC and Section 16 of the Court Fee Act,
wherein, it was observed that even if the parties come forward to settle
their dispute before the Court itself, they should not be denied refund of
Full Court Fees on the ground that they had not settled the dispute by any
of the four methods provided under Section 89 of CPC. The object behind
section 89 CPC was to encourage the parties to arrive at settlement and if
that object was sought to be achieved by means of referring the matter to
any of the four methods mentioned in section 89 CPC, then even the
^ ILR 2006 Kar 4032
® AIR 2010 Kar 279
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settlement arrived at the earliest stage before the Court would also be one
of the method provided under Section 89, Sub-section (1).
26.
In Dayaram‘s case (supra), the Madhya Pradesh High
Court also, referred to the judgment of Punjab and Haryana High Court in
Pradeep Sonawat V. Satish Prakash @ Satish Chandra^,
wherein, it was observed that whether the compromise is with the
persuasion of the Court or amongst the parties by themselves in terms of
Section 89 CPC or otherwise, invocation of provision of Section 16 of the
Court Fee Act should be made in all cases so that settlements by way of
Alternative Dispute Resolution mechanism were encouraged.
27.
In High Court of Judicature at Madras (supra), the
Hon’ble Apex Court observed agreement with the approach taken by the
High Courts in Kamalamma (supra), and the cases, which followed
Kamalamma (supra) including Pradeep Sonawat (supra). It was
observed that the purpose of Section 69-A of Tamilnadu Court Fees
Act, 1955 was to reward parties who had chosen to withdraw their
litigations in favour of more conciliatory dispute settlement mechanisms,
thus saving the time and resources of the Court, by enabling them to claim
refund of the court fees deposited by them. Such refund of court fee,
though it might not be connected to the substance of the dispute between
the parties, was certainly an ancillary economic incentive for pushing them
” 2015 (2) Civil Court Cases 52
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towards exploring alternative methods of dispute settlement. It was
observed that the Karnataka High Court rightly observed in Kamalamma
(supra), that the parties who had agreed to settle their disputes without
requiring judicial intervention under Section 89 CPC were even more
deserving of this benefit. Because, by choosing to resolve their claims
themselves, they had saved the State of the logistical hassle of arranging
for a third-party institution to settle the dispute. Though arbitration and
mediation are certainly salutary dispute resolution mechanisms, the
importance of private amicable negotiation between the parties could not
be understated. The Hon’ble Apex Court held that there was no justifiable
reason why Section 69-A of the Tamilnadu Court Fees Act, 1955 should
only incentivise the methods of out-of-court settlement stated in Section 89
CPC and afford step-brotherly treatment to other methods availed of by
the parties.
28. It is apt to reproduce paragraph Nos.11 to 26 of High Court
of Judicature at Madras (supra) as under :
“11. The gravamen of the petitioner’s contentions is that Section
69-A of the 1955 Act only contemplates refund of court fees in those
cases where the Court itself refers the parties to any of the alternative
dispute settlement mechanisms listed in Section 89 CPC. That hence it
does not apply to circumstances such as in the present case, where the
parties, without any reference by the Court, privately agreed to settle
their dispute outside the modes contemplated under Section 89 CPC.
This Court’s analysis
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12. Having heard the petitioner and thoroughly considered the
arguments advanced, we find ourselves unimpressed by the petitioner’s
contentions, for reasons outlined below.
13. The provisions of Section 89 CPC must be understood in the
backdrop of the longstanding proliferation of litigation in the civil courts,
which has placed undue burden on the judicial system, forcing speedy
justice to become a casualty. As the Law Commission has observed in
its 238th Report on Amendment of Section 89 of the Code of CivilProcedure, 1908 and Allied Provisions, Section 89 has now made it
incumbent on civil courts to strive towards diverting civil disputes
towards alternative dispute resolution processes, and encourage their
settlement outside of court (Para 2.3). These observations make the
object and purpose of Section 89 crystal clear to facilitate private
settlements, and enable lightening of the overcrowded docket of the
Indian judiciary. This purpose, being sacrosanct and imperative for the
effecting of timely justice in Indian courts, also informs Section 69-A of
the 1955 Act, which further encourages settlements by providing for
refund of court fee. This overarching and beneficent object and purpose
of the two provisions must, therefore, inform this Court’s interpretation
thereof.
14. Before expounding further on our interpretation of the
aforesaid provisions, regard must be had to the following postulation of
this Court’s interpretive role in Directorate of Enforcement v. Deepak
Mahajan ((1994) 3 SCC 440): (SCC pp. 453-54, paras 24-25)“24. …Though the function of the courts is only to expound
the law and not to legislate, nonetheless the legislature
cannot be asked to sit to resolve the difficulties in theimplementation of its intention and the spirit of the law. In
such circumstances, it is the duty of the court to mould or
creatively interpret the legislation by liberally interpreting
the statute.
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25. In Maxwell on Interpretation of Statutes, Tenth Edn. at
p. 229, the following passage is found:
‘Where the language of a statute, in its ordinary
meaning and grammatical construction, leads to a
manifest contradiction of the apparent purpose of
the enactment, or to some inconvenience or
absurdity, hardship or injustice, presumably not
intended, a construction may be put upon it which
modifies the meaning of the words, and even the
structure of the sentence. Where the main object
and intention of a statute are clear, it must not bereduced to a nullity by the draftsman’s unskilfulness
or ignorance of the law, except in a case of
necessity, or the absolute intractability of the
language used.’(emphasis supplied)
15. Therefore, it is well settled that the courts may, in order to
avoid any difficulty or injustice resulting from inadvertent ambiguity in the
language of a statute, mould the interpretation of the same so as toachieve the true purpose of the enactment. This may include expanding
the scope of the relevant provisions to cover situations which are notstrictly encapsulated in the language used therein
16. This principle of statutory interpretation has been affirmed
more recently in the decision in Shailesh Dhairyawan v. Mohan
Balkrishna Lullas (2016 3 SCC 619): (SCC p. 642, para 33)
“33. .. Though the literal rule of interpretation, till some
time ago, was treated as the “golden rule”, it is now the
doctrine of purposive interpretation which is predominant,
particularly in those cases where literal interpretation
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brings about an end which is at variance with the
purpose of statute, that cannot be countenanced.”
(emphasis supplied)
This was followed in the subsequent decision of this
Court in Anurag Mittal v. Shaily Mishra Mittal (2018 9
see 691).
17. In light of these established principles of statutory
interpretation, we shall now proceed to advert to the specific provisions
that are the subject of the present controversy. The narrow
interpretation of Section 89 CPC and Section 69-A of the 1955 Act
sought to be imposed by the petitioner wouid lead to an outcome
wherein the parties who are referred to a mediation centre or other
centres by the Court will be entitled to a full refund of their court
fee; whilst the parties who similarly save the Court’s time and
resources by privately settling their dispute themselves will be
deprived of the same benefit, simply because they did not require
the Court’s interference to seek a settlement. Such an
interpretation, in our opinion, clearly leads to an absurd and unjust
outcome, where two classes of parties who are equally facilitating
the object and purpose of the aforesaid provisions are treated
differentialiy, with one class being deprived of the benefit of
Section 69-A of the 1955 Act. A literal or technical interpretation, in
this background, wouid only lead to injustice and render the
purpose of the provisions nugatory and thus, needs to be departed
from, in favour of a purposive interpretation of the provisions.
18. It is pertinent to note that the view taken by the High
Court in the impugned judgment^ has been affirmed by the High Courts
in other States as well. Reference may be had to the decision of the
Karnataka High Court in Kamalamma v. Honnali Taluk Agricultural
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Produce Coop. Mktg. Society Ltd.(2009 SCC Online kar 744). wherein
it was held as follows: (SCC Online Kar para 6)
“6. Whether the parties to a suit or appeal or any other
proceeding get their dispute settled amicably through
arbitration, or meditation or conciliation in the Lok
Adalat, by invoking provisions of Section 89 CPC or
they get the same settled between themselves
without the intervention of any
Arbitrator/Mediator/ Conciliators in Lok Adalat,
etc,, and without invoking the provision of
Section 89 CPC, the fact remains that they get
their dispute settled without the intervention of
the Court. If they get their dispute settled by
invoking Section 89 CPC, in that event the State may
have to incur some expenditure but, if they get their
dispute settled between themselves without the
intervention of the Court or anyone else, such as
arbitrator/mediator, etc., the State would not be
incurring any expenditure. This being so, I am of the
considered opinion that whether the parties to a
litigation get their dispute settled by invoking
Section 89 CPC or they get the same settled
between themselves without invoking Section 89
CPC, the party paying court fees in respect
thereof should be entitled to the refund of full
court fees as provided under Section 16 of the
Court Fees Act, 1870.”
(emphasis supplied)
19. Section 16 of the Court Fees Act, 1870 is in pari materia with
Section 69-A of the 1955 Act, and hence the abovestated principles are
equally applicable to the present case.
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20. The holding in Kamalamma (2009 SCC Online Kar 744) has
been followed by the Punjab and Haryana High Court in Pradeep
Sonawat v. Satish Prakash (2015 SCCOnLine P&H 2235) and Pritam
Singh v. Ashok Kumar ((2019) 1 Law Herald 721 (P&H)), which in turn
were further affirmed in Raj Kumar v. Gainda DeVito (2009 SCC Online
P&H 658).
21. The Delhi High Court has also taken a similar view in J.K.
Forgings v. Essar Construction (India) Ltd. (2009 SCC Online Del
3134): (SCC Online Del paras 11-12, 14 & 17-19)
“11. The laudable object sought to be achieved by
inserting and amending these sections seems to be
speedy disposal. The policy behind the statute is to
reduce the number of cases by settlement. Section 89
CPC and Section 16 of the Court Fees Act are welcome
step in that direction, as the number of cases has
increased, it is the duty of court to encourage
settlement. In present scenario of huge pendency of
cases in the courts a purposive and progressive
interpretation is the requirement of present hour. The
intention of the Legislature is primarily to be gathered
from the object and the words used in the material
provisions. The statute must be interpreted in their plain
grammatical meaning.
12. It is very clear that the legislative intent of Section
16 of the Court Fees Act was made broad enough to
take cognizance of all situations in which parties arrive
at a settlement irrespective of the stage of the
proceedings. It is also obvious that the purpose of
making this provision was in order to provide some sort
of incentive to the party who has approached the court
to resolve the dispute amicably and obtain a full refund
of the court fees. Having regard to this position, the
present application will have to be allowed.
14. This is not a case where parties to the suit after long
drawn trial have come to the court for settlement. Had it
been the case of long drawn trial non-refund of court
fees could have been justified but in such like cases
courts’ endeavour should be to encourage the parties
and court fees attached with the plaint should be
refunded as an incentive to them.
19
(RNT,J & DR.YLRJ
I.A.NO.l OF 2025 IN/AND A.S. NO.472 OF 2024)
17. Settlement of dispute only through any of the mode
prescribed under Section 89 CPC is not sine qua non of
Section 89 CPC rather it prescribes few methods
through which settlement can be reached, sine qua non
for applicability of Section 89 is settlement between the
parties outside the court without the intervention of the
courts.
18. It is also not the requirement of the section that
court must always refer the parties to Dispute
Resolution Forum. If parties have arrived at out-of-court
settlement it should be welcomed subject to principles of
equity.
19. The Court Fees Act is a taxing statute and has to be
construed strictly and benefit of any ambiguity if any
has to go in favour of the party and not to the State.”
22. The view taken in both Kamalamma (2009 SCC OnLine
Kar 744) and J.K. Forgings(2009 SCC Online Del 3134) has been
subsequently relied upon by the Delhi High Court in Inderjeet Kaur
Raina v. Harvinder Kaur Anand (2018 SCC OnLine Del 6557).
23. We find ourselves in agreement with the approach taken
by the High Courts in the decisions stated supra. The purpose of
Section 69-A is to reward parties who have chosen to withdraw their
litigations in favour of more conciliatory dispute settlement
mechanisms, thus saving the time and resources of the Court, by
enabling them to claim refund of the court fees deposited by them.
Such refund of court fee, though it may not be connected to the
substance of the dispute between the parties, is certainly an ancillary
economic incentive for pushing them towards exploring alternative
methods of dispute settlement. As the Karnataka High Court has
rightly observed in Kamalamma (2009 SCC OnLine Kar 744), the
parties who have agreed to settle their disputes without requiring
judicial intervention under Section 89 CPC are even more deserving
of this benefit. This is because by choosing to resolve their claims
themselves, they have saved the State of the logistical hassle of
arranging for a third-party institution to settle the dispute. Though
20
(RNT,J & DR.YLR,J
I.A.NO.l OF 2025 IN/AND A.S. N0.472 OF 2024)
arbitration and mediation are certainly salutary dispute resolution
mechanisms, we also find that the importance of private amicable
negotiation between the parties cannot be understated. In our view,
there is no justifiable reason why Section 69-A should only incentivise
the methods of out-of-court settlement stated in Section 89 CPC and
afford step-brotherly treatment to other methods availed of by the
parties.
24. Admittedly, there may be situations wherein the parties
have after a course of a long-drawn trial, or multiple frivolous
litigations, approached the Court seeking refund of court fees in the
guise of having settled their disputes. In such cases, the Court may,
having regard to the previous conduct of the parties and the principles
of equity, refuse to grant relief under the relevant rules pertaining to
court fees. However, we do not find the present case as being of such
nature.
25. Thus, even though a strict construction of the terms of
Section 89 CPC and Section 69-A of the 1955 Act may not
encompass such private negotiations and settlements between
the parties, we emphasize that the participants in such
settlements will be entitled to the same benefits as those who
have been referred to explore alternate dispute settlement
methods under Section 89 CPC. Indeed, we find it puzzling that the
petitioner should be so vehemently opposed to granting such benefit.
Though the Registry/State Government will be losing a one-time court
fee in the short term, they will be saved the expense and opportunity
cost of managing an endless cycle of litigation in the long term. It is
therefore in their own interest to allow Respondent Ts claim.
26. Thus, in our view, the High Court was correct in holding
that Section 89 CPC and Section 69-A of the 1955 Act be interpreted
liberally. In view of this broad purposive construction, we affirm the
High Court’s conclusion, and hold that Section 89 CPC shall cover,
and the benefit of Section 69-A of the 1955 Act shall also extend to all
21
(RNTJ & OR.YLR,J
I.A.NO.l OF 2025 IN/AND A.S. N0.472 OF 2024)
methods of out-of-court dispute settlement between parties that the
Court subsequently finds to have been legally arrived at. This would,
thus, cover the present controversy, wherein a private settlement was
arrived at, and a memo to withdraw the appeal was filed before the
High Court. In such a case as well, the appellant i.e. Respondent 1
herein would be entitled to refund of court fee.”
29. In High Court of Judicature at Madras (supra), thus, it
has been laid down that the participants in private settlements and
negotiations will be entitled to the same benefits of refund of Court Fee, as
those who have been referred to explore alternative dispute settlement
methods under Section 89 CPC.
30. The Hon’ble Apex Court, however, further observed that there
may be situations, wherein the parties have after a course of a long-drawn
trial, or multiple frivolous litigations, approached the Court seeking refund
of court fees in the guise of having settled their disputes. In such cases,
the Court may, having regard to the previous conduct of the parties and
the principles of equity, refuse to grant relief under the relevant rules
pertaining to court fees.
31. We may also refer to Jage Ram V. Ved Kaur^. In the said
case, the second appeal was decided in terms of the settlement by the
High Court and not on merits. The appellant prayed for refund of Court
‘ Special Leave to Appeal (c) No.723 of 2023
22
(RNT,J & DR.YLR,J
I.A.NO.l OF 2025 IN/AND A.S. N0.472 OF 2024)
Fee paid by him in the trial Court as well as in the first Appellate Court and
the second Appellate Court. The High Court rejected the prayer, by
holding that no case for refund was made out. The Hon’ble Apex Court
held that the refund of Court Fee was permissible only if the matter was
referred to Arbitration, Conciliation, Judicial settlement, including through
Lok Adalat or mediation for settlement and the case was decided in terms
of such a settlement and not otherwise.
32. The judgment in Jage Ram (supra) is reproduced as
under
“1. Heard learned counsel for the parties.
2. The second appeal was decided by the High Court in
terms of the settlement, a signed copy of vjhich was
produced before it.
3. Since the appeal was decided in terms of the
settlement and not on merits, the petitioner prayed to
refund the court fees paid by him in the trial Court as
well as in the First Appellate Court and Second
Appellate Court.
4. In the second appeal, the petitioner had paid
Rs.29,053/- (Rupees Twenty-Nine Thousand Fifty-
Three only).
5. The High Court by the impugned order has rejected
the prayer so made by the petitioner by holding that no
ground for refund has been made out.
6. The refund of court fees is permissible only if the
matter is referred to Arbitration, Conciliation, judicial
settlement, including through Lok Adalat or mediation
23
(RNT,J & DR.YLRJ
I.A.NO.l OF 2025 IN/AND A.S. N0.472 OF 2024)
for settlement and the case is decided in terms of such
a settlement and not otherwise.
7. In the case at hand, the settlement in terms of which
the second appeal was decided by the High Court is
not on reference to any of the above authorities/for a
rather it was an amicable settlement out of the
court.
8. Accordingly, we are of the opinion that the
petitioner is not entitled to refund of the court
fees and the High Court has not committed any error
or illegality in refusing such a prayer. ”
33. Jage Ram (supra) does not refer to High Court of
Judicature at Madras (supra).
34. in Jage Ram (supra), there was a settiement out of court
during the pendency of second appeal. It was not on a reference to any of
the authorities under Section 89 CPC. It was an amicable settlement
arrived at independently, but the second appeal was decided in terms of
that an out-of-court settlement without reference to Section 89 CPC.
35. In High Court of Judicature at Madras (supra), there
was an out of Court settlement independent of Section 89 CPC and in
view thereof, the appeal was permitted to be withdrawn. The appeal was
not decided in terms of the out of Court settlement.
24
(RNT,J & DR.YLR,J
I.A.NO.l OF 2025 IN/AND A.S. N0.472 OF 2024)
36. The present is not a case where the appeal is decided, based
on an out of Court settlement. Instead, in view of the settlement, the
appellant sought to withdraw the appeal, and permission for such
withdrawal has been granted. Upon consideration of the aforesaid
judgments, we are of the view that the judgment in the case of High
Court of Judicature at Madras, V. M.C.Subramaniam and
Others is fully applicable and attracted to the facts of the present case.
Accordingly, by following the aforesaid judgment, we hold that the
appellant is entitled for refund of Court Fee.
POINT ‘B’:-
37. The question now is as to what amount of Court Fee
deserves to be refunded ?
38. We may refer, Sanjeev Kumar Harakchand
Kankariya V. Union of India and Others^, on the point of refund of
Court Fee, in which, the appellant had entered into agreement of sale. Theagreement of sale could not be performed and as such, he preferred a
Special Civil Suit before the Civil Court, praying for a direction of specific
performance of the contract. The dispute was referred to mediation under
Section 89 CPC and, was amicably resolved. The terms of the settlement
were presented to the Court and the Civil Suit was disposed of in terms of
2024 see On-line Se 3811
25
(RNTJ & DR.YLRJ
I.A.NO.l OF 2025 IN/AND A.S. N0.472 OF 2024)the said compromise. A request for refund of Court fees was allowed only
to the extent of 50%. Challenging which, and claiming full refund, it was
contended that under Section 21 of the Legal Services Authority Act,
1987, Section 20(1) r/w 16 of the Court Fee Act, 1870, 100% of the Court
Fee should have been refunded.
39. The question for consideration was as per paragraph No.5 of
the judgment in Sanjeev Kumar (supra), which reads as under:
“5. The question presented for this Court’s adjudication
was, considering the submissions as afore-stated is whether in
view of the inconsistency between the CFA, 1870 and the MCFA,
1959, if any, would the appellant be entitled to a complete
refund of court fees per the former, since is a Central
legislation? Allied thereto, would be the question of whether the
Maharashtra State Legislature could have enacted the provision
and brought out a notification giving refunds in ways contrary to
and distinct from the manner and method provided in theCentral Legislation?”
40. The Maharashtra Court Fee Act, 1959, provided for refund of
Court Fee in certain circumstances under Section 43(1) and Section 43(2)
provided for the notification, which notification dated 08.05.2013 was
issued. There was no such provision like Section 16 of the Court Fees Act,
in the Maharashtra Court Fee Act, 1959. Later on, in 2018, Section 16A
had been introduced in Maharashtra Court Fee Act, 1959, identical to
26
(RNT,J & DR.YLR,J
I.A.NO.l OF 2025 IN/AND A.S. N0.472 OF 2024)
Section 16 of the Court Fees Act,1870. The Hon’ble Apex Court conciuded
and held vide paragraph Nos. 21 to 24, which read as under:
CONCLUSION
21. The inescapable conclusion per the above discussion,
holding that Entry 1 lA List III cannot govern the refund of court
fees when matter is settled by methods of alternate dispute
resolution, in the face of Entry 3 List 11 simply by the use of the
words “administration of justice” in the former and, thatreference to CFA, 1870 in respect of refund of court fees when
the matter is settled by way of an Award of Lok Adalat does not
mean that the same shall be extended to the settlement ofdispute by mediation for the simple reason that Lok Adalat and
mediation are two distinct methods and cannot be equated, we
hold that this appeal lacks merit and is liable to be dismissed.
Ordered accordingly.
22. As extracted supra, the High Court in the impugned
judgment had made a suggestion to the State legislature that the
differences in the court fees in Lok Adalat, vis-a-vis, the forms of
ADR should be done away with the view to promote the
adaptation of such methods of dispute resolution among the
public. It has been brought to our attention that the State
legislature has indeed carried out such an amendment to the
MCFA, 1959 and Section 16A has been introduced therein by
way of Maharashtra Act No. of 2018, the relevant extract of
which reads under:
MAHARASHTRA ACT No. X OF 2018.
(First published, after having received the assent of the Governor
in the “Maharashtra Government Gazette”, on the 16th January
2018.)An Act further to amend the Maharashtra Court-fees Act.
27
(RNT,J & DR.YLR,J
I.A.NO.l OF 2025 iN/AND A.S. N0.472 OF 2024)WHEREAS it is expedient further to amend the Maharashtra
Court- fees Act, for the purposes hereinafter appearing; it ishereby enacted in the Sixty-eighth Year of the Republic of India as
follows:-
1…. 2. After section 16 of the Maharashtra Court-fees Act
(hereinafter referred to as “principal Act”), the following section
shall be inserted, namely:-
“16A. Where the court refers the parties to the suit to
any one of the modes of settlement of dispute referred
to in section 89 of the Civil Procedure Code, 1908 and
suit is disposed of by the court by adaptation of any of
the modes prescribed under the said section, the
plaintiff shall be entitled to a certificate from the court
authorizing him to receive back from the collector, the
full amount of the fee paid in respect of such plaint.”.
23. The effect of the above being that for the time when the
amendment to the MCFA, 1959 granting partial or complete
refund, as the case may be, in accordance with Section 43 as
amended, the persons whose matters were settled by way of
ADR would not be entitled to 100% refund. Any matter settled
under the processes mentioned in Section 89 CPC after the
coming into force of the above- extracted amendment, such
parties shall receive refund of court fees in its entirety.
24. The total amount of court fees paid by the appellant, in
respect of the refund of which the matter has travelled up to this
Court was approximately Rs. 5 lakhs. Should we, in the facts
and circumstances of this case grant, in exercise of
extraordinary jurisdiction under Article 142 of the Constitution of
India, refund of the said amount is a question we have asked
ourselves. Considering the fact that the original dispute was
settled amicably and that the amount of court fees involved is
28
(RNTJ & DR.YLR,J
I.A.NO.l OF 2025 IN/AND A.S. N0.472 OF 2024)
not excessive, in the peculiar facts of this case, for it not to be a
binding precedent, we are of the view that the same can be
refunded to him. Ordered accordingly, Pending
applications, if any, shall stand disposed o.f
41. In Sanjeev Kumar Harakchand Kankariya (supra)
the Hon’ble Apex Court held that as per the Maharashtra Court Fee Act,
1959 (unamended), the persons whose matters were settled by way of
Alternative Dispute Resolution would not be entitled 100% refund. Any
matter settled under the processes mentioned in Section 89 CPC after
coming into force of amendment i.e.. Section 16 A in the Maharashtra
Court Fee Act, 1959, such parties shall receive refund of Court Fees in its
entirety. The Flon’ble Apex Court through granted refund of entire Court
fee, but observing that was done in the peculiar facts of that case, for not
being a binding precedent, and in the exercise of jurisdiction under Article
142 of the Constitution of India.
42. The out-of-court settlement, in our view, was not arrived at
the earliest stage, nor was it affected by taking recourse to Section 89 of
the CPC. Therefore, Section 66-A of the Act, which provides for a refund
of the full amount of Court Fee upon certification by the Court, is not
applicable in the present case with respect to the refund of Full Court fee
as sought.
29
(RNT,J & DR.YLR,J
I.A NO.l OF 2025 IN/AND A.S. N0.472 OF 2024)
43. The appellant filed the present appeal, which was listed and
heard on multiple occasions. On 04.11.2024, an interim order was
granted, subject to the condition of depositing the suit costs. Furthermore,
under Section 63 of the Act, in cases where the memorandum of appeal is
rejected on the ground of delay and the delay is not condoned, the refund
is permissible only to the extent of 50% under sub-section (2).
44. Although Section 63 is not attracted, considering the
legislative intent behind the aforesaid provisions, we are of the opinion that
directing a refund of 100% of the Court Fee would not be appropriate in
the present circumstances. Accordingly, the appellant is not entitled to a
100% refund of the Court Fee. We allow a refund of 50% of the Court Fee
deposited.
VI . Conclusion
45. Our conclusions on the points framed are as under
(i) On Point ‘A’, we hold that the appellant is entitled for refund
of Court Fee.
(ii) On Point ‘B’, we hold that 50% of the Court Fee paid in this
appeal shall be refunded.
30
(RNT,J & DR.YLRJ
I.A.NO.l OF 2025 IN/AND A.S. N0.472 OF 2024)
VII . Result
46. IN THE RESULT,
i) The Appeal Suit is dismissed as withdrawn ;
N) I.A.No.1 of 2025 is partly allowed for the refund of 50% of
Court Fee paid in this appeal ;
iii) The Court Fee shall be paid to the appellant in his Bank
Account, the particulars of which shall be furnished to the Registrar
(Judicial) of this Court;
iv) The Registrar (Judicial), High Court of Andhra Pradesh, shall
take necessary steps.
No order as to costs.
As a sequel thereto, miscellaneous petitions, if any
pending, shall also stand closed.
Sd/- K TATA RAO
DEPUTY REGISTRAR
//TRUE COPY//
SEC N OFFICER
One fair copy to the Honourable Sri Justice RAVI NATH TILHARI
(for His Lordships kind perusal)
One fair copy to the Honourable Dr Justice Y.LAKSHMANA RAO
(for His Lordships kind perusal)
To
1. The Registrar (Judicial), High Court of Andhra Pradesh at Amaravathi
2. The III Additional District Judge, Nellore, SPSR Nellore District, (with
records)
3. One CC to Sri. Rosedar S.R.A., Advocate [OPUC]
4. Nine (09) L.R copies
5. The Under Secretary, Union of India Ministry of Law, Justice and
Company Affairs, New Delhi
6. The Secretary, Andhra Pradesh High Court Advocates Association
Library, High Court Buildings at Amaravathi
7. The Section Officer, Accounts Section, High Court of Andhra Pradesh at
Amaravathi.
8. The Section Officer, V.R. Section High Court of Andhra Pradesh at
Amaravathi.
9 Three CD Copies
Stu
sree
HIGH COURT
DATED:09/05/2025
JUDGMENT
I.A No.1 of 2025 in/and AS.No.472 of 2024
DISMISSING THE APPEAL SUIT AS WITHDRAWN
AND PARTLY ALLOWING THE I.A No.1 of 2025