GEORGE Vs. BANK OF INDIA

JUDGEMENT

(1.) A question of court-fee is raised by the order of reference made by the Division Bench of this Court dated 17-10-1988. The question relates to payment of court fee under explanation (3) to S. 52 of the kerala Court Fees and Suits Valuation Act, 1959, hereinafter called the "act", in respect of pendente-lite interest in an appeal preferred by a defendant before the appellate court.

(2.) THE facts of the case are that the respondent, Bank of india, filed a suit for money against the appellants. THE transaction included the hypothecation of movables and also an equitable mortgage of 10 cents of property by the second defendant, who is the wife of the first defendant. THE suit, o. S. No. 225 of 1985, was laid by the Bank in the court of III Additional subordinate Judge, Ernakulam, for recovery of a sum of Rs. 1,53,654. 09. THE suit was instituted on 12-4-1985, and the decree was passed on 30-6-1987 for recovery of a sum of Rs. 1,53,654. 09 with future interest at the rate of 17. 5% per annum from the date of suit till realisation from the defendants and charged on 10 cents of property comprised in Sy. No. 711/6-7 of Cheranalloor Village , and belonging to the 2nd defendant. THE plaintiff was also allowed to realise the amount due to it by the sale of machinery and other movables in the business premises of the first defendant. Costs were also awarded. Against the said judgment and decree, the first defendant, and his wife, the second defendant, filed the appeal on 1-6-1988 in this Court. THE appeal wasvaluedonlyatrs. 1,53,654. 09,and the court fee of Rs. 15,346/- was sought to be paid under Ss. 22 and 33 read with S. 51 of the Act. THE Registry raised an objection stating that the court fee has to be paid on the interest amount decreed from the date of suit to the date of decree also THE appellants' counsel submitted to the Registry that the word 'claims' and the word 'accrued' read with the words 'except where such interest is relinquished' in Explanation (3) to S. 52 will lead to the inference that the provision is applicable only to a case of plaintiff-appellant, and not to a case of defendant-appellant. According to the appellants' counsel, the defendant-appellant is only resisting the suit, and if the suit is dismissed, there is no question of paying interest separately. Counsel contended that in the light of the decision of the Supreme Court in State of Maharashtra v. Mishrilal, AIR 1964 SC 457, the decision of the Division Bench of this Court in azeez & Co. v. Indian Overseas Bank, 1983 KLT 935 which is followed in union of India v. Transformers & Electricals, 1985 KLT 319, require reconsideration. THE matter was then placed before the Division Bench, and the division Bench referred the matter to a Full Bench by order of reference dated 17-10-1988.

(3.) SO far as the decision of the Supreme Court in State of Maharashtra v. Mishrilal is concerned, their Lordships were not dealing with any provision introducing a fiction as in Explanation (3) to S. 52 of the Act. Their Lordships were concerned in that case with the Bombay Court Fees Act, and were interpreting Sch. L Art. I where the words 'subject-matter in dispute' alone are used. It was held that in respect of amount of interest decreed for periods subsequent to the institution of the suit, no court fee is payable in the appeal preferred by the defendant. The Supreme Court proceeded on the basis that the award of interest is discretionary, and further it is incidental to the amount claimed. A reading of the Supreme Court decision further shows that in such an appeal the plaintiff need not pay court fee on pendente lite interest, and therefore the defendant also need not pay court fee in respect of pendente-lite interest, unless the defendant specifically questions the award of interest. In our view the said decision of the Supreme Court has no application to a question arising under the Kerala Act wherein we have a separate deeming provision in Explanation (3) to S. 52. We are, therefore, of the view that the above said two decisions of this Court holding that in the case of an appeal by a defendant court fee is payable on the pendente-lite interest are correct, and do not require any reconsideration.