PAY FOR RE­LIEF

HT Estates - - HTESTATES - In civil suits for can­cel­la­tion of sale deed, court fees may be sig­nif­i­cantly high The court fee which is payable by a lit­i­gant in a civil suit is closely linked to what kind of le­gal re­lief he is seek­ing In a suit for can­cel­la­tion of sale deed, court fe

As a party to the sale deed, X is re­quired to pay court fee on ad val­orem ba­sis (based on the value of the prop­erty set out in the sale deed). As a re­sult, the higher the to­tal sale price, the greater would be the court fees payable by X. The court fees payable by Y (who is not a party to the sale deed) would de­pend on whether or not he has pos­ses­sion of such prop­erty. In case Y has pos­ses­sion of the prop­erty, and sues for a dec­la­ra­tion that the sale deed is in­valid, he has to pay a fixed nom­i­nal court fee as pre­scribed un­der the Court Fees Act, 1870. How­ever, if Y is not in pos­ses­sion of the prop­erty, and seeks the re­lief of dec­la­ra­tion along with the re­lief of re­gain­ing pos­ses­sion, Y has to pay court fees on ad val­orem ba­sis, ie, on the value of the prop­erty.

Sale price vs mar­ket value

Re­cently, an in­ter­est­ing is­sue on the method of cal­cu­la­tion of court fees in a suit for can­cel­la­tion of sale deed un­der t he pro­vi­sions of Andhra Pradesh Court Fees and Suits Val­u­a­tion Act, 1956, came up in Po­lam­rasetti Manikyam and An­other vs Tee­gala Venkata Ra­mayya and an­other (2014). In this case, the Supreme Court heard ar­gu­ments on whether val­u­a­tion of the suit should be done on the ba­sis of cur­rent mar­ket value or on the ba­sis of value of the prop­erty men­tioned in the sale deed. The apex court held that in a suit for can­cel­la­tion of sale deed, court fee is to be cal­cu­lated on the ba­sis of value of the prop­erty given in the sale deed. This rul­ing has im­por­tant im­pli­ca­tions given that mar­ket value of prop­erty rises, even steeply, with time.

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