Punjab National Bank vs Pushpa Builders Ltd. and Others

Jaspal Singh, J.

(1) The Recovery of Debts Due to Banks and Financial Institution Act, 1993 which came into force on 24/06/1993 provides for establishment of Debts Recovery Tribunal to entertain and decide applications from the banks and financial institutions for recovery of debts due to such banks-and financial institutions. Every such application is to be accompanied with a fee subject to a maximum of Rs. 1,50,000.00. The Act further provides that on and from the appointed day, the jurisdiction of any Court or other authority in relations to the matters specified above shall stand ousted. Admittedly, such a Tribunal has been established in New Delhi with effect from 5/07/1994. However, despite all this,the Punjab National Bank has filed this suit for the recovery of Rs. 1,59,34,131-61(Rupees one crore fifty nine lacs thirty four thousand one hundred thirty one and paise sixty only) with pendente-lite and future interest and for sale of mortgaged property and has paid thereon a Court fee of Rs. 1,50,000.00 although admittedly as per the Court Fees Act the advalorem Court fees works out to Rs. 1,57,528 / - leaving thus a deficiency of Rs. 7,528/.

(2) Why this suit has been instituted in the Court and not before the Tribunal The reason is an order of a Division Bench of 5/07/1994 passed by this Court inC.W.P. 3050 of 1994 staying the "operation of this Act in its applicability to the Union Territory of Delhi". This obviously clears the hurdle with regard to jurisdiction of this Court. However, the question with regard to payment of requisite Court fees remains.

(3) As already noticed above, the maximum fee prescribed under the Act is Rs.1,50,000.00. Had there been no order of stay regarding the operation of the Act, the Bank would have been obliged to pay only that much amount as fee on the application .It is now required to pay Rs. 7,528.00 more as Court fees under the Court Fees Act. The Bank says that since it has been compelled, on account of the stay order, to institute the suit in this Court and not before the Tribunal, and as incase of vacation of the stay order or dismissal of the writ petition, the suit will go to the Tribunal, it should be exempted from paying Court fees over and above the maximum prescribed under the Act or in any case, the payment of the requisite Court fees should be deferred at least till the matter pending before the Division Bench is finally disposed of. It is this prayer which has led to this order.

(4) In support of the prayer it was submitted by the learned Counsel for the Bank that in view of the facts of the case the bank deserved to be exempted from paying the Court fee over and above Rs. 1,50,000.00 and that, in any case, the Court was bound under Order 7 Rule 11 of the CPC to extend time even if it was not inclined to exempt payment of the remaining part of the Court fee. However ,he did not feel it necessary to cite any authority in support or against.

(5) Section 4 of the Court Fees Act enacts that no documents shall be received in any proceeding unless proper Court fee as provided in the Schedules to the Act had been paid thereon. Under this section, a plaint. Memorandum of Appeal, etc.,which is not stamped or insufficiently stamped will be non est. In this context:lause (e) of Order Vii Rule 11 of the CPC may also be noticed. It says that the plaint shall be rejected-where the relief claimed is properly valued, but the plaint is written upon paper insufficiently stamped, and the plaintiff on being required by the Court to supply the requisite stamp-paper within a time to be fixed by the Court, fails to do so.

(6) Is the Court bound to grant some time to make up the deficiency before rejection of the plaint? There seems to be difference of opinion on this. Whereas judgments such as Venkanna v. Achutaramanna Air 1938 Mad. 542 ; AIR 1949 263 (Nagpur); AIR 1937 414 (Oudh) ; Jagatram v.Kha rati Air 1937 Lah 392; Tulsiram v. Keshri Air 1962 Pat. 189 hold this view, the Bombay High Court in Chandrakant Vassudev Lotikar and others Vs. Vaman Mahadev Lotikar and others, has struck a different note. It says that time can be extended only when a cause of exceptional nature is shown and grave injustice will be caused to the plaintiff if extension is not granted and that "except in those cases, there is no discretion left to the Court to grant extension of time to pay the deficient Court-fee."

(7) To me, one thing is certain and it is that it is not Order 7 Rule 11 but Section149 which enables a Court to grant extension and that no party can demand as a legal right, grant of time under the said Order. Any such approach would obviously come into conflict with Section 149. l have also no manner of doubt that this section gives discretion either to grant time or to refuse time according to the circumstances of the case. In support I seek to draw force from the Full Bench decision of the Lahore High Court in jagat Ram v. Nisar Kharaiti Ram, Air 1938Lahore 361.

(8) Section 149 empowers the Court to grant time for extension of time for making good the deficiency "in its discretion". And, how should the words "in its discretion" be construed? On this too the High Courts have not followed a uniform practice .The judgment from the Bombay High Court referred to above, for example ,seems to Advocate a strict construction of the provision. Reference in this connection may also be made to Brijbhukhan and Others Vs. Tota Ram and Others and Shri Krishna Vs. Sm. Saraswati Devi, . In the same refrain is the judgment of the Patna High Court, in Ram Sahay Ramv. Lakshmi Narain Singh Air 1917 Pat 26.Chamier C.J. with whom Mullick J. agreed, observed:

"IN my opinion. Section 149 should not be construed in such a way as to nullify the express provisions of Sec. 4, Court Fees Act. When the amount of the Court-fee payable is open to doubt or the amount of the fee cannot be ascertained by the Court till the record is received or it appears that the appellant has made the appeal an honest attempt to comply with the law, the Court may, properly receive the appeal and allow time for the deficiency, if any, to be made good. In the cases before us the appellants have deliberately and to suit their own convenience paid on their appeals insufficient Court-fees, in fact they have paid only a small fraction of the fees which they admit are payable by them. In such cases the Court is not, in my opinion, bound to receive the appeal and give the appellants time to make good the deficiency."

In Jagat Ram v. NisarKharaiti Ram Air 1938 Lah 361, the Full Bench of the Lahore High Court was inclined to take a liberal view of Section 149. DalipSingh, J. with whom other Judges agreed observed:

"IT The question seems to me that the discretion conferred on the Court by Sec-149, CivilP.C" is normally expected to be exercised in favor of the litigant except incase of contumacy or positive mala fides or reasons of similar kind. The question of bona fides in this connection should be construed in the sense that the word is used in the General Clauses Act and not as used in the Limitation Act .A thing should be presumed to be done bona fide, if it is done honestly whether it is done negligently or not for the purposes of judging whether the discretion under Sec-149 should or should not be exercised in favor of the litigant "

(9) Same question arose before the Full Bench of the Allahabad High Court also in S. Wajid Ali Vs. Mt. Isar Bano Urf Isar Fatma, , Agarwala J. with whom the four other Judges agreed, observed:

"IN my opinion, where an insufficiently stamped document has been received, filed or used in a Court, through mistake or inadvertence, time will ordinarily be granted for making good the deficiency. Where the deficiency is discovered at the time of the presentation of an insufficiently stamped document, no hard and fast rule can be laid down as to the circumstances in which the discretion under Sec. 149 will be exercised by a Court. Each case will have to be decided upon its own facts. All that can be laid down is that; (a) where insufficiency in Court-fee is due to a bona fide mistake in calculating the amount payable, or to circumstances beyond the control of the party concerned, e.g. robbery, non-availability of Court-fee stamps etc., the Court will, no doubt, use its discretion in favor of the litigant; and (b) where a litigant is able to pay full Court-fee and yet presents a document insufficiently stamped either because he expects a compromise in the case or he wants to await the result of some other litigation, or because he negligently failed to bring sufficient money with him for paying the Court fee, or for any similar reason; or where he is guilty of contumacy or mala fides, e.g. when he wants to harass the other side by continuing a litigation, time will not be granted. There may be cases lying between those two extremes. But no general rule can be laid down about them and they will have to be decided according to their own circumstances."

(11) If we look at the facts of the case before me, they would reveal that the plaintiff bank is in the know of the amount of Court fees payable, i.t is obviously IN a position to pay that amount, and that it has knowingly and deliberately avoided payment of full Court fee hoping to derive pecuniary benefit in the event of dismissal of the writ petition. I have no manner of doubt that if the words "in its discretion" appearing in Section 149 are interpreted strictly, the plaintiff would not be entitled to any extension, but then, with respect, I do find myself more inclined to accept the liberal approach adopted by the Full Bench of the Lahore High Court. And ,for having once decided to respectfully follow those hallowed footsteps what clinches the issue is that the whole conduct of the plaintiff bank is open. It hides nothing .It has been compelled, if I may say so, to institute the suit in this Court and expects it to be ultimately tried by the Tribunal. It is positively thus not a case of contumacy or positive malafides nor is it blemished by reasons of a similar kind. But then, at the same time, no exemption from making up the deficiency can be granted .Section 149 invests this Court with no such power. What is permissible is to allow the person, by whom the fee is payable to pay the whole or part, as the case may be, of such Court fee.

(12) The plaintiff having instituted the suit in this Court, whether of its own volition or out of some compulsion, avoidable or not, the prescribed .Court fees the happening shall have to be paid and the Court would not make it payable contingent upon the happening of some event in future, near or distant. In short thus I would not allow