Issue Of Valuation/Court Fees Isn’t Invariably Required To Be Tried As Preliminary Issue, Holds Karnataka HC (FB) [Read Order]

‘Tersely put, in our view, if the Court finds that the question of valuation and/or court fees as raised by the defendant relates to the jurisdiction of the Court, it may try such an issue first and before the evidence is recorded on the merits of the claim.’

The Karnataka High Court has held that when an issue of valuation and/or court fees is raised in a civil suit on the objection of the defendant, the same is not invariably required to be tried as a preliminary issue and before taking evidence on other issues.

The full bench comprising Chief Justice Dinesh Maheswari, Justice AS Bopanna and Justice Aravind Kumar observed that such an issue could be tried as a preliminary issue if it relates to the jurisdiction and the trial court is of the view that the suit or any part thereof could be disposed of on its determination.

The question referred before the full bench (Venkatesh R. Desai vs. Pushpa Hosmani) was whether, by virtue of Section 11 of the Karnataka Court Fees and Suits Valuation Act, 1958, when an issue of valuation and court fees is raised on the objections of the defendants, the same is invariably required to be tried as a preliminary issue and before taking evidence on other issues.

The matter was referred since conflicting views were noticed in judgments of two division bench. In Veeragouda vs. Shantakumar, it was held that issue relating to court fees is invariably required to be tried as a preliminary issue, while in Nanjamma vs. Akkayamma, it was held not mandatory.

The bench said Section 11 cannot be read to mean that irrespective of the law applicable to the case, mere raising of question by the defendant regarding valuation and/or court fees would be sufficient to displace a suit from its regular trial and, first of all, the exercise is invariably required to be carried out for determination of such question of valuation and/or court fees.

“The approach in Veeragouda’s case is flawed for the fundamental reason that on a literal interpretation, it has been observed that the expression ‘shall’ could only mean a mandate and nothing else. With respect, the Division Bench appears to have overlooked the basic principle that the word ‘shall’ as occurring in statute even when is prima facie taken as mandatory yet, the function of the Court is to ascertain its real intention by examination of the whole scope of the statute and to construe the expression that relates to the context in which it is used and the purpose it seeks to serve,” the court said.

Answering the reference, the bench, also examining the provisions of Order XIV Rule 2 of the Code of Civil Procedure, 1908,  said: “Tersely put, in our view, if the Court finds that the question of valuation and/or court fees as raised by the defendant relates to the jurisdiction of the Court, it may try such an issue first and before the evidence is recorded on the merits of the claim; and in other eventualities, the Court may examine such a question of valuation and/or court fees, but not necessarily as a preliminary issue or before the evidence on other issues.”