'Court Fee Refund Only If Case Settled Through ADR Mechanisms' : Supreme Court Rejects Refund Claim For Private Out-of-Court Settlement

The Supreme Court held that litigants who resolve their disputes privately outside of court are not entitled to a refund of court fees.

The Court said that the refund of the court fees is permissible only “if the matter is referred to Arbitration, Conciliation, judicial settlement, including through Lok Adalat or mediation for settlement and the case is decided in terms of such a settlement and not otherwise.”

The bench comprising Justices Pankaj Mithal and Ahsanuddin Amanullah was hearing the SLP where the petitioner was aggrieved by the High Court's refusal to refund the court fees paid by him in the trial court, first appeal and second appeal because the case was amicably settled on their own outside the court without an aid of Alternative Dispute Resolution (ADR) mechanism.

Affirming the High Court's decision, the court noted that because the second appeal was decided not in reference to any of the ADR mechanism but on the settlement arrived between the parties, therefore no error was committed in the impugned decision in denying the refund of the court fees.

“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/fora rather it was an amicable settlement out of the court.”, the court noted.

“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.”, the court held.

Case Title: JAGE RAM VERSUS VED KAUR & ORS.

Citation : 2025 LiveLaw (SC) 138

Click here to read/download the order

Appearance:

For Petitioner(s) Mr. Rajinder Singh Kataria, Adv. Mr. S.P.Laler, Adv. Ms. Twinkle Kataria, Adv. Mr. Rameshwar Prasad Goyal, AOR

For Respondent(s) Mr. Deepak Thukral, AAG Mr. Samar Vijay Singh, AOR Ms. Sabarni Som, Adv. Mr. Aman Dev Sharma, Adv. Mr. Fateh Singh, Adv.

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