Supreme Court of India
SANJEEVKUMAR HARAKCHAND KANKARIYAversusUNION OF INDIA & ORS.
- Citation
- [2024] 12 S.C.R. 866
- Decided
- 19 December 2024
- Disposal
- Dismissed
- Bench
- C T RAVIKUMAR
Holding
The appeal lacks merit; Entry 11A List III does not govern refund of court fees for ADR settlements, and the Maharashtra Court Fees Act, 1959 (with its amendment) prevails over the central Court Fees Act, 1870.
Summary
The appellant filed a civil suit for specific performance which was referred to mediation under Section 89 of the CPC and settled amicably; he sought a full refund of the court fees paid, but the trial court allowed only a 50% refund. He challenged this in a writ petition, arguing that Section 16 of the Court Fees Act, 1870 and Section 21 of the Legal Services Authorities Act, 1987—both central statutes—mandated a complete refund and that the central law should override the Maharashtra Court Fees Act, 1959. The High Court rejected the petition, holding that the state law governed the refund and suggested legislative amendment. On appeal, the Supreme Court examined the constitutional distribution of powers, the doctrine of pith and substance, and the distinction between Lok Adalat awards and mediation settlements, concluding that Entry 11A of List III does not control the refund of fees for ADR settlements and that the state legislation prevails. While the appeal was dismissed, the Court, exercising its extraordinary jurisdiction under Article 142, ordered a discretionary refund of approximately Rs.5 lakhs to the appellant.
Issues considered
- The applicability of Section 16 of the Court Fees Act, 1870 to a case settled by mediation under Section 89 CPC.
- Whether the central Court Fees Act, 1870 overrides the Maharashtra Court Fees Act, 1959 in matters of fee refund.
- Whether Entry 11A of List III (administration of justice) governs the refund of court fees for ADR settlements, or whether Entry 3 of List II (fees) prevails.
- The extent of refund permissible under the Maharashtra Court Fees Act, 1959 and its amendment.
- The propriety of exercising Article 142 to grant a discretionary refund.
Legislation cited
- Code of Civil Procedure, 1908s. 89
- Constitution of Indias. Article 142, s. Article 246, s. Article 254, s. Article 372
- Court Fees Act, 1870s. 16
- Legal Services Authorities Act, 1987s. 21
- Maharashtra Act No. X of 2018s. 16A
- Maharashtra Court Fees Act, 1959s. 16A, s. 43
- Mediation Act, 2023
Headnote
Issue for Consideration Issue arose whether in view of the inconsistency between the Court Fees Act, 1870 and Maharashtra Court Fees Act, 1959, if any, would the appellant be entitled to a complete refund of court fees per the former, since it is a Central legislation. Headnotes† Court Maharashtra Court Fees Act, 1959 – Code of Civil Procedure, 1908 – s.89 – Settlement of disputes outside the Court – Court fees – Complete refund of – Entitlement – Civil dispute filed by the appellant which was resolved through mediation u/s.89 CPC
Subjects
Inconsistency between the Court Fees Act, 1870 and Maharashtra Court Fees Act, 1959Complete refund of court feesCentral legislationMaharashtra State LegislatureRefund of court feesCivil disputeMediation under Section 89 CPCLok AdalatAlternate dispute resolutionAdministration of justiceEntry 11A List IIIEntry 3 List IIDoctrine of pith and substanceHarmonious constructionArticle 254 repugnancy
Judgment
[2024] 12 S.C.R. 866 : 2024 INSC 1004
Sanjeevkumar Harakchand Kankariya
v.
Union of India & Ors.
(Civil Appeal No. 14742 of 2024)
19 December 2024
[C.T. Ravikumar and Sanjay Karol,* JJ.]
Issue for Consideration
Issue arose whether in view of the inconsistency between the
Court Fees Act, 1870 and Maharashtra Court Fees Act, 1959, if
any, would the appellant be entitled to a complete refund of court
fees per the former, since it is a Central legislation.
Headnotes†
Court Fees Act, 1870 – Maharashtra Court Fees Act, 1959 –
Code of Civil Procedure, 1908 – s.89 – Settlement of disputes
outside the Court – Court fees – Complete refund of –
Entitlement – Civil dispute filed by the appellant which was
resolved through mediation u/s.89 CPC – Trial court allowed
refund of court fees only to the extent of 50% – Appellant
filed writ petition seeking complete refund of court fees on
the ground that the civil court erred by allowing refund only
to the extent of 50% in view s.16 of the CFA, 1870; that as
per s.21 of the LSA Act,1987 when a matter is referred to Lok
Adalat u/s.20(1) of the said Act and a compromise or settlement
is arrived, the court fee paid in such a matter shall also be
refunded in accordance with CFA, 1870; that the said Act being
a Central legislation, would override the State enactment –
High Court rejected the petition – Correctness:
Held: Entry 11A List III cannot govern the refund of court fees when
a matter is settled by methods of alternate dispute resolution, in the
face of Entry 3 List II simply by the use of the words “administration
of justice” in the former – Reference to CFA, 1870 in respect of
refund of court fees when the matter is settled by way of an award
of Lok Adalat does not mean that the same shall be extended to
the settlement of dispute by mediation for the simple reason that
* Author
[2024] 12 S.C.R. 867
Sanjeevkumar Harakchand Kankariya v. Union of India & Ors.
Lok Adalat and mediation are two distinct methods and cannot be
equated – High Court made suggestion to the State legislature
that the differences in the court fees in Lok Adalat, vis-à-vis, the
forms of ADR should be done away to promote the adaptation
of such methods of dispute resolution among the public – State
legislature carried out such an amendment to the MCFA, 1959 and
s.16A has been introduced therein – Effect would be that for the
time when the amendment to the MCFA, 1959 granting partial or
complete refund, as the case may be, in accordance with s.43 as
amended, the persons whose matters were settled by way of ADR
would not be entitled to 100% refund – Any matter settled under
the processes mentioned in s.89 CPC after the coming into force
of the said amendment, such parties to receive refund of court fees
in its entirety – Total amount of court fees paid by the appellant, in
respect of the refund of which the matter has travelled up to this
Court was approximately Rs. 5 lakhs – Considering the fact that
the original dispute was settled amicably and that the amount of
court fees involved is not excessive, the same can be refunded
to him. [Paras 20-24]
Case Law Cited
Pushpabai Shankerlal Sura v. The Official Liquidator, Sholapur Oil
Mills Ltd. 1968 SCC OnLine Bom 62; Salem Advocate Bar Assn. (II)
v. Union of India [2005] Supp. 1 SCR 929 : (2005) 6 SCC 344; High
Court of Madras v. MC Subramaniam [2021] 1 SCR 552 : (2021) 3
SCC 560; Rangathan v. In the Court of District Judge, Trichirapalli;
K.S Periyaswamy v. State of Karnataka 2019 SCC OnLine
Kar 3032; Maharishi Shankarrao Mohite-Patil Sahakar Sakhar
Karkhana Ltd. v. State of Maharashtra 2019 SCC OnLine Bom
628; Girnar Traders (3) v. State of Maharashtra [2011] 3 SCR 1 :
(2011) 3 SCC 1; Venkataramana Devaru v. State of Mysore [1958]
1 SCR 895 : AIR 1958 SC 255; Calcutta Gas Co. (Proprietary)
Ltd. v. State of West Bengal [1962] Supp. 3 SCR 1 : AIR 1962
SC 1044; J.K. Cotton Spinning & Weaving v. State of U.P. [1961]
3 SCR 185 : AIR 1961 SC 1170; British Airways PLC v. Union
of India [2001] Supp. 5 SCR 152 : (2002) 2 SCC 96; Jamshed
N. Guzdar v. State of Maharashtra [2005] 1 SCR 223 : (2005) 2
SCC 591; In Re The Special Courts Bill, 1978 [1979] 2 SCR 476 :
(1979) 1 SCC 380; State of T.N. v. G.N. Venkataswamy [1994]
Supp. 1 SCR 322 : (1994) 5 SCC 314; M. Karunanidhi v. Union
868 [2024] 12 S.C.R.
Supreme Court Reports
of India [1979] 3 SCR 254 : (1979) 3 SCC 431; Ujagar Prints (II)
v. Union of India [1989] 1 SCR 344 : (1989) 3 SCC 488; Afcons
Infrastructure Ltd. v. Cherian Varkey Construction Co. (P) Ltd.
[2010] 8 SCR 1053 : (2010) 8 SCC 24; State of Punjab v. Jalour
Singh [2008] 1 SCR 922 : (2008) 2 SCC 660; Perry Kansagra
v. Smriti Madan Kansagra [2019] 3 SCR 991 : (2019) 20 SCC
753 – referred to.
Books and Periodicals Cited
‘Principles of Statutory Interpretation’, 14th Ed. by Justice G.P.
Singh – referred to.
List of Acts
Legal Services Authorities Act, 1987; Court Fees Act, 1870; Code
of Civil Procedure 1908; Bombay Court Fees Act, 1959; Mediation
Act, 2023; Maharashtra Court Fees Act, 1959; Constitution of India;
Maharashtra Act No. X of 2018.
List of Keywords
Inconsistency between the Court Fees Act, 1870 and Maharashtra
Court Fees Act, 1959; Complete refund of court fees; Central
legislation; Maharashtra State Legislature; Refund; Court fees; Civil
dispute; Mediation u/s.89 CPC; Refund of court fees only to the
extent of 50%; Lok Adalat; Compromise or settlement; Alternate
dispute resolution; Administration of justice; Award of Lok Adalat;
Settlement of dispute by mediation; Lok Adalat and mediation,
two distinct methods.
Case Arising From
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 14742 of 2024
From the Judgment and Order dated 01.10.2014 of the High Court
of Judicature at Bombay at Aurangabad in WP No. 4919 of 2014
Appearances for Parties
Sandeep Sudhakar Deshmukh, Nishant Sharma, Advs. for the
Appellant.
Vikramjeet Banerjee, A.S.G., Akshay Nain, Akshit Pradhan, Bhuvan
Mishra, Ms. Ruchi Gour Narula, Ms. Aarushi Singh, Arvind Kumar
[2024] 12 S.C.R. 869
Sanjeevkumar Harakchand Kankariya v. Union of India & Ors.
Sharma, Ms. Rukmini Bobde, Siddharth Dharmadhikari, Aaditya
Aniruddha Pande, Ms. Soumya Priyadarshinee, Amit Srivastava,
Amlaan Kumar, Vinayak Aren, Advs. for the Respondents.
Judgment / Order of the Supreme Court
Judgment
Sanjay Karol, J.
Leave granted.
THE CHALLENGE
2. This appeal questions the correctness of the judgment and order
dated 1st October, 2014 passed by the High Court of Judicature at
Bombay (Aurangabad Bench) between the self-same parties, whereby
the High Court refused the prayer of the appellant herein seeking -
(a) a writ, order, order or direction to the State of Maharashtra to
initiate a complete refund of court fees of all litigants including
the appellant whose proceedings before the Civil Courts were
disposed of in accordance with Section 89 of the Code of Civil
Procedure 19081;
(b) quashing of notification dated 8th May, 2013 issued by the Law
and Judiciary Department, Government of Maharashtra bearing
No. HCA.2010/C.R 87/D192 as contrary to the provisions of the
Court Fees Act, 18703 read with certain provisions of the Legal
Services Authorities Act, 19874;
(c) a declaration to the effect that Respondent No.2 i.e. State of
Maharashtra had no authority in law to issue a notification
contrary to the provisions of the CFA, 1870; and
(d) that all such notifications and rules running contrary thereto be
quashed and set aside.
1 Hereinafter ‘CPC’
2 Hereafter, “the impugned notification”
3 CFA, 1870
4 LSA Act, 1987
870 [2024] 12 S.C.R.
Supreme Court Reports
THE FACTUAL AND LEGAL BACKGROUND
3. The factual background which led the appellant to prefer the
writ petition before the High Court was that he had entered into
an agreement to sell a certain property located at Aurangabad.
However, the said Agreement could not be performed and as such,
he preferred Special Civil Suit No.274 of 2013 before the Court of
the Civil Judge, Senior Division, Aurangabad, praying for a direction
of specific performance of the contract. The dispute was referred to
mediation under Section 89 CPC and, amicably resolved. The terms
of settlement were presented to the Court and the Civil Suit was
disposed of in terms of the said compromise. A request for refund
of court fees was allowed only to the extent of 50%.
3.1 The appellant contended before the High Court that the learned
Civil Court fell in error by allowing refund only to the extent of 50%
in view Section 16 of the CFA, 1870. It was further contended
that as per Section 21 of the LSA Act,1987 when a matter is
referred to Lok Adalat under Section 20(1) of the said Act and
a compromise or settlement is arrived at therein, the Court Fee
paid in such a matter shall also be refunded in accordance with
CFA, 1870. Still further it was argued that the said Act being a
Central legislation, would override the State enactment.
3.2 The High Court’s observations can be summarized thus:-
(a) The CFA, 1870 is a pre-constitutional enactment which
no longer applies to the State of Maharashtra after
the enactment of the Bombay Court Fees Act, 19595.
In reaching this conclusion, reliance was placed on a
judgment of a co-ordinate bench in Pushpabai Shankerlal
Sura v. The Official Liquidator, Sholapur Oil Mills Ltd.6
(b) The use of CFA, 1870 in LSA, 1987 is a case of “legislation
by incorporation”, the same analogy cannot be applied to
the orders passed by courts on settlement of disputes.
Decrees passed by courts on the basis of settlement cannot
be equated to awards passed by Lok Adalat. Since the
BCFA, 1959 would be applicable, no error can be found in
the State issuing a notification under Section 43(2) thereof.
5 Hereinafter, BCFA, 1959.
6 1968 SCC OnLine Bom 62
[2024] 12 S.C.R. 871
Sanjeevkumar Harakchand Kankariya v. Union of India & Ors.
3.3 Disposing of the writ petition, the Court made the following
observations:
“16. While disposing of the writ petition, we deem it
appropriate to recommend the State Government to issue
necessary notification or to bring out necessary amendment
incorporating provision in respect of refund of Court fees
to the extent of 100% in respect of the matters which are
disposed of by the Courts on adaptation of any of the
modes prescribed under section 89 of the Code of Civil
Procedure, 1908. Such a step would be in consonance
with the directives issued by the Supreme Court in Salem
Advocates Bar Association v. Union of India (supra), as
well as it would bring parity with the provisions of section
21 of the Legal Services Authorities Act and section 16 of
the Court Fees Act, 1870. Thus, in order to bring uniformity
in the matter of refund of Court fees and to eliminate
discrepancies so far as matters disposed of in view of the
award passed by Lok Adalat, and such of those matters
which are disposed of in terms of the settlement arrived at
on the basis of observance of any of the modes prescribed
under section 89 of the Code of Civil Procedure, a direction
needs to be issued by the State of Maharashtra to take
effective steps. Such a positive move will also give boost
to the movement of Alternate Disputes Resolution, which,
in fact, curtails precious time of the Court as well as avoids
unnecessary and prolonged indulgence in litigation before
the Court. We hope and trust that respondent-State would
consider this suggestion earnestly and take measures
expeditiously.”
4. We have heard Mr. Sandeep Sudhakar Deshmukh, learned Advocate-
on- Record for the Appellant, Mr. Vikramjit Banerjee, learned Additional
Solicitor General, and Ms. Rukmini Bobde, Learned Counsel, for the
Respondents. We have also perused the parties’ written submissions.
4A. Submissions on behalf of Appellants
4A.1 Section 16 of the CFA, 1870 contemplates a refund of court
fees in its entirety if the dispute inter se the parties is settled.
The same is irrespective of the stage of the lis.
872 [2024] 12 S.C.R.
Supreme Court Reports
4A.2 The Constitution of India in its Federal structure provides for
the distribution of powers as enumerated in the lists under
Schedule VII. Administration of justice is Entry No.11 – A in List
III. The process of settlement of disputes through alternative
dispute resolution7 mechanisms is a concept embedded in the
effective administration of justice, and, therefore the CFA, 1870
as also the legislations governing court fees in the States, are
in concurrent operation. It, therefore, submitted that the State
cannot be permitted to legislate to an extent such as it may
repeal this Central Legislation.
4A.3 Section 21 of the LSA Act, 1987 specifically contemplates a
reference to refund of court fees in terms of the provisions of
CFA, 1870.
4A.4 It is submitted that Section 89 CPC was inserted into the
statute book in 1999 empowered by the 129th Report of the Law
Commission of India. The statement of objects and reasons
thereof prescribes the intention of encouraging the settlement
of disputes through ADR mechanisms. If the contention of the
State is accepted that the CFA, 1870 is repealed in so far as
the State of Maharashtra is concerned and the MCFA, 1959
holds the field, it is submitted that the intention of the legislature
in inserting Section 89 into the CPC, would be frustrated.
4A.5 It is submitted that in order to protect the fulcrum of the insertion
of Section 89 CPC, harmonious construction of all the statutes
is to be adopted. Without doing the same, the said section
would be rendered otiose.
4B. Submissions on behalf of Respondent(s)
4B.1 The CFA, 1870 was an ‘existing law’ within the meaning of
Article 366 of the Constitution of India, and by virtue of Article
372 of the Constitution, it continued to operate as law till such
time ‘until altered or repealed or amended by a competent
legislature.’
4B.2 The erstwhile State of Bombay, being the competent state
legislature as described under Article 372 read with Article 246(2)
7 Hereinafter, ADR
[2024] 12 S.C.R. 873
Sanjeevkumar Harakchand Kankariya v. Union of India & Ors.
superseded the CFA, 1870 with the BCFA, 1959, renamed
the Maharashtra Court Fees Act,8 by an amendment in 2012.
Section 49 of the MCFA, 1959 read with Schedule 4 thereof,
explicitly repealed the CFA, 1870 in so far as Entries 3 and 66
of the List II of the Constitution are concerned. As such, CFA,
1870 has no application in the State of Maharashtra, which
would, obviously, include Section 16 thereof, which provides
for 100% refund of court fees if the case is settled through one
of the modes mentioned in Section 89, CPC.
4B.3 Section 43 of the MCFA,1959 governs the refund of court fees
in the circumstances specified therein. The impugned notification
dated 8th May, 2013 was passed under sub-section 2 of Section
43, which specifies hundred percent repayment of court fees in
certain specified circumstances- relating to social and welfare
legislations, and for other matters it provides for fifty percent,
and in yet other cases, the refund percentage is twenty-five.
4B.4 Even if the impugned notification is found to be unconstitutional,
the appellant would still be bound by Section 43(1) of the
MCFA, 1959. The appellant has not challenged the vires of
the said section.
4B.5 This Court and various High Courts, it is submitted, have
recognized court fees as a state subject. Reference is made
to decisions of this Court in Salem Advocate Bar Assn. (II) v.
Union of India;9 High Court of Madras v. MC Subramaniam10
as being entirely distinguishable from the present facts. For
High Courts, reliance is placed on Rangathan v. In the Court
of District Judge, Trichirapalli; K.S Periyaswamy v. State
of Karnataka;11 Maharishi Shankarrao Mohite-Patil Sahakar
Sakhar Karkhana Ltd. v. State of Maharashtra.12 In these
judgments, it is submitted that the respective High Courts
permitted a hundred percent refund of court fees recognizing
that the settlement arrived at was under the LSA Act, 1987.
8 Hereinafter, MCFA, 1959
9 [2005] Supp. 1 SCR 929 : (2005) 6 SCC 344
10 [2021] 1 SCR 552 : (2021) 3 SCC 560
11 2019 SCC OnLine Kar 3032
12 2019 SCC OnLine Bom 628
874 [2024] 12 S.C.R.
Supreme Court Reports
4B.6 It was also submitted that subsequently, in 2018, a provision,
identical to Section 16 CFA, 1870 came to be inserted into the
MCFA, 1959 by Maharashtra Act No. X of 2018.
4B.7 In view of the above submissions, it is prayed that the High Court
has rightly rejected the challenge to the impugned notification,
on grounds of inconsistency with Section 16 of the CFA, 1870.
QUESTION FOR CONSIDERATION
5. The question presented for this Court’s adjudication was, considering
the submissions as afore-stated is whether in view of the inconsistency
between the CFA, 1870 and the MCFA, 1959, if any, would the
appellant be entitled to a complete refund of court fees per the
former, since it is a Central legislation? Allied thereto, would be the
question of whether the Maharashtra State Legislature could have
enacted the provision and brought out a notification giving refunds in
ways contrary to and distinct from the manner and method provided
in the Central Legislation?
RELEVANT PROVISIONS
6. As is clear from the above, the present case involves the interpretation
of various legislative provisions falling within both Central and State
Legislations. For reference, they are extracted hereinbelow :-
“CONSTITUTION OF INDIA
PART XI
RELATIONS BETWEEN THE UNION AND THE
STATES CHAPTER I.—LEGISLATIVE RELATIONS
Distribution of Legislative Powers
“246. (2) Notwithstanding anything in clause (3), Parliament,
and, subject to clause (1), the Legislature of any State
also, have power to make laws with respect to any of the
matters enumerated in List III in the Seventh Schedule
(in this Constitution referred to as the “Concurrent List”).”
… … ……
“372. (1) Notwithstanding the repeal by this Constitution
of the enactments referred to in article 395 but subject
[2024] 12 S.C.R. 875
Sanjeevkumar Harakchand Kankariya v. Union of India & Ors.
to the other provisions of this Constitution, all the law
in force in the territory of India immediately before the
commencement of this Constitution shall continue in force
therein until altered or repealed or amended by a competent
Legislature or other competent authority.
(2) For the purpose of brining the provisions of any law in
force in the territory of India into accord with the provisions
of this Constitution, the President may by order make
such adaptations and modifications of such law, whether
by way of repeal or amendment, as may be necessary or
expedient, and provide that the law shall, as from such
date as may be specified in the order, have effect subject
to the adaptations and modifications so made, and any
such adaptation or modification shall not be questioned
in any court of law.
(3) Nothing in clause (2) shall be deemed—
(a) to empower the President to make any adaptation or
modification of any law after the expiration of three years
from the commencement of this Constitution; or
(b) to prevent any competent Legislature or other competent
authority from repealing or amending any law adapted or
modified by the President under the said clause.
Explanation I.—The expression “law in force” in this article
shall include a law passed or made by a Legislature or
other competent authority in the territory of India before
the commencement of this Constitution and not previously
repealed, notwithstanding that it or parts of it may not be
then in operation either at all or in particular areas.
Explanation II.—....
Explanation III.—....
Explanation IV.—....
List II—State List 1.
1. ...
2. ...
876 [2024] 12 S.C.R.
Supreme Court Reports
3. ***Officers and servants of the High Court; procedure
in rent and revenue courts; fees taken in all courts except
the Supreme Court.
List III—Concurrent List
x x x x
[11A. Administration of Justice; constitution and organisation
of all courts, except the Supreme Court and the High
Courts.]
PART XXI
[TEMPORARY, TRANSITIONAL AND SPECIAL
PROVISIONS]
372. (1) Notwithstanding the repeal by this Constitution of
the enactments referred to in article 395 but subject to the
other provisions of this Constitution, all the law in force in
the territory of India immediately before the commencement
of this Constitution shall continue in force therein until
altered or repealed or amended by a competent Legislature
or other competent authority.
(2) For the purpose of brining the provisions of any law in
force in the territory of India into accord with the provisions
of this Constitution, the President may by order1 make
such adaptations and modifications of such law, whether
by way of repeal or amendment, as may be necessary or
expedient, and provide that the law shall, as from such
date as may be specified in the order, have effect subject
to the adaptations and modifications so made, and any
such adaptation or modification shall not be questioned
in any court of law.
(3) Nothing in clause (2) shall be deemed—
(a) to empower the President to make any adaptation or
modification of any law after the expiration of 2[three years]
from the commencement of this Constitution; or
(b) to prevent any competent Legislature or other competent
authority from repealing or amending any law adapted or
modified by the President under the said clause.
[2024] 12 S.C.R. 877
Sanjeevkumar Harakchand Kankariya v. Union of India & Ors.
Explanation I.—The expression “law in force” in this article
shall include a law passed or made by a Legislature or
other competent authority in the territory of India before
the commencement of this Constitution and not previously
repealed, notwithstanding that it or parts of it may not be
then in operation either at all or in particular areas.”
COURT FEES ACT, 1870
16. [ Refund of fee [Section 16 repealed by Act
5 of 1908 and again inserted by Act 46 of 1999,
Section 34.]
Where the Court refers the parties to the suit to any one
of the mode of settlement of dispute referred to in section
89 of the Code of Civil Procedure, 1908 (5 of 1908), the
plaintiff shall be entitled to a certificate from the Court
authorising him to receive back from the Collector, the full
amount of the fee paid in respect of such plaint.]”
LEGAL SERVICES AUTHORITIES ACT, 1987
“21. Award of Lok Adalat.—1 (1) Every award of the Lok
Adalat shall be deemed to be a decree of a civil court
or, as the case may be, an order of any other court and
where a compromise or settlement has been arrived at,
by a Lok Adalat in a case referred to it under sub-section
(1) of section 20, the court-fee paid in such case shall be
refunded in the manner provided under the Court-fees
Act, 1870 (7 of 1870).
(2) Every award made by a Lok Adalat shall be final and
binding on all the parties to the dispute, and no appeal
shall lie to any court against the award.”
MAHARASHTRA COURT FEES ACT, 1959
Section 43. Repayment of fee in certain circumstances.
(1) When any suit in a Court or any proceeding instituted
by presenting a petition to a Court under the Hindu
Marriage Act, 1955 (XXV of 1955), is settled by agreement
of parties before any evidence is recorded, or any appeal
or cross objection is settled by agreement of parties
878 [2024] 12 S.C.R.
Supreme Court Reports
before it is called on for effective hearing by the Court,
half the amount of the fee paid by the plaintiff, petitioner,
appellant, or respondent on the plaint, petition, appeal or
cross objection, as the case may be, shall be repaid to
him by the Court :
Provided that, no such fee shall be repaid if the amount of
fee paid does not exceed twenty-five-rupees or the claim
for repayment is not made within one year from the date
on which the suit, proceeding, appeal or cross objection
was settled by agreement.
(2) The State Government may, from time to time, by
order, provide for repayment to the plaintiffs, petitioners,
complaints under section 138 of the Negotiable Instruments
Act, 1881 (26 of 1881), appellants or respondents of any
part of the fee paid by them on plaints, petitions, complaints
under section 138 of the Negotiable Instruments Act,
1881 (26 of 1881), appeals or cross objections, in suits
complaints under section 138 of the Negotiable Instruments
Act, 1881 (26 of 1881), proceedings or appeals disposed of
under such circumstances and subject to such conditions
as may be specified in the order.
Explanation.- For the purpose of this section, effective
hearing shall exclude the dates when the appeal is merely
adjourned without being heard or argued.”
ANALYSIS AND CONSIDERATION
7. The sum and substance of the case put forward by the appellant is
that this case pertains not merely to court fees as an issue, but the
larger issue of administration of justice, as that consequently, by virtue
of Entry 11-A to the VII Schedule to the Constitution of India, the
issue of refund of court fees, since it involves settlement of disputes
by alternate mechanisms, which is an aspect of the administration
of justice. Harmonious Construction needs to be adopted of all the
provisions involved, i.e., CFA, 1870, MCFA 1959, LSA Act, 1987, and
that the MCFA, 1959 being a State Legislation, cannot be allowed
to override the Central Legislation(s).
8. Keeping in view the contentions raised, adjudication of this dispute
would involve the analysis of the provisions cited from the lens of the
[2024] 12 S.C.R. 879
Sanjeevkumar Harakchand Kankariya v. Union of India & Ors.
doctrine of pith and substance and harmonious construction. Before
proceeding to the merits of the instant case, it would be apposite to
refer to certain pronouncements in this regard.
8.1 The Doctrine of Pith and Substance
The examination of the application of this doctrine has arisen before
this Court on numerous occasions. For instance, a Bench of five
Judges in Girnar Traders (3) v. State of Maharashtra,13 observed
thus:
“173. The doctrine of pith and substance can be applied to
examine the validity or otherwise of a legislation for want
of legislative competence as well as where two legislations
are embodied together for achieving the purpose of the
principal Act. Keeping in view that we are construing a
federal Constitution, distribution of legislative powers
between the Centre and the State is of great significance.
Serious attempt was made to convince the Court that
the doctrine of pith and substance has a very restricted
application and it applies only to the cases where the court
is called upon to examine the enactment to be ultra vires
on account of legislative incompetence.
174. We are unable to persuade ourselves to accept this
proposition. The doctrine of pith and substance finds its
origin from the principle that it is necessary to examine
the true nature and character of the legislation to know
whether it falls in a forbidden sphere. This doctrine was
first applied in India in Prafulla Kumar Mukherjee v. Bank
of Commerce Ltd. [(1946-47) 74 IA 23 : AIR 1947 PC 60]
The principle has been applied to the cases of alleged
repugnancy and we see no reason why its application
cannot be extended even to the cases of present kind
which ultimately relates to statutory interpretation founded
on source of legislation.
175. In Union of India v. Shah Goverdhan L. Kabra Teachers’
College [(2002) 8 SCC 228] this Court held that in order
13 [2011] 3 SCR 1 : (2011) 3 SCC 1
880 [2024] 12 S.C.R.
Supreme Court Reports
to examine the true character of the enactment, the entire
Act, its object and scope is required to be gone into. The
question of invasion into the territory of another legislation
is to be determined not by degree but by substance. The
doctrine of pith and substance has to be applied not only
in cases of conflict between the powers of two legislatures
but also in any case where the question arises whether
a legislation is covered by a particular legislative field
over which the power is purported to be exercised. In
other words, what is of paramount consideration is that
the substance of the legislation should be examined to
arrive at a correct analysis or in examining the validity of
law, where two legislations are in conflict or alleged to be
repugnant.”
8.2 Doctrine of Harmonious Construction
In the authoritative text ‘Principles of Statutory Interpretation’, 14th
Ed. by Justice G.P. Singh, the Rule of Harmonious Construction has
been captured in the following terms :
“As stated by VENKATARAMA AIYAR, J., “the Rule of
Construction is well settled that when there are in an
enactment two provisions which cannot be reconciled with
each other, they should be so interpreted that, if possible,
effect should be given to both. This is what is known as
the rule of harmonious construction.” That, effect should
be given to both, is the very essence of the rule. Thus a
construction that reduces one of the provisions to a “useless
lumber” or “dead letter” is not harmonious construction.
To harmonize is not to destroy.”
The judgments referred to in the above paragraph are Venkataramana
Devaru v. State of Mysore;14 Calcutta Gas Co. (Proprietary) Ltd.
v. State of West Bengal;15 J.K. Cotton Spinning & Weaving v.
State of U.P..16
14 [1958] 1 SCR 895 : AIR 1958 SC 255
15 [1962] Supp. 3 SCR 1 : AIR 1962 SC 1044
16 [1961] 3 SCR 185 : AIR 1961 SC 1170
[2024] 12 S.C.R. 881
Sanjeevkumar Harakchand Kankariya v. Union of India & Ors.
We may also refer to British Airways PLC v. Union of India17
wherein this Court said as follows :
“8. While interpreting a statute the court should try to
sustain its validity and give such meaning to the provisions
which advance the object sought to be achieved by the
enactment. The court cannot approach the enactment with
a view to pick holes or to search for defects of drafting
which make its working impossible. It is a cardinal principle
of construction of a statute that effort should be made in
construing the different provisions so that each provision will
have its play and in the event of any conflict a harmonious
construction should be given. The well-known principle of
harmonious construction is that effect shall be given to
all the provisions and for that any provision of the statute
should be construed with reference to the other provisions
so as to make it workable. A particular provision cannot
be picked up and interpreted to defeat another provision
made in that behalf under the statute. It is the duty of the
court to make such construction of a statute which shall
suppress the mischief and advance the remedy. While
interpreting a statute the courts are required to keep in
mind the consequences which are likely to flow upon the
intended interpretation.”
9. The primary argument, as recorded above is that the resolution of
disputes by alternate mechanisms is an aspect of the administration
of justice and, therefore, anything connected thereto inclusive of
refund of court fees as a result of out of Court settlement, would be
governed by Entry 11A of List III.
Further, the inconsistency between the Central and State Act would
have to be resolved, giving the Central Act primacy over the State
Act. This argument is difficult to countenance.
10. The scope of Entry 11A of List III has been discussed by a Constitution
Bench of this Court in Jamshed N. Guzdar v. State of Maharashtra,18
in the following terms :
17 [2001] Supp. 5 SCR 152 : (2002) 2 SCC 96
18 [2005] 1 SCR 223 : (2005) 2 SCC 591
882 [2024] 12 S.C.R.
Supreme Court Reports
“42. The general jurisdiction of the High Courts is dealt
with in Entry 11-A under the caption “administration
of justice”, which has a wide meaning and includes
administration of civil as well as criminal justice. The
expression “administration of justice” has been used
without any qualification or limitation wide enough to
include the “powers” and “jurisdiction” of all the courts
except the Supreme Court. The semicolon (;) after
the words “administration of justice” in Entry 11-A has
significance and meaning. The other words in the same
entry after “administration of justice” only speak in relation
to “constitution” and “organisation” of all the courts except
the Supreme Court and High Courts. It follows that under
Entry 11-A the State Legislature has no power to constitute
and organise the Supreme Court and High Courts. It is an
accepted principle of construction of a Constitution that
everything necessary for the exercise of powers is included
in the grant of power. The State Legislature being an
appropriate body to legislate in respect of “administration
of justice” and to invest all courts within the State including
the High Court with general jurisdiction and powers in all
matters, civil and criminal, it must follow that it can invest
the High Court with such general jurisdiction and powers
including the territorial and pecuniary jurisdiction and also
to take away such jurisdiction and powers from the High
Court except those, which are specifically conferred under
the Constitution on the High Courts.”
(Emphasis Supplied)
It is also important to note the discussion made by Y.V Chandrachud,
CJI while writing for the majority of the seven Judges Bench in In
Re The Special Courts Bill, 1978.19 The relevant extract thereof
is as under:
“45. The field of legislation covered by Entry 11-A of List III
was originally a part of Entry 3 of List II. By Section 57(b)
(iii) of the 42nd Amendment Act, 1976 which came into
force on January 3, 1977 that part was omitted from Entry
19 [1979] 2 SCR 476 : (1979) 1 SCC 380
[2024] 12 S.C.R. 883
Sanjeevkumar Harakchand Kankariya v. Union of India & Ors.
3, List II and by clause (c) of Section 57, it was inserted
into List III as Item 11-A. This transposition has led to
the argument that the particular amendment introduced
by Section 57 (b)(iii) and (c), is invalid since it destroys
a basic feature of the Constitution as originally enacted,
namely, federalism. We are unable to appreciate how the
conferment of concurrent power on the Parliament, in place
of the exclusive power of the States, to the constitution
and organisation of certain courts affects the principle
of federalism in the form in which our Constitution has
accepted and adopted it...”
(Emphasis supplied)
We must also take note of the observations in State of T.N. v. G.N.
Venkataswamy.20 It was held:
“12. It is no doubt correct that with the coming into force
of Entry 11-A List III it is no more the exclusive power of
the State Legislature to legislate under the said entry but
“administration of justice” and “constitution and organisation
of all courts” are the subjects on which the State Legislature
can legislate. These expressions have been authoritatively
interpreted by this Court in Narothamdas case [1950 SCC
905 : 1951 SCR 51 : AIR 1951 SC 69] . It is, therefore,
settled that under Entry 11-A the State Legislature has
the power to make laws thereby enlarging or reducing the
powers of the courts. The State Legislature can create new
courts, reorganise the existing courts, provide jurisdiction to
the said courts and also take away the existing jurisdiction
if it so desires. We, therefore, see no reason why a State
Legislature cannot confer additional jurisdiction on existing
revenue courts to recover any public dues as arrears of
land revenue.”
11. Administration of justice, as it flows from the above, pertains to
investment in all Courts with general, territorial and pecuniary
jurisdiction. All the powers necessary for constitution and organisation
of Courts except this Court, and the High Courts, to some extent,
20 [1994] Supp. 1 SCR 322 : (1994) 5 SCC 314
884 [2024] 12 S.C.R.
Supreme Court Reports
have been invested with the State as well as the Centre, under this
Entry. Laws made by the Centre would necessarily prevail over the
State made laws, should there be any inconsistency between the
two, and the laws made by the latter shall be unconstitutional to
the extent that they are inconsistent with the Central laws, by virtue
of the Doctrine of Repugnancy, the contours of which can be well
understood by a perusal of the judgment in M. Karunanidhi v. Union
of India.21 The Constitution Bench held:
“8. It would be seen that so far as clause (1) of Article 254
is concerned it clearly lays down that where there is a direct
collision between a provision of a law made by the State
and that made by Parliament with respect to one of the
matters enumerated in the Concurrent List, then, subject
to the pro- visions of clause (2), the State law would be
void to the extent of the repugnancy. This naturally means
that where both the State and Parliament occupy the field
contemplated by the Concurrent List then the Act passed
by Parliament being prior in point of time will prevail and
consequently the State Act will have to yield to the Central
Act. In fact, the scheme of the Constitution is a scientific
and equitable distribution of legislative powers between
Parliament and the State Legislatures. First, regarding the
matters contained in List I, i.e. the Union List to the Seventh
Schedule, Parliament alone is empowered to legislate and
the State Legislatures have no authority to make any law
in respect of the Entries contained in List I. Secondly, so
far as the Concurrent List is concerned, both Parliament
and the State Legislatures are entitled to legislate in
regard to any of the Entries appearing therein, but that
is subject to the condition laid down by Article 254(1)
discussed above. Thirdly, so far as the matters in List II,
i.e. the State List are concerned, the State Legislatures
alone are competent to legislate on them and only under
certain conditions Parliament can do so. It is, therefore,
obvious that in such matters repugnancy may result from
the following circumstances:
21 [1979] 3 SCR 254 : (1979) 3 SCC 431
[2024] 12 S.C.R. 885
Sanjeevkumar Harakchand Kankariya v. Union of India & Ors.
1. Where the provisions of a Central Act and a State
Act in the Concurrent List are fully inconsistent and are
absolutely irreconcilable, the Central Act will prevail and
the State Act will become void in view of the repugnancy.
2. Where however a law passed by the State comes into
collision with a law passed by Parliament on an Entry
in the Concurrent List, the State Act shall prevail to the
extent of the repugnancy and the provisions of the Central
Act would become void provided the State Act has been
passed in accordance with clause (2) of Article 254.
3. Where a law passed by the State Legislature while being
substantially within the scope of the entries in the State
List entrenches upon any of the Entries in the Central List
the constitutionality of the law may be upheld by invoking
the doctrine of pith and substance if on an analysis of the
provisions of the Act it appears that by and large the law falls
within the four corners of the State List and entrenchment,
if any, is purely incidental or inconsequential.
4. Where, however, a law made by the State Legislature
on a subject covered by the Concurrent List is inconsistent
with and repugnant to a previous law made by Parliament,
then such a law can be protected by obtaining the assent
of the President under Article 254(2) of the Constitution.
The result of obtaining the assent of the President would
be that so far as the State Act is concerned, it will prevail
in the State and overrule the provisions of the Central Act
in their applicability to the State only. Such a state of affairs
will exist only until Parliament may at any time make a law
adding to, or amending, varying or repealing the law made
by the State Legislature under the proviso to Article 254.”
12. The argument of the appellant aside, court fees finds mention in the
Seventh Schedule in Entry 3 of List II (reproduced supra). However,
as is obvious, there is no inconsistency between Central and State
legislation here. The reason why it is difficult to accept the argument
of the appellant is because court fees are explicitly governed by
Entry 3 List II, reproduced supra. When that is the case, no argument
pertaining to inconsistency between the two entries and the respective
laws made thereunder can be entertained in law. Still further, the
886 [2024] 12 S.C.R.
Supreme Court Reports
law-making power given as delineated in the Seventh Schedule
is not constricted, but wide. When the competence to legislate is
called into question, it is permissible to demonstrate the same from
a conjoint reading of multiple entries and it need not flow directly
from one particular entry. M.N.Venkatachaliah J. (as his Lordship
then was) writing for the majority in Ujagar Prints (II) v. Union of
India22 held as under:
“53. If a legislation purporting to be under a particular
legislative entry is assailed for lack of legislative competence,
the State can seek to support it on the basis of any other
entry within the legislative competence of the legislature. It
is not necessary for the State to show that the legislature, in
enacting the law, consciously applied its mind to the source
of its own competence. Competence to legislate flows from
Articles 245, 246, and the other articles following, in Part
XI of the Constitution. In defending the validity of a law
questioned on ground of legislative incompetence, the State
can always show that the law was supportable under any
other entry within the competence of the legislature. Indeed
in supporting a legislation sustenance could be drawn and
had from a number of entries. The legislation could be a
composite legislation drawing upon several entries….”
13. A natural conclusion that can be drawn is that if legislative competence
can be demonstrated, drawing on multiple entries, the same can be
taken to be beyond the pale of any doubt when there is a particular
entry to that effect. Entry 3, List II specifically empowers the State to
legislate in respect of fees taken in all courts, save this Court. Ergo,
there is no reason to accept the appellant’s contention that simply
because it involves settlement of the dispute per alternative dispute
mechanisms, the matter pertaining to the court fee payable in such
a case, would travel out of the purview of Entry 3, List II, and would
instead fall within the amplitude of Entry 11-A, List III.
14. At this juncture, let us address the argument of the appellant that
differentiation in the refund of fees applicable between the Central
and State legislation would defeat the overall, salutary purpose of
Section 89 CPC.
22 [1989] 1 SCR 344 : (1989) 3 SCC 488
[2024] 12 S.C.R. 887
Sanjeevkumar Harakchand Kankariya v. Union of India & Ors.
14.1 Reference may be made to the High Court of Judicature at
Madras v. M.C. Subramaniam,23 wherein it has been held
that the provision must be understood in the “backdrop of the
long-standing proliferation of litigation in the civil court which
has placed an undue burden on the judicial system, forcing
speedy justice to become a casualty.”
14.2 The observations in Afcons Infrastructure Ltd. v. Cherian
Varkey Construction Co. (P) Ltd.,24 are also noteworthy-
“26. Section 89 starts with the words “where it appears
to the court that there exist elements of a settlement”.
This clearly shows that cases which are not suited for
ADR process should not be referred under Section 89
of the Code. The court has to form an opinion that a
case is one that is capable of being referred to and
settled through ADR process. Having regard to the
tenor of the provisions of Rule 1-A of Order 10 of the
Code, the civil court should invariably refer cases to
ADR process. Only in certain recognised excluded
categories of cases, it may choose not to refer to an
ADR process. Where the case is unsuited for reference
to any of the ADR processes, the court will have to
briefly record the reasons for not resorting to any of
the settlement procedures prescribed under Section
89 of the Code. Therefore, having a hearing after
completion of pleadings, to consider recourse to ADR
process under Section 89 of the Code, is mandatory.
But actual reference to an ADR process in all cases is
not mandatory. Where the case falls under an excluded
category there need not be reference to ADR process.
In all other cases reference to ADR process is a must.
Further ahead in this judgment, Raveendran J. writing for
thisCourt, listed out the scenarios in which reference under
Section 89 CPC should or should not be made. The same are
not reproduced here but suffice it to say that the present dispute
does not fall into any of the exceptions listed for the otherwise
mandatory reference thereunder.
23 [2021] 1 SCR 552 : (2021) 3 SCC 560
24 [2010] 8 SCR 1053 : (2010) 8 SCC 24
888 [2024] 12 S.C.R.
Supreme Court Reports
A perusal of the above as also other judgments on the application
and scope of Section 89 CPC nowhere correlates the settlement
of disputes by alternate mechanisms to the amount of money
that may be saved by the parties in so far as the court fee is
concerned.The only purpose is the resolution of the dispute by
the means prescribed therein, aiding the reduction of pendency
and backlog of cases. The refund of court fees, either partial
or complete, as the case may be, is a benefit, incidental to the
resolution of the dispute. Undoubtedly, the added pecuniary
advantage may serve as a reason to galvanize and buoy the
position of ADR, leading an increasing number of persons
involved in disputes to opt therefor, however, that aspect, is
not in the realm of primary considerations when examining the
growth of ADR, or the object and purpose of the introduction
of Section 89 into the CPC.
14.3 It is difficult to accept this submission that Section 89, CPC will
be negated if the scheme of refund as envisaged by the MCFA,
1959 is given effect. It cannot be doubted that the settlement
of a dispute outside court is a cause for celebration in as much
as it translates to early resolution of the dispute inter se the
parties and it means also, that there is one less file to add on to
already overflowing record rooms of the concerned civil courts.
It also cannot be gainsaid that all efforts should be made to
encourage the adoption of ADR mechanisms.
15. Let us now examine the submission regarding the reference in LSA
Act, 1987 of the CFA, 1870 and its effect, if any, on MCFA, 1959. One
is a Central legislation and the other is a State legislation. The LSA
Act, 1987 was enacted by the legislature to give effect to Article 39A
of the Constitution of India which places responsibility upon the State
to secure the operation of a legal system which promotes justice and
further casts a responsibility upon the State to provide free legal aid
by way of suitable legislation or schemes so as to ensure that justice
is not the province of only those who are unaffected by economic or
other disabilities. The primary mode of dispute settlement prescribed
in the Act is the ‘Lok Adalat’,the constitution and functioning of which
are discussed in Chapters 6 and 6A of the Act.
16. The submission of the learned counsel for the appellant is to the
effect that since a Central legislation, i.e., the LSA Act, 1987, in
connection with an alternate method of dispute resolution makes
[2024] 12 S.C.R. 889
Sanjeevkumar Harakchand Kankariya v. Union of India & Ors.
reference to CFA, 1870, the same should be extended to other similar
modes of dispute resolution as well. In a sense, an effort has been
made on part of the appellant to equate the Award of Lok Adalat to
the resolution of his dispute by way of reference under Section 89
CPC, i.e., mediation. This equivalence is misplaced.
17. The scope of Lok Adalat has been discussed by a Bench of three
learned Judges in State of Punjab v. Jalour Singh.25
“8. It is evident from the said provisions that the Lok Adalats
have no adjudicatory or judicial functions. Their functions
relate purely to conciliation. A Lok Adalat determines a
reference on the basis of a compromise or settlement
between the parties at its instance, and puts its seal of
confirmation by making an award in terms of the compromise
or settlement. When the Lok Adalat is not able to arrive at a
settlement or compromise, no award is made and the case
record is returned to the court from which the reference was
received, for disposal in accordance with law. No Lok Adalat
has the power to “hear” parties to adjudicate cases as a
court does. It discusses the subject-matter with the parties
and persuades them to arrive at a just settlement. In their
conciliatory role, the Lok Adalats are guided by the principles
of justice, equity and fair play. When the LSA Act refers to
“determination” by the Lok Adalat and “award” by the Lok
Adalat, the said Act does not contemplate nor require an
adjudicatory judicial determination, but a non-adjudicatory
determination based on a compromise or settlement, arrived
at by the parties, with guidance and assistance from the Lok
Adalat. The “award” of the Lok Adalat does not mean any
independent verdict or opinion arrived at by any decision-
making process. The making of the award is merely an
administrative act of incorporating the terms of settlement
or compromise agreed by parties in the presence of the
Lok Adalat, in the form of an executable order under the
signature and seal of the Lok Adalat.”
18. The process of mediation has been described in Perry Kansagra v.
Smriti Madan Kansagra.26 The following extract, although, in regard
25 [2008] 1 SCR 922 : (2008) 2 SCC 660
26 [2019] 3 SCR 991 : (2019) 20 SCC 753
890 [2024] 12 S.C.R.
Supreme Court Reports
to the importance of confidentiality in such proceedings are none
the less important for the instant case.
“27. We, thus, have line of cases dealing with mediation/
conciliation and other proceedings in general and Rule 8 of
the Rules dealing inter alia, with custody issues which is in
the nature of an exception to the norms of confidentiality.
It is true that the process of mediation is founded on
the element of confidentiality. Qualitatively, mediation or
conciliation stands on a completely different footing as
against regular adjudicatory processes. Instead of an
adversarial stand in adjudicatory proceedings, the idea
of mediation is to resolve the dispute at a level which is
amicable rather than adversarial. In the process, the parties
may make statements which they otherwise would not have
made while the matter was pending adjudication before a
court of law. Such statements which are essentially made
in order to see if there could be a settlement, ought not
to be used against the maker of such statements in case
at a later point the attempts at mediation completely fail.
If the statements are allowed to be used at subsequent
stages, the element of confidence which is essential for
healthy mediation/conciliation would be completely lost.
The element of confidentiality and the assurance that the
statements would not be relied upon helps the parties
bury the hatchet and move towards resolution of the
disputes. The confidentiality is, thus, an important element
of mediation/ conciliation.”
19. As can be seen, there are certain similarities in the two processes,
however, there are certain undeniable differences, foremost among
them being that the former is governed by independent legislation and
now, so are the certain aspects of the latter (Mediation Act, 2023).
20. It is inconceivable as to how a reference to mediation under the
CPC can be read to be the same or equal to proceeding before a
Lok Adalat for any reference thereto, to be helpful to the case put
forward by the appellant. Simply because a refund under CFA, 1870
is statutorily prescribed, to be given when a dispute is settled by
way of a Lok Adalat, does by no stretch of the imagination mean
by the exact situation be adopted to the settlement of a dispute by
[2024] 12 S.C.R. 891
Sanjeevkumar Harakchand Kankariya v. Union of India & Ors.
mediation. This argument has to be necessarily rejected. No error
can be found, in this regard with the reasoning of the High Court.
CONCLUSION
21. The inescapable conclusion per the above discussion, holding that Entry
11A List III cannot govern the refund of court fees when a matter is
settled by methods of alternate dispute resolution, in the face of Entry
3 List II simply by the use of the words “administration of justice” in the
former and, that reference to CFA, 1870 in respect of refund of court
fees when the matter is settled by way of an Award of Lok Adalat does
not mean that the same shall be extended to the settlement of dispute
by mediation for the simple reason that Lok Adalat and mediation are
two distinct methods and cannot be equated, we hold that this appeal
lacks merit and is liable to be dismissed. Ordered accordingly.
22. As extracted supra, the High Court in the impugned judgment had
made a suggestion to the State legislature that the differences in
the court fees in Lok Adalat, vis-à-vis, the forms of ADR should be
done away with the view to promote the adaptation of such methods
of dispute resolution among the public. It has been brought to our
attention that the State legislature has indeed carried out such an
amendment to the MCFA, 1959 and Section 16A has been introduced
therein by way of Maharashtra Act No.X of 2018, the relevant extract
of which reads under :
MAHARASHTRA ACT No. X OF 2018.
(First published, after having received the assent of the
Governor in the “Maharashtra Government Gazette”, on
the 16th January 2018.)
An Act further to amend the Maharashtra Court-fees Act.
WHEREAS it is expedient further to amend the Maharashtra
Court-fees Act, for the purposes hereinafter appearing; it
is hereby enacted in the Sixty-eighth Year of the Republic
of India as follows :—
1….
2. After section 16 of the Maharashtra Court-fees Act
(hereinafter referred to as “principal Act”), the following
section shall be inserted, namely :—
892 [2024] 12 S.C.R.
Supreme Court Reports
“16A. Where the court refers the parties to the suit to any
one of the modes of settlement of dispute referred to in
section 89 of the Code of Civil Procedure, 1908 and suit
is disposed of by the court by adaptation of any of the
modes prescribed under the said section, the plaintiff shall
be entitled to a certificate from the court authorising him
to receive back from the collector, the full amount of the
fee paid in respect of such plaint.’’.”
23. The effect of the above being that for the time when the amendment to
the MCFA, 1959 granting partial or complete refund, as the case may
be, in accordance with Section 43 as amended, the persons whose
matters were settled by way of ADR would not be entitled to 100%
refund. Any matter settled under the processes mentioned in Section
89 CPC after the coming into force of the above-extracted amendment,
such parties shall receive refund of court fees in its entirety.
24. The total amount of court fees paid by the appellant, in respect of
the refund of which the matter has travelled up to this Court was
approximately Rs. 5 lakhs. Should we, in the facts and circumstances
of this case grant, in exercise of extraordinary jurisdiction under
Article 142 of the Constitution of India, refund of the said amount is
a question we have asked ourselves. Considering the fact that the
original dispute was settled amicably and that the amount of court
fees involved is not excessive, in the peculiar facts of this case, for
it not to be a binding precedent, we are of the view that the same
can be refunded to him. Ordered accordingly.
Pending applications, if any, shall stand disposed of.
Result of the case: Appeal dismissed.
†
Headnotes prepared by: Nidhi Jain
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