Date of Order:
13/07/1988
Bench:
DUTT, M.M. (J) MISRA RANGNATH
Parties:
PETITIONER:
COMMERClAL AVIATION & TRAVEL COMPANY & ORS.
Vs.
RESPONDENT:
VIMAL PANNALAL
SUBJECT
- The appellant contended (1) that in a suit for accounts the plaintiff could not value the suit most arbitrarily according to her whims and (2) that an objective standard or positive material 432 appeared on the face of the plaint and the valuation of the relief ignoring such objective standard was demonstratively arbitrary.
- The Court can revise a valuation if it appears arbitrary, unreasonable, or demonstratively undervalued. In Meenakshisundram’s case, the plaintiff’s lease-hold interest valuation was reasonable. The appeal was ultimately dismissed with costs of Rs.5,000.
IMPORTANT PROVISIONS
- CIVIL PROCEDURE CODE, 1908: order Vll Rule (11b)-Plaint to be rejected where relief claimed undervalued-Duty of Court to come to a finding that relief claimed is undervalued.
OVERVIEW
- The respondent, who is the plaintiff, has filed a suit against the appellants, inter alia, for dissolution of partnership and for accounts. The suit has been valued for the purpose of jurisdiction at Rs.25 lakhs and at Rs.500 for the purpose of court fee.
- The appellants filed an application wherein a preliminary objection was raised as to the valuation of the suit. It was contended by them that the relief sought for in the suit had been grossly undervalued 434 and the Court should reject the plaint under order VII, Rule 11(b) of the Code of Civil Procedure.
- The Single Judge overruled the preliminary objection and found the suit not undervalued. The Division Bench dismissed the appeal, following a Full Bench decision. The plaintiff argued that the plaintiff could not value the suit arbitrarily and that ignoring an objective standard was demonstratively arbitrary in a suit for accounts.
ARGUMENTS ADVANCED BY THE APPELLANT
- Counsel Sorabjee argues that the respondent’s valuation of the suit is arbitrary, as in a suit for accounts, the plaintiff cannot impose an arbitrary valuation on the relief claimed. He cites several Court decisions, such as Meenaakshisundaram Chettiar v. Venkatachalam Chettiar, which emphasize the importance of a reasonable estimate for relief sought.
ARGUMENTS ADVANCED BY THE RESPONDENT
- The appellants argue that the respondent should have valued relief for rendition of accounts at Rs.25 lakhs, but this statement lacks objective standard of valuation. The respondent was not required to make such a statement, and the appellants believe she would be entitled to such a large amount upon account taking.
JUDGEMENT ANALYSIS
- In a suit for accounts, it is difficult for the plaintiff to accurately value relief as they cannot determine the amount due to them on accounting. The Code of Civil Procedure’s order VII, Rule II(b) states that a court must determine the undervalued relief and require the plaintiff to correct their valuation within a fixed timeframe. This ensures that the relief is properly valued and the plaintiff is required to correct their valuation within the agreed-upon timeframe.
- In Kishori Lal Marwari v. Kumar Chandra Narain Deo and another, AIR 1939 Patna 572 a question arose as to the valuation of a suit for injunction restraining a decree-holder from executing his decree on the ground that the decree was collusive and obtained by fraud and, therefore, void and incapable of execution. It was held by the Patna High Court that the plaintiff must value his suit according to the amount of decree and must pay ad valorem court fee on such amount. In this case also, there was a positive objective standard for the valuation of the suit.
- The Court can only revise a valuation if it appears arbitrary, unreasonable, or demonstratively undervalued. In Meenakshisundram’s case, the plaintiff’s lease-hold interest valuation was reasonable and not demonstratively arbitrary. However, there is an objective standard of valuation, the rent of the lease-hold interest, which may be arbitrary and unreasonable. The Court may intervene in cases where this standard is violated.
- The Court can only revise a valuation if it appears arbitrary, unreasonable, or demonstratively undervalued. In Meenakshisundram’s case, the plaintiff’s lease-hold interest valuation was reasonable and not demonstratively arbitrary. However, there is an objective standard of valuation, the rent of the lease-hold interest, which may be arbitrary and unreasonable. The Court may intervene in cases where this standard is violated.
- In Atma Ram Charan Das v. Bisheshar Nath Dina Nath, the Lahore High Court ruled that the plaintiff’s valuation of relief for the rendition of accounts was neither unreasonable nor demonstratively arbitrary.
- The court hence concluded that the plaintiff could not be prejudiced or damnified by adding unnecessary computations to the plaint. The appeal was dismissed with costs quantified at Rs.5,000.
