THE HIGH COURT OF JUDICATURE AT MADRAS REP. BY ITS REGISTRAR GENERAL versus M.C. SUBRAMANIAM AND ORS. on 17 February 2021

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[2021] 1 S.C.R.

ATHE HIGH COURT OF JUDICATURE AT MADRAS REP. BYITS REGISTRAR GENERAL

v.

M.C. SUBRAMANIAM AND ORS.

B(Special Leave Petition (Civil) Nos. 3063-3064 of 2021)

FEBRUARY 17, 2021[MOHAN M. SHANTANAGOUDAR ANDVINEET SARAN, JJ.]

Code of Civil Procedure, 1908: s.89 – Tamil Nadu Court FeesCand Suit Valuation Act, 1955 – s.69-A – Parties entering into aprivate out of court settlement for resolving the controversy betweenthem outside the modes contemplated under s.89 and seekingpermission to withdraw suit and also refund of court fees – Refundof court fees – Permissibility of – Held: The purpose of s.69-A is toDreward parties who have chosen to withdraw their litigations infavour of more conciliatory dispute settlement mechanisms, thussaving the time and resources of the Court, by enabling them toclaim refund of the court fees deposited by them – Such refund ofcourt fee, though it may not be connected to the substance of thedispute between the parties, is certainly an ancillary economicEincentive for pushing them towards exploring alternative methodsof dispute settlement – Object of s.89 is to facilitate privatesettlements, and enable lightening of the overcrowded docket ofthe Indian judiciary – s.69-A of the Act, 1955 and s.89 CPC shouldbe interpreted liberally in a manner that would serve their objectFand purpose – Construing them narrowly would lead to situationwherein parties who settle the dispute through mediation centre orother centres of alternative judicial settlement under s.89 would beentitled to claim refund of their court fees whilst parties who settlethe disputes privately by themselves will be left without any meansto seek the refund – Differential treatment between two similarlyGsituated persons would constitute a violation of Art.14 of theConstitution – Thus, s.89 of CPC shall cover, and the benefit ofs.69-A of the 1955 Act shall also extend to, all methods of out-of-court dispute settlement between parties that the Court subsequentlyfinds to have been legally arrived at – This would, thus, cover the H

THE HIGH COURT OF JUDICATURE AT MADRAS REP. v.M.C. SUBRAMANIAM

present controversy, wherein a private settlement was arrived at,and a memo to withdraw the appeal was filed before the High Court.

Interpretation of statutes: Purposive interpretation – It is well-settled that the Courts may, in order to avoid any difficulty orinjustice resulting from inadvertent ambiguity in the language of astatute, mould the interpretation of the same so as to achieve thetrue purpose of the enactment – This may include expanding thescope of the relevant provisions to cover situations which are notstrictly encapsulated in the language used therein.

Dismissing the Special Leave Petitions, the Court HELD: 1. The provisions of Section 89 of CPC must beunderstood in the backdrop of the longstanding proliferation oflitigation in the civil courts, which has placed undue burden onthe judicial system, forcing speedy justice to become a casualty.As the Law Commission has observed in its 238th Report onAmendment of Section 89 of the Code of Civil Procedure 1908 andAllied Provisions, Section 89 has now made it incumbent on civilcourts to strive towards diverting civil disputes towardsalternative dispute resolution processes, and encourage theirsettlement outside of court (Para 2.3). These observations makethe object and purpose of Section 89 crystal clear – to facilitateprivate settlements, and enable lightening of the overcrowdeddocket of the Indian judiciary. This purpose, being sacrosanctand imperative for the effecting of timely justice in Indian courts,also informs Section 69-A of the 1955 Act, which furtherencourages settlements by providing for refund of court fee. Thisoverarching and beneficent object and purpose of the twoprovisions must, therefore, inform this Court’s interpretationthereof. [Para 12][560-B-E]

2. It is well-settled that the Courts may, in order to avoidany difficulty or injustice resulting from inadvertent ambiguity inthe language of a statute, mould the interpretation of the sameso as to achieve the true purpose of the enactment. This mayinclude expanding the scope of the relevant provisions to coversituations which are not strictly encapsulated in the language used AB

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Atherein. The narrow interpretation of Section 89 of CPC andSection 69-A of the 1955 Act sought to be imposed by thePetitioner would lead to an outcome wherein parties who arereferred to a Mediation Centre or other centres by the Courtwill be entitled to a full refund of their court fee; whilst partieswho similarly save the Court’s time and resources by privatelyBsettling their dispute themselves will be deprived of the samebenefit, simply because they did not require the Court’sinterference to seek a settlement. Such an interpretation, in ouropinion, clearly leads to an absurd and unjust outcome, wheretwo classes of parties who are equally facilitating the object andCpurpose of the aforesaid provisions are treated differentially, withone class being deprived of the benefit of Section 69-A of the1955 Act. A literal or technical interpretation, in this background,would only lead to injustice and render the purpose of theprovisions nugatory – and thus, needs to be departed from, infavour of a purposive interpretation of the provisions. [Paras 13,D15][561-B-C; F-H; 562-A-B]

3. The purpose of Section 69-A is to reward parties whohave chosen to withdraw their litigations in favour of moreconciliatory dispute settlement mechanisms, thus saving the timeand resources of the Court, by enabling them to claim refund ofEthe court fees deposited by them. Such refund of court fee, thoughit may not be connected to the substance of the dispute betweenthe parties, is certainly an ancillary economic incentive for pushingthem towards exploring alternative methods of disputesettlement. As the Karnataka High Court has rightly observedFin Kamalamma, parties who have agreed to settle their disputeswithout requiring judicial intervention under Section 89, CPCare even more deserving of this benefit. This is because bychoosing to resolve their claims themselves, they have savedthe State of the logistical hassle of arranging for a third-partyinstitution to settle the dispute. Though arbitration and mediationGare certainly salutary dispute resolution mechanisms, we also findthat the importance of private amicable negotiation between theparties cannot be understated. There is no justifiable reason whySection 69-A should only incentivize the methods of out-of-courtsettlement stated in Section 89, CPC and afford step-brotherlyH

treatment to other methods availed of by the parties. [Para19][564-C-G]

4.1 Admittedly, there may be situations wherein the partieshave after the course of a long-drawn trial, or multiple frivolouslitigations, approached the Court seeking refund of court fees inthe guise of having settled their disputes. In such cases, the Courtmay, having regard to the previous conduct of the parties and theprinciples of equity, refuse to grant relief under the relevant rulespertaining to court fees. However, the present case is not of suchnature. [Para 19][564-G-H; 565-A]

4.2 Thus, even though a strict construction of the terms ofSection 89, CPC and 69-A of the 1955 Act may not encompasssuch private negotiations and settlements between the parties,the participants in such settlements will be entitled to the samebenefits as those who have been referred to explore alternatedispute settlement methods under Section 89, CPC. Though theRegistry/State Government will be losing a one-time court fee inthe short term, they will be saved the expense and opportunitycost of managing an endless cycle of litigation in the long term. Itis therefore in their own interest to allow Respondent No. 1’sclaim. [Para 20][565-A-C]

4.3 Thus, the High Court was correct in holding that Section89 of the CPC and Section 69-A of the 1955 Act be interpretedliberally. In view of this broad purposive construction, the HighCourt’s conclusion, is affirmed. Section 89 of CPC shall cover,and the benefit of Section 69-A of the 1955 Act shall also extendto, all methods of out-of-court dispute settlement between partiesthat the Court subsequently finds to have been legally arrived at.This would, thus, cover the present controversy, wherein a privatesettlement was arrived at, and a memo to withdraw the appealwas filed before the High Court. In such a case as well, theappellant, i.e., Respondent No. 1 would be entitled to refund ofcourt fee. [Para 21][565-C-E]

Directorate of Enforcement v. Deepak Mahajan, 19943 SCC 440 : [1994] 1 SCR 445; Shailesh Dhairyawanv. Mohan Balkrishna Lulla, (2016) 3 SCC 619 : [2015]

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A12 SCR 70; Anurag Mittal v.Shaily Mishra Mittal,(2018) 9 SCC 691: [2018] 10 SCR 123 – relied on.

Kamalamma & Ors. v.Honnali Taluk AgriculturalProduce Co-operative Marketing Society Ltd., (2010)1 AIR Kar. R 279; Pradeep Sonawat v.Satish Prakash,B2015 (1) RCR Civil 955; Pritam Singh v.Ashok Kumar,2019 (1) Law Herald (P&H) 721; Raj Kumar v.GaindaDevi through LRs & Ors., 2019 SCC OnLine P&H 658;J.K. Forgings v. Essar Construction India Ltd. & Ors.,(2009) 113 DRJ 612; Inderjeet Kaur Raina v. HarvinderCKaur Anand, 2018 SCC OnLine Del 6557 – referredto.

Case Law Reference

From the Judgment and Order dated 08.01.2020 of High Court ofEJudicature at Madras in C.M.P. Nos. 26742 and 26743 of 2019.

Anish R. Shah, Adv. for the Petitioner.

The Judgment of the Court was delivered by MOHAN M. SHANTANAGOUDAR, J.F

1. These special leave petitions arise out of common order andjudgement of the High Court of Madras (hereinafter, ‘High Court’) dated8.01.2020. By the impugned judgement, the High Court allowed CivilMiscellaneous Petitions Nos. 26742 & 26743 of 2019 filed by theRespondent No.1 herein praying for refund of the court fees depositedGby him in Appeal Suits Nos. 876/2012 and 566/2013 filed by him beforethe High Court.

2. The facts leading to these petitions are as follows: RespondentNo.1 purchased two vehicles from Respondent No. 2 vide two separatehire purchase agreements (hereinafter, ‘Agreement-I’ and ‘Agreement-II’; collectively, ‘the Agreements’) dated 10.06.1996, under whichH

Respondent No.1 was the principal debtor/hirer, and Respondents Nos.3 and 4 were the sureties to the Agreements. As per the terms of theAgreements, Respondent No.1 was to pay a sum of Rs.10,08,000/- instipulated instalments to Respondent No. 2 for each of the two vehicles.

3. It suffices to note for our purposes that Respondent No. 2brought Original Suits Nos. 66/2003 and 76/2003 against RespondentsNos. 1, 3 and 4 before the Additional District Munsif Court, Coimbatore(hereinafter, ‘Munsif Court’) and the Additional District and SessionsCourt, Coimbatore (hereinafter, ‘District Court’) respectively. In the twosuits, Respondent No.2 alleged non-payment of Rs.6,64,000/- andRs.5,97,200/- towards the instalments stipulated in Agreement-I andAgreement-II respectively, and sought recovery of the balance amountsalong with interest thereon. Both the Original Suits Nos.66/2003 and 76/2003 were partly decreed by the Munsif Court and District Court, byjudgments dated 13.02.2004 and 31.01.2005 respectively.

4. Aggrieved, Respondent No.1 preferred Appeal Suits Nos. 876/2012 and 566/2013 before the High Court, against the judgments in O.S.No. 66/2003 and O.S. No.76/2013, respectively. While the appeals werestill pending consideration before the High Court, the parties enteredinto a private out-of-court settlement, thus resolving the controversybetween them. In view of this, Respondent No. 1 filed a memo beforethe High Court, seeking permission to withdraw Appeal Suits Nos. 876/2012 and 566/2013. Such permission, along with a direction to refundthe court fee deposited by Respondent No.1, was granted by ordersdated 16.09.2019 and 18.09.2019 in A.S. Nos.566/2013 and A.S. Nos.876/2012 respectively.

5. Despite the above stated orders of the High Court, the Registryorally refused Respondent No.1’s request for refund of court fees, onthe ground that such refund is not authorised by the relevant rules. Leftwithout recourse, on 25.12.2019, Respondent No.1 filed CivilMiscellaneous Petitions Nos. 26742/2019 and 26743/2019 under Section151, Code of Civil Procedure, 1908 (hereinafter, ‘CPC’), praying forrefund of the court fees paid by him in A.S. Nos. 876/2012 and 566/2013respectively, in terms of the orders dated 18.09.2019 and 16.09.2019therein.

6. By the impugned common judgment and order dated 8.01.2020,the High Court has allowed the aforementioned Civil Miscellaneous AB

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APetitions, and directed the Registry to refund the full court fee toRespondent No. 1 herein.

7. In addressing the question of whether the refund of court feewas permissible under the relevant rules, the High Court consideredSection 69-A of the Tamil Nadu Court Fees and Suit Valuation Act, 1955B(hereinafter, ‘1955 Act’), which reads as follows:

“69-A. Refund on settlement of disputes under section 89of Code of Civil Procedure.—Where the Court refers theparties to the suit to any of the modes of settlement of disputereferred to in section 89 of the Code of Civil Procedure, 1908C(Central Act V of 1908), the fee paid shall be refunded upon suchreference. Such refund need not await for settlement of thedispute.” (emphasis supplied)

Considering, appeal suits to be continuation of original suits, andtherefore falling within the ambit of ‘suits’ as provided in Section 69-A,Dthe Court went on to take notice of Section 89, CPC which reads asfollows:

“89. Settlement of disputes outside the Court.—(1) Whereit appears to the Court that there existelements of a settlementwhich may be acceptable to the parties, the Court shall formulateEthe terms of settlement and give them to the parties for theirobservations and after receiving the observations of the parties,the Court may reformulate the terms of a possible settlement andrefer the same for :—

(a) arbitration;

F(b) conciliation;

(c) judicial settlement including settlement through Lok Adalat: or (d) mediation.

(2) Were a dispute has been referred—

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(a) for arbitration or conciliation, the provisions of the Arbitrationand Conciliation Act,1996 (26 of 1996) shall apply as if theproceedings for arbitration or conciliation were referred forsettlement under the provisions of that Act; (b) to Lok Adalat, the Court shall refer the same to the Lok AdalatHin accordance with the provisionsof sub-section (1) of section 20

of the Legal Services Authority Act, 1987 (39 of 1987) and allother provisions of that Act shall apply in respect of the dispute soreferred to the Lok Adalat;

(c) for judicial settlement, the Court shall refer the same to asuitable institution or person and such institution or person shall bedeemed to be a Lok Adalat and all the provisions of the LegalServices Authority Act, 1987 (39 of 1987) shall apply as if thedispute were referred to a Lok Adalat under the provisions of thatAct; (d) for mediation, the Court shall effect a compromise betweenthe parties and shall follow such procedure as may be prescribed.”

8. After giving due consideration to the above provisions, the HighCourt held that, given their beneficial intent, they must be interpretedliberally, in a manner that would serve their object and purpose. Construingthem narrowly would lead to a situation wherein parties who settle theirdispute through a Mediation Centre or other centres of alternative judicialsettlement under Section 89, CPC would be entitled to claim refund oftheir court fee, whilst parties who settle the disputes privately bythemselves will be left without any means to seek a refund. Accordingly,the High Court opined that such differential treatment between twosimilarly situated persons, would constitute a violation of Article 14 ofthe Constitution. Therefore, in the High Court’s view, a constitutionalinterpretation of Section 89 of the CPC, and resultantly Section 69-A ofthe 1955 Act, would require that these provisions cover all methods ofout-of-court dispute settlement between parties that the Courtsubsequently finds to have been legally arrived at.

9. Dissatisfied, the Petitioner herein has challenged the impugnedjudgment of the High Court.

10. The gravamen of the Petitioner’s contentions is that Section69-A of the 1955 Act only contemplates refund of court fees in thosecases where the Court itself refers the parties to any of the alternativedispute settlement mechanisms listed in Section 89 of the CPC. Thathence it does not apply to circumstances such as in the present case,where the parties, without any reference by the Court, privately agreedto settle their dispute outside the modes contemplated under Section 89of the CPC.

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AThis Court’s Analysis

11. Having heard the petitioner and thoroughly considered thearguments advanced, we find ourselves unimpressed by the Petitioner’scontentions, for reasons outlined below.

12. The provisions of Section 89 of CPC must be understood inBthe backdrop of the longstanding proliferation of litigation in the civilcourts, which has placed undue burden on the judicial system, forcingspeedy justice to become a casualty. As the Law Commission hasobserved in its 238th Report on Amendment of Section 89 of the Codeof Civil Procedure 1908 and Allied Provisions, Section 89 has nowCmade it incumbent on civil courts to strive towards diverting civil disputestowards alternative dispute resolution processes, and encourage theirsettlement outside of court (Para 2.3). These observations make theobject and purpose of Section 89 crystal clear – to facilitate privatesettlements, and enable lightening of the overcrowded docket of theIndian judiciary. This purpose, being sacrosanct and imperative for theDeffecting of timely justice in Indian courts, also informs Section 69-A ofthe 1955 Act, which further encourages settlements by providing forrefund of court fee. This overarching and beneficent object and purposeof the two provisions must, therefore, inform this Court’s interpretationthereof.

E13. Before expounding further on our interpretation of the aforesaidprovisions, regard must be had to the following postulation of this Court’sinterpretive role in Directorate of Enforcement v. Deepak Mahajan,1994 3 SCC 440 –

“24…Though the function of the Courts is only to expound theFlaw and not to legislate, nonetheless the legislature cannot be askedto sit to resolve the difficulties in the implementation of its intentionand the spirit of the law. In such circumstances, it is the duty ofthe court to mould or creatively interpret the legislation by liberallyinterpreting the statute.

G25. In Maxwell on Interpretation of Statutes, Tenth Edn. at page229, the following passage is found:

“Where the language of a statute, in its ordinary meaning andgrammatical construction, leads to a manifest contradiction of theapparent purpose of the enactment, or to some inconvenience orHabsurdity, hardship or injustice, presumably not intended, a

construction may be put upon it which modifies the meaning ofthe words, and even the structure of the sentence. … Where themain object and intention of a statute are clear, it must not bereduced to a nullity by the draftsman’s unskilfulness or ignoranceof the law, except in a case of necessity, or the absolute intractabilityof the language used.” (emphasis supplied)

Therefore, it is well-settled that the Courts may, in order to avoidany difficulty or injustice resulting from inadvertent ambiguity in thelanguage of a statute, mould the interpretation of the same so as toachieve the true purpose of the enactment. This may include expandingthe scope of the relevant provisions to cover situations which are notstrictly encapsulated in the language used therein.

14. This principle of statutory interpretation has been affirmedmore recently in the decision in Shailesh Dhairyawan v. MohanBalkrishna Lulla, (2016) 3 SCC 619 –

“33.…Though the literal rule of interpretation, till some time ago,was treated as the “golden rule”, it is now the doctrine of purposiveinterpretation which is predominant, particularly in those caseswhere literal interpretation may not serve the purpose or maylead to absurdity. If it brings about an end which is at variancewith the purpose of statute, that cannot be countenanced.”(emphasis supplied)

This was followed in the subsequent decision of this Court inAnurag Mittal v. Shaily Mishra Mittal, (2018) 9 SCC 691.

15. In light of these established principles of statutory interpretation,we shall now proceed to advert to the specific provisions that are thesubject of the present controversy. The narrow interpretation of Section89 of CPC and Section 69-A of the 1955 Act sought to be imposed bythe Petitioner would lead to an outcome wherein parties who are referredto a Mediation Centre or other centres by the Court will be entitled to afull refund of their court fee; whilst parties who similarly save the Court’stime and resources by privately settling their dispute themselves will bedeprived of the same benefit, simply because they did not require theCourt’s interference to seek a settlement. Such an interpretation, in ouropinion, clearly leads to an absurd and unjust outcome, where two classesof parties who are equally facilitating the object and purpose of theaforesaid provisions are treated differentially, with one class being A

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Adeprived of the benefit of Section 69-A of the 1955 Act. A literal ortechnical interpretation, in this background, would only lead to injusticeand render the purpose of the provisions nugatory – and thus, needs tobe departed from, in favour of a purposive interpretation of the provisions.

16. It is pertinent to note that the view taken by the High Court inBthe impugned judgement has been affirmed by the High Courts in otherstates as well. Reference may be had to the decision of the KarnatakaHigh Court in Kamalamma & ors. v. Honnali Taluk AgriculturalProduce Co-operative Marketing Society Ltd., (2010) 1 AIR Kar. R279, wherein it was held as follows:

C“6. Whether the parties to a suit or appeal or any other proceedingget their dispute settled amicably through Arbitration, or meditationor conciliation in the Lok Adalath, by invoking provisions of Section89, C.P. C. or they get the same settled between themselves withoutthe intervention of any Arbitrator/Mediator/Conciliators inLokadalath etc., and without invoking the provision of Section 89,DC.P.C., the fact remains that they get their dispute settled withoutthe intervention of the Court. If they get their dispute settled byinvoking Section 89, C.P.C., in that event the State may have toincur some expenditure but, if they get their dispute settled betweenthemselves without the intervention of the Court or anyone else,Esuch as arbitrator/mediator etc., the State would not be incurringany expenditure. This being so, I am of the considered opinionthat whether the parties to a litigation get their dispute settled byinvoking Section 89, C.P.C. or they get the same settled betweenthemselves without invoking Section 89, C.P.C., the party payingCourt-Fees in respect thereof should be entitled to the refund ofFfull Court-Fees as provided under Section 16 of the Court-FeesAct, 1870.”

(emphasis supplied)

Section 16 of the Court-Fees Act, 1870 is in parimateria withGSection 69-A of the 1955 Act, and hence the above stated principles areequally applicable to the present case.

17. The holding in Kamalamma (supra) has been followed bythe Punjab & Haryana High Court in Pradeep Sonawat v. SatishPrakash, 2015 (1) RCR Civil 955 and Pritam Singh v. Ashok Kumar,2019 (1) Law Herald (P&H) 721, which in turn were further affirmed inH

Raj Kumar v. Gainda Devi through LRs & ors., 2019 SCC OnLineP&H 658.

18. The Delhi High Court has also taken a similar view in J.K.Forgings v. Essar Construction India Ltd. & Ors., (2009) 113 DRJ612:

“11. The laudable object sought to be achieved by inserting andamending these sections seems to be speedy disposal. The policybehind the statute is to reduce the No. of cases by settlement.Section 89 of C.P.C. and Section 16 Court Fee Act are welcomestep in that direction, as the No. of cases has increased, it is theduty of court to encourage settlement. In present scenario of hugependency of cases in the courts a purposive and progressiveinterpretation is the requirement of present hour.The intention ofthe Legislature is primarily to be gathered from the object and thewords used in the material provisions. The statute must beinterpreted in their plain grammatical meaning.

12. It is very clear that the Legislative intent of Section 16 ofCourt Fees Act was made broad enough to take cognizance of allsituations in which parties arrive at a settlement irrespective ofthe stage of the proceedings. It is also obvious that the purpose ofmaking this provision was in order to provide some sort of incentiveto the party who has approached the court to resolve the disputeamicably and obtain a full refund of the court fees. Having regardto this position, the present application will have to be allowed.

14. This is not a case where parties to the suit after long drawntrial have come to the court for settlement. Had it been the caseof long drawn trial non-refund of court fees could have beenjustified but in such like cases courts endeavor should be toencourage the parties and court fees attached with the plaint shouldbe refunded as an incentive to them.

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17. Settlement of dispute only through any of the mode prescribedunder section 89 of C.P.C is not sine qua non of section 89 C.P.C.rather it prescribes few methods through which settlement canbe reached, sine qua non for applicability of section 89 is settlementbetween the parties outside the court without the intervention ofthe courts.

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18. It is also not the requirement of the section that court mustalways refer the parties to Dispute Resolution Forum. If partieshave arrived at out of court settlement it should be welcomedsubject to principles of equity.

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19. Court Fees Act is a taxing statute and has to be construedBstrictly and benefit of any ambiguity if any has to go in favour ofthe party and not to the state.” (emphasis supplied)

The view taken in both Kamalamma (supra) and J.K. Forgings(supra) has been subsequently relied upon by the Delhi High Court inInderjeet Kaur Raina v. Harvinder Kaur Anand, 2018 SCC OnLineCDel 6557.

19. We find ourselves in agreement with the approach taken bythe High Courts in the decisions stated supra. The purpose of Section69-A is to reward parties who have chosen to withdraw their litigationsin favour of more conciliatory dispute settlement mechanisms, thus savingDthe time and resources of the Court, by enabling them to claim refund ofthe court fees deposited by them. Such refund of court fee, though itmay not be connected to the substance of the dispute between the parties,is certainly an ancillary economic incentive for pushing them towardsexploring alternative methods of dispute settlement. As the KarnatakaHigh Court has rightly observed in Kamalamma (supra), parties whoEhave agreed to settle their disputes without requiring judicial interventionunder Section 89, CPC are even more deserving of this benefit. This isbecause by choosing to resolve their claims themselves, they have savedthe State of the logistical hassle of arranging for a third-party institutionto settle the dispute. Though arbitration and mediation are certainlyFsalutary dispute resolution mechanisms, we also find that the importanceof private amicable negotiation between the parties cannot be understated.In our view, there is no justifiable reason why Section 69-A should onlyincentivize the methods of out-of-court settlement stated in Section 89,CPC and afford step-brotherly treatment to other methods availed of bythe parties.G

Admittedly, there may be situations wherein the parties have afterthe course of a long-drawn trial, or multiple frivolous litigations, approachedthe Court seeking refund of court fees in the guise of having settled theirdisputes. In such cases, the Court may, having regard to the previousconduct of the parties and the principles of equity, refuse to grant reliefH

under the relevant rules pertaining to court fees. However, we do notfind the present case as being of such nature.

20. Thus, even though a strict construction of the terms of Section89, CPC and 69-A of the 1955 Act may not encompass such privatenegotiations and settlements between the parties, we emphasize that theparticipants in such settlements will be entitled to the same benefits asthose who have been referred to explore alternate dispute settlementmethods under Section 89, CPC. Indeed, we find it puzzling that thePetitioner should be so vehemently opposed to granting such benefit.Though the Registry/State Government will be losing a one-time courtfee in the short term, they will be saved the expense and opportunitycost of managing an endless cycle of litigation in the long term. It istherefore in their own interest to allow the Respondent No. 1’s claim.

21. Thus, in our view, the High Court was correct in holding thatSection 89 of the CPC and Section 69-A of the 1955 Act be interpretedliberally. In view of this broad purposive construction, we affirm theHigh Court’s conclusion, and hold that Section 89 of CPC shall cover,and the benefit of Section 69-A of the 1955 Act shall also extend to, allmethods of out-of-court dispute settlement between parties that the Courtsubsequently finds to have been legally arrived at. This would, thus,cover the present controversy, wherein a private settlement was arrivedat, and a memo to withdraw the appeal was filed before the High Court.In such a case as well, the appellant, i.e., Respondent No. 1 hereinwould be entitled to refund of court fee.

Conclusions and Directions

22. These petitions are accordingly dismissed, and the impugnedjudgment of the High Court dated 8.01.2020 is upheld.

23. The petitioners are directed to refund the court fee depositedby Respondent No. 1 for Appeal Suits Nos. 876 of 2012 and 566 of2013, within a period of six weeks.

Devika Gujral

Petitions dismissed.

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