2016 (10) TMI 152 - SC - Indian Laws

Court fees and valuation of suits - Levy of additional court fee in respect of each appeal or revision at the rate of 0.5% of the amount involved in the dispute in cases where it is capable of valuation, and at the rate of ₹ 50 in other cases - Held that - The argument of the appellants ignores that as per Section 76(3) of the CF Act, one of the purposes for which the Fund is to be utilised is for providing efficient legal services for the people of the State. It clearly amounts to quid pro quo. Other purpose is also for the benefit of the public at large. When we talk of sound and stable system of administration of justice, all the stakeholders in the said legal system need to be taken care of. Legal community and advocates are inseparable and important part of robust legal system and they not only aid in seeking access to justice but also promote justice. Judges cannot perform their task of dispensing justice effectively without the able support of advocates. In that sense, advocates play an important role in the administration of justice. It is wisely said that for any society governed by Rule of Law, effective judicial system is a necessary concomitant. The Rule of Law reflects man s sense of order and justice. There can be no Government without order; there can be no order without law; and there can be no administration of law without lawyers. It is no small service to be called upon to prosecute and enforce the rights of a litigant through the court of law and in that sense the legal profession is treated as service to the justice seekers. It is, therefore, by contributing an essential aid to the process of the administration of justice that the advocate discharges a public duty of the highest utility. When the subject matter of the instant cases is examined in the aforesaid hue, it becomes apparent that providing social security to the legal profession becomes an essential part of any legal system which has to be effective, efficient and robust to enable it to provide necessary service to the consumers of justice. Section 76 of the CF Act and the impugned notification vide which additional court fee is imposed have a direct nexus to the objective sought to be achieved in relation to the service available to the appellants or others who approached the courts/tribunals for redressal of their grievances.

Summary

Issues Involved:
1. Validity of S.R.O. No. 226 of 2002 issued under Section 76(1) of the Kerala Court Fees and Suits Valuation Act, 1959.
2. Nature of the additional court fee as a compulsory exaction/tax.
3. Presence of quid pro quo in the levy of additional court fee.

Issue-wise Detailed Analysis:

1. Validity of S.R.O. No. 226 of 2002:
The appellants, registered dealers under the Kerala General Sales Tax Act, 1963, and/or the Kerala Value Added Tax Act, 2003, challenged the vires of S.R.O. No. 226 of 2002 issued by the Government of Kerala. This notification authorized tribunals and appellate authorities under special or local laws to levy an additional court fee at the rate of 0.5% of the amount involved in the dispute or ?50 in other cases. The High Court upheld the validity of the notification, following its earlier judgment in Chackolas Spinning & Weaving Mills Ltd. v. State of Kerala. The Supreme Court noted that Section 76 of the CF Act empowers the State Government to levy an additional court fee and that the notification was intra vires the provision of Section 76 of the CF Act.

2. Nature of the Additional Court Fee as a Compulsory Exaction/Tax:
The appellants contended that the levy was a compulsory exaction/tax without any element of service or quid pro quo. They argued that the additional court fee did not benefit the litigants but was used for the benefit of advocates, making it a tax rather than a fee. The Supreme Court disagreed, stating that Section 76(3) of the CF Act specifies that the Fund is to be utilized for providing efficient legal services for the people of the State, which constitutes a quid pro quo. The court emphasized that a sound and stable system of administration of justice involves all stakeholders, including the legal community and advocates, who play an essential role in promoting justice.

3. Presence of Quid Pro Quo in the Levy of Additional Court Fee:
The appellants argued that the additional court fee lacked quid pro quo as it did not provide any direct benefit to the litigants. The Supreme Court rejected this argument, highlighting that the legal profession is an integral part of the judicial system and that providing social security to the legal profession is essential for an effective legal system. The court noted that the administration of justice, as per Article 39A of the Constitution, involves providing equal justice and free legal aid, which justifies the levy of additional court fees to support the legal profession and ensure efficient legal services.

Conclusion:
The Supreme Court found no merit in the appeal and the writ petitions, affirming the validity of the notification and the levy of additional court fees. The court emphasized the importance of a robust legal system and the essential role of advocates in the administration of justice, thereby justifying the levy as a fee with a direct nexus to the service provided to litigants. The appeal and writ petitions were accordingly dismissed.