Full Judgment
King, J.
1. This is a reference under Section 5, Court-fees Act, 1870. The suit was for recovery of Rs. 37,246 from the Agra United Mills Ltd., and from certain debenture holders of that Company, and for a declaration that the amount is recoverable in priority over the debentures in favour of defendants 2 to 7. The debenture holders have appealed to the High Court to modify the decision of the trial Court by refusing the declaration that the plaintiff's claim has priority over the debentures. The appeal is valued at Rupees 37,346 and a court-fee of Rs. 10 only has been paid. The question is, what is the proper court-fee payable on the memorandum of appeal? The stamp Reporter contends that an ad valorem fee on Rs. 37,246 amounting to Rupees 1,055 is payable. The appellants' learned advocate contends that the appeal challenges nothing more than the declaratory portion of the trial Court's decree and the court-fee is governed by Article 17(3), Schedule 2.
2. In my opinion, Article 17(3) has no application to the facts of this case. That provision applies to a memoramdum of appeal in, a suit 'to obtain a declaratory decree where no consequential relief is prayed. 'The present suit was of a very different nature. It was primarily a suit for money. It is true that a declaration was also prayed for, as a further relief but the suit was obviously not for a mere declaration without concequential relief, so Article 17(3) cannot apply. Moreover, the relief claimed in this appeal is not a mere declaration but a modification of the trial Court decree, which is a substantial relief. The appellants rely upon Chunia v. Ram Dial [1876] 1 All 360. Moti Singh v. Kaun silla [1894] 16 All 301, Bangala Sundari Debi v. Prosanna Nath Makerjee [1917] 35 IC 797. and Shrimant Sagajirao v. Smith [1896] 20 Bom 736., but they are quite beside the point. They refer to the court-fee payable on the plaint in a suit which is held to be for a declaration pure and simple. Nukho Tewari v. Kishun Prasad Pandey AIR 1924 Pat 582 is also cited. The suit was for a declaration and for consequential relief in the form of a temporary injunction pending the disposal of the suit. A decree was granted for the declaration only. The court-fee on the defendants' appeal against this declaratory decree was held to be governed by Article 17, Schedule II. as the temporary injunction was granted at an early stage of the suit and thereafter the suit was reduced into a mere suit for a declaration and it was tried as such. This ruling therefore is also clearly distinguishable upon the facts.
3. As Article 17(3) does not apply, and there is no suggestion that the memo-randam of appeal is otherwise specially provided for, I think it follows that the court-fee is payable ad valorem under Schedule I, Article 1, upon the amount or value of the subject matter in dispute in the appeal. The appellant seeks to establish the priority of their debentures. In other words, they seek to exonerate the property which is security for their debentures (to the extent of the value of their debentures) from liability to satisfy the decretal debt. I think the court fee is payable ad valorem on the decretal debt, or on the value of their debentures, whichever is less. This conclusion is supported by la decision of this Court in Moti Begam v. Har Prasad [1918] 47 IC 311. That was a suit for sale upon a mortgage and one of the defendants Moti Begam, claimed priority for a mortgage executed in her favour to secure her dower debt. The Court held that the plaintiff's mortgage was prior in date. Mst. Moti Begam appealed for a declaration that she had a prior charge for the amount of her dower debt and that the property could only be sold subject to her prior charge. The facts are therefore similar to those of the present case. The Taxing Judge repelled the contention that the court fee was payable as in a suit for a mere declaration, and held that it was payable on the amount of the. prior charge.
4. I am also supported by the following decisions of other High Courts Venkappa v. Narasimha [1887] 10 Mad 187, Kesavarapu Ramkrishna Reddi v. Kotta Kota Reddi [1907] 30 Mad 96, Jugal Pershad Singh v. Parbhu Narain Jha [1910] 37 Cal 914 and Premsukh Das v. Shah Gopi Saran AIR 1919 Pat. 233. The Madras Full Bench decision lays down that where the appellant in an appeal against a mortgage decree does not dispute the liability of certain properties for the decretal amount, then the court fee is payable on the value of the proporties, or on the decretal amount, which ever is less. The other rulings are consistent with this view and I think the same principles are applicable to the present case. I therefore hold that the court fee is payable ad valorem on the decretal amount, or on the value of the debentures, whichever is less.