Court-fee on Section 35 appeals under the U.P. Tenancy Act, 2021 must cover accrued/ascertainable mesne profits forming part of the decretal liability
1. Introduction
In Arif Khan v. Smt Roshan Jahan (Allahabad High Court, decided on 28-07-2026), the petitioner-tenant invoked the High Court’s supervisory jurisdiction under Article 227 to challenge an order of the Rent Tribunal, Varanasi directing him to deposit additional court-fee on the entire decretal amount, including the component of mesne profits, for continuation of his appeal under Section 35 of the U.P. Regulation of Urban Premises Tenancy Act, 2021.
The landlady (respondent) had obtained a composite order from the Rent Authority under Section 21 of the Act, 2021: eviction from three shops, recovery of arrears of rent, and mesne profits at Rs. 2,000/- per day. The tenant appealed under Section 35 (and made the statutory pre-deposit), but affixed court-fee equivalent to what had been paid on the original application. The landlady objected that the appeal was deficiently stamped because the tenant had not paid ad valorem court-fee on the decretal monetary liability including mesne profits. The Tribunal upheld the objection; hence the Article 227 petition.
Key legal issue
Whether, on a true construction of Section 39 of the Act, 2021 read with the Court Fees Act, 1870, an appeal under Section 35 against a composite decree must be valued on the “subject-matter in dispute in appeal” (including accrued/ascertainable mesne profits), or whether the court-fee in appeal is confined to the court-fee paid on the original application before the Rent Authority.
2. Summary of the Judgment
The High Court dismissed the petition and upheld the Tribunal’s direction. It held that:
- Section 39(1) applies the Court Fees Act, 1870 to applications and appeals under the Act, 2021.
- Section 39(2) creates a limited deeming fiction (treating the application and the memorandum of appeal as “suits” between landlord and tenant) only for computation of court-fee; it does not freeze appellate court-fee at the level paid on the original application.
- Consequently, the memorandum of appeal must be valued with reference to the “subject-matter in dispute in appeal”.
- Where the appellant challenges a composite decree and seeks to displace monetary liability, the appeal must carry court-fee on the decretal liability to the extent it is challenged, including mesne profits that have accrued or are capable of precise arithmetical ascertainment as on the date of appeal.
- No jurisdictional error or perversity was shown to justify interference under Article 227.
3. Analysis
3.1 Statutory scheme and the court’s construction of Section 39
The court treated Section 39 as an incorporation of the Court Fees Act into the special rent adjudication framework, with targeted modifications:
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Section 39(1) is the gateway: it squarely attracts the Court Fees Act, 1870 to both original proceedings and appeals under the Act, 2021.
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Section 39(2) is a limited statutory fiction: it deems the specified proceedings to be “suits” only for computation of court-fee, ensuring that the Court Fees Act can operate appropriately in a tribunal-based rent regime.
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The fiction cannot be enlarged to mean that court-fee in appeal must always equal court-fee paid at institution. Once the appeal is brought under the Court Fees Act regime, computation follows the Act’s established valuation principles—especially the principle that court-fee on appeal is tied to what is actually in dispute in appeal.
3.2 Precedents cited and their role
The High Court treated State of Maharashtra v. Mishrilal Tarachand Lodha as the anchor for the meaning of “subject-matter in dispute in appeal”. It extracted the controlling idea that appellate valuation turns on what the appellant actually challenges and what requires adjudication in appeal. The petitioner relied on it to argue exclusion of certain decree components; the court clarified that the precedent excludes items like pendente lite interest/costs only when not challenged, and it does not create a blanket rule that monetary components (including mesne profits) are never part of appellate valuation.
(B) Shivaji v. Deoji; Ratnamma v. Karthiyani Pillai
The petitioner relied on Shivaji v. Deoji and Ratnamma v. Karthiyani Pillai to contend that mesne profits—being uncertain—do not attract separate court-fee at the appellate stage. The High Court accepted the general distinction underlying these authorities but confined their relevance to future/unascertained mesne profits. It held they cannot be “mechanically extended” where the decree has already created a monetary liability that has accrued or become arithmetically ascertainable and is being challenged.
(C) In re Kudappa Subbamma
The respondent relied on In re Kudappa Subbamma to support the proposition that once the court determines the rate/period or otherwise crystallises mesne profits into an ascertainable obligation, that component attracts ad valorem court-fee when challenged in appeal. The High Court used it to reinforce the turning point: uncertainty at institution is not the same as crystallisation by decree, and court-fee consequences can change once the liability becomes ascertainable.
The Full Bench decision in Ragho Prasad v. B. Pratap Narain Agrawal was used to negate the petitioner’s “same-fee-as-institution” theory. The High Court drew from it the broader appellate principle: valuation of an appeal is related to the relief sought against the decree, and an appellant seeking to avoid an ascertained money liability must value accordingly.
While the petitioner attempted to distinguish Alok Kumar Jain v. Indra Bhushan Sawhney, the High Court used it to support the interpretive approach that Sections 39 (and, where needed, 42) reflect a self-contained scheme in the sense of specifying how the Court Fees Act applies within the special statute—without displacing core valuation principles of the Court Fees Act regarding appeals.
(F) “Gopalakrishna Pillai” (as discussed by the Court)
The judgment also referred to Gopalakrishna Pillai (in the context of future mesne profits) to underline why future mesne profits can be incapable of present valuation at institution. The High Court distinguished that line of reasoning from a situation where the decree fixes a rate and liability becomes accrued/arithmetically ascertainable as on the appellate date.
3.3 Legal reasoning (ratio decidendi)
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Appeal court-fee is an independent statutory obligation: compliance with the proviso to Section 35 (50% pre-deposit of “entire payable amount”) does not substitute for or dilute proper stamping under Section 39.
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Section 39(2)’s deeming fiction is limited: it is “exhausted” once it brings the appeal within the Court Fees Act framework; it cannot be expanded to equate the appeal’s court-fee with the original application’s court-fee.
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Valuation is governed by “subject-matter in dispute in appeal”: if the appellant challenges a composite decree in entirety, the subject-matter encompasses the decretal burdens he seeks to displace.
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Mesne profits—future vs accrued/ascertainable: while future or indeterminate mesne profits may not be immediately fee-bearing, the position changes when (to the extent) mesne profits have accrued or can be computed arithmetically at the time of appeal and are specifically within the challenge.
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Article 227 restraint: where the Tribunal’s view is consistent with statute and settled valuation principles, the High Court will not interfere merely because an alternate view is arguable; it looks for jurisdictional error, perversity, or manifest illegality.
3.4 Impact and significance
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Clarifies appellate court-fee practice under the Act, 2021: litigants and Rent Tribunals now have a clear rule—appeals under Section 35 must be valued on the disputed decretal liability, not automatically on the original Form-7 application fee.
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Mesne profits treatment is nuanced: the court draws a workable line—only mesne profits that are accrued or arithmetically ascertainable as of the appeal date, and are part of what is challenged, are included for valuation.
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Discourages under-stamped “composite challenges”: appellants cannot challenge eviction plus monetary burdens while paying only the nominal/initial fee structure applicable at institution.
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Operational consequence: Rent Tribunals are justified in requiring deficit court-fee to be made good (rather than rejecting at the threshold) and may treat it as a curable defect, aligning procedural discipline with access to appeal.
4. Complex concepts simplified
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Mesne profits: compensation payable for wrongful possession of property—i.e., what the occupier actually earned or could have earned with reasonable diligence, plus interest (Section 2(12), CPC). In simple terms, it is “rent-like compensation” for staying on after the right to occupy has ended.
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Accrued vs future mesne profits:
- Accrued/ascertainable: amounts up to a known date, or computable from a fixed rate × known period; these can be valued.
- Future/unascertained: amounts dependent on unknown future events (e.g., when possession will actually be delivered); these are harder to value upfront.
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“Subject-matter in dispute in appeal”: the part of the decree the appellant actually asks the appellate forum to change. If you challenge the entire decree, the dispute generally covers the whole liability.
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Statutory fiction (deeming provision): the law pretends something is true for a limited purpose (here, treating an application/appeal as a “suit” only to compute court-fee). It cannot be used beyond that purpose.
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Article 227: a supervisory power to keep tribunals within jurisdiction and legality; it is not a routine appellate re-hearing on merits.
5. Conclusion
The decision establishes that under the U.P. Regulation of Urban Premises Tenancy Act, 2021, an appeal under Section 35 challenging a composite rent decree must be stamped based on the subject-matter in dispute in appeal in accordance with the Court Fees Act, 1870. Crucially, mesne profits are included in the appeal’s valuation to the extent they represent an existing decretal liability that has accrued or become capable of precise arithmetical ascertainment as on the date of appeal and are part of the challenge. Section 39(2)’s deeming of proceedings as “suits” is a computational device—not a rule freezing appellate court-fee at the level paid at institution.