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Refund of Court Fees on Withdrawal of suit after IBC settlement

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Judgment dated 1.6.2026 of the High Court of Delhi in CS (COMM) No.474 of 2019 of Sainik Industries Pvt Ltd Vs.  Indian Sugar Manufacturing Company Limited

Court Fees Refund on withdrawal of suit for IBC Settlement

Refund of Court Fees on Withdrawal of suit after IBC settlement

Encouraging Settlement of Disputes

The plaintiff filed the suit for recovery of Rs.19,55,30,723/- with interest.

In the meanwhile, the plaintiff submits its claims before Insolvency Resolution Professional in the IBC proceedings.   The said claims were accepted and the plaintiff was paid the amount.

In that context, the plaintiff filed application for withdrawal of the suit and the refund of court fees.

“16. Refund of fee.- Where the Court refers the parties to the suit to anyone of the mode of settlement of dispute referred to in section 89 of the Code of Civil Procedure, 1908 (5 of 1908), the plaintiff shall be entitled to a certificate from the Court authorising him to receive back from the collector, the full amount of paid in respect of such plaint.”

The Apex Court is of the opinion that any kind of settlement by which the Plaintiff agrees to bring quietus to the dispute comes within the four corners of Section 16 of the Court Fees Act and that one cannot distinguish cases on the mode of settlement.

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