Costs under Civil Procedure Code

The Civil Procedure Code of India lays down the rules and regulations governing the procedures in civil litigation. Among these rules, the provisions related to costs under Civil Procedure Code play an important role in ensuring fair litigation practices. The CPC provides for four kinds of costs: General costs (Section 35), Miscellaneous costs (Order 20A), Compensatory costs for false or vexatious claims or defences (Section 35A) and Costs for causing delay (Section 35B).

General Costs under Civil Procedure Code: Section 35 of Civil Procedure Code

Section 35 of the CPC deals with general costs, which are awarded to litigants to cover the expenses incurred during litigation. The primary objective of awarding costs under this section is to ensure that the successful party is compensated for the legal expenses they have borne.

Principles Governing General Costs Civil Procedure Code

1. Discretion of the Court: The award of general costs is at the discretion of the court. However, this discretion must be exercised judiciously, based on sound legal principles, rather than capriciously or arbitrarily.
2. Costs Follow the Event: Typically, costs should follow the event, meaning that the successful party is entitled to costs. This principle ensures that the winning party is not financially burdened by the litigation. However, the court may deviate from this rule if there are valid reasons.
3. Recording Reasons: If the court decides that costs should not follow the event, it must record the reasons for such a decision as per sub-section (2) of Section 35. This provision ensures transparency and accountability in the awarding of costs.

Miscellaneous Costs under Civil Procedure Code: Order 20A

Order 20A of the CPC specifically addresses the power of the court to award costs for certain expenses incurred during litigation. These expenses include:

• Giving notices
• Typing charges
• Inspection of records
• Producing witnesses
• Obtaining copies

The inclusion of miscellaneous costs under Order 20A aims to cover specific, often overlooked, expenses that parties incur in the process of litigation. By doing so, the CPC ensures that parties are adequately compensated for all legitimate expenses.

Compensatory Costs under Civil Procedure Code: Section 35A

Section 35A provides for compensatory costs, which serve as an exception to the general rule of costs under Section 35. This section is designed to address situations where Section 35 does not offer sufficient compensation, particularly in cases involving false or vexatious claims or defences.

Conditions for Awarding Compensatory Costs

For Section 35A to apply, the following conditions must be met:

1. False or Vexatious Claim/Defense: The claim or defence must be false or vexatious, brought with malicious intent.
2. Objection by the Other Party: The other party must have raised an objection that the claim or defence was false or vexatious, to the knowledge of the party raising it.
3. Disallowed, Withdrawn or Abandoned Claim: The claim must have been disallowed, withdrawn or abandoned, either in whole or in part.

The maximum amount that can be awarded under Section 35A is Rs. 3,000. It is important to note that this section applies only to suits, not to appeals or revisions. This provision empowers the court to impose compensatory costs on parties who misuse the legal process for vexatious purposes.

Costs for Causing Delay: Section 35B

Section 35B addresses costs for causing delays during litigation. This section empowers the court to impose costs on parties who cause unnecessary delays at any stage of the litigation process, regardless of the ultimate outcome of the case.

Grounds for Awarding Costs for Delay

Costs for causing delay may be awarded under the following circumstances:

1. Failure to Take Required Steps: If a party fails to take a step required by or under the code on a specified date.
2. Obtaining Adjournments: If a party obtains an adjournment for taking such a step or for producing evidence or on any other ground.

In such cases, the court may order the party responsible for the delay to pay costs to the other party. This provision ensures that the litigation process is not unduly prolonged and that parties act diligently and in good faith.

Analysis and Implications of Costs under Civil Procedure Code

The provisions related to costs under the CPC are important for several reasons. Firstly, they act as a deterrent against frivolous and vexatious litigation. By imposing financial consequences on parties who engage in such practices, the CPC discourages misuse of the legal system. Secondly, the provisions ensure that the successful party is not unduly burdened by the costs of litigation. This promotes fairness and equity in the legal process.

The discretion granted to the courts in awarding costs ensures that each case is assessed on its merits. However, the requirement for courts to record reasons for deviating from the principle that costs follow the event adds a layer of accountability. This transparency helps maintain trust in the judicial process.

The inclusion of miscellaneous costs under Order 20A ensures that parties are compensated for all legitimate expenses, not just the major ones. This comprehensive approach to awarding costs reflects a nuanced understanding of the various expenses involved in litigation.

Section 35A’s provision for compensatory costs addresses a significant gap by providing a remedy in cases where the general rule does not offer sufficient compensation. This section is particularly important in addressing malicious litigation practices.

Finally, Section 35B’s provision for costs for causing delay underscores the importance of timely and efficient litigation. By imposing costs on parties who cause unnecessary delays, the CPC promotes the swift resolution of cases, benefiting both the parties involved and the judicial system as a whole.

Conclusion

The provisions related to costs under the CPC play a vital role in the Indian legal system. They ensure that litigation is conducted fairly, that parties are compensated for their legitimate expenses and that the legal process is not misused. By providing mechanisms to address false or vexatious claims, compensate for specific litigation expenses and penalise delays, the CPC fosters a just and efficient legal system.