In India, the delivery justice system is very slow as compared to some other big
countries due to the huge amount of population which is directly related to an
increase in the number of cases in a court as well as less trust of people in
Alternative Dispute Resolution System. The immense amount of case pendency in
Indian Courts and costly legal assistance is a major factor as to why litigation
is not a viable option in the present scenario.
The Code of Civil Procedure,
1908, has a solution to this issue for civil lawsuits under the Sections 34,
35,35A and 35B of CPC which offer redress for the winning party in consideration
of substantial reimbursement incurred for the maintenance of the costs of
Everyone who has seen or drafted a plaint or some kind of an application or a
petition in Civil Practice would have observed that there is always a prayer
seeking the court to award "costs to the suit". This has become a format and is
a widely used term but many people do not know where the concept of costs is
dealt with and under which statute. Costs in a civil suit are not to be confused
with compensation or damages claimed by a party as the two are completely
different concepts which will be explained further in this article.
To begin with, the meaning of costs under legal terminology, Costs are
monetary/pecuniary allowance that is granted by the court to a successful party
in a civil suit towards expenses incurred by such person in prosecuting or
defending the suit. Costs in a civil suit are dealt with under Sections 35, 35A,
35B of the Civil Procedure Code ('CPC') along with Order XXA of CPC. Under these
sections' costs are imposed for different reasons like general costs to the
successful party, compensatory costs against false and vexatious claims, costs
for causing delay, costs for miscellaneous expenses like serving notice, typing
Objectives of the study
We will see the types of costs under CPC and understand when a court can impose
costs on a party. Further, there will be an analysis on the jurisdiction of High
Courts in imposing costs under CPC in the light of the recent judgements.
It becomes important for any court to impose a cost in an effective and
efficient manner to make litigation more successful, trustworthy and rapid. The
number of cases in India is increasing every day and the Indian Courts are
burdened by them. Average litigation in subordinate courts takes around 6 years
for a civil case to get to a decision, therefore some people take advantage
of it to trouble the opposite party or enemies.
It becomes very easy for a party
to file a frivolous and vexatious suit in court due to the inefficiency of the
court to impose proper and adequate costs on the party making false claims and
wasting the precious time of the court. There are various other threats and
problems that have been identified in the 240th Law Commission Report which
afflict the costs provision under the CPC which majorly revolves around these
three principles below:
- The cost doesn't generally follow the event.
- The cost awarded is very different from the actual realistic cost.
- The current cost imposed doesn't curb frivolous and vexatious
- When and why is the cost imposed?
My study is based on "DOCTRINAL METHOD." This undertaking is primarily based
on studies methodology. The resource materials are secondary. I have used
secondary assets like books, articles, and journals, and Internet-based
Why do costs need to be imposed?
It is a well-known fact that Civil Litigation in India is an arduous and lengthy
process that takes years for a single case to get resolved. To add fuel to the
fire, there are a huge number of civil suits which are false and vexatious being
filed every year which is leading to crores of pending cases and an extreme
workload on judges.
The concept of imposing costs is to deter litigants from indulging in filing
false and vexatious cases and cause unnecessary delay by using dilatory tactics
like taking unnecessary adjournments etc. The intention of legislators in
providing provisions for costs in CPC is firstly, to indemnify the successful
party to the suit by awarding them legal expenses in prosecuting or defending
the suit. Secondly, to deter the litigants from filing false and bogus cases.
Thirdly, to deter the litigants from causing unnecessary delays.
Existing framework and types of costs under CPC
Provisions regarding imposing costs in civil litigation are enshrined under
Sections 35, 35A, 35B and Order XXA of the CPC. The CPC provides for different
types of costs under the above sections namely general costs, compensatory
costs, costs for causing delay and miscellaneous costs.
General Costs are dealt with under Section 35 of the CPC. This section states
that costs can be granted to any party to the suit by the courts under their own
discretion. If costs are not granted then the courts need to give reasons for
doing so. Costs under this provision are not granted to a successful party to
make profit out of them or as a punishment for losing the party. The main
objective of this section is to award costs to the successful party to a suit
against the expenses he might have incurred for prosecuting or defending the
Compensatory Costs are dealt with under Section 35A of CPC. This section is an
exception to the principle of general costs which is to indemnify the successful
party. The objective of this section is to deter the false and vexatious cases
being filed by the litigants by imposing costs to compensate the other party who
has suffered from such false litigation. If the judge is satisfied that the suit
is false and vexatious then compensatory costs with a maximum amount of
Rs.3000/- can be granted to the victim.
Costs for causing delay are dealt with under Section 35B of CPC. The objective
of this section is to deter the parties to the suit to employ delaying tactics.
The court can order costs against a party trying to unnecessarily delay the
progress of the suit causing a delay in resolution of the matter.
Miscellaneous Costs are provided under Order XXA of the CPC. Under this Order,
specific provisions are made giving power to the court to grant costs with
respect to miscellaneous expenses like serving notices, typing and printing
charges, production of witnesses etc.
It is to be noted that if costs are awarded against a party to a civil suit, it
does not mean that he is exempt from any other criminal or civil liability. If a
person is found filing a false case, then the victim can file a fresh suit for
damages and also criminally prosecute such person even if costs are granted
against such person for filing a false and vexatious case.
Difference between costs in a civil suit under CPC and writ proceedings/public
The main difference between the costs under CPC and costs in writ proceedings is
the maximum limit of the number of costs. Under CPC there is a limit of
Rs.3000/- for compensatory costs for false and vexatious cases and other
limitations based on the rules framed by respective high courts of each state.
Whereas, under writ proceedings and public interest litigations if they are
found to be false and vexatious then the High Courts' have the power to order
exemplary costs and there is no limit. There are many examples of false or
politically motivated public interest litigations where courts have imposed
exemplary costs ranging from a few thousand to a few lakhs.
Juhi Chawla's Case
Juhi Chawla has filed a civil suit before the Delhi High Court against the roll
out of 5G communication technology in India on the grounds of long-term and
short-term harm to human, animal and plant life and detrimental impact on the
environment at large.
Delhi High Court has imposed a cost of Rs.20,00,000/- (Twenty Lakh Rupees)
against the famous film actress Juhi Chawla in the month of June, 2021. This
case became quite viral when Juhi Chawla has knowingly or unknowingly shared the
meeting link related to the hearing of the case to the public through her social
media handle and to add fuel to the fire random strangers have interrupted the
court hearings many times and one of them even sung a song from one of Juhi
Chawla's movies. The court observed that this is a case filed for all wrong
reasons and for publicity by the actress and valuable judicial time of this
Court has been wasted due to the public sharing of meeting links by her.
As the case stands thus, the question that arises is whether the High Court has
the power to impose exemplary costs under CPC when there is a statutory
limitation to awarding costs under CPC. This will be analysed in the next
section of this article.
Analysis on High Courts' power to impose costs under CPC
Firstly, not all High Courts in India have ordinary original civil jurisdiction
and hence civil suits cannot be filed directly in those High Courts. Only Delhi,
Bombay, Calcutta, Madras and Himachal Pradesh High Courts have ordinary original
civil jurisdiction in India. Hence, civil suits can be filed directly only in
these 5 High Courts and all other High Courts only have appellate jurisdiction
when it comes to civil suits.
As discussed in the earlier parts of this article, the concept of costs is
provided under CPC and there is a limitation on the amount of money that can be
imposed as costs for false or vexatious suits filed by a party. The maximum
amount that can be awarded as costs for a false and vexatious suit is Rs.3000/-
as per Section 35A of CPC.
It is well within the power of the High Court to dismiss the suit for lack of
enough court fee or other defects and as a false and vexatious suit and impose
costs in tune of Rs.3000/- but imposing anything above that is nothing but
judicial overreach. It is pertinent to observe that the High Court cannot take
the aid of Article 226 when it is working with CPC under its ordinary original
civil jurisdiction and hence it has to abide by the provisions of CPC.
The current case of Juhi Chawla is a clear example of the Delhi High Court not
abiding by the provisions of CPC in imposing the costs. In a civil suit filed
under CPC, High Courts have very limited power to impose costs and the same has
also been reiterated by the Hon'ble Supreme Court time and again in many of its
judgements. "Ashok Kumar Mittal v. Ram Kumar Gupta & Anr" is one such case where
Delhi High Court has imposed a cost of 1 Lakh rupees each on Plaintiff and
Defendant for lying on oath.
The Supreme Court has observed that while dealing
with civil suits under CPC High Courts need to abide by the limit set under
Section 35A of CPC. Further, the Supreme Court has once again reiterated the
ration in Ashok Mittal judgement in the case of "Sanjeev Kumar Jain v. Raghubir
Saran Charitable Trust
" where a whopping 45 Lakh rupees was imposed as costs by
the Delhi High Court.
In this case, the Supreme Court has while setting aside the order related to
costs, has strongly observed that the High Court cannot impose exemplary costs
in a civil suit ignoring the limit of Rs.3000/- set in the CPC and further
ordered the respondent to only pay Rs.3000/- as costs. Again, in the case of "Vinod Seth v. Devinder Bajaj
", the Supreme Court
once again reiterated that the High Court needs to follow the statutory limit
provided under CPC in awarding costs.
The Supreme Court in this case has also observed that if a suit is governed by
CPC, then no court can, merely because it considers it just and equitable, issue
directions which are contrary to or not authorized by law.
Supreme Court's Suggestions and 240th Law Commission Report 2012
The Supreme Court of India on one hand is doing its job by not allowing the High
Courts to exceed their powers beyond what is provided in the CPC while on the
other hand, it kept on suggesting in numerous judgements that there should be
change in the maximum limit of costs under CPC on a regular basis and that the
present system is outdated and it is not deterring the false and vexatious suits
or providing enough for expenses of the successful litigant prosecuting or
defending the suit.
The Supreme Court has proposed that:
- the upper limit under CPC be increased from the Rs.3000/- to at
least Rs.1,00,000/- to effectively deter litigants from instituting
false/vexatious suits and
- instead of awarding nominal costs, actual realistic costs be imposed,
i.e., costs that are practical and costs that a normal advocate in a normal
case of a particular nature would charge.
The Law Commission of India in its 240th Report headed by Justice (Retd.)
P.V.Reddy has endorsed the suggestions made by the Supreme Court regarding an
increase in the upper limit to costs along with many other necessary changes to
the current costs regime under the CPC, but till date, there has been no
legislative action on these suggestions by the lawmakers.
It is pretty clear that India needs a big-time revamp in the costs regime under
CPC and there is no arguing otherwise. The current regime is way outdated as the
last amendment was made in the 1970s and the value of money has increased a lot
since then. The Legislature needs to take the suggestions by the Supreme Court
as well as the 240th Law Commission Report and make necessary changes to the
costs regime under CPC and make it more up to date and robust.
Further, it is to be noted by the Legislature that while making the changes,
aspects like court fees, advocates fees, duration of the proceedings and
appropriate restitution for the successful litigant need to be considered. In
absence of the necessary reforms the hands of courts are tied and the judges are
powerless to dissuade/deter the false and frivolous litigation as the costs
under the current regime are nominal.
Nevertheless, the trend that is being followed by courts more importantly by the
High Courts with ordinary original civil jurisdiction by awarding exemplary
costs by going beyond the Rs.3,000/- ceiling set in the CPC is not a good trend.
Yes, it is just and equitable but at the same time it is judicial overreach and
it sets bad precedents.
This has been explained beautifully by the Supreme Court in Vinod Seth v.
where the apex court has quoted Benjamin N. Cordozo:
"The Judge, even when he is free, is still not wholly free. He is not to
innovate at pleasure. He is not a knight-errant roaming at will in pursuit of
his own ideal of beauty or of goodness. He is to draw his inspiration from
He is not to yield to spasmodic sentiment, to vague and unregulated benevolence.
He is to exercise a discretion informed by tradition, methodized by analogy,
disciplined by system, and subordinated to "the primordial necessity of order in
And observed that Judges can innovate, to discipline those whom it considers to
be adventurers in litigation, but it has to do so within the four corners of the
law. The Apex Court has further observed that "Hard Cases Make Bad Law" and
quoted the dissenting opinion of Justice Holmes in Northern Securities Co. v.
United States 193 (1903) US 197 that, A lawsuit involving equities that tempt a
judge to stretch or even disregard a principle of law at issue but a Judge
should not give in and take moral high ground.
Finally, I would like to conclude by stating that orders like the one in Juhi
Chawla's case by Delhi High Court, even if it has done for good purpose to deter
the false and vexatious litigation, may lead to the public gradually losing
faith in the judiciary and start seeking extra-judicial remedies like seeking
the help of goons/mafia or police to settle their claims which will lead to
break-down of rule of law. Hence, no order or direction of the High Court, even
if it is intended to deter false and frivolous litigation, should lead to
obstruction of access to courts and needs to be within the four corners of rule
- Harish Narasappa, The long, expensive road to justice India Today
(last visited Sep 25, 2020).
- Law Commission of India, Report no. 253 on Commercial Division and
Commercial Appellate Division of High Courts and Commercial Courts Bill,