'Costs' under S. 35 B of the Code of Civil Procedure : Consequences of Failure to Pay

Justice Raveendran

The Supreme Court in Manohar Singh vs D.S. Sharma & Anr. has examined the scope and ambit of S. 35B of the Code of Civil Procedure, 1908. While examining the nature of the provision, the court has considered whether non-payment of costs by a defaulting party could lead to dismissal of a suit? While negativing the aforesaid question, the Supreme Court has held as under;

4. The appellants contended that having regard to the provisions of section 35B of CPC, if costs levied on plaintiff are not paid, the court can only stop further prosecution of the suit by the plaintiff. It is submitted that section 35B does not confer power to dismiss the suit for non- payment of costs. Learned counsel for the second respondent, on the other hand, supported the judgment of the trial court, as affirmed by the High Court.

5. Section 35B of CPC deals with costs for causing delay. Relevant portion of the said section extracted below :

"35B. Costs for causing delay. - (1) If, on any date fixed for the hearing of a suit or for taking any step therein, a party to the suit-- 

(a) fails to take the step which he was required by or under this Code to take on that date, or

(b) obtains an adjournment for taking such step or for producing evidence or on any other ground, the Court may, for reasons to be recorded, make an order requiring such party to pay to the other party such costs as would, in the opinion of the Court, be reasonably sufficient to reimburse the other party in respect of the expenses incurred by him in attending the Court on that date, and payment of such costs, on the date next following the date of such order, shall be a condition precedent to the further prosecution of-- 

(a) the suit by the plaintiff, where the plaintiff was ordered to pay such costs,

(b) the defence by the defendant, where the defendant was ordered to pay such costs.

xxxxxxx xxxxxxx"

Section 35B provides that if costs are levied on the plaintiff for causing delay, payment of such costs on the next hearing date, shall be a condition precedent to the further prosecution of the suit by the plaintiff. Similarly, if costs are levied on the defendant for causing delay, payment of such costs on the next date of hearing, shall be a condition precedent to the further prosecution of the defence of the suit by the defendant. This takes us to the meaning of the words "further prosecution of the suit" and "further prosecution of the defence". If the Legislature intended that the suit should be dismissed in the event of non-payment of costs by plaintiff, or that the defence should be struck off and suit should be decreed in the event of non-payment of costs by the defendant, the Legislature would have said so. On the other hand, Legislature stated in the rule that payment of costs on the next date shall be a condition precedent to the further prosecution of the suit by plaintiff (where the plaintiff was ordered to pay such costs), and a condition precedent to the further prosecution of the defence by the defendant (where the defendant was ordered to pay such costs). This would mean that if the costs levied were not paid by the party on whom it is levied, such defaulting party is prohibited from any further participation in the suit. In other words, he ceases to have any further right to participate in the suit and he will not be permitted to let in any further evidence or address arguments. The other party will of course be permitted to place his evidence and address arguments, and the court will then decide the matter in accordance with law. We therefore reject the contention of the respondents that section 35B contemplates or requires dismissal of the suit as an automatic consequence of non-payment of costs by plaintiff.

6. We may also refer to an incidental issue. When section 35B states that payment of such costs on the date next following the date of the order shall be a condition precedent for further prosecution, it clearly indicates that when the costs are levied, it should be paid on the next date of hearing and if it is not paid, the consequences mentioned therein shall follow. But the said provision will not come in the way of the court, in its discretion extending the time for such payment, in exercise of its general power to extend time under section 148 of CPC. Having regard to the scheme and object of section 35B, it is needless to say that such extension can be only in exceptional circumstances and by subjecting the defaulting party to further terms. No party can routinely be given extension of time for payment of costs, having regard to the fact that such costs under section 35B were itself levied for causing delay.

7. We may also refer to the provisions of Rule 1 of Order XVII of CPC which deals with grant of time and adjournments. The said provision is extracted below :

"1. Court may grant time and adjourn hearing.--(1) The Court may, if sufficient cause is shown, at any stage of the suit, grant time to the parties or to any of them, and may from time to time adjourn the hearing of the suit for reasons to be recorded in writing: Provided that no such adjournment shall be granted more than three times to a party during hearing of the suits.

(2) Costs of adjournment.--In every such case the Court shall fix a day for the further hearing of the suit, and shall make such orders as to costs occasioned by the adjournment of such higher costs as the Corut deems fit:

Provided that, --

(a) when the hearing of the suit has commenced, it shall be continued from day to-day until all the witnesses in attendance have been examined, unless the Court finds that, for the exceptional reasons to be recorded by it, the adjournment of the hearing beyond the following day is necessary,

(b) no adjournment shall be granted at the request of a party, except where the circumstances are beyond the control of that party, 

(c) the fact that the pleader of a party is engaged in another Court, shall not be a ground for adjournment,

(d) where the illness of a pleader or his inability to conduct the case for any reason, other than his being engaged in another Court, is put forward as a ground for a adjournment, the Court shall not grant the adjournment unless it is satisfied that the party applying for adjournment could not have engaged another pleader in time, (e) where a witness is present in Court but a party or his pleader is not present or the party or his pleader, though present in Court, is not ready to examine or cross-examine the witness, the Court may, if it thinks fit, record the statement of the witness and pass such orders as it thinks fit dispensing with the examination-in-chief or cross-examination of the witness, as the case may be, by the party or his pleader not present or not ready as aforesaid.

(emphasis supplied)

It is evident from Rule 1(2) proviso (e) of Order 17 that where a witness is present in court but the other side is not ready to cross-examine the witness, the court can dispense with his cross-examination. But where a genuine and bona fide request is made for adjourment, instead of resorting to forfeiture of the right to cross-examine, the court may grant time by levying costs.

8. A conspectus of the above provisions clearly demonstrates that under the scheme of CPC, a suit cannot be dismissed for non-payment of costs. Non-payment of costs results in forfeiture of the right to further prosecute the suit or defence as the case may be. Award of costs, is an alternative available to the court, instead of dispensing with the cross-examination and closing the evidence of the witness. If the costs levied for seeking an adjournment to cross-examine a witness are not paid, the appropriate course is to close the cross-examination of the witness and prohibit the further prosecution of the suit or the defence, as the case may be by the defaulting party.

9. In this case, the plaintiff has harassed the defendants and its witness by seeking repeated adjournments. In view of it, plaintiff's right to cross-examine DW2 stands forfeited. However, as costs were levied, but were not paid, the court should have closed the evidence of DW2, permitted the defendants to produce any further evidence (without any right to plaintiff to cross-examine such witnesses) and then ought to have proceeded to dispose of the suit on merits by considering the material available and hearing the arguments of defendant. The court could not have dismissed the suit.

Eviction of Tenants by Police Force

Justice Katju

Justice Markandey Katju and Justice Gyan Sudha Mishra in M/s Ram Prakash Sharma v. Baulal (D) by LR's has issued general directions in all cases where the tenants do not vacate the premises in eviction cases despite granting time by the Court or despite furnishing an undertaking to the Court. The short order reads as follows;

"Heard learned counsel for the parties. In the facts and circumstances of the case, time to vacate the premises in question is extended till 31st August, 2011 and if the tenants do not vacate on or before the said date, they will be evicted by police force. We further make it clear that when this Court allows the petition/appeal of the landlord or dismisses the petition/appeal of the tenant and grant some time to vacate the premises in question and if the tenant does not vacate within the time granted, the tenant shall be evicted by police force. This is a general direction we are passing because we are coming across several cases where the tenants are not vacating the premises in question despite granting time by this Court or despite furnishing an undertaking to this Court with a result that the landlord has to initiate contempt proceedings or any other proceedings. 

Hence, we give a general direction that when tenant's petition/appeal is dismissed and he is given time to vacate then on the expiry of that time, he will be evicted by police force if he does not vacate of his own.

If any extension of time to vacate is desired, that application should be filed well in advance. The Interlocutory Application is allowed accordingly.

'Affidavits' under Order XIX of Code of Civil Procedure : Supreme Court Directions

Justice Ganguly

The Supreme Court in Amar Singh v. Union of India and Others, has issued directions to the courts registry to carefully scrutinize all affidavits, petitions and applications and reject those which do not conform to the requirements of Order XIX of the Code of Civil Procedure and Order XI of the Supreme Court Rules. The Supreme Court has highlighted the importance of affidavits in this judgment and has discussed various judicial pronouncements on the aspect. The relevant extracts of the aforesaid judgment are reproduced hereinbelow;

12. The provision of Order XIX of Code of Civil Procedure, deals with affidavit. Rule 3 (1) of Order XIX which deals with matters to which the affidavit shall be confined provides as follows: 

"Matters to which affidavits shall be confined. - (1) affidavits shall be confined to such facts as the deponent is able of his own knowledge to prove, except on interlocutory applications, on which statements of his belief may be admitted; provided that the grounds thereof are stated."

13. Order XI of the Supreme Court Rules 1966 deals with affidavits. Rule 5 of Order XI is a virtual replica of Order XIX Rule 3 (1). Order XI Rule 5 of the Supreme Court Rules is therefore set out: "Affidavits shall be confined to such facts as the deponent is able of his own knowledge to prove, except on interlocutory applications, on which statements of his belief may be admitted, provided that the grounds thereof are stated."

14. In this connection Rule 13 of Order XI of the aforesaid Rules are also relevant and is set out below:

"13. In this Order, `affidavit' includes a petition or other document required to be sworn or verified; and `sworn' includes affirmed. In the verification of petitions, pleadings or other proceedings, statements based on personal knowledge shall be distinguished from statements based on information and belief. In the case of statements based on information, the deponent shall disclose the source of this information."

15. The importance of affidavits strictly conforming to the requirements of Order XIX Rule 3 of the Code has been laid down by the Calcutta High Court as early as in 1910 in the case of Padmabati Dasi v. Rasik Lal Dhar [(1910) Indian Law Reporter 37 Calcutta 259]. An erudite Bench, comprising Chief Justice Lawrence H. Jenkins and Woodroffe, J. laid down:

"We desire to impress on those who propose to rely on affidavits that, in future, the provisions of Order XIX, Rule 3, must be strictly observed, and every affidavit should clearly express how much is a statement of the deponent's knowledge and how much is a statement of his belief, and the grounds of belief must be stated with sufficient particularity to enable the Court to judge whether it would be sage to act on the deponent's belief."

16. This position was subsequently affirmed by Constitution Bench of this Court in State of Bombay v. Purushottam Jog Naik, AIR 1952 SC 317. Vivian Bose, J. speaking for the Court, held:

"We wish, however, to observe that the verification of the affidavits produced here is defective. The body of the affidavit discloses that certain matters were known to the Secretary who made the affidavit personally. The verification however states that everything was true to the best of his information and belief. We point this out as slipshod verifications of this type might well in a given case lead to a rejection of the affidavit. Verification should invariably be modelled on the lines of Order 19, Rule 3, of the Civil Procedure Code, whether the Code applies in terms or not. And when the matter deposed to is not based on personal knowledge the sources of information should be clearly disclosed. We draw attention to the remarks of Jenkins, C. J. and Woodroffe, J. in Padmabati Dasi vs. Rasik Lal Dhar 37 Cal 259 and endorse the learned Judges' observations."

17. In Barium Chemicals Limited and another v. Company Law Board and others, AIR 1967 SC 295, another Constitution Bench of this Court upheld the same principle:

"The question then is: What were the materials placed by the appellants in support of this case which the respondents had to answer? According to Paragraph 27 of the petition, the proximate cause for the issuance of the order was the discussion that the two friends of the 2nd respondent had with him, the petition which they filed at his instance and the direction which the 2nd respondent gave to respondent No. 7. But these allegations are not grounded on any knowledge but only on reasons to believe. Even for their reasons to believe, the appellants do not disclose any information on which they were founded. No particulars as to the alleged discussion with the 2nd respondent, or of the petition which the said two friends were said to have made, such as its contents, its time or to which authority it was made are forthcoming. It is true that in a case of this kind it would be difficult for a petitioner to have personal knowledge in regard to an averment of mala fides, but then were such knowledge is wanting he has to disclose his source of information so that the other side gets a fair chance to verify it and make an effective answer. In such a situation, this Court had to observe in 1952 SCR 674: AIR 1952 SC 317, that as slipshod verifications of affidavits might lead to their rejection, they should be modelled on the lines of O. XIX, R. 3 of the Civil Procedure Code and that where an averment is not based on personal knowledge, the source of information should be clearly deposed. In making these observations this Court endorse the remarks as regards verification made in the Calcutta decision in Padmabati Dasi v. Rasik Lal Dhar, (1910) ILR 37 Cal 259."

18. Another Constitution Bench of this Court in A. K. K. Nambiar v. Union of India and another, AIR 1970 SC 652, held as follows:

"The appellant filed an affidavit in support of the petition. Neither the petition nor the affidavit was verified. The affidavits which were filed in answer to the appellant's petition were also not verified. The reasons for verification of affidavits are to enable the Court to find out which facts can be said to be proved on the affidavit evidence of rival parties. Allegations may be true to knowledge or allegations may be true to information received from persons or allegations may be based on records. The importance of verification is to test the genuineness and authenticity of allegations and also to make the deponent responsible for allegations. In essence verification is required to enable the Court to find out as to whether it will be safe to act on such affidavit evidence. In the present case, the affidavits of all the parties suffer from the mischief of lack of proper verification with the result that the affidavits should not be admissible in evidence."

19. In the case of Virendra Kumar Saklecha v. Jagjiwan and others, [(1972) 1 SCC 826], this Court while dealing with an election petition dealt with the importance of disclosure of source of information in an affidavit. This Court held that non-disclosure will indicate that the election petitioner did not come forward with the source of information at the first opportunity. The importance of disclosing such source is to give the other side notice of the same and also to give an opportunity to the other side to test the veracity and genuineness of the source of information. The same principle also applies to the petitioner in this petition under Article 32 which is based on allegations of political motivation against some political parties in causing alleged interception of his telephone. The absence of such disclosure in the affidavit, which was filed along with the petition, raises a prima facie impression that the writ petition was based on unreliable facts.

20. In case of M/s Sukhwinder Pal Bipan Kumar and others v. State of Punjab and others, [(1982) 1 SCC 31], a three Judge Bench of this Court in dealing with petitions under Article 32 of the Constitution held that under Order XIX Rule 3 of the Code it was incumbent upon the deponent to disclose the nature and source of his knowledge with sufficient particulars. In a case where allegations in the petition are not affirmed, as aforesaid, it cannot be treated as supported by an affidavit as required by law. (See para 12 page 38)

21. The purpose of Rules 5 and 13 of the Supreme Court Rules, set out above, has been explained by this Court in the case of Smt. Savitramma v. Cicil Naronha and another, AIR 1988 SCC 1987. This Court held, in para 2 at page 1988, as follows: "...In the case of statements based on information the deponent shall disclose the source of his information. Similar provisions are contained in Order 19, Rule 3 of the Code of Civil Procedure. Affidavit is a mode of placing evidence before the Court. A party may prove a fact or facts by means of affidavit before this Court but such affidavit should be in accordance with Order XI, Rules 5 and 13 of the Supreme Court Rules. The purpose underlying Rules 5 and 13 of Order XI of the Supreme Court Rules is to enable the Court to find out as to whether it would be safe to act on such evidence and to enable the court to know as to what facts are based in the affidavit on the basis of personal knowledge, information and belief as this is relevant for the purpose of appreciating the evidence placed before the Court, in the form of affidavit...."

22. In the same paragraph it has also been stated as follows:

"...If the statement of facts is based on information the source of information must be disclosed in the affidavit. An affidavit which does not comply with the provisions of Order XI of the Supreme Court Rules, has no probative value and it is liable to be rejected..."

23. In laying down the aforesaid principles, this Court in Smt. Savitramma (supra) relied on a full Bench judgment in Purushottam Jog Naik (supra).

24. In the instant case, the petitioner invoked the extraordinary writ jurisdiction of this Court under Article 32, without filing a proper affidavit as required in terms of Order XIX Rule 3 of the Code. Apart from the fact that the petitioner invoked Article 32, the nature of the challenge in his petition is very serious in the sense that he is alleging an attempt by the government of intercepting his phone and he is further alleging that in making this attempt the government is acting on extraneous considerations, and is virtually acting in furtherance of the design of the ruling party. It is, therefore, imperative that before making such an allegation the petitioner should be careful, circumspect and file a proper affidavit in support of his averment in the petition.

25. In our judgment, this is the primary duty of a petitioner who invokes the extraordinary jurisdiction of this Court under Article 32.

...

65. This court wants to make one thing clear i.e. perfunctory and slipshod affidavits which are not consistent either with Order XIX Rule 3 of the CPC or with Order XI Rules 5 and 13 of the Supreme Court Rules should not be entertained by this Court.

66. In fact three Constitution Bench judgments of this Court in Purushottam Jog Naik (supra), Barium Chemicals Ltd. (supra) and A.K.K. Nambiar (supra) and in several other judgments pointed out the importance of filing affidavits following the discipline of the provision in the Code and the said rules.

67. These rules, reiterated by this Court time and again, are aimed at protecting the Court against frivolous litigation must not be diluted or ignored. However, in practice they are frequently flouted by the litigants and often ignored by the Registry of this Court. The instant petition is an illustration of the same. If the rules for affirming affidavit according to Supreme Court were followed, it would have been difficult for the petitioner to file this petition and so much of judicial time would have been saved. This case is not isolated instance. There are innumerable cases which have been filed with affidavits affirmed in a slipshod manner.

68. This Court, therefore, directs that the Registry must henceforth strictly scrutinize all the affidavits, all petitions and applications and will reject or note as defective all those which are not consistent with the mandate of Order XIX Rule 3 of the CPC and Order XI Rules 5 and 13 of the Supreme Court Rules.

"An Action at Law is not a Game of Chess" : Supreme Court Raps Amar Singh

Source : Indlaw

The Supreme Court today lifted its five-year-old gag order restraining print and electronic media from publishing and broadcasting contents of taped telephone conversations of former Samajwadi Party leader Amar Singh with politicians and Bollywood stars.

Dismissing Singh's petition, a bench of Justices G S Singhvi and A K Ganguly vacated the apex court's interim order passed on February 27, 2006 restraining the media from making contents of the taped conversation public. 

Singh, then general secretary of Samajwadi Party, through a petition in 2006, had sought and got restraint order against publication of contents of his telephonic conversation he alleged had been taped illegally. 

He had earlier accused the Congress through its President Sonia Gandhi and private telecom operator Reliance Infocomm, of being behind the tapping but had later withdrawn his allegations against the Congress. 

But a non-government organisation (NGO), the Centre for Public Interest Litigation, through its lawyer Prashant Bhushan, had pleaded for publication of the taped contents, saying it was the right of people to know the alleged illegal dealings of public figures in the discharge of their public functions. The PIL by the NGO said this right of the people was guaranteed by the Article 19(1) (a) of the Constitution and also upheld by the apex court. 

Justice AK Ganguly, who wrote the judgement for the bench, said no case is made out against the Centre and its authorities as they were not involved in tapping Singh's telephone. 

The court, however, said Singh was at liberty to file a case against Reliance Infocomm (now Reliance Communications) for illegally tapping his phone. 

The bench had reserved its verdict on Singh's petition on March 29 after hearing him and the NGO, which had opposed his plea and sought a direction for making public all his taped conversations.

Find the entire Judgment here.