PUNJAB AND SIND BANK Vs. JEFFERSON BOLTS INDIA PVT LTD
LAWS(DR)-2005-5-10
DEBTS RECOVERY APPELLATE TRIBUNAL
Decided on May 12,2005

Appellant
VERSUS
Respondents

JUDGEMENT

Motilal B.Naik, - (1.) THIS Miscellaneous Appeal is directed against the order dated 3.6.2004 made in I.A. 708/2004 by the Presiding Officer, DRT-I, Delhi imposing a cost of Rs. 10,000/-.
(2.) On behalf of the appellant, Mr. Rajeeve Mehra, the learned Counsel for the appellant (plaintiff in the O.A. 876/95) mainly stated that the Tribunal, though competent to impose cost as provided under Section 35-B of the CPC, is not justified in directing the party to remit the same in favour of the Registrar of the very same Tribunal. It is stated by the learned Counsel that the cost so awarded is in the nature of compensatory, and as such the Tribunal could not have directed the cost to be paid by way of demand draft in favour of the Registrar. Counsel drew the attention of this Court to the provisions of Section 35-A of the CPC, and stated that there is no ambiguity in those provisions and, therefore, the order of the Tribunal to the extent of imposing the cost though justifiable, the Tribunal could not have directed the said cost to be deposited in favour of the Registrar by way of demand draft, and sought to set aside the order. There are two provisions in the CPC--Sections 35-A and 35-B--which speak about compensatory costs and costs for causing delay. Section 35-A speaks about compensatory costs in respect of the false or vexatious claim or defences, whereas, Section 35-B speaks about costs for causing delay. The principle governing the imposition of costs is well settled that by the act of one party for its false or vexatious claims or defences, the Court shall be competent to impose costs, which are in the nature of compensatory. The ground under 35-B is if on any date fixed for the hearing of a suit or for taking any step, the a party fails to take steps and obtains an adjournment on one pretext or the other, the Court may, by recording reasons, make an order requiring such party to pay 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. Another situation arising out of Section 35-A is if in any suit or other proceeding, any party objects to the claim or defence on the ground that the claim or defence or any part of it is as against the objector, false or vexatious to the knowledge of the party by whom it has been put forward, and if thereafter, as against the objector, such claim or defence is disallowed, abandoned or withdrawn in whole or in part, the Court may after recording its reasons for holding such claim or defence to be false or vexatious, make an order for the payment to the objector by the party by whom such claim or defence has been put forward, of costs by way of compensation. In other words it can be said that the costs are compensatory or to meet the expenses incurred for attending the Court on the dates.
(3.) NEEDLESS to mention, when costs are imposed the Court should exercise its discretion on the question of quantum of the costs to be imposed, and that costs should not be so abnormal. What is bothering this Court is that through the impugned order the Presiding Officer has imposed the cost of Rs. 10,000/-, but, however, directed the party to pay the same by way of Demand Draft in favour of the Registrar, when the provisions of the sections are so clear that these costs are compensatory or meeting the expenses incurred, necessarily these costs should have been directed to be paid to the opposite party through the Counsel. Directing the party to deposit a cost by way of demand draft in favour of the Registrar may not be proper, lest it may give scope for unnecessary comments.;


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