Monday, 29 October 2018

The Cost of Litigation Act 2017

[AS PASSED BY THE NATIONAL ASSEMBLY]

BILL further to amend the Code of Civil Procedure, 1908 and the Code of ' Criminal Procedure, 1898 It is hereby enacted as follows:-

1 Short title, application and commencement,-
(1) This Act may be called the Costs of Litigation Act, 2017,
(2) It shall apply to the Islamabad Capital Territory.

2. Amendment of Act v of 1908.- In the code of civil Procedure, 1908 (Act V of 1908),-
(I) for section 35, the following shall be substituted, namely:- A WHEREAS it is expedient further to amend the Code of Civil Procedure, 1908 (Act V of 1908) and the Code of Criminal Procedure, 1898 (V of 1898), for the purposes hereinafter appearing; (3) It shall come into force on such date as the Federal Government may, by notiflcation in the official Gazette, specify and shall apply to such courts in the Islamabad Capital Territory as the Federal Government may, by notification in the official Gazette, determine in this behalf and different dates may be specified in respect of different courts.
PART-I CIVIL PROCEEDINGS "35. Costs.- (1) Subject to such conditions and limitations as may be prescribed, and to the provisions of any law for the tirne being in force,-
(i) a party to any proceedings shall, before the announcement of final order, judgment or decree, file in the prescribed Form, details of actual costs of litigation, including but not limited to court fee, s:amp fee, fee paid to counsel and all other ancillary or incidental expenses thereto;
(ii) the Court shall award the actual costs of litigation under clause
(i) to the successful party with markup not exceeding the prescribed limit per annum, as notified by the State Bank of Pakistan, at the time of passing the order, judgment or decree;
(iii) the costs other than those mentioned in clause (i) shall be in the discretion of the Court; and (iv) the Court shall have full power to determine out of what property such costs are to be paid and recovered and to give all necessary directions for the purposes aforesaid.
(2) The fact that the Court has no jurisdiction in respect of the proceedinqs shall be no bar to the exercise of such powers under - this section.";
(II) for section 35-A, the following shall be substituted, namely:- "35A. Adjournment costs.-If, on the date fixed for hearing in any proceedings, a party to the proceedings or any other person, despite service of notice, fails to appear or comply with any order of the Court or mandatory provision of the Code or any other law for the time being in force, seeks an adjournment for such purpose, the Court shall, for sufficient cause and reasons to be recorded, grant such adjournment on the condition that such party or person shall pay to the other party, costs of adjournment which shall not be less than five thousand Rupees per adjournment or such higher amount as may be prescribed from time to time: Provided that if the Court is satisfied that the adjournment being sought ls on account of unavoidable reasons beyond the control of the party concerned, which reasons shall be recorded by the Court, the Court may grant adjournment without imposing adjournment costs: Provided further that if the court finds that there is a tendency of seeking repeated adjournments by any party on such grounds/ the court may not grant adjournment without lmposing the adjournment costs as the court may deem fit."; and
(III) after section 35A, substituted as aforesaid, the following new sections shall be inserted, namely:- "35B. Special costs.-
(1) if in any proceedings, the Court finds that any averment made by any party is false or vexatious to the knowledge of such party, the Court shall award special costs to the opposite party against whom such averment has been made.
(2) The amount of any special costs awarded under sub-section (1) shall be taken into account in any subsequent suit for damages or compensation in respect of such claim or defence. 35C. General provisions as to costs.- The Government shall not be liable to costs under sections 35, 35A and 358. Explanation.- In sections 35, 35A and 35B, the expression "proceedlngs" lncludes suit, appeal, review, revision, execution or any other proceedings and any matter incidental thereto.".

PART.II CRIMINAL PROCEEDINGS
3. Amendment of Act v of 1898.-In the Code of Criminal Procedure, 1898 (Act V of 1898),- -3-
(I) the existing section 200 shall be renumbered as sub-section (1) thereof and,- (i) in sub.section (1), renumbered as aforesaid, proviso. after clause (aa), the following new (b) shall be inserted. namely:- in the clause (U) (n1) "(b) \r'/here a complainant is a Court or a public servant, the Court or a public servant, as the case may be, shall not be liable to adjournment costs under sub-section (2)i'; and (ii) after sub-section (1"), amended as aforesaid, the following new sub-section shall be added, namety:- "(2) Subject to provisions of section 344, il on the date fixed for hearing in any proceedings, a party to a case or any other person, despite service of notice. fails to appear cr comply with any order of the Court or mandatory provision of the Code or any other law fl)r the time being in force, seeks an adjournment f,lr such purpose. the Court may, for sufficient cause and reasons to be recorded, grant such edjournment on the condition that such party or F,erson shall pay to the other party, adjournment costs which shall not be less than ten thousand rupees per adjournment or such higher amount e s may be prescribed from time to time."; ln section 250, in sub-section (2), for the words "twenty five thousand" th_e words "one hundred thousand" shall be substituted."; and in sectiori 344, in sub-section (1), after the expression "terms" tile commas and words ", including adjournment costs," shall be inserted.". -
4- STATEMENT OF OBJECTS AND REASONS The tendency of filing false and vexatious cases and taking baseless grounds for defense is unfortunately on the increase. This tendency leads to numerous evils, lncluding heavy expenditure incurred by the affected parties, causing them financial loss and mental torture, apart from wasting precious time of the courts. It is, therefore, necessary to empower courts to impose costs to discourage false and frivolous litigation and unnecessary adjournments. It is proposed to make amendments in the Code of Civll Procedure, 1908 for thls purpose. Amendments are also being proposed in the Code of Criminal Procedure, 1898 to provide for impositlon of adjournment costs in criminal cases. The Bill is designed to achieve the aforesald object.
MINISTER-IN-CHARGE -5-

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