INDIA Law and Practice Contributed by: Anuradha Mukherjee, Omar Ahmad, Vikram Shah and Soumya Dasgupta, Cyril Amarchand Mangaldas
11.2 Factors Considered When Awarding Costs Please see 11.1 Responsibility for Paying the Costs of Litigation . In commercial disputes, the court has to con- sider the following while awarding costs: • whether costs are payable by one party to another; • the quantum thereof; and • the time when such costs are to be paid. While awarding costs in arbitral proceedings, the arbitrator has to consider: • whether costs are payable by one party to another; • the quantum thereof; • the time when such costs are to be paid; • the conduct of the parties; • whether a party has succeeded in its case; • whether a frivolous counterclaim was made, resulting in a delay in disposal of the arbitral proceedings; and • whether any reasonable offer to settle the dispute was made by one party and refused by the other party. 11.3 Interest Awarded on Costs In suits and arbitral proceedings, interest on costs can be awarded from or until a certain date. 12. Alternative Dispute Resolution (ADR) 12.1 Views of ADR Within the Country The CPC envisages five types of ADR: • arbitration;
If a suit is settled before the trial commences between the parties, the plaintiff can request a refund of the court fees, which can be granted by the court at its discretion for either the entire amount or a part thereof. During the pendency of the litigation, the parties bear their own costs, but the court can award the costs of the litigation to the successful party when passing its final judgment and decree. Costs Costs awarded have to be reasonable and can include the court fees and expenses incurred in filing the suit, the production of witnesses, legal fees and expenses, and any other expenses incurred that were incidental to the suit. A court has further powers to award compen- satory costs in the case of false and vexatious claims or defences, but such costs are capped at INR3,000 or the limit of the pecuniary juris- diction of the relevant court, whichever is lower. Further costs can also be awarded if any delay in the hearing of the suit is caused by any party. At any time during the pendency of a suit, a court can also require the plaintiff to furnish security for the payment of costs incurred or likely to be incurred by the defendant. If the plaintiff fails to furnish the security, the court can even pass an order dismissing the suit. Costs can also be awarded by an arbitrator in the arbitral award. Similar to suits, the general rule in arbitration is also that the unsuccessful party shall pay costs to the successful party, and that costs follow the event.
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