240th Report on Costs in Civil Litigation - Law Commission of India

Provided that the party’s adverse socio-economiccondition and the hardship that may be caused by imposingthe costs under this sub-section should be taken intoaccount by the Court while determining the quantum ofcosts.1-B: Out of the costs so awarded, part of the costs shall beordered to be paid to the party against whom the claim ordefence of false or vexatious nature has been set up andpart of it shall be ordered to be deposited in the JudicialInfrastructure Fund created under the orders of the HighCourt;1-C:High Courts may frame Rules for the creation andadministration of Judicial Infrastructure Fund andnotwithstanding that such Fund is not created, the Courtmay award costs under sub-section (1) to the party subjectto frivolous or vexatious claim or defence.(iii) Instead of “three thousand rupees” in sub-section(2)“rupees one lakh” to be substituted.(iv)The first Proviso to sub-section may be omitted as it is nolonger necessary.(v) In Sub-section (4), for the expression ‘compensation’, the word ‘costs’ to besubstituted.9. SECTION 959.1 Section 95 of the Code provides that where, in any suit, an arrest orattachment has been effected or a temporary injunction has been granted under47