Section 35A — Compensatory Costs for False or Vexatious Claims or Defences
Ordinary costs (§35) compensate the winner for litigating. §35A goes further — it lets the Court penalise a party who knowingly raised a false or vexatious claim or defence, paying real compensation to the wronged side, capped at ₹3,000.
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How to read Section 35A
1
What it is for
To deter knowingly false or vexatious litigation. It is compensation to the objector, not a fine to the State — but it works like a penalty on the wrongdoer.
2
Strict gate-keeping
It bites only where the claim/defence was false or vexatious to the knowledge of the party, an objection was taken, the claim was disallowed/abandoned/withdrawn, and the Court records reasons.
3
A hard money cap
The amount can never exceed ₹3,000 (or the Court’s pecuniary limit, whichever is less). It does not wipe out criminal liability, and is set off in any later damages suit.
The bare Act — verbatim
⚠️ Section 35A. Compensatory costs in respect of false or vexatious claims or defences.
(1)
If in any suit or other proceeding, including an execution proceeding but excluding an appeal or a revision, 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it has been put forward, and if thereafter, as against the objector, such claim or defence is disallowed, abandoned or withdrawn in whole or in part, the Court if it so thinks fit may, after recording its reasons for holding such claim or defence to be false or vexatious, make an order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.
(2)
No Court shall make any such order for the payment of an amount exceeding three thousand rupees or exceeding the limits of its pecuniary jurisdiction, whichever amount is less:
Provided that where the pecuniary limits of the jurisdiction of any Court exercising the jurisdiction of a Court of Small Causes under the Provincial Small Cause Courts Act, 1887 (9 of 1887), or under a corresponding law in force in any part of India to which the said Act does not extend, are less than two hundred and fifty rupees, the High Court may empower such Court to award as costs under this section any amount not exceeding two hundred and fifty rupees and not exceeding those pecuniary limits by more than one hundred rupees:
Provided further that the High Court may limit the amount or class of Courts which is or are to be empowered to make orders under this section.
(3)
No person against whom an order has been made under this section shall, by reason thereof, be exempted from any criminal liability in respect of any claim or defence made by him.
(4)
The amount of any compensation awarded under this section in respect of a false or vexatious claim or defence shall be taken into account in any subsequent suit for damages or compensation in respect of such claim or defence.
Dissecting Section 35A — sub-section by sub-section
⚠️ The four gates before a §35A order
1
✋
Objection taken
A party objects that the claim/defence is false or vexatious to the knowledge of the one who raised it.
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2
❌
It fails
That claim/defence is disallowed, abandoned or withdrawn (wholly or partly) against the objector.
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3
✍️
Reasons recorded
Court records its reasons for holding it false or vexatious (“if it so thinks fit”).
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4
💰
Compensation ordered
The wrongdoer pays the objector costs by way of compensation.
Applies in any suit/proceeding incl. execution — but not in an appeal or a revision.
Scopein any suit or other proceeding, including an execution proceeding but excluding an appeal or a revisionWhere it operates: original suits and proceedings and execution — but expressly NOT appeals or revisions.
Conditionany party objects … that the claim or defence … is, as against the objector, false or vexatious to the knowledge of the party by whom it has been put forwardTwo things are needed: an objection, and that the claim/defence was false/vexatious to the knowledge of its maker (mere weakness or losing is not enough).
Conditionand if thereafter, as against the objector, such claim or defence is disallowed, abandoned or withdrawn in whole or in partThe false claim/defence must actually fail — rejected by the Court, given up, or withdrawn (even partly).
Discretionthe Court if it so thinks fit may, after recording its reasons for holding such claim or defence to be false or vexatiousThe power is discretionary (“may”) and conditional — the Court must record written reasons before making the order.
Effectmake 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 compensationThe order: the wrongdoer pays the objector — not ordinary taxed costs, but costs by way of compensation for the false litigation.
💰 The hard ceiling on the amount
₹3,000 MAX
CEILING
The award can never exceed ₹3,000 — or your Court’s pecuniary limit, whichever is less.
⚖ The general cap
min(₹3,000, pecuniary jurisdiction). A court that can try suits only up to ₹1,000 cannot award more than ₹1,000 here.
📍 Proviso 1 — tiny Small-Cause courts
If a Small-Cause court’s limit is under ₹250, the High Court may empower it to award up to ₹250 — but not more than ₹100 above its own limit.
🏛️ Proviso 2: the High Court may limit the amount, or the class of Courts, empowered to make §35A orders at all.
LimitNo Court shall make any such order for the payment of an amount exceeding three thousand rupees or exceeding the limits of its pecuniary jurisdiction, whichever amount is lessA double ceiling — the lower of ₹3,000 and the court’s pecuniary jurisdiction. (Raised from ₹1,000 to ₹3,000 by Act 104 of 1976.)
Provisowhere the pecuniary limits … of a Court of Small Causes … are less than two hundred and fifty rupees, the High Court may empower such Court to award … not exceeding two hundred and fifty rupees and not exceeding those pecuniary limits by more than one hundred rupeesA special uplift for very small Small-Cause courts so they can still award a meaningful sum — capped at ₹250, and at ₹100 over their own limit.
Provisothe High Court may limit the amount or class of Courts which is or are to be empowered to make orders under this sectionThe High Court controls the tap — it may cap the amount, or restrict which classes of courts may use §35A at all.
⚖ Costs here do NOT buy off the crime
💰
§35A order (civil)
Pay compensatory costs (≤ ₹3,000) to the objector for the false claim/defence.
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⚖️
Criminal liability (separate)
Still fully prosecutable — e.g. perjury, fabricating false evidence, forgery under the penal law.
Paying under §35A is not a substitute for, and gives no exemption from, criminal punishment.
SavingNo person against whom an order has been made under this section shall, by reason thereof, be exempted from any criminal liability in respect of any claim or defence made by himA without-prejudice clause: a §35A compensation order is a civil consequence only. It leaves criminal liability untouched — the wrongdoer can still be tried and punished for the offence behind the false claim.
💲 Counted against any later damages suit
A
💰
§35A award now
Objector gets, say, ₹3,000 compensatory costs for the false claim.
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B
⚖️
Later damages suit
Objector sues for full damages for the same false/vexatious claim.
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C
➖
Set off
The ₹3,000 already awarded is deducted — no double compensation.
AdjustmentThe amount of any compensation awarded under this section … shall be taken into account in any subsequent suit for damages or compensation in respect of such claim or defencePrevents double recovery: if the objector later sues for damages over the same false claim, whatever was awarded under §35A is credited / set off in that suit.
📍 The two provisos — special cap & High Court control
📍 Proviso 1 — tiny Small-Cause courts
If a Small-Cause court’s pecuniary limit is under ₹250, the High Court may empower it to award up to ₹250 — but not more than ₹100 above its own limit.
🏛️ Proviso 2 — High Court controls the tap
The High Court may limit the amount, or the class of Courts, empowered to make §35A orders at all.
Proviso 1where the pecuniary limits … of a Court of Small Causes … are less than two hundred and fifty rupees, the High Court may empower such Court to award … not exceeding two hundred and fifty rupees and not exceeding those pecuniary limits by more than one hundred rupeesA special uplift for very small Small-Cause courts so they can still award a meaningful compensatory sum — capped at ₹250, and at ₹100 over their own pecuniary limit.
Proviso 2the High Court may limit the amount or class of Courts which is or are to be empowered to make orders under this sectionThe High Court controls the tap — it may cap the amount, or restrict which classes of courts may use §35A at all. A supervisory check on the power.
Section 35A at a glance
⚙️ Elements (working parts)
Objection that claim/defence is false or vexatious to knowledge
That claim/defence is disallowed/abandoned/withdrawn
Court records reasons & orders compensation to the objector
Compensation set off in a later damages suit
⏱️ Conditions & limits
Not in appeal or revision (suits/execution only)
Discretionary — “may … if it so thinks fit”
Cap = min(₹3,000, pecuniary limit)
No exemption from criminal liability
How the four sub-sections connect
🔗 One penalty, built in four linked steps
SUB-SEC (1) — CREATE
The liability is born
A false/vexatious claim, objected to and disallowed, lets the Court order compensatory costs to the objector.
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SUB-SEC (2) — CAP
Its size is limited
That amount can never exceed ₹3,000 (or the court’s pecuniary limit) — (2) controls how big (1) can be.
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SUB-SEC (3) — PRESERVE
Crime stays separate
Paying under (1) gives no exemption from criminal liability — (3) stops the costs order being a buy-off.
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SUB-SEC (4) — CREDIT
It is set off later
Whatever (1) awarded is deducted in any later damages suit — (4) prevents double recovery for the same wrong.
So the four sub-sections are one mechanism, not four topics: (1) creates the compensation, (2) caps it, (3) keeps it from displacing criminal liability, and (4) coordinates it with a future damages claim.
