Delhi High Court Dismisses Review Petition Challenging ₹50,000 Costs in Commercial Litigation: Holds That Costs Are Nominal and Cannot Be Waived Through Review

Court’s Decision

The Delhi High Court declined to vary or waive the costs of ₹50,000/- imposed earlier, emphasizing that the costs were reasonable, particularly in the context of commercial litigation. The court also noted that the Supreme Court had dismissed the petitioner’s Special Leave Petition (SLP) challenging the same costs, finding no reason to interfere with the High Court’s original order. The court, however, extended the time for payment of costs by eight weeks from the date of this order.

Facts

1. Background of the Transfer Petitions:
   • The petitioner filed two transfer petitions (TR.P.(C.) 75/2024 and TR.P.(C.) 76/2024) seeking the transfer of cases.
   • These petitions were dismissed by the Delhi High Court, with costs of ₹50,000/- imposed on the petitioner.
2. Supreme Court Involvement:
   • Dissatisfied with the dismissal, the petitioner approached the Supreme Court via an SLP.
   • The Supreme Court dismissed the SLP, explicitly stating that there was no cause to interfere with the High Court’s order, including the imposition of costs.
3. Filing of Review Petitions:
   • The petitioner subsequently filed review petitions before the Delhi High Court seeking a waiver of the costs.

Issues

1. Whether the costs of ₹50,000/- imposed by the High Court in the original order could be waived through a review petition.
2. Whether additional time for payment of costs could be granted to the petitioner.

Petitioner’s Arguments

The petitioner argued that:

1. The costs imposed were excessive and unwarranted under the circumstances.
2. A waiver of costs was justified to avoid undue financial burden.

Respondent’s Arguments

The respondents were not represented during the proceedings, and no arguments were advanced on their behalf.

Analysis of the Law

1. Costs in Commercial Litigation:
   • The court observed that costs are an essential element of commercial litigation to discourage frivolous petitions and ensure responsible use of judicial resources.
   • The imposition of costs also compensates the other party for unnecessary expenses incurred due to unmeritorious litigation.
2. Scope of Review Petitions:
   • The court reiterated the limited scope of review under the law, which does not permit reconsideration of the merits of the case unless there is an error apparent on the face of the record.
   • The petitioner failed to demonstrate any such error, as the costs were clearly justified in the context of the case.
3. Supreme Court’s Dismissal of SLP:
   • The Supreme Court’s concurrence with the High Court’s order further affirmed the appropriateness of the costs imposed, leaving little room for review.

Precedent Analysis

1. The High Court relied on its original decision to impose costs, finding that it was consistent with the principles governing commercial litigation.
2. The Supreme Court’s dismissal of the SLP served as a significant precedent, as it explicitly endorsed the High Court’s reasoning.

Court’s Reasoning

1. Reasonableness of Costs:
   • The court stated that the costs of ₹50,000/- were nominal, particularly given the commercial nature of the disputes.
   • It noted that commercial litigation often involves significant financial stakes, making the imposition of such costs a minimal burden.
2. Lack of Grounds for Review:
   • The court highlighted that the petitioner failed to provide any substantive reason for waiving the costs.
   • The Supreme Court’s explicit refusal to interfere with the High Court’s order reinforced the legitimacy of the costs imposed.
3. Extension of Time:
   • Acknowledging the practicalities of compliance, the court granted the petitioner an additional eight weeks to pay the costs.

Conclusion

The High Court dismissed the review petitions, holding that there was no basis to waive or reduce the costs imposed. However, it allowed the petitioner an extension of eight weeks to pay the costs.

Implications

1. Deterrence Against Frivolous Litigation:
   • This judgment highlights the role of costs as a deterrent against unnecessary or unmeritorious petitions in commercial litigation.
   • It reinforces the principle that litigants should bear the financial consequences of frivolous litigation.
2. Limited Scope of Review Petitions:
   • The case underscores the limited scope of review petitions, emphasizing that they cannot be used to reargue matters or revisit decisions already affirmed by higher courts.
3. Practical Relief:
   • While dismissing the review petitions, the court’s decision to extend the time for payment of costs reflects a balance between enforcing accountability and accommodating practical difficulties faced by litigants.

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