(1) Subject to such conditions and limitations as may be prescribed, and to the provisions of law for the time being in force, the costs of and incident to all suits shall be in the discretion of the Court, and the Court shall have full power to determine by whom or out of what property and to what extent such costs are to be paid, and to give all necessary directions for the purposes aforesaid. The fact that the Court has no jurisdiction to try the suit shall be no bar to the exercise of such powers.
(2) Where the Court directs that any costs shall not follow the event, the Court shall state its reasons in writing.
(i) Employer committed default in not remitting premium from salary of an employee to LIC, Employer was directed to pay cost of proceedings to heirs of employee; Delhi Electric Supply Undertaking v. Basanti Devi, AIR 2000 SC 43.
(ii) It is necessary to discourage people from bringing petitions which are motivated by mere personal interests in the name of public interest, for which they have no locus standi. To prevent and penalise such abuse of the process of the Court in the garb of public interest, the Court invoked this section and imposed a cost of Rs. 10,000 on the petitioners; Prayag Vyapar Mandal v. State of Uttar Pradesh, AIR 1997 All 1.
1. Sub-section (3) omitted by Act 66 of 1956, sec. 3 (w.e.f. 1-1-1957)