Order XXV Rule 1 CPC: When Security for Costs May Be Required from a Plaintiff
Order 25 Rule 1 of the Code of Civil Procedure, 1908 (CPC) enables a civil court to require a plaintiff to provide security for a defendant's litigation costs. The provision sets out the court's discretion and a specific mandatory situation involving plaintiffs residing outside India.
Meaning and purpose of security for costs
Security for costs is a safeguard ordered by a court to help ensure that a defendant's costs, if payable, can be recovered. It is not a determination of the merits of the suit and is distinct from an immediate order directing payment of costs.
Order XXV Rule 1 CPC - statutory provision
Rule 1(1): Power to require security
At any stage of a suit, the Court may, either of its own motion or on the application of any defendant, order the plaintiff, for reasons to be recorded, to give within the time fixed by it security for the payment of all costs incurred and likely to be incurred by any defendant:
Provided that such an order shall be made in all cases in which it appears to the Court that a sole plaintiff is, or (when there are more plaintiffs than one) that all the plaintiffs are, residing out of India and that such plaintiff does not possess or that no one of such plaintiffs possesses any sufficient immovable property within India other than the property in suit.
Rule 1(2): Deemed residence outside India
Whoever leaves India under such circumstances as to afford reasonable probability that he will not be forthcoming whenever he may be called upon to pay costs shall be deemed to be residing out of India within the meaning of the proviso to sub-rule (1).
When can the court order security for costs?
Under sub-rule (1), the court may act on its own motion or on a defendant's application, at any stage of the suit. The court must record its reasons and fix the time for furnishing security. The security concerns costs already incurred as well as costs likely to be incurred by any defendant.
The proviso makes an order mandatory when the court finds both of the following: the sole plaintiff, or every plaintiff in a multi-plaintiff suit, resides outside India; and none has sufficient immovable property in India apart from the property involved in the suit.
Sub-rule (2) additionally treats a person who leaves India in circumstances indicating a reasonable probability of not being available to pay costs as residing outside India for this purpose.
How an application is considered
A defendant seeking security may file an application identifying the circumstances that justify the request, the relevant facts about residence and property, and the costs for which security is sought. The court considers the applicable rule, records reasons for its order, and specifies a time for compliance. The precise form and amount of security depend on the order and applicable procedural rules.
What happens if security is not furnished?
Order XXV Rule 2 CPC provides that if the ordered security is not furnished within the fixed time, the court shall dismiss the suit unless the plaintiff or plaintiffs are permitted to withdraw it. A dismissed suit may be restored if the plaintiff establishes sufficient cause for failing to furnish security within time; the court may impose terms. Notice of the restoration application must be served on the defendant.
Read the related provision: Order XXV Rule 2 CPC - Effect of Failure to Furnish Security.
Illustrative example
Suppose a sole plaintiff resides abroad and has no sufficient immovable property in India other than the property disputed in the suit. If the court finds these facts established, the proviso to Rule 1(1) requires an order for security for costs. Where multiple plaintiffs sue together, the statutory proviso refers to all plaintiffs residing outside India and the absence of sufficient qualifying immovable property held by any of them.
Official law and further reading
Consult the Code of Civil Procedure, 1908 - official India Code text (PDF) and the CPC sections, orders and rules guide. State-specific and High Court amendments, where applicable, should also be checked before relying on the general central text.