Communication Components Antenna Inc. v. ACE Technologies Corp. and Ors.:Date of Order: 01 July 2025:Case Number: CS(COMM) 1222/2018:Neutral Citation: 2025:DHC:5139-DB:Name of Court: High Court of Delhi at New Delhi:Name of Judges: Hon’ble Mr. Justice Navin Chawla and Hon’ble Ms. Justice Shalinder Kaur
Very brief facts:
The plaintiff, a foreign company, filed a suit concerning intellectual property rights. The defendants sought an order directing the plaintiff to furnish security for costs under Order XXV Rule 1(1) of the CPC, arguing the plaintiff had no sufficient immovable property in India.
Procedural background:
A single judge noticed conflicting decisions by coordinate benches of the High Court on whether the proviso to Order XXV Rule 1(1) of the CPC is mandatory or discretionary and whether it applies only to suits related to immovable property. The matter was therefore referred to a larger bench for authoritative interpretation.
Dispute:
Whether it is mandatory under the proviso to Order XXV Rule 1(1) CPC for the court to direct a plaintiff residing outside India and not having sufficient immovable property in India to furnish security for costs, and whether this proviso applies only to suits concerning immovable property.
Discussion:
The court examined earlier conflicting judgments, legislative intent, related provisions, and principles of statutory interpretation. It concluded that while the main provision of Order XXV Rule 1(1) is discretionary, the proviso is mandatory when its conditions are met. The court also agreed that the proviso applies only to suits relating to immovable property.
Decision:
The court held it is mandatory for the court to order security for costs when the plaintiff resides outside India and lacks sufficient immovable property in India, provided the suit concerns immovable property. However, the quantum of security remains within the court's discretion depending on the facts of each case.
