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        Companies Law

        1917 (11) TMI 1 - HC - Companies Law

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        In Forma Pauperis for Companies: corporate plaintiffs may sue without fees through an official liquidator if the company cannot pay. Order XXXIII of the CPC applies to companies: a company qualifies as a 'pauper' if it cannot pay court fees and may seek leave to sue in forma pauperis. ...
                        Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
                          Provisions expressly mentioned in the judgment/order text.

                            In Forma Pauperis for Companies: corporate plaintiffs may sue without fees through an official liquidator if the company cannot pay.

                            Order XXXIII of the CPC applies to companies: a company qualifies as a "pauper" if it cannot pay court fees and may seek leave to sue in forma pauperis. The requirement of personal presentation does not bar corporate plaintiffs because law permits representative litigation (for example by an official liquidator acting under company law and procedural rules). The liquidator's personal finances are irrelevant; the determinative fact is the company's inability to pay. Payment of statutory remuneration or commission to the liquidator does not amount to an agreement with a third party that disqualifies the company from proceeding in forma pauperis.




                            Issues: Whether Order XXXIII of the Code of Civil Procedure, 1908 (suits by paupers) applies to companies and whether an official liquidator may present and prosecute a suit in forma pauperis on behalf of a company.

                            Analysis: Order XXXIII, Rule 1 permits a "pauper" to institute a suit subject to the order's provisions; the Code does not define "person" and the definition in the General Clauses Act applies unless repugnant. A company, being a "person" under that definition, may be unable to pay court-fees and thus prima facie entitled to seek leave to sue in forma pauperis. The explanation to Rule 1 regarding deduction for necessary wearing apparel does not imply that only human beings can be paupers; a company simply cannot deduct wearing apparel. Rule 3's requirement of personal presentation does not exclude cases where personal appearance is impossible by reason of the party being a company, infant, or lunatic; in such cases law permits representation (e.g., next friend, guardian ad litem), and the Companies Act and Order XXIX provide that a liquidator or principal officer may act for the company. The liquidator's personal financial status is immaterial; the real question is whether the actual plaintiff (the company) is a pauper. Payment of a commission to a liquidator under statutory authority does not constitute an agreement with a third person disqualifying the company under Order XXXIII, Rule 5.

                            Conclusion: Order XXXIII of the Code of Civil Procedure, 1908 applies to companies; an official liquidator may present and prosecute a suit in forma pauperis on behalf of a company that is a pauper; the liquidator's receipt of statutory remuneration does not disqualify the company from proceeding in forma pauperis.


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                            ActsIncome Tax
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