Bailabel Type : non-bailable

Description

Order 29 of the Civil Procedure Code (CPC) governs suits by or against corporations, particularly focusing on how corporations (such as companies, public bodies, and other legal entities) are involved in civil litigation. Corporations, being artificial persons, cannot represent themselves in court and must do so through a representative, typically an authorized agent or officer. This order outlines how corporations should initiate legal actions and how they can be sued, along with the process for service of summons and representation in civil suits.

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Key Provisions of Order 29

Rule 1: Suit by Corporation

1. How Corporation Can Sue:

   • When a corporation (such as a company or public body) files a suit, it must do so through a duly authorized agent or officer. This person is usually someone who holds an official position within the organization, such as a director, manager, or legal representative.
   • The authorized person acting on behalf of the corporation may file the plaint (written statement of the claim) and attend court hearings as the representative of the corporation.

2. Power of the Agent:

   • The person authorized to represent the corporation must be empowered by the corporation’s governing body (like a board of directors for companies) to initiate legal proceedings.
   • The suit must be properly authorized by a resolution or other formal action of the corporation.

3. Verification of the Plaint:

   • The plaint filed on behalf of the corporation must be verified by the person authorized to represent the corporation, certifying that the contents of the plaint are true to the best of their knowledge.
   • The verification must confirm that the agent or officer filing the suit has the authority to do so on behalf of the corporation.

Rule 2: Suit Against Corporation

1. How Corporation is Sued:

   • A suit against a corporation is typically initiated in the same manner as a suit against any other defendant. However, the main difference is that the corporation will be represented by its authorized officer or agent in court.
   • If the corporation is a company, it is generally sued by naming the company itself as the defendant, and the summons will be served to the corporation's registered office or headquarters. The service can also be made to a director or any officer authorized to receive notices on behalf of the corporation.

2. Service of Summons:

   • For a suit against a corporation, the summons will be directed to the corporation’s registered office or headquarters. If no officer is available at the registered office, it can also be served to an officer, director, or other person authorized by the corporation to accept legal notices.
   • This ensures that the corporation is notified and has the opportunity to respond to the legal proceedings.

Rule 3: Verification and Power of Agents

1. Verification of Written Statement:
   • In suits involving corporations, the written statement (which is the response to the plaint) must also be verified by an authorized officer. This ensures that the corporation's response to the lawsuit is legitimate and properly documented.
2. Power to Act on Behalf of Corporation:
   • The person filing the written statement or acting in the case on behalf of the corporation must have specific authorization from the corporation’s board of directors or management body. If such authorization is lacking, the corporation’s legal standing may be questioned.

Rule 4: Representation in Court

1. Who Can Represent a Corporation:
   • A corporation can be represented by any person authorized to do so. Typically, this would be an officer or employee of the corporation who has been delegated the authority to act on its behalf.
   • The authorized person may not always need to be a lawyer, but a lawyer is often used, particularly in complex legal matters.
2. Corporate Officer’s Role:
   • The corporate officer representing the company in a suit can take the position of plaintiff or defendant in legal proceedings, depending on whether the corporation is suing or being sued.

Punishment

Dismissal of Suit:

• If the correct procedures are not followed, such as the failure to have proper authorization from the corporation’s governing body (e.g., board of directors), the suit may be dismissed. This could happen if the person who files the suit does not have the necessary authority to represent the corporation in court.

Contempt of Court:

• If the corporation or its representatives fail to comply with the court's orders, such as failing to attend hearings or respond to summons, the court may initiate contempt of court proceedings.

Penalties for Improper Representation:

• If it is found that the representative or agent of the corporation has been falsely authorized or has no authority to act, the corporation may be held accountable, and the proceedings may be invalidated.