Code of Civil Procedure, 1908 (CPC)
Order XXIX CPC: Suits by or Against Corporations
A corporation is a person in law but has no hands to sign with and no door to knock on. Order XXIX of the Code of Civil Procedure, 1908 supplies both: it names the officers who may sign and verify a corporation's pleadings, prescribes how a summons is served on it, and allows the court to require the personal attendance of an officer who can answer material questions. These notes cover the three rules of the Order, their interaction with the Companies Act, and the practical questions that arise when a company sues or is sued.
The three things a juristic person lacks: hands to sign, a door to serve, a voice to answer
1. Signing and Verification of Pleadings: Rule 1
§ Order XXIX Rule 1, CPC 1908 In suits by or against a corporation, any pleading may be signed and verified on behalf of the corporation by the secretary or by any director or other principal officer of the corporation who is able to depose to the facts of the case. |
§ Four points on Rule 1 Each is regularly tested: • Who may sign. The secretary, or any director or other principal officer. The expression other principal officer is not confined to those named in the articles; it covers an officer occupying a position of responsibility in the corporation's affairs, such as a general manager or a branch manager for a suit arising from that branch. • The qualifying condition. He must be able to depose to the facts of the case. This is the heart of the rule: the signatory is not a formal delegate but a person with knowledge, because verification is a statement that the facts are true. • It is an enabling provision. Rule 1 permits these officers to sign; it does not exclude a person duly authorised under a power of attorney, who may sign under Order VI Rule 14 as a person authorised to sue or defend on the party's behalf. • A defect is curable. A pleading signed by a person not competent under the rule is an irregularity, not a nullity, and the court may permit it to be signed and verified afresh by a competent officer, consistently with the approach in Vidyawati Gupta v. Bhakti Hari Nayak, (2006) 2 SCC 777. |
§ Verification, the affidavit and the deponent's knowledge Order VI Rule 15 requires the verification to state, by reference to the numbered paragraphs, what is true to the deponent's knowledge and what is stated on information received and believed to be true, with the source disclosed. Rule 15(4) and Section 26(2) require a supporting affidavit. For a corporation this matters more than for an individual, because the officer signing may know some matters personally and others only from the company's records. He must say which is which. The principle in Janki Vashdeo Bhojwani v. Indusind Bank Ltd., (2005) 2 SCC 217 applies here too: an officer may depose to acts done by him and to facts within his knowledge, including what the records he maintains show, but not to matters of which he has no knowledge at all. |
2. Service on a Corporation: Rule 2
§ Order XXIX Rule 2, CPC 1908 Subject to any statutory provision regulating service of process, where the suit is against a corporation, the summons may be served — (a) on the secretary, or on any director, or other principal officer of the corporation; or (b) by leaving it or sending it by post addressed to the corporation at the registered office, or if there is no registered office then at the place where the corporation carries on business. |
i. Two alternative modes. Service may be effected either personally on a named class of officer, or by leaving or posting it at the registered office. The plaintiff may adopt either.
ii. Subject to any statutory provision. The opening words defer to special legislation, and the most important is the Companies Act, 2013, under which Section 20 provides for the service of documents on a company at its registered office by registered post, speed post, courier or electronic mode. Where that Act applies, its provisions govern.
iii. Where there is no registered office, service is at the place where the corporation carries on business, which covers unregistered bodies corporate and foreign corporations operating in India.
iv. The general modes remain available. Order V continues to apply so far as consistent, including service by speed post, courier, fax or electronic mail under Order V Rule 9 as amended, and substituted service under Rule 20 where the corporation evades service.
3. Personal Attendance of an Officer: Rule 3
§ Order XXIX Rule 3, CPC 1908 The Court may, at any stage of the suit, require the personal appearance of the secretary or of any director, or other principal officer of the corporation who may be able to answer material questions relating to the suit. |
The rule answers a practical problem. A corporation appears through counsel, and counsel may be unable to answer the factual questions the court puts under Order X Rule 2, which is designed to elicit admissions and narrow the dispute. Rule 3 allows the court to require the attendance of an officer who can actually answer, at any stage. Three limits attend the power. The officer must be one able to answer material questions, so the court cannot summon a director with no connection to the transaction merely to inconvenience the company. The purpose must be the elucidation of the dispute, as under Order X, rather than the collection of evidence, for which the ordinary witness provisions apply. And the power is discretionary, and is not exercised where the company's written material and counsel's instructions are sufficient.
4. Practical Questions in Corporate Litigation
Question | Answer |
|---|---|
Who is the party? | The corporation itself, in its own name, being a juristic person. Its directors are not parties merely because they manage it, and a decree against the company is not executable against them personally |
Can a power-of-attorney holder sign the plaint? | Yes, under Order VI Rule 14 as a person duly authorised, in addition to the officers named in Order XXIX Rule 1; but he may depose only to facts within his own knowledge |
How is a decree enforced against a corporation? | By attachment and sale of its property under Order XXI; for a decree for specific performance or an injunction, by attachment of its property or, with the leave of the court, detention of its directors under Order XXI Rule 32(2) |
Is a corporation liable to arrest? | No. It cannot be detained; the coercive process against it is attachment of its property, and detention reaches only its directors or principal officers with leave |
Can the court order a director to attend? | Yes, under Order XXIX Rule 3, provided he is able to answer material questions relating to the suit |
What if the company changes its registered office? | Service is at the registered office as it stands when service is effected; a change does not invalidate service already effected at the former office where the company had not notified the change as required |
5. Landmark Points
- Order XXIX Rule 1. Pleadings may be signed and verified by the secretary, a director or other principal officer who is able to depose to the facts of the case.
- Order XXIX Rule 2. Service may be on the secretary, a director or principal officer, or by leaving or posting the summons at the registered office, or at the place of business where there is none.
- Order XXIX Rule 3. The court may at any stage require the personal appearance of an officer able to answer material questions relating to the suit.
- Section 20, Companies Act, 2013. Service of documents on a company at its registered office, which the opening words of Order XXIX Rule 2 defer to.
- Order XXI Rule 32(2). A decree for specific performance or an injunction against a corporation is enforced by attachment of its property or, with leave, detention of its directors.
- Vidyawati Gupta v. Bhakti Hari Nayak, (2006) 2 SCC 777. Defects in signing and verification are curable irregularities rather than nullities.
6. Frequently Asked Questions
Who can sign and verify a corporation's pleadings?
Under Order XXIX Rule 1, the secretary, or any director or other principal officer of the corporation who is able to depose to the facts of the case. A person duly authorised under a power of attorney may also sign under Order VI Rule 14.
Must the officer who signs have personal knowledge?
He must be able to depose to the facts of the case, which is the qualifying condition in Rule 1. In the verification he must state which paragraphs are true to his knowledge and which on information and belief, disclosing the source, as Order VI Rule 15 requires.
How is a summons served on a company?
Under Order XXIX Rule 2, on the secretary or any director or other principal officer, or by leaving or sending it by post addressed to the corporation at its registered office, or where there is none, at the place where it carries on business. The rule is subject to any statutory provision, notably Section 20 of the Companies Act, 2013.
Can a court require a director to appear personally?
Yes. Order XXIX Rule 3 allows the court at any stage to require the personal appearance of the secretary or any director or other principal officer who may be able to answer material questions relating to the suit. The officer must be one who can actually answer.
Is a defect in signing a corporate pleading fatal?
No. It is an irregularity rather than a nullity, and the court may permit the pleading to be signed and verified afresh by a competent officer, consistently with the approach in Vidyawati Gupta v. Bhakti Hari Nayak.
How is a decree enforced against a corporation?
By attachment and sale of its property under Order XXI. For a decree for specific performance or an injunction, Order XXI Rule 32(2) allows enforcement by attachment of the corporation's property or, with the leave of the court, by the detention of its directors or other principal officers.
7. Related Topics in This CPC Series
- Order XXX: Suits by or Against Firms
- Recognised Agents and Pleaders under Order III
- Pleadings under Order VI: Verification and Amendment
- Issue and Service of Summons: Sections 27 to 29 and Order V