Delhi HC Modifies Format Of Assets, Income And Expenditure To Be Filed By Parties To A Matrimonial Litigation [Read Judgment]

In its judgment, single bench of Justice JR Midha has modified the format by incorporating International Best Practices alongside important questions and documents contained in the formats previously prescribed by the High Court in the following cases:

• Kusum Sharma I, - (2014) 214 DLT 493;
• Kusum Sharma II, (2015) 217 DLT 706;
• Kusum Sharma III, MANU/DE/2406/2017;
• Kusum Sharma IV, (2018) 246 DLT 1.

The bench has also incorporated the benevolent features of its decision dated August 5, 2020, in the case Bhandari Engineers II- stipulating affidavit of assets, income and expenditure to be filed by the judgment-debtor in execution cases.

Delhi HC Frames Formats Of Assets And Income For Disclosure Of Judgment Debtor's Financial Capacity, Asks Centre To Consider Incorporating In Statute

Filing of comprehensive format of assets, income and expenditure in matrimonial cases is essential to determine the maintenance. In this backdrop the High Court expressed that mandatory filing of the affidavit by the parties should be incorporated in the statutes, as is done in the developed countries.

"Let this suggestion be considered by the Central Government," the bench observed while also directing that the Judgment be circulated to all concerned courts, the Delhi Judicial Academy and the National Judicial Academy.

Also Read: Right To Maintenance: Why High Courts Should follow The Lead Taken By The Delhi High Court

The High Court has annexed the new format to its order as 'Annexure 2'. The same may be accessed at the end of this report.

These modified directions/guidelines shall apply to all matrimonial cases including cases under Hindu Marriage Act, 1955; Protection of Women from Domestic Violence Act, 2005; Section 125 Cr.P.C.; Hindu Adoption and Maintenance Act, 1956; Special Marriage Act, 1954; Indian Divorce Act, 1869; Guardians and Wards Act, 1890 and Hindu Minority and Guardianship Act, 1956.

The modified affidavit requires the parties to disclose the following information:

• In case of a salaried person—particulars of his employment including salary, D.A., commissions, incentives, bonus, perks, perquisites, other benefits, Income tax etc.
• In case of a self-employed person—the nature of business/ profession, share in the business, net worth of the business, number of employees, annual turnover/gross receipts, gross profit, Income Tax, net income and regular monthly withdrawal/drawings from the business.
• Income from other sources—agricultural income, rent, interest on bank deposits and other investments, dividends, mutual funds, annuities, profit on sale of movable/immovable assets etc.
• Particulars of immovable properties— financial assets including bank accounts, DEMAT accounts, safety deposit lockers; investments including FDRs, stocks, shares, insurance policies, loans, foreign investments;
• Particulars of movable assets—motor vehicles, mobiles, computer, laptop, electronic gadgets, gold, silver and diamond jewellery etc.; intangible assets; garnishee(s)/trade receivables; corporate/business interests; disposal and parting away of properties; properties acquired by the family members, inheritance.
• Standard of living and lifestyle—credit/debit cards, membership of clubs and other associations, loyalty programmes, social media accounts, domestic helps and their wages, mode of travel in city and outside city, category of hotels, category of hospitals for medical treatment, frequency of foreign travel, frequent flyer cards, brand of mobile, wrist watch, pen, expenditure ordinarily incurred on family functions, festivals and marriage of family members etc.
• Expenditure— on housing, household expenditure, maintenance of dependents, transport, medical expenditure, insurance, entertainment, holiday and vacations, litigation expenses, discharge of liabilities, etc.

The Court has clarified that affidavits of both the parties should be taken on record "simultaneously".

"The simultaneous filing of the affidavit by the parties would avoid any undue advantage to the party who files his/her affidavit later. It is clarified that the affidavit of assets, income and expenditure is not to be filed along with the petition/application/ or written statement/reply," the order states.

Other guidelines to be observed by the Family Courts include:

• Upon completion of the pleadings in the maintenance application, the Court shall fix the date for reconciliation and direct the parties to simultaneously file the affidavits of their assets, income and expenditure.
• The Court shall direct the party seeking maintenance to produce the passbook of his/her savings bank account in which maintenance can be directly deposited/transferred by the opposite party.
• If a party is carrying on the business as proprietor of proprietorship concern/partner of a partnership concern/director of a company/member of a HUF/trustee of a trust/ member of a society/ or in any other form/entity, the Court may consider directing the party to file an additional affidavit with respect to the assets of the proprietorship concern/partnership concern/ company/society/HUF/Trust, as the case may be.
• In pending maintenance cases, if the parties have not already filed the affidavit of their assets, income and expenditure, the Court shall direct the parties to file their affidavit.
• If the reconciliation fails, the Court shall grant an opportunity to the parties to respond to the affidavit of the opposite party and list the maintenance application for hearing.
• In appropriate cases, the Court may direct a party to file an additional affidavit relating to his assets, income and expenditure at the time of marriage and/or one year before separation and/or at the time of separation.
• If the admitted income of the parties is on record, such as, in the case of a salaried employee whose salary slip is on record, the Court may fix ad-interim maintenance on the basis of the admitted documents pending filing of the affidavit of the assets, income and expenditure by both the parties. The Court may record the statement of the parties, if considered necessary for fixing the ad-interim maintenance.

The High Court has asked the Family Courts to ensure that the filing of the affidavits is not reduced to a "mere ritual" or formality.

Insist On Income & Assets Affidavit In Matrimonial Cases, Directs P&H HC

It has suggested:

• If the affidavit of the party is not in the prescribed format or is not accompanied with all the relevant documents, the Court may take the affidavit on record and grant reasonable time to the party to remove the defects/deficiencies.
• If the party does not truly disclose all his assets and income, the opposite party is at liberty to serve the interrogatories under Order XI of the Code of Civil Procedure and/or seek production of relevant documents from the party filing the affidavit.
• In appropriate cases, Court may order interrogatories, discovery, inspection, production of any document and/or order any fact to be proved by affidavit under Section 30 of the Code of Civil Procedure.
• If any party delays in filing of the affidavit of assets, income and expenditure or the affidavit filed by a party is not in terms of these directions or a party delays the disclosure of further information/documents and the delay is causing hardship, the Court is at liberty to fix ad-interim maintenance after hearing the parties.

After filing of the affidavit, the Court has directed the Family Courts to observe the following procedure:

• Consider whether the oral examination of the party is necessary under Section 165 of the Evidence Act. If so, the Court shall proceed to examine the party to elicit the truth
• If the statements made in affidavit of assets, income and expenditure are found to be incorrect, the Court shall consider its effect by drawing an adverse inference or imposing additional cost, while fixing the maintenance. However, an action under Section 340 Cr.P.C. is ordinarily not warranted in matrimonial litigation till the decision of the main petition unless the Court, for the reasons to be recorded, considers it expedient in the interest of justice, to deal with it earlier.

At the time of issuing notice on the petition for dissolution of marriage, the Court has directed that the family courts shall consider directing the petitioner to deposit such sum, as the it may consider appropriate for payment to the respondent towards interim litigation/ part litigation expenses; except in cases, such as, divorce petition by the wife who is unable to support herself and is claiming maintenance from the respondent husband

It is clarified that the interim litigation expenses directed by the Court at the stage of issuing notice, does not preclude the respondent from seeking further litigation expenses incurred by the respondent at a later stage.

At the time of passing a decree of divorce, the Court has directed that the family courts shall bring to the notice of the concerned party that he/she can claim permanent alimony without prejudice to his/her right to challenge the decree of divorce and if the party seeks permanent alimony, at that stage, for which an oral prayer/application is sufficient, the Court shall fix the permanent alimony on the basis of the affidavits of assets, income and expenditure, after hearing both the parties.

However, if the affidavits have not been filed at the stage of fixing the permanent alimony, the Court shall direct the parties to file the same before fixing the permanent alimony.

Case Details:

Case Title: Kusum Sharma v. Mahinder Kumar Sharma

Case No.: FAO 369/1996

Quorum: Justice JR Midha

Appearance: Senior Advocate Sunil Mittal as Amicus Curiae with Advocates Seema Seth and Dhruv Grover and Advocate Anu Narula as Amicus Curiae

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