Introduction
Continuing its progressive approach to matrimonial cases, the Hon’ble Supreme Court, in the matter of Apurva v. Dolly & Ors[i]*, *reiterated that a person’s right to live a dignified life overrides the statutory rights guaranteed to the creditors under various economic laws.
Brief Facts
Aggrieved by the order of maintenance passed by the Hon’ble Gujarat High Court, which had granted the Respondent (‘wife’) and the two children monthly maintenance of Rs. 1,00,000/- and Rs. 50,000/-, respectively, the Appellant (‘husband’) approached the Supreme Court.
The brief facts of the matter are as follows:
The Ld. Family Court at Surat had initially granted monthly maintenance of Rs. 6,000/- to the wife and Rs. 6,000/- (Rs. 3,000/- for each child) to the children. Aggrieved by this nominal maintenance that was awarded, the wife filed a revision application before the High Court.
The High Court enhanced the maintenance, taking into account the husband’s financial affluence as a diamond factory owner. The husband’s failure to produce income tax returns led to adverse inferences, prompting the High Court to accept the wife’s claim for enhanced maintenance and order arrears payment within six months.
In the appeal before the Supreme Court, the husband submitted his income tax returns and argued that the wife’s claims were inflated and that she earned her own income. He also contended that business losses and recovery proceedings had significantly reduced his financial capacity.
After considering these submissions, the Supreme Court issued an interim order on 07.11.2022, staying the enhanced maintenance and directing the husband to pay Rs. 50,000/- per month to the wife, Rs. 25,000/- per month to each child and 25% of the arrears.
Held
After reviewing the submissions and facts, the Supreme Court partially allowed the appeal and modified the maintenance granted by the High Court to the extent that the monthly maintenance payable towards the wife and the children was fixed at Rs. 50,000/- per month and Rs. 25,000/- per month for each child, respectively, payable from the date of the High Court’s order.
The Court emphasized that the right to maintenance is a fundamental right, intrinsically tied to sustenance and dignity under a. 21 of the Constitution of India (‘Constitution’). It also authorised the Ld. Family Court to take coercive measures, including auctioning the husband’s assets, in case of non-payment of arrears.
While clarifying that the High Court’s enhancement was not erroneous, the Court noted that the lack of sufficient documentary evidence prevented its full assessment. The wife was allowed to seek amendments to the maintenance grant under s. 127 of the Code of Criminal Procedure, 1973 (‘CrPC’) upon presenting additional evidence of the husband’s income.
The Court also observed that maintenance rights take precedence over creditors’ claims, including those under the Insolvency and Bankruptcy Code, 2016 (‘IBC’). It held that the wife and children would have preferential rights over the husband’s assets, even in ongoing or future recovery proceedings initiated by creditors.
Our Analysis
The Supreme Court’s ruling reaffirms the primacy of maintenance as a fundamental right under a. 21 of the Constitution, directly linked to the dignity and sustenance of the wife and children. While the judgment offers crucial relief to vulnerable dependents, it also raises concerns about its implications for creditors' rights under statutes like the IBC and the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act).
The relief granted, rooted in protecting the dignity of dependents, appears well-balanced. However, completely barring financial creditors from opposing maintenance payments could inadvertently infringe upon their own rights under a. 21. Both maintenance recipients and creditors rely on financial stability to maintain their quality of life, which is equally protected under the Constitution.
The Court’s decision to prioritise maintenance over creditors’ claims may dilute the statutory framework of the IBC, particularly ss. 231 and 238, which ensure the framework’s precedence over conflicting laws. However, the provision allowing the wife to seek amendments under s. 127 of the CrPC reflects the Court’s nuanced approach, recognising the possibility of evolving financial circumstances for both parties.
Striking the right balance between competing rights under a. 21 will be critical in shaping jurisprudence on the intersection of matrimonial and insolvency laws. Future cases may require further deliberation to ensure equitable treatment for all stakeholders without compromising fundamental rights.
End Note
[i] Criminal Appeal No. 5148-5149 of 2024.
Authored by Anshi Bhatia, Advocate at Metalegal Advocates. The views expressed are personal and do not constitute legal opinions.
AUTHORED BY
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