Nitish Banka

    • How to prepare your arguments based on an Income Affidavit in maintenance cases?

    These days after the judgement of Rajnish Vs. Neha, the court asks for an Asset-liabilities affidavit after your reply has been filed. Now in Delhi, this affidavit was there and changed due to a recent Supreme Court judgment.

    Income Affidavit is a crucial tool to know about the social status of the parties as an overall aspect regarding the true lifestyle of the parties. The issue in earlier procedures in maintenance cases was that both the husband and the wife used to hide their income and assets due to which it became difficult for the court to assess the status of the parties to determine the maintenance awarded to each of the parties. Earlier Sec. 106 read with Sec. 91 of CrPC was used for disclosure of assets of the parties provided the other party had basic information of the assets of the other party. The judgment of Rajnish vs. Neha solved the issue of getting this confidential information about the parties by ordering the mandatory disclosure of the true financial status of the parties. Not only this the affidavit of income and assets also resolves the problem related to the disposal of the assets. Previously what the husband’s side used to do was that any income coming into his account was transferred to his parents’ account or any assets in the name of the husband were transferred to the parent’s account to avoid paying high-maintenance to the estranged wife. It is also pertinent to mention that earlier parties used to play a cat-and-mouse game of not disclosing as well as transferring assets so as to make the court believe that the husband was a pauper. Sometimes husband used to make the court believe that he was unemployed and the wife’s side had no clue about the income of the husband. In the case of the husband having a business, he used to show losses in that particular year, in which the maintenance case was put into in order to show that he had no money left to pay for the wife and children’s maintenance. It is also common for the husband’s side to show a lower standard of living after the maintenance case is put on and the husband manipulates his present income. The same applies to the wife who used to show that she was incapable of working as soon as she filed for the maintenance case so as to show that she is unable to maintain herself. Both parties were using these eyewash tactics to either lower or increase the maintenance awarded by the courts. To address this problem some of the High Courts had to take steps like the introduction of affidavits of income/assets/liabilities but the issue was that this procedure was not uniform throughout the country. Therefore to address this issue the judgment of Rajnesh vs. Neha was pronounced by the Hon’ble Supreme Court which is a guideline for deciding the maintenance cases.

    CONTENTS OF AFFIDAVITS

    The broad contents of the affidavit of Rajnesh vs. Neha are categorized as

    Declaration of last three years’ assets– The declaration of income of both parties for the last three years solved the last-minute manipulation of assets and liabilities by both parties and actually calculated the real capacity of both parties. It was quite common for both husband and wife to dispose of assets like properties/cars/mutual funds/shares/FDs/Insurance Policies as soon as the maintenance case was filed but nowadays the parties have to disclose the last three years of assets and liabilities to show the real wealth of the parties. The Income Affidavit solves this issue.

    Status of Dependents– It became really important to know about the status of the dependents like mother, father, and children so as to assess the liabilities of the husband on other dependents without this earlier there was no way to assess the burden on the husband to legally maintain the old and ailing parents and children.

    Assessment of True Expenses of the Parties – The affidavit also provides for the assessment of the true expenses of the parties for assessment of the maintenance requirement of the wife and children. If the husband shows exorbitant expenses like home loans, EMIs rent then in such cases the wife is also entitled to the same set of lifestyle requirements therefore it becomes futile to show expenses on exorbitant things.

    POINTS TO ARGUE USING INCOME AFFIDAVIT

    1. Comparing Bank Statements with Income Declarations– It is very important to compare the credit in the bank statement and the income shown in the income affidavit. Case example- In one of my client’s cases, while representing the wife’s side I argued on the basis of the Bank account statement of the husband in which there were transactions of lakhs of rupees were made whereas, in the declaration of income affidavit, he declared his income to be in losses as his business could not perform well. To cover up this it was contended by the husband that he had to take loans from somewhere to pay off the salaries of the employees and that is why his bank statement shows transactions that are very heavy although he didn’t have any profit from the business. We argued from the wife’s side that the husband who is suffering from various losses from business is a man of means who cares so much for his employees that he spent lakhs of Rupees on salaries and bonuses but his clearly neglecting his own wife and children. The court awarded maintenance to the wife and children to the tune of rupees 1 Lakh a month. In another case in which I was representing the husband’s side, we argued that the wife’s bank statement shows a heavy amount of credits while her income affidavit shows no income as per her she is unemployed. We also moved application under section 91 CrPC for disclosure of bank as well as employment details as well as credit details of the wife. We also found out where the wife was working and we were able to establish by pointing out the bank account statement of the wife to show that she is gainfully employed and the credit to her is none other than her own salary. No explanation from the wife’s side about the entries in her bank account statement was put forward and thus the maintenance was denied to her.
    2. Arguments about Deduction in Salary – It is important to know that there are certain deductions in the salary of both husband and wife which are termed as EPF/PPF/Income Tax etc. Some of them are statutory deductions. In one of my cases which I argued last week the husband who was my client had mistakenly submitted to the court that he was earning rupees 2,50,000 per month whereas in the income affidavit, we had submitted his income as rupees 1,50,000 per month. Now if the court had awarded maintenance to the tune of Rs. 2.5 lacs then it would have been Rs. 90,000 – 1,00,000 as maintenance to the wife and the child. I, during the arguments clarified to the court that the income of the husband is variable and he earned Rupees 2.5 Lacs and there are also statutory deductions on his income on average his net income turned out to be Rs. 1.5 Lacs. The court assessed his final income as Rs. 1.5 Lacs only and passed a maintenance order of Rs. 50,000 instead of 90,000.
    3. EMI Loans Investment– In one of the cases in which I was representing the wife’s side the husband showed that he was merely earning Rs. 6000 per month and placed no document apart from a fake Bank Account Statement showing he was earning Rs. 6000 per month. The account was one year old and it seemed like he was preparing for the maintenance cases. My client then gave me an investment document to the tune of Rs. 21 Lacs of the husband and we placed this before the court. The court verified that the document was actually of the husband who concealed his true income and investment from the court. The court adopted the method of guesswork and assessed the husband’s income to the tune of Rs. 6Lacs and passed an order of Rs. 1 lakh per month as maintenance for the wife and the child.
    4. Declaration of Expenses– In one of the cases in which I was representing the husband and on the other hand the wife side presented expenses to the tune of Rs. 1.5 Lakhs and gave a breakdown of all those expenses. We pointed out that the expenses presented by the wife’s side are not supported by any documentary evidence and are deliberately inflated just to get a higher amount of maintenance.
    5. Non-Disclosure of Income– It is very common that after filing of income affidavit wife side joins the job and starts earning and gets a promotion but no fresh income affidavit is filed by the wife to show a change in circumstances and this non-disclosure is also termed as concealment of facts. In such a situation it is the duty of the husband to bring out these facts before the judge and in one of the cases my client found out after filing the income affidavit wife had actually started to work in a company but she did not disclose this to the court such non-disclosure was termed as concealment by the court and the court denied maintenance to the wife.

    CONCLUSION

    The non-disclosure or disclosure of certain facts needs to be addressed in a proper way by presenting the arguments. An income affidavit is the best tool to bring out the true income and expenditure of the parties and therefore should be used very strategically to argue your cases successfully.

    Advocate Nitish Banka

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