Income tax returns cannt decide Maintenance

IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION

WRIT PETITION NO.569 OF 2010

Amit Rasiklal Shah …Petitioner
Vs.
Sonal Amit Shah …Respondent

Ms. T. F. Irani for the Petitioner
Mr. Rakesh K. Agarwal for Respondent

CORAM : SMT. ROSHAN DALVI, J.
DATED : 18TH NOVEMBER, 2010
ORAL ORDER :

1. The Petitioner husband has challenged the order of the Family Court, Mumbai dated 4th November 2009 granting interim
maintenance of Rs.20,000/­ to his wife and Rs.10,000/­ each to his sons in the Petition filed by the wife.
2. The Petitioner’s income is required to be seen to adjudicate whether the impugned order grants a reasonable amount of
maintenance or whether the maintenance is excessive considering the Petitioner’s station in life.

3. The Respondent wife has not been shown to be having any separate means of livelihood. The two children are aged about 12 and 10 years.

4. The Petitioner has produced income tax returns for 3 years. He
contends that net taxable income is the only numerical figure
from the income tax returns must be seen by the Court based
upon which the maintenance for the wife and children must be
granted. The contention is wholly incorrect. It would be
absurd to consider the net income of an assessee who has
various sources of income some of which may not be liable to
tax at all.

5. Consequently, the computation of taxable income of the
Petitioner’s individual returns must be seen in its entirety and
has to be read as a whole. The Petitioner is admittedly in
business. Hence the business returns of the partnership firm or
sole proprietary concern along with the trading and profit and
loss account as well as the balance sheet of the firm must be
seen to appreciate what income the firm or the individual
would have at least approximately earned and what income is
ultimately shown as the net taxable income. This is aside from
the fact that it is settled position in law that the tax returns of
a party shown by the party in Court, specially in matrimonial
proceedings, cannot be taken for the gospel.

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6. With that it will be interesting and appropriate to decipher the
Petitioner’s income from the individual returns shown by
himself.

7. The Petitioner was married in 1997. The parties have fallen off
in April 2006. The wife lives with her two sons in her parental home.

8. The Petitioner’s income tax returns is for the year 2006­2007.
It makes interesting reading. The income from his business
and profession is only Rs.9695/­. The long term capital gains
of the Petitioner are Rs.3.62 lakhs. Income from other sources
is Rs. 1 lakh and the gross total income is Rs.4.72 lakhs. After
deductions under Section 80 C of the Income Tax Act of Rs.1
lakh the total income is shown to be Rs.3.72 lakhs. The
computation of his total income shows, not profit from his
business, but as salary of Rs.1 lakh with the aforesaid capital gains.

9. For the next assessment year 2007­2008 the Petitioner has
shown the share of profit from his firm of Vintex Optics as well
as Mesha International. These are petty figures of Rs.25000/­
and Rs.9000/­ each. The Petitioner has shown the
remuneration from Vintex Optics which exceeds his share of
profit. It is approximately Rs.57000/­ less interest thereon of
Rs.27000/­. The Petitioner has shown commission received
from another firm. It is stated by him in Court that he had
introduced a client from Andheri to his brother in the said firm
for which he received a commission of Rs.90000/­. The
Petitioner has further shown short term as well as long term
capital gains. These are on shares of listed companies. The
dividend income from shares, which is exempt from tax is in a
sum of Rs.37,688/­ as also with interest on RBI bonds and PPF
interest. The long term capital gains is to the extent of Rs.16.5
lakhs and short term profit of shares treated separately is also
shown deducted from the income of the Petitioner on certain
shares. Income of the two minor sons of the Petitioner is also
shown in his own return. The LIC premium which is deducted
is of Rs.1lakh and the Petitioner who is present in Court
concedes that the LIC policies are more than Rs.20 lakhs.

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10.The returns for the year 2008­2009 also shows the share of
profit from Mesha International, but not from Vintex Optics. It
shows a loss from this proprietary concern. These returns also
show the dividend, PPF, Insurance etc. as in the earlier year.
The capital account of the Petitioner which is shown only in
the last year’s income tax returns shows gift of Rs.5 lakhs and
Rs.2.25 lakhs amongst others given to his father and his
brothers. The income from the partnership firm of Nisha
International is not shown. Instead the assets in the balance
sheet shows a certain flat premises in Goregaon. The
investments in shares, insurance, mutual funds recurring
deposits, PPF etc. are also shown aggregating to about Rs.55
lakhs including the investment in shares of Rs.30 lakhs. Loans
and advances are shown against all the family members except
perhaps his wife. The cash and bank balances are shown to
aggregate to approximately Rs.3 lakhs.

11.These returns themselves show the worth of the Petitioner.
They do not show a person who earns an amount of Rs.
20000/­ per month as is alleged by the Petitioner. A person
who earns that income, if that be his only income, would not
be able to invest in shares of listed companies, insurance, PPF
account, government bonds, flat, shop etc. Though these
assets are not liable to distribution or division whilst
considering the interim maintenance, these are required to be
seen and appreciated by the court for considering the income
earned from such assets to appreciate his standing in society.

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12.It is argued on behalf of wife that the Petitioner’s total
earnings including earnings as a partner or sole proprietor in
the aforesaid firms and as a Director in Global Parasol
Reinsurance Bonds besides having shares, bank accounts and
cash etc. It is also argued that the Petitioner owns 5 cars and
has bank accounts in IDBI Bank, Axis Bank, Indian Overseas
Bank and HDFC Bank. The Petitioner also has credit card of
Citibank.

13.The Advocate on behalf of wife drew my specific attention to
the income tax returns of the Petitioner for the assessment year
2007­2008 showing the current year’s income remaining after
set off of the losses of earlier years including salary, business
speculation, short term capital gain etc., to be Rs.3.65 lakhs.
The total exempted income including the long term capital
gain against security transactions is shown to be Rs.17.5 lakhs.
The learned Judge has considered the aforesaid amounts to
determine the Petitioner’s standard of living. That has been
correctly considered. Though the Petitioner may be entitled to
set off the losses and though the Petitioner may be legally
exempt from tax for the purpose of payment of income or
wealth tax, the fact that the Petitioner has earned those
amounts cannot be sidelined. It would have to be considered
reading the taxation returns as a whole. Considering these
returns itself the interim maintenance amount would be
calculated. This would leave out the immovable properties, if
any, owned by the Petitioner and the Bank accounts which are
not produced before this Court. Upon seeing these returns
maintenance of Rs.20000/­ for the wife and Rs.10000/­ each
for the children is not only reasonable, but in order. The order
of the learned Family Court Judge is not required to interfered
with.

14.The Writ Petition is dismissed.
15.The Civil Application No.2705/2010 also stands disposed off
as infructuous.
(SMT. ROSHAN DALVI, J.)

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