In a pivotal judgment that underscores the primacy of familial obligations over financial claims, the Supreme Court of India has ruled that maintenance rights of a wife and children take precedence over creditors’ claims in recovery proceedings. The judgment, delivered in Criminal Appeal Nos. 5148-5149 of 2024, has far-reaching implications for the interpretation of maintenance laws and their interplay with financial statutes like the SARFAESI Act and the Insolvency and Bankruptcy Code (IBC).
Case Background
The appellant, Apurva @ Apurvo Bhuvanbabu Mandal, a diamond factory owner, challenged the Gujarat High Court’s decision to significantly enhance the maintenance for his estranged wife, Dolly, and their two children. The High Court had revised the Family Court’s initial maintenance order of Rs.6,000 per month for the wife and Rs.3,000 per month for each child to Rs.1,00,000 for the wife and Rs.50,000 per month for each child.
The appellant contested the revised amounts, citing financial difficulties and claiming his wife was self-sufficient. The legal team for the appellant, led by Senior Advocate Ms. Meenakshi Arora, argued that the quantum was excessive and unsustainable given his recent business setbacks. Advocating for the respondent, Mr. Samar Vijay Singh and team highlighted the appellant’s refusal to disclose income documents and argued for maintenance commensurate with the family’s lifestyle and needs.
Key Legal Issues
1. Priority of Maintenance Obligations: Whether the right to maintenance for dependents overrides the claims of creditors under recovery laws like the SARFAESI Act and the IBC.
2. Determination of Maintenance Quantum: Balancing the appellant’s claimed financial difficulties against the legal duty to support dependents.
3. Scope of Maintenance Rights Under Article 21: The court examined the relationship between the right to maintenance and the constitutional right to a dignified life.
Supreme Court’s Observations
A bench comprising Justice Surya Kant and Justice Ujjal Bhuyan issued a judgment emphasizing the constitutional and moral imperative of maintenance.
1. Maintenance as a Fundamental Right
The court ruled that the right to maintenance is integral to the right to sustenance and dignity, flowing directly from Article 21 of the Constitution of India. “The right to maintenance is commensurate with the right to sustenance. This right is a subset of the right to dignity and a dignified life,” the bench observed.
2. Priority Over Creditors’ Claims
Highlighting the preeminence of familial obligations, the court stated that maintenance rights supersede the claims of secured and operational creditors under the SARFAESI Act, IBC, and other recovery laws. The judgment clarified, “No objection of any secured creditor, operational creditor, or any other claimant shall be entertained opposing the entitlement of the respondents for maintenance.”
3. Modified Maintenance
While acknowledging the appellant’s financial distress, the Supreme Court reduced the High Court’s award, ordering:
– Rs.50,000 per month for the wife.
– Rs.25,000 per month for each child.
Arrears from the date of the High Court order (12.09.2022) were to be cleared within three months, with maintenance arrears taking precedence over other recovery claims. The court also emphasized that arrears could be recovered by auctioning the appellant’s immovable assets if necessary.
