Karnataka High Court lays down procedure to access spouse’s income-tax returns in matrimonial disputes

The Karnataka High Court has issued comprehensive guidelines for spouses to obtain income tax returns and financial records of their partners in maintenance proceedings, as the law does not permit couples in matrimonial disputes to access each other’s financial data under the Right to Information (RTI) Act.

The court said that trial courts, in every proceeding relating to alimony/maintenance, at the earliest opportunity and preferably at the first effective hearing, enquire into the financial capacity of both parties and specifically ascertain whether either party wishes to seek production of financial records from the Income Tax Department or any other authority.

Not on oral assertions

The trial courts should not determine maintenance based merely on oral assertions or unverified claims regarding income, particularly when the income of either party is disputed, but should suo motu consider invoking its powers to summon documentary evidence, including I-T returns and related financial records, the court said.

Justice Suraj Govindaraj delivered the verdict while allowing a petition filed by the Income Tax Department and setting aside an order of the Central Information Commission, which had directed the department to furnish a man’s returns to his estranged wife.

Difficulties faced

Accepting the department’s contention that I-T returns, which are “personal information” of the assessee cannot be disclosed under the RTI Act, except in larger public interest, the court also found that the trial courts have power in law to summon I-T returns and other financial details in matrimonial disputes.

However, on noticing the genuine difficulties faced by spouses in establishing the true income of their partners for determining just maintenance/alimony, the court issued the guidelines to be followed by all the trial courts in Karnataka and the I-T-Department.

Production order

The guidelines also mandate that spouses seeking financial records must file applications before the trial courts, which has to examine requirement of summoning I-T returns and pass ‘production order’ asking the department to submit the returns in a sealed cover.

The trial courts must complete hearing on such applications within 14 days by issuing notice to opposite spouse, and the Income Tax Department must comply with judicial orders within 21 working days through the designated nodal officers, the court said.

Privacy issues

The guidelines also incorporate safeguards to protect the assessee’s spouse’s privacy as the trial courts will have to open the documents from the I-T department in the presence of both parties and afford inspection.

Before any disclosure, the applicant-spouse must execute a written undertaking on affidavit that the information shall be used solely for the maintenance proceedings and not disclosed to any third party or used for any other purpose. The trial court’s can also refuse to give photocopy of the returns and also allow only inspection of the returns and taking notes of only relevant portions, the court said.

Any misuse of the information obtained, including use for purposes other than the maintenance proceedings, should be viewed as contempt of court and abuse of process of law, the court said.

Gender neutral

Making it clear that the guidelines apply equally to applications filed by wives seeking husband’s information and husbands seeking wife’s information, the court also said that the guidelines extend to obtaining financial records sought from the Goods and Services Tax (GST) Department, Employees Provident Fund Organisation (EPFO), banks, and other institutions holding financial information of a spouse.