Originally posted by : Anis
Dear All, my wife is not working anywhere.. She was not working b4 marriage also. Ny point is that after paying EMI and Professional Tax I am left with Rs.6,379/- only. Out of that MM court has granted Rs.6,000/- Should I appeal in MM court for revision or should I move Sessions court.
The following are the conditions depending on which alimony is awarded by the court.
Alimony is generally not granted to the seeking spouse if he or she is already receiving support during the time of divorce. Although the rewarding of alimony can be revised in such events based on the arguments for claiming the support. In case of a contested divorce, often spouses fail to come to any understanding regarding alimony. In such situations, the court takes up the task of making a decision on the amount of alimony to be paid. Only under certain compelling situations the court steps out to change the already framed alimony. Some times the court might even hand over the burden of paying for the maintenance to a public body.
The following are the factors that influence the duration and amount to be paid as alimony.
The amount and duration of alimony generally depends upon how long the marriage existed. Marriages that lasted more than 10 years are entitled to be granted a life long alimony. Age of the spouse is also taken into consideration while awarding alimony. Normally a young recipient of alimony gets it for a short period of time if the court thinks that he or she will soon be able to become financially sound trough prospective career excellence. Alimony is also in vogue in order to equalize the economic condition of both the spouses.
The higher earning spouse is entitled to pay a heavy amount as alimony. The spouse who is projected to be enjoying a prosperous career is liable to pay high alimony amount. If one of the spouses is suffering from poor health, the other is subjected to payment of high alimony to ensure proper medication and well being of the other spouse.
The terms and conditions of payment of alimony in India vary from one personal law to another. None of the Indian personal laws are spared from criticism due to existence of flaws in framing definite rules for granting alimony. The Shah Bano case is one such instance that exposes how the sustenance of a divorced woman is affected due to inclusion of inappropriate laws regarding post divorce maintenance and financial support.
Is there tax on alimony or is alimony tax deductible?
Unlike child support which is not tax-deductible, alimony is taxable income. Alimony becomes tax-deductible for the person paying alimony, which it is taxable for the one receiving it. As far as housing is concerned, if you happen to take possession of the house, you are liable to pay tax on it.
Kinds of monetary compensation
Alimony could be offered in two ways. It can either be a maintenance during the time of court proceedings or a permanent maintenance/lumpsum compensation after the legal separation. The lumpsum payment is usually referred to as the alimony. The spouse has the choice to go for either lumpsum payment or a fixed monthly payment, depending on the requirements.
How is alimony decided?
The court decides on the amount of alimony/maintenance after looking at factors like husband's income and property, the woman's income and property and the divorced individual's financial needs. The court could also look at external factors such as inflation while deciding on the alimony amount. However, it is the applicant who has to prove her/his spouse's net worth, which, in turn, will decide the amount of alimony/maintenance.
Explains Neeraj Shah, a Mumbai-based lawyer who specialises in family court and divorce laws, "One of the main issues we encounter in such divorce cases is lack of transparency. A wife is often clueless about her husband's net worth. This is more common when the woman is a home maker. The husband usually routes most of his investment-related letters, cheques and even bills to his office address. This makes it difficult for a woman to calculate the appropriate alimony or a monthly maintenance amount."
Once the court passes the order, the husband has to pay a lumpsum or a monthly amount till the wife remarries. The husband can request to stop or reduce the outgo, if the wife manages to get another source of income, adds Mr Shah. Often, a wife can gauge her husband's net worth by looking at his income tax returns, credit card and other utility bills like the mobile, share certificates and other investments, lifestyle and wealth (if any) inherited from his family. Otherwise, it will be difficult to arrive at an appropriate alimony/maintenance amount as it will be difficult to find how much the husband earns.
"It is essential to collect all these details as the existing legal stipulation does not prescribe any floor limit on alimony. It's very subjective today, and the spouse has to do the homework before computing compensation. The individual has to be doubly careful, especially if the spouse is a businessperson or has huge unaccounted salary," says Jignesh Kalotia, another Mumbai-based lawyer.
There is no fixed rule or formula to calculate the alimony. However, if both husband and wife are working, then the maintenance paid to the wife may vary in the range of one-third and one-fifth of the joint income of both spouses. That has been the trend, adds Mr Kalotia. Calculating alimony also factors in the lawyers' fee. The fees can vary from Rs 20,000 to Rs 2 lakh for the whole case taken together. Some lawyers also charge for every hearing, which could again fall in the range of Rs 2,000 to Rs 25,000. The fees depend on the case or petition, number of hearings and seniority of the lawyer.
In the end, tackling divorce is a daunting task without doubt. But following a systematic process to handle finances post-separation could help smoothen some of the rough edges.