Receipt of alimony from ex-husband is nothing but Gift and is exempt

Prema G. Sanghvi Vs. ITO (ITAT Mumbai)

It is not disputed that the assessee was the legally wedded wife of Mr. Zaun. It is also not disputed that the said marriage was performed as per the Hindu customary rights. It is also not disputed that the said marriage was dissolved on 20-6-1978 as per the provisions of Hindu Marriage Act.

Under the Hindu Law, a wife has a preexisting right of maintenance and alimony. The said right exists even after divorce from the husband. So far the granting of divorce under the German Law is concerned, the learned Commissioner (Appeals) has discussed at length about the German Law relating to marriage and divorces and thereafter has concluded that even under the German Law, the maintenance can be claimed, if any of the spouse is unable to maintain himself/herself.

He has further held that under the German Law spouses are free to arrange for the financial consequences only in case of an eventual divorce possibly by way of prenatal agreement. However, the learned Commissioner (Appeals) has not discussed, if there is any bar in paying alimony by the husband to her divorced wife.

In our view, no law prevents such a lump sum payment by a husband to his wife in lieu of her maintenance for the whole life. In the proviso to section 56(2)(vi) any sum received from a relative is exempt from tax. In the definition of relative, the receipt from whom is exempt under the Act, inter alia not only the spouse but the brother and sister of the spouse have also been included.

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