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Maintenance Rights of Wife, Children Override Creditors’ Claims Under SARFAESI/IBC: SC

Writer's picture: Legal Soch FoundationLegal Soch Foundation
1 min read

The Supreme Court has ruled that the right to maintenance of a wife and children will have priority over creditors' claims on a husband’s assets under laws like the SARFAESI Act and the Insolvency and Bankruptcy Code (IBC).


The judgment was delivered in a case where the creditors of a man sought to recover debts by attaching and auctioning his property. The wife and children objected, claiming their statutory maintenance rights over the property. The Court emphasized that the constitutional and statutory obligations to provide maintenance must not be undermined by creditors' claims.


The bench clarified that the fundamental right to life under Article 21 of the Constitution encompasses the right to live with dignity, which includes the provision of maintenance to dependents. It held that family members, particularly spouses and children, are entitled to protection under various laws, including the Hindu Adoptions and Maintenance Act and the Criminal Procedure Code.


Rejecting the arguments of creditors, the Court noted that Section 26 of the SARFAESI Act and similar provisions in the IBC must be read harmoniously with other laws protecting maintenance rights. It ruled that the property required to satisfy maintenance obligations cannot be auctioned or attached for debt recovery.


This landmark ruling ensures that vulnerable dependents are safeguarded against financial hardships caused by creditors' enforcement actions. The judgment also reinforces the balance between financial recovery mechanisms and the constitutional duty to uphold family welfare.


This decision sets a precedent for prioritizing maintenance rights over commercial interests, promoting justice for those relying on statutory and moral obligations for survival.






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