Division of Assets and Liabilities during Divorce


Marriage in India is considered to be a sacred union of two souls. It is contemplated that both husband and wife are the better half of each other and they are incomplete without each other. Sometimes the situation between the marriages might deteriorate to the point where divorce becomes an unavoidable alternative. Divorce is still considered an inauspicious occasion in India and involves a lot of emotional trauma, financial irregularities, and stressful thinking. The major issue faced at the time of the divorce is how will the assets be divided? This includes not only the division of personal property or money but every single thing such as stocks, debts, real estate, responsibilities, etc. The house in which the couple was living previously is left isolated and a question arises who will have the house? Across the globe, two models are relied upon for the division of the property during the divorce: Separate Ownership and Community Ownership. 

Separate ownership of Property

The property which is privately owned by one of the spouses, before or after the marriage, that property is retained by that spouse only, after the divorce and the other spouse will have no right over that property. 

Community ownership of Property

The property which is equally owned by both the spouses is equally divided between both of them after the divorce. The main intention behind this ownership of property is to consider that both husband and wife have contributed equally to buy that house. Under this, only financial contribution is not taken into consideration but non-financial contribution is also given equal weightage. 

Unfortunately, India mainly follows the concept of separate ownership and does not acknowledge the contribution of non-financial contributors, generally females. The property belongs to the one who has the ownership title. Under the Indian Legal System, after the divorce, if the house belongs to the husband and he has the title deeds over it wife cannot ask for the house. The wife who non-financially contributed to the house for her whole married life fails to acquire a small part of it. However, she has the right to ask for shelter. She can also claim this right from her in-laws if they are all living in an ancestral property along with the husband. 

A wife cannot ask for the property or the house owned by the husband during divorce but she has a right to claim Alimony. If the wife has no independent source of income, she is entitled to an amount that will enable her to have a reasonable standard of living as per his husband’s financial status. If the wife does not have enough income to continue the same standard of living then the husband has to provide her with the shortfall. 

Joint-owned Property

The property which is jointly owned by both the spouses and both of them contributed, then it would be divided proportionally based on their contribution in buying that property. 

The property which is jointly owned by both the spouses but one of them paid the whole amount is generally divided equally between the both. But if one of the spouses proves in the court of law that the house or the property has been bought out of his sole earnings, then he may acquire the whole property, irrespective of the joint ownership. 

Dividing Assets and Liabilities

If the divorce is taking place amicably without the intervention of the court, then before splitting the assets and liabilities it is important to list them all be it house, car, retirement plans, insurance policies, loans, cash, and other household stuff such as furniture, etc. After that market value of all the items is ascertained and divided between both the spouses in an agreed proportion. While dividing the assets, the role played by both the spouses is taken into consideration. If the wife is not employed, she has a right to claim alimony for her maintenance so that she can have the same standard of living enjoyed by her during the marriage. Her financial rights depend upon the husband’s financial status and living standard, plus his assets and liabilities. 

Each party intends to receive more in such a scenario, however, if assets are divided equally and in an appropriate ratio, all the liabilities and responsibilities shall also be divided in a pertinent manner. 

If the parties go to the court of law for settling their dispute, the court divides the assets and liabilities as per its discretion and the parties are bound to agree with the same. 


Streedhan is the assets or the gifts received by the women at the time of marriage. It includes all the things bought by her or received by her before the marriage, at the marriage, or during the period when she was married. It incorporates all the gifts received by her parents, husband, in-laws, or other relatives. The wife exercises sole ownership over these items and it completely belongs to her. 

Streedhan includes all the valuable items such as jewellery, any property or house for which she has title deeds and has a sole right over them for her entire life. If the wife has inherited any ancestral jewellery after the marriage then she has ownership over it and it belongs to her. Similarly, any valuable inherited by the husband belongs to him, for example, the ancestral property. Anything that is passed on to the wife from the mother-in-law belongs to the wife. 

Any other valuables such as a painting or a silver set or cash gifts received by the couple at the time of marriage are jointly owned by them. So, these items should be divided equally between them at the time of the divorce. If any item is gifted by the husband or wife to each other before or after the marriage then the person to whom it was gifted has all the rights over that gift and it will not be divided at the time of divorce.  

Streedhan does not include:

  • Valuables are gifted to the husband by in-laws or other relatives at marriage.
  • The wife’s earnings are considered Streedhan but she cannot claim back the money she has spent on the household.
  • Expenditure incurred by the female’s side at marriage functions. 


In the Indian scenario, the assets are divided between the spouses based on ownership title. However, if the other spouse can prove his financial contribution in the court of law, then he can claim the right over that property. Jointly owned assets would be equally divided between the parties or the proportion contributed by them. In the same manner, if there is any jointly owned debt or loan by the parties, it would also be divided equally between both parties. At present, section 27 of the Hindu Marriage Act, 1955 vaguely deals with the provisions related to the division of parties during the divorce. The problem with this provision is that it does not explain the intention of the legislature due to which several times courts have given contradictory observations. Under our legal system, the concept of community ownership is not given importance due to which the role played by the females is always underestimated.

Bhakti Arora
I am Bhakti Arora, a final year student at Amity Law School, Delhi affiliated with GGSIPU. I have a keen interest in Family Law, Environment Law, and Criminal Law. I feel that writing content helps me to increase my knowledge and helps people looking for relevant information. It also helps me in widening my thinking and analyzing capacity.