An unpleaded and unsubstantiated cash-payment allegation cannot trigger consequential proceedings under Section 269ST.

The Petitioner challenged the order dated 13 November 2025 passed by the Family Court, South-East District, Saket Courts, New Delhi, in HMA No. 1545/2022, whereby three applications, including an application under Order XVIII Rule 17 read with Section 151 of the Code of Civil Procedure, 1908 (“CPC”), were dismissed.

Before the High Court, the Petitioner confined the challenge to the rejection of his request concerning an alleged cash payment exceeding ₹2,00,000 by the Respondent’s family to him.

He contended that Section 269ST of the Income Tax Act, 1961, and the Supreme Court’s decision in The Correspondence, RBANMS Educational Institution v. B. Gunashekar & Anr. , Civil Appeal No. 5200/2025, required the Family Court to notify the Income Tax Department.

The Respondent argued that the alleged transaction had not been pleaded and remained an unsubstantiated assertion arising from cross-examination.

The Family Court had found no material establishing the alleged cash exchange and no discernible nexus between the proposed inquiry and the matrimonial proceedings, which concerned dissolution of marriage on the ground of cruelty.

1. Whether the Family Court erred in refusing to recall a witness under Order XVIII Rule 17 read with Section 151 CPC for examining an alleged cash transaction exceeding ₹2,00,000 that had not been pleaded or substantiated by evidence.

2. Whether the alleged cash transaction, elicited only as a suggestion or assertion during cross-examination, furnished a sufficient factual foundation to require the Family Court to notify the Income Tax Department under Section 269ST of the Income Tax Act, 1961.

3. Whether the impugned order disclosed any jurisdictional error, manifest illegality, perversity, or failure to exercise jurisdiction warranting interference under Article 227 of the Constitution.

The Court considered Order XVIII Rule 17 read with Section 151 CPC, under which recall of a witness is discretionary and cannot ordinarily be invoked to introduce an unpleaded or unsubstantiated issue.

The Court considered Section 269ST of the Income Tax Act, 1961, concerning restrictions on receipt of specified cash amounts.

The Court considered the Supreme Court’s decision in The Correspondence, RBANMS Educational Institution v. B. Gunashekar & Anr. , Civil Appeal No. 5200/2025, relied upon by the Petitioner in support of consequential action under the Income Tax law.

The Court further applied the settled principle that the mere suggestion or assertion of a fact in cross-examination does not establish that fact or automatically trigger proceedings before another statutory authority.

Interference under Article 227 is supervisory and is warranted sparingly only where the subordinate court’s order reflects a jurisdictional error, manifest illegality, perversity, or failure to exercise jurisdiction.

The High Court found that the alleged cash transaction did not form part of the pleadings and therefore lacked a foundational factual basis in the lis.

The Family Court had also recorded that no material or proof established the alleged exchange of cash and that the proposed inquiry had no discernible connection with the cruelty-based matrimonial proceedings.

In these circumstances, recalling a witness under Order XVIII Rule 17 CPC would have permitted an inquiry into an issue that was neither pleaded nor substantiated.

The Court further held that an assertion emerging during cross-examination could not, by itself, be treated as an established fact sufficient to initiate consequential proceedings under Section 269ST or require notification to the Income Tax Department.

Since the Family Court had considered the Petitioner’s request and exercised its discretion on the basis of the absence of pleadings and supporting material, its order disclosed no jurisdictional infirmity warranting supervisory interference under Article 227.

It held that the refusal to recall the witness and examine the alleged cash transaction was justified because the transaction had neither been pleaded nor substantiated, and that the cross-examination assertion did not constitute a sufficient factual foundation for action under Section 269ST of the Income Tax Act.

Finding no jurisdictional error or other ground for interference under Article 227, the High Court dismissed the petition and all pending applications.

The Court clarified that it had expressed no opinion on the merits of the underlying issues and that the Petitioner remained at liberty to take such steps as may be permissible in law.