Nidhi Bhargava vs. National Insurance Company Ltd.

1
REPORTABLE
2025 INSC 526
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. OF 2025
[@ SPECIAL LEAVE PETITION (CIVIL) NO.10664 OF 2019]
NIDHI BHARGAVA & ORS. …APPELLANTS
A1: NIDHI BHARGAVA
A2: MANUJ BHARGAVA
A3: ANUJ BHARGAVA
VERSUS
NATIONAL INSURANCE COMPANY LTD. & ORS.
1
…RESPONDENTS
R1: NATIONAL INSURANCE COMPANY LTD. THROUGH ITS
REGIONAL MANAGER
R2: K. L. BHARGAVA
R3: ANIL KUMAR KUKREJA
J U D G M E N T
Signature Not Verified
Digitally signed by
VARSHA MENDIRATTA
Date: 2025.04.22
17:08:51 IST
Reason:
1
As per the amended Memo of Parties.

2
AHSANUDDIN AMANULLAH, J.
Leave granted.
2. This appeal arises from the Final Judgment and Order dated
20.09.2018 (hereinafter referred to as the ‘Impugned Order’)
[ 2018:DHC:6122 | 2018 SCC OnLine Del 11494 ] in MAC. APP.
No.589 of 2018 rendered by a learned Single Judge of the High Court
of Delhi (hereinafter referred to as the ‘High Court’) filed by
Respondent No.1-Insurance Company, whereby the High Court
disposed of the appeal by reducing the compensation payable to the
Appellants from Rs.31,41,000/- (Rupees Thirty-One Lakhs Forty-One
Thousand) to Rs.16,97,370/- (Rupees Sixteen Lakhs Ninety-Seven
Thousand Three Hundred and Seventy) maintaining the interest
awarded at the rate of 9% per annum .
FACTS IN BRIEF:
3. On 12.08.2008, a Blue Line bus bearing Registration No.DL-
1PB-0035, being driven by one Javed Aftar in an allegedly negligent
manner, hit a motorcycle bearing Registration No.DL-6SX-6483, which

3
was being driven by Kapil Bhargava (hereinafter referred to as the
‘deceased’) along with his wife (Appellant No.1), as a result of which
the deceased died in hospital and Appellant No.1 survived, but
suffered grievous injuries.
4. The Appellants and other legal heirs of the deceased filed a
Claim Petition viz . MACT No.357515/2016 under Section 166 read
with Section 140 of the Motor Vehicles Act, 1988 (hereinafter referred
to as the ‘Act’) before the Court of the learned Judge, MACT-1
(Central), Delhi (hereinafter referred to as the ‘Tribunal’), claiming
compensation for the death of the deceased for Rs.40,00,000/-
(Rupees Forty Lakhs). After hearing the parties, on 20.03.2018, the
Tribunal by a common judgment awarded a compensation of
Rs.31,41,000/- (Rupees Thirty-One Lakhs Forty-One Thousand) with
interest at the rate of 9% per annum from the date of filing of the Claim
Petition, i.e., 27.09.2008 till realization in MACT No.357515/2016.
5. The Appellants, being aggrieved by the Award/Order dated
20.03.2018 in MACT No.357515/2016 preferred an appeal, namely,
MAC. APP. No.796/2018 before the High Court for enhancement of the

4
compensation awarded by the Tribunal. Respondent No.1, also
aggrieved by the Award/Order dated 20.03.2018, preferred MAC. APP.
Nos.589/2018 and 592/2018 before the High Court against, apropos
MACT No.357515/2016 and MACT No.357259/2016, respectively.
6. The High Court disposed all the three MAC. APP. petitions by
the common Impugned Order and held that the Income Tax Returns for
the Assessment Year 2008-2009 were filed after the date of the
accident, therefore, the income of the deceased had to be assessed
on the basis of Assessment Year 2007-2008. While changing some of
the heads of compensation granted by the Tribunal, the High Court
reduced the compensation payable to the Appellants from
Rs.31,41,000/- (Rupees Thirty-One Lakhs Forty-One Thousand) to Rs.
16,97,370/- (Rupees Sixteen Lakhs Ninety-Seven Thousand Three
Hundred and Seventy). The High Court also modified the
compensation under various heads from Rs.4,30,000/- (Rupees Four
Lakhs Thirty Thousand) to Rs.3,94,543/- (Rupees Three Lakhs Ninety-
Four Thousand Five Hundred Forty-Three) insofar as MACT
No.357259/2016 was concerned.


5
7. The Appellants have filed the instant appeal challenging the
Order of High Court only qua MAC. APP. No.589/2018.
8. It would be useful to set out the computation as per the
Tribunal’s Award and the Impugned Order:

APPELLANTS’ SUBMISSIONS:
9. The learned counsel for the Appellants submitted that the High
Court had erred in ignoring the gross income shown by the deceased-
Assessee for the Assessment Year 2008-2009. As a matter of fact, the
Assessment Year for the Return filed in 2008-2009 was, in fact, the
gross income of the deceased-Assessee for the Financial Year

6
01.04.2007 to 31.03.2008, for which, the accounts of the Assessee
were already sealed, as cut-off date i.e., 31.03.2008, was prior to the
date of the accident. It was submitted that there was no question of
any manipulation by the Assessee or the persons claiming through
him. It was prayed that the appeal be deservedly allowed, on this short
ground alone.
RESPONDENT NO.1’S SUBMISSIONS:
10. The learned counsel for the Respondent No.1 submitted that
the Impugned Order is well-reasoned and does not warrant any
interference. Learned counsel urged that the average of the Income
Tax Returns for the Assessment Years 2007-2008 and 2008-2009, at
best, could be the basis for assessing the income of deceased. It was
otherwise prayed that the appeal be dismissed and the Impugned
Order be upheld.
ANALYSIS, REASONING AND CONCLUSION:
11. Having considered the matter, we find the reasoning in the
Impugned Order to be, putting it mildly, erroneous. The only reasoning

7
by the High Court can be found in Paragraph 10 of the Impugned
Order, extracted below:
‘ 10.  Upon hearing and on perusal of impugned Award,
evidence on record and the decisions cited, I find that in
the case of deceased-Kapil Bhargava, the income tax
returns for assessment years 2008-09 was filed on
th
10   September, 2008 i.e. after the day of accident and
so, it has to be excluded from consideration. The income
of deceased-Kapil   Bhargava has to be assessed on the
basis of previous assessment year's income tax return
i.e. for the year 2007-08. The gross income of deceased
in the assessment year 2007-08 was Rs. 1,25,600/- and
after deducting tax of Rs. 1610/-, the net income of
deceased is assessed at Rs. 1,23,990/-.
Deceased- Kapil Bhargava was aged 43 years on the
day of accident and in view of Supreme Court's decision
in Sarla Verma (Smt.) v. Delhi Transport
Corporation (2009) 6 SCC 121, the Tribunal has rightly
applied multiplier of 14. In light of Supreme Court's
Constitution Bench decision in National Insurance
Company Ltd. v. Pranay Sethi (2017) 16 SCC 680, the
Tribunal has rightly made addition of 25% towards
“future prospects. In view of aforesaid, the “loss of
dependency” of deceased- Kapil Bhargava is reassessed
as under:—
Rs. 1,23,990/- × 14 × 125/100 × ¾ = Rs. 16,27,370/- ’
(emphasis supplied)
12. Just because on the date of the accident i.e., 12.08.2008, the
Return for the Assessment Year 2008-2009 had not been filed, cannot

8
disadvantage the appellants, for the reason that the period for which
st
the Return is to be submitted covers the period starting 1 of April,
st
2007 and ending 31 March, 2008. Thus, for obvious reasons, the
Return would be only for the period 01.04.2007 to 31.03.2008, and
date of submission would be post-31.03.2008. No income earned
beyond 31.03.2008 would reflect in the Income Tax Return for the
Assessment Year 2008-2009. To reject the Return on the sole ground
of its submission after the date of accident alone, in our considered
view, cannot be legally sustained.
13. The Income Tax Return is a legally admissible document on
which the income assessment of the deceased could be made. This
Court in Malarvizhi v United India Insurance Co. Ltd. , (2020) 4 SCC
228 affirmed that the determination of income must proceed on the
basis of Income Tax Return(s), when available, being a statutory
document. In S Vishnu Ganga v Oriental Insurance Company
Limited , 2025 SCC OnLine SC 182 , we opined:

9

14. In Malarvizhi ( supra ), the Madras High Court relied upon the
Returns ‘ for Assessment Year 1997-1998 and not 1999-2000 and
2000-2001 which reflected a reduction in the annual income of the
deceased ’ therein.
15. The High Court interfered and reduced the compensation as
awarded by the Tribunal only on the ground that Return for the
Assessment Year 2008-2009 had to be excluded from consideration. It
is not in dispute that the deceased was a businessman. The relevance
of the Income Tax Return stems, in the context of the Act, for the
period which it relates to i.e., the Financial Year concerned, and not on
the date on which it is filed with the Income Tax Department. When
faced with Returns for different Assessment Years, it would be upto
the Tribunal concerned to adopt either the average income therefrom
or choose an Assessment Year to rely upon. There is good reason to
leave judicial discretion on the Tribunal to adopt one of the afore-noted
two courses of action, bearing in nature the social purpose and object
behind the Act, which is a beneficial legislation. It is quite unfortunate

10
that the High Court in the present case has dealt with the matter in
such a casual and superficial way where the rightful claim of the
appellants under a welfare legislation has been drastically reduced
without any cogent reason on a very tenuous ground, which we find to
be totally unjustified. As pointed out in Shivaleela v Divisional
Manager, United India Insurance Co. Ltd. , 2025 SCC OnLine SC
563 :

16. On the strength of the reasons afore-indicated, the Impugned
Order is modified to the extent that the original amount [Rs.
31,41,000/- (Rupees Thirty-One Lakhs Forty-One Thousand)] awarded
2
Also reported as [2025] 4 SCR 63 | 2025 INSC 357 .

11
by the Tribunal in MACT No.357515/2016 as compensation is
restored. Payment be made to the Appellants by the Respondent No.1
at the rate of 9% interest per annum after adjusting amount(s), if any,
that may have been paid during the interregnum. The exercise be
completed within two months from today, failing which an additional
9% interest per annum shall be payable for the period of delay, both
on the principal amount as well as on the interest component, till the
date of actual payment. No order as to costs, in the circumstances.
17. The Civil Appeal is disposed of accordingly.
…………………......................J.
[SUDHANSHU DHULIA]

………………….......................J.
[AHSANUDDIN AMANULLAH]
NEW DELHI
APRIL 22, 2025