Bhaskar N Shetty vs THE MANAGER
- Court
- Karnataka High Court
HC-KAR
NC: 2026:KHC:37402-DB
MFA No. 8635 of 2019
CNR: KAHC010473222019
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
ST
DATED THIS THE 21 DAY OF JULY, 2026
R
PRESENT
HON'BLE MR. JUSTICE JAYANT BANERJI
AND
HON'BLE MS. JUSTICE TARA VITASTA GANJU
MISCELLANEOUS FIRST APPEAL NO.8635 OF 2019
(MV-D)
BETWEEN:
1. BHASKAR N SHETTY
S/O NARAYANA SHETTY,
NOW AGED ABOUT 49 YEARS
2. MASTER BHANUSH B. SHETTY
S/O BHASKAR N SHETTY,
NOW AGED ABOUT 17 YEARS
3. MASTER SHUBRATH B SHETTY
D/O BHASKAR N SHETTY,
NOW AGED ABOUT 17 YEARS
SINCE APPELLANT NOS.2 & 3 ARE MINORS
REP BY THEIR FATHER AND N/G i.e.,
APPELANT NO.1,
RD
ALL ARE R/A NO.225, 3 CROSS,
ND RD
2 BLOCK, 3 STAGE,
BASAVESWARANAGARA,
BANGALORE – 560 079
…APPELLANTS
(BY SRI. RAGHU R., ADVOCATE)
Digitally signed by
SUMATHY KANNAN
Location: HIGH
COURT OF
KARNTAKA
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AND:
THE MANAGER
B.M.T.C., SHANTHI NAGARA,
DOUBLE ROAD,
BENGLAURU – 560 079
…RESPONDENT
(BY SRI. F.S.DABALI., ADVOCATE)
THIS MFA IS FILED UNDER SECTION 173(1) OF MV ACT
PRAYING TO a) PERUSE AND MODIFY THE JUDGMENT AND
AWARD DATED 28.12.2018, PASSED IN MVC NO.4306/2017,
ON THE FILE OF THE COURT OF SMALL CAUSES AND MACT
(SCCH-16), BENGALURU AND ALLOW THE APPEAL AND
ENHANCE THE COMPENSATION AMOUNT; b) ALLOW THIS
APPEAL WITH COSTS THROUGHOUT.
THIS APPEAL COMING ON FOR HEARING THIS DAY,
JUDGMENT WAS DELIVERED THEREIN AS UNDER:
CORAM: HON'BLE MR. JUSTICE JAYANT BANERJI
and
HON'BLE MS. JUSTICE TARA VITASTA GANJU
ORAL JUDGMENT
(PER: HON'BLE MS. JUSTICE TARA VITASTA GANJU)
1. The present appeal seeks to challenge the judgment
and award dated 28.12.2018, in MVC No.4306/2017,
passed by the Small Causes and Motor Accident Claims
Tribunal, Bengaluru (hereinafter referred to as the
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MFA No. 8635 of 2019
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‘Impugned Award’). By the Impugned Award, the learned
Tribunal has awarded compensation to the
appellants/claimants in a sum of Rs.13,30,000/-, along with
interest at 9% per annum from the date of the petition till
its realisation.
2. The challenge in the present appeal is by the
appellants/claimants.
3. The brief relevant facts are that an accident took place
on 01.07.2017, at around 02.30 p.m., which involved the
deceased, who was riding as a pillion rider on a Motorcycle
bearing Reg.No.KA-02-ER-5017, being ridden by her
brother. The said motorcycle was hit by a BMTC bus bearing
Reg.No.KA-01-F-9013. It is stated that the offending bus
was being driven in a rash and negligent manner. In view
of the accident, the deceased fell down and sustained fatal
injuries. Although she was shifted to Panacia Hospital, she
succumbed to her injuries in the hospital despite treatment.
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4. A claim petition under Section 166 of the Motor
Vehicles Act, 1988 (hereinafter referred to as the ‘MV Act’)
was filed before the learned Tribunal, by the husband and
two children of the deceased. It was stated therein that the
deceased was running a Tutorial and earning a sum of
Rs.1,00,000 /- per month.
5. The claim petition was contested by the
respondent/BMTC. It was stated that the driver of the bus
was not negligent, but the negligence was on the rider of
the motorcycle. Thus, it was contended that the claim
petition be dismissed.
6. Based on the pleadings set out by the parties, the
following issues were framed by the learned Tribunal:
“1. Whether the petitioners prove that deceased
Smt.Shakila B. Shetty succumbed to the injuries
sustained in vehicular accident alleged to have occurred
on 01.07.2017 due to the rash and negligent driving of
the driver of the BMTC Bus bearing No.KA-01-F-9013?
2. Whether the petitioners are entitled to
compensation? If so, what is the quantum and from
whom?
3. What order or Award?”
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7. In order to prove their case, the appellant
No.1/claimant No.1, husband of the deceased, was
examined as PW-1 and twelve documents were marked as
Exhibits P1 to P12, which included the FIR (Exhibit-P1),
Mahazar (Exhibit-P3), Sketch (Exhibit-P4), IMV Report
(Exhibit-P5), Inquest Mazhar (Exhibit-P9) and the charge-
sheet (Exhibit-P10). The Income Tax Returns (hereinafter
referred to as ‘ITR’) for four assessment years from 2012-
13 to 2016-17 were produced as Exhibit-P11 (collectively).
The respondent/BMTC also examined the Driver of the
offending bus as RW-1. However, no documents were
produced on the behalf of the respondent/BMTC.
8. The learned Tribunal after reviewing the evidence
placed it found that the Driver of the respondent/BMTC bus
(RW-1) had stated in his evidence that he was waiting at a
traffic signal and the rider of the motorcycle came at a high
speed and tried to take a right turn. Thus, it was stated that
the motorcyclist was negligent. However, in his cross-
examination, RW-1, who is the driver of the offending bus,
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admitted that the bus bearing Reg.No.KA-01-F-3892 had
stopped in front of the offending vehicle, but denied the
accident had taken place in the manner described.
9. The learned Tribunal examined the spot mahazar and
sketch, as well as other documents and found that the
sketch clearly shows that the offending bus came from the
rear side and hit the motorcycle, as well as hit another BMTC
Bus, which was parked. Thus, it was held by the learned
Tribunal that based on the Police documents as well as the
documents filed by the appellants/claimants, the version of
the respondent was not believable, and that the accident
happened as a result of negligence of the offending bus
driver.
10. On the quantum awarded, the learned Tribunal found
that although the appellants/claimants stated that the
deceased was working as a Teacher, and produced ITRs,
neither any documents for having studied B.Tech or TCH
were produced, nor was the license produced to show that
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the deceased was running a Tutorial. The relevant extract
of the Impugned Order is set out below:
“12. For the determination of the quantum of
compensation, the Tribunal has to take into account the
age, income and occupation of the deceased. Firstly, I
wish to see what the avocation and income of deceased
was. According to petitioners, deceased was working as
teacher and running a tutorial classes and earning
Rs.1,00,000/- per month. To substantiate this aspect,
they have produced income tax returns for the
assessment year from 2012-13 to 2016-2017 as per
Ex.P11. For having studied B.Ed or TCH, no
document is produced. Likewise no license is
produced to show that the deceased was running
tutorials. Moreover, no PAN card is produced to show
that the deceased was an income tax assessee. On the
other hand, a close scrutiny of income tax returns show
that there is variation in the signatures found on Ex.P11.
For all these reasons, I am of the opinion that the income
tax returns which are at Ex.P11 cannot be relied upon
since it appears to be created for the sake of this case .
So, in the absence of documentary proof, notional
income has to be taken. Since the accident took
place in the year 2017, a sum of Rs.9,000/- is taken
as notional income. ”
[Emphasis Supplied]
10.1 Thus, the learned Tribunal took the notional income as
Rs.9,000/- per month and since the deceased was 41 years
rd
of age, future prospects was considered at 25% and 1/3
of the income was deducted towards personal expenses.
Thus, the loss of dependency was calculated as follows:
(Rs.9,000 + 25%) = 11,250 – 1/3 x 12 x 14 = Rs.12,60,000/-
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11. In addition, the learned Tribunal also awarded
amounts towards loss of consortium, loss of estate, funeral
expenses in the following manner:
Sl.No. Particulars Amount (Rs.)
1 Loss of Dependency 12,60,000/-
2 Loss of Consortium 40,000/-
3 Loss of Estate 15,000/-
4 Funeral Expenses 15,000/-
Total 13,30,000/-
11.1 Thus, it was held that the appellants/claimants were
entitled to a sum of Rs.13,30,000/- along with 9% interest
per annum, from the date of petition till the date of
realization.
12. The learned counsel for the appellants/claimants
made two submissions. Firstly, he submits that the ITRs of
the deceased produced were completely ignored by the
learned Tribunal, given the fact that there was no license
for the Tutorial classes. Secondly, that the compensation
awarded under the non-pecuniary heads is also not in
accordance with the settled law.
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12.1 Reliance is placed by the learned counsel for the
appellants/claimants on the judgment of the Supreme Court
in the case of Smt.Anjali And Others vs. Lokendra
1
Rathod And Others and Rashmirekha Tripathy and
Another vs. Branch Manager (Legal Claims), Sriram
2
General Insurance Company Limited and Others .
13. The learned counsel for the respondent, on the other
hand, has contended that the award has been passed in
accordance with law. He further contends that the
appellants/claimants had failed to produce any documents
reflecting the education of the deceased and her capabilities
for taking tuition. Thus, the learned Tribunal had rightly
disregarded the ITRs and awarded notional income.
14. Based on the averments of the parties, the issues that
arise before this Court are:
(i) Whether the learned Tribunal was right in
disregarding the ITRs filed by the
1
Civil Appeal No.009014 of 2022, dtd. 06.12.2022
2
2026 SCC Online SC 1256
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appellants/claimants, given the settled position of
law? and
(ii) To what additional amounts, if any, are the
appellants/claimants entitled to?
15. The facts in contention are not disputed by the parties
are the way the accident took place or the negligence. The
only question in dispute is regarding the quantum of
compensation awarded.
15.1 The learned Tribunal has examined the records and
has found that since no educational certificates or other
documents have been filed to state that the deceased was
a Teacher, the ITR cannot be considered. This Court is
unable to agree with this finding, for the reason that once
the ITR in respect of the income of an individual are filed,
these are to be examined for the purposes of calculating
compensation. It is a settled law that the ITRs cannot be
ignored or disregarded by the learned Tribunal.
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16. The Supreme Court in Smt.Anjali case, while relying
on its judgment in Malarvizhi & Ors. Vs. United India
3
Insurance Co. Ltd. & Ors. has held that the ITRs filed by
the appellants/claimants to prove the income of the
deceased cannot be disregarded. It is a statutory document
on which reliance shall be placed. The relevant extract of
the judgment is set out below:
th
“8. Assailing the High Court’s impugned order dated 16
August, 2018, the learned Counsel appearing on behalf of
the Appellants has contended:
a. The High Court and the Tribunal failed to
consider the deceased’s Income Tax Return filed
on 28.05.2010 for the year 2009-2010, the HC
rejected the ITR on the ground that earlier returns
were not filed while the Income Tax Inspector was
examined.
b. The High Court and Tribunal failed to observe that
since the number of dependents exceeded 6 members,
the deduction made towards personal expenses ought to
be one-fifth (1/5th). In the present case there are 7
dependents of the deceased.
c. The Tribunal failed to award any amount under the
Conventional Heads and the High Court awarded a sum
of Rs.70,000/- in lumpsum under the Conventional
Heads, whereas the same ought to have been
Rs.1,20,000/- as per the Supreme Court’s judgment
in Malarvizhi & Ors. Vs. United India Insurance CO. Ltd.
& Ors.
3
(2020) 4 SCC 228
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d. Both the Tribunal and High Court awarded interest at
the rate of 6% per annum from the date of application
while it ought to have been 9% as held in Malarvizhi &
Ors. Vs. United India Insurance Co. Ltd. & Ors.(Supra).
9. The Tribunal and the High Court both committed
grave error while estimating the deceased’s income
by disregarding the Income Tax Return of the
Deceased. The appellants had filed the Income Tax
Return (2009- 2010) of the deceased, which reflects
the deceased’s annual income to be Rs.1,18,261/-,
approx. Rs.9,855/- per month. This Court
in Malarvizhi & Ors. (Supra) has reaffirmed that the
Income Tax Return is a statutory document on which
reliance be placed, where available, for computation
of annual income. In Malarvizhi (Supra), this Court has
laid as under:
“10. …We are in agreement with the High Court that the
determination must proceed on the basis of the income
tax return, where available. The income tax return is
a statutory document on which reliance may be
placed to determine the annual income of the
deceased.” Hence, this Court is of the opinion that the
deceased’s annual income be fixed at Rs.1,18,261/-,
approx. Rs.9,855/- per month keeping in mind the
deceased’s Income Tax Return for the year 2009-2010.”
[Emphasis Supplied]
16.1 Recently as well, the Supreme Court in the case of
Rashmirekha Tripathy case, has held that where the ITRs
has been filed, the latest among those ITRs requires to be
taken into consideration where an employee is salaried.
However, where the individual is self-employed or carrying
on his own business, the average income of the previous
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three years’ ITRs shall be taken into consideration. If only 1
or 2 years' returns have been filed, the fluctuation of income
must be seen along with the surrounding circumstances of
the business must be seen in the following terms:
“18. We find force in the submission put forth by Mr. J.R
Midha, learned senior counsel. There must be a
bifurcation made between salaried individuals and
self-employed individuals when it comes to
assessment of annual income. In our view, for salaried
individuals, only the ITR of the previous year will be
sufficient for showcasing the annual income from
salary. The reason for considering only the preceding
year is that the financial impact of promotions is
significant and may be reflected in the ITR for only that
year. A situation may also arise whereby the
deceased/claimant might not have completed a year in
the promoted position before the accident or might not
have filed ITR for such period. In such cases the Court
concerned shall take reference to the promotion letter and
other corroboratory financial statements.
19. When it comes to self-employed / individuals
carrying out their own business , in our view, the
average of the income specified in the ITRs of up to
the previous three years is to be taken as a
reference point for assessment of annual income
from their business. There may also be a scenario
where only one or two ITRs have been filed. Given
such scenarios and the fluctuation of income in
these professions, surrounding circumstances are
also to be taken into consideration. These would
include:
a) The nature of the business (including geographic
location, category etc.);
b) Growth pattern of the business and impact of death
on the business;
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c) Potential growth of business (for instance certain
businesses are capital intensive at the outset and are
profitable at scale/in the future);
d) Negative income (certain businesses may require
losses in the initial years, which may not reflect the
true financial standing); and
e) Any other relevant factor relating to the business.
20. The date when the ITRs are filed would also
become a relevant consideration, as there may be
scenarios where inflated income is showcased after
death/injury. In these circumstances, the surrounding
factors of the business would become more relevant.
However, if sufficiently supported by financial statements,
such ITRs may also be taken into consideration.”
[Emphasis Supplied]
17. The Learned Tribunal has examined the records and
found that since no educational certificates or other
documents have been placed on record that the deceased
was a teacher, the income tax returns cannot be
considered. This Court is unable to agree. Once Income Tax
Returns in respect of the income of the individual is filed,
these have to be examined for the purposes of calculating
income. Given that the deceased was self-employed,
average income based on the last 3 years, as per the ITR
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has to be taken into consideration, less tax, to calculate the
monthly income.
17.1 An examination of the record before this Court shows
that the document exhibited as Exhibit-P11 are four ITRs of
the deceased. The gross taxable income for the last three
assessment years 2014-2015, 2015-2016 and 2016-2017,
is Rs.3,13,389/-, Rs.3,50,840 and Rs.3,35,851/-
respectively. Thus, the average gross annual income of the
deceased as per the ITRs filed for the past three years is
Rs.3,33,360/- per annum and Rs.27,780/- per month.
Thus, the monthly income of the deceased can be taken at
Rs.27,780/-. Since the deceased was 41 years of age the
appropriate multiplier applicable would be ‘14’ and future
prospects was considered at 25%. Further, the deceased
had three dependants including husband, and minor
rd
children and hence, 1/3 of the income was deducted
towards personal expenses. Accordingly, the loss of
dependency shall be calculated as follows:
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rd
(Rs.27,780 + 25%) = (34,725 – 1/3 ) x 12 x 14 =
Rs.38,89,200/-
18. Further, in view of the law laid down by the Supreme
Court in the Pranay Sethi case, loss of consortium is
payable at Rs.40,000/- to three claimants, amounting to
Rs.1,20,000/- . The respondents/claimants are also
entitled to compensation under the conventional heads.
Accordingly, loss of estate and funeral expenses are
awarded at Rs.15,000/- each.
19. Since the accident was of the year 2017 and although
the judgment of the learned Tribunal was passed in the year
2018, no escalation has been awarded on the ‘conventional
heads’. The Supreme Court in its judgment in the case of
Pranay Sethi has upheld the aforesaid principle of law. The
relevant paragraph is set out below:
“59.8. Reasonable figures on conventional heads,
namely, loss of estate, loss of consortium and
funeral expenses should be Rs 15,000, Rs 40,000
and Rs 15,000 respectively. The aforesaid
amounts should be enhanced at the rate of 10%
in every three years. ”
[Emphasis Supplied]
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19.1 Accordingly, escalation at the rate of 10% is also
awarded on the conventional heads.
20. In view of the aforegoing discussions, the
compensation awarded by the learned Tribunal requires to
be recalculated in the following terms:
Sl.No. Particulars Amount
(Rs.)
1 Loss of Dependency
rd
(Rs.27,780 + 25%) = (34,725 – 1/3 ) x
12 x 14
38,89,200/-
2 Loss of Consortium
(Rs.40,000 x 3 +10%)
1,32,000/-
3 Loss of Estate
(Rs.15,000 + 10%)
16,500/-
4 Funeral Expenses
(Rs.15,000 + 10%)
16,500/-
Total 40,54,200/-
Less : Awarded by the Tribunal 13,30,000/-
Enhanced Compensation 27,24,200/-
21. Hence, the appellants/claimants are entitled to a total
compensation of Rs.40,54,200/- along with interest at 9%
per annum from the date of petition till its realization.
However, the appellants/claimants shall not be entitled to
interest for the delayed period of 217 days in filing the
appeal.
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22. Accordingly, this Court proceeds to pass the following:
ORDER
(i) The appeal is allowed in part;
(ii) The Judgment and Award dated 28.12.2018, in
MVC No.4306/2017, passed by the Small Causes and
Motor Accident Claims Tribunal, Bengaluru is modified
by awarding a total compensation of Rs.40,54,200/-
along with interest at the rate of 9% per annum from
the date of petition till realization.
(iii) The interest awarded shall be recalculated from the
date of the petition till the date of realisation as set out
under Section 171 of the MV Act, the
appellants/claimants shall not be entitled to interest for
the delayed period of 217 days in filing the appeal.
(iv) The remaining portion of the Impugned Award of
the Tribunal remains undisturbed.
(v) The appellant/Insurance company is directed to
pay the enhanced compensation with interest as
awarded by the Tribunal within eight weeks from today.
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(vi) On such deposit of compensation, the same shall
be released in favour of the appellants/claimants, on
filing of an appropriate application for withdrawal of the
enhanced amount.
(vii) The Registry is directed to draw the modified
Award accordingly.
(viii) The Registry is directed transmit the amount in
deposit along with a copy of this judgment to the
concerned Tribunal, along with its records for disbursal.
(ix) No order as to costs. All pending application(s)
stand closed.
Sd/-
(JAYANT BANERJI)
JUDGE
Sd/-
(TARA VITASTA GANJU)
JUDGE
JJ
List No.: 1 Sl No.: 33
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