A posthumously filed income-tax return cannot determine deceased’s income; contemporaneous returns may establish it.

On 26 February 2010, Bakulchandra Vasava was travelling in an Indica car from Rameshwar to Vadodara. Near Neelkanth Hotel, the driver-cum-owner allegedly drove rashly and negligently, lost control of the vehicle, and collided with a tree. Bakulchandra sustained grievous injuries and subsequently died.

His legal representatives filed Motor Accident Claim Petition No. 564 of 2010 before the Motor Accident Claims Tribunal, Vadodara.

The Tribunal awarded ₹6,26,662 with interest at 7.5% per annum from the date of filing of the claim petition until realization.

The claimants preferred the present appeal, challenging the award solely on the quantum of compensation.

They relied upon income-tax returns for Assessment Years 2007–08 and 2008–09 and bank-passbook records to contend that the deceased’s income had been wrongly assessed at ₹50,000 per annum.

The insurer argued that the 2008–09 return was filed after the deceased’s death and could not be relied upon, and that only 25% future prospects could be added for a deceased aged 43 years.

1. Whether the deceased’s annual income was required to be reassessed on the basis of the income-tax return for Assessment Year 2007–08, rather than being fixed at ₹50,000 per annum by the Tribunal?

2. Whether the claimants were entitled to an addition for future prospects and, if so, at what rate?

3. Whether the compensation under the conventional heads of loss of estate, funeral expenses, and loss of consortium required enhancement in accordance with the applicable Supreme Court precedents?

The Court applied the principles governing assessment of compensation under the Motor Vehicles Act, including proof of the deceased’s income, deduction for personal expenses, addition of future prospects, and application of the age-based multiplier.

It relied on National Insurance Co. Ltd. v. Pranay Sethi, (2017) 16 SCC 680, for the applicable addition towards future prospects and standardized amounts under conventional heads such as loss of estate and funeral expenses.

It also relied on Magma General Insurance Co. Ltd. v. Nanu Ram @ Chuhru Ram, (2018) 18 SCC 130, for awarding consortium to each eligible legal representative of the deceased.

The Court accepted contemporaneous income evidence but declined to rely on the income-tax return filed by the deceased’s father after the deceased’s death.

The Court found that the Tribunal had improperly disregarded the income-tax return for Assessment Year 2007–08, which had been filed by the deceased himself.

That return disclosed a net income of ₹96,990; the Court therefore rounded the annual income to ₹97,000.

In contrast, the Assessment Year 2008–09 return was filed by the deceased’s father after the death and was excluded from consideration as income evidence.

Since the deceased was 43 years old, the Court added 25% towards future prospects, resulting in an annual income of ₹1,21,250.

As the deceased left five legal representatives, one-fourth was deducted towards personal expenses, producing an annual dependency contribution of ₹90,938.

Applying a multiplier of 14, the loss of dependency was calculated at ₹12,73,132.

Applying Pranay Sethi, the Court awarded ₹18,150 each for loss of estate and funeral expenses.

Applying Magma General Insurance, it awarded consortium to all five claimants at ₹48,400 each, totalling ₹2,42,000.

The total compensation was enhanced from ₹6,26,662 to ₹15,51,432, comprising ₹12,73,132 for loss of dependency, ₹18,150 for loss of estate, ₹2,42,000 for loss of consortium, and ₹18,150 for funeral expenses.

After deducting the amount already awarded, the claimants were granted additional compensation of ₹9,24,770.

The additional amount was directed to carry interest at 7.5% per annum from the date of filing of the claim petition until realization.

The insurer was directed to deposit the additional compensation and interest within six weeks, after which the Tribunal was to disburse the amount to the claimants subject to verification and deduction of any deficit court fees.