Income-tax returns are statutory documents and must be considered the primary basis for assessing a deceased's income.

On July 16, 2009, 24-year-old Surendra Varma was killed when a spare wheel fell from a speeding luxury bus and struck him while he was riding his motorcycle

The claimants (legal heirs) filed a petition seeking ₹32,43,200/- in compensation

The Motor Accident Claims Tribunal (MACT), Bhuj-Kachchh, awarded ₹8,94,000/-, assessing the deceased's monthly income at a nominal ₹4,000/- despite the production of an Income Tax Return (ITR) acknowledgment

The appellants preferred this appeal specifically to challenge the quantum of compensation, asserting that the Tribunal failed to properly consider the ITR and internalize recent precedents on consortium and conventional heads

1. Whether the Tribunal erred in assessing the monthly income at ₹4,000/- despite evidence of an Income Tax Return showing a higher annual income

2. Whether the claimants are entitled to enhanced compensation under the heads of loss of dependency, consortium, and other conventional heads based on current legal precedents

The Court applied the principle from Govind Yadav v. National Insurance Co. Ltd., which mandates the use of minimum wages only in the absence of income proof

it relied on Malarvizhi v. United India Insurance Co. Ltd. and Nidhi Bhargava v. National Insurance Co. Ltd., establishing that Income Tax Returns are statutory documents and should be treated as reliable evidence of income, even if filed prior to the accident

Regarding quantum calculation, the Court followed the standardized frameworks for future prospects and conventional heads set out in National Insurance Co. Ltd. v. Pranay Sethi

and the principles for parental and filial consortium established in Magma General Insurance Co. Ltd. v. Nanu Ram and Janabai v. ICICI Lombard Insurance Co. Ltd.

The Court observed that the Tribunal committed a physical error by ignoring the ITR (Exh: 50) which showed a gross annual income of ₹1,02,383/- for A.Y. 2007-08

The High Court held that the last-filed ITR must be the baseline for income assessment when it inspires confidence, translating to a monthly income of ₹8,532/-

Applying the Pranay Sethi formula, the Court added 40% for future prospects and deducted 1/2 for personal expenses given the deceased was a bachelor, resulting in a net dependency of ₹5,972/- per month

Furthermore, the Court found the Tribunal’s award for conventional heads insufficient; it adjusted the funeral expenses and loss of estate to ₹18,150/- each (reflecting a 10% increase) and awarded ₹96,800/- for loss of consortium to the parents, which the Tribunal had previously omitted

This resulted in an enhancement of ₹5,29,052/- over the Tribunal's original award

The Court directed Respondent No. 3 (Insurance Company) to deposit the additional amount with proportionate interest and costs within four weeks

The Tribunal was further directed to deduct deficit court fees from the enhanced amount before disbursement to the claimants