Pre-accident income-tax returns may reliably establish a claimant’s income in motor accident compensation claims.

In brief

The question

Whether the Tribunal’s assessment of the claimant’s income and 25% permanent disability, and its resulting award, warranted enhancement or reduction.

The court held

The Court dismissed both appeals as devoid of merit.

It also directed

The Tribunal’s award of Rs. 19,20,900 with interest at 6% per annum remained undisturbed; there was no order as to costs.

01Facts

On 27 June 2016, the claimant was injured when the car in which she was travelling was struck from behind by a truck driven by respondent No. 1, owned by respondent No. 2 and insured by respondent No. 3.

¶ 3

She sought compensation under Section 166 of the Motor Vehicles Act, 1988.

¶ 3

The Tribunal assessed her monthly income at Rs. 35,000, found 25% permanent disability, and awarded Rs. 19,20,900 with interest at 6% per annum.

¶ 4–5

The claimant appealed for enhancement, while the insurer appealed seeking reduction of the award and exoneration from liability.

¶ 2, 6–7

02Issues

i.Whether the Tribunal’s assessment of the claimant’s income and 25% permanent disability, and its resulting award, warranted enhancement or reduction.

¶ 9, 14–15

ii.Whether the insurer established grounds to avoid or reduce its liability under the award.

¶ 5, 7, 13, 15

03Law Applied

Section 166 of the Motor Vehicles Act, 1988 provides the basis for a claim seeking compensation for injuries caused by a motor accident.

¶ 3

In assessing income, a Tribunal may make a reasonable estimate from the evidence, applying the preponderance-of-probabilities standard rather than the strict rules of evidence.

¶ 10

In Rashmirekha Tripathi v. The Branch Manager (Legal Claims), Shriram General Insurance Company Limited [2026 LiveLaw (SC) 654], the Supreme Court stated that, for self-employed persons or individuals carrying on business, income shown in up to three preceding years’ income-tax returns may be averaged, with relevant surrounding circumstances also considered.

¶ 11

Under Raj Kumar v. Ajay Kumar, (2011) 1 SCC 343, disability and its functional impact are assessed in determining compensation for personal injuries; the Tribunal relied on that decision in assessing disability.

¶ 14

Provisions in the judgment · 4 · Linked ones open on LawLens

Indian Penal Code, 1860 Section 279 Section 337 Section 338

Motor Vehicles Act, 1988 Section 166

04Reasoning

The High Court found no basis to disturb the Tribunal’s income assessment: the claimant’s three income-tax returns included a return filed before the accident identifying coaching classes as her income source, and the Court found no reason to disbelieve them.

¶ 9, 12–13

It also upheld the 25% assessment of permanent disability, noting the medical evidence that the disability was confined to the affected part of the body and could improve with physiotherapy.

¶ 14

On review of the parties’ challenges to the award, the Court concluded that the compensation was just and reasonable and did not warrant interference.

¶ 15–16