Accident compensation – IT return income Vs. Notional income

Judgment dated 2^nd August, 2023 of the High Court of Bombay

IT return of highest income Vs. Notional income – Accident compensation

On 4.2.2009, while Tanaji Bhoir was riding the motor cycle with pillion rider Pingale, another motor cycle gave forceful dash from behind.   As a result, Tanaji, who sustained injuries, died in the hospital.

He had resigned from Reliance Industries Ltd, one month before accident.

Claim for Rs.1.25 crores compensation was filed.

The Tribunal awarded Rs.56,48,374/- on consideration of income of Rs.4,77,580/- as per the last year IT Return for the financial year 2007-2008 of the deceased.

The Insurance Company filed the appeal in the High Court and mainly challenged the quantum of compensation on the following grounds –

1.  In the claim petition, the occupation of the deceased was mentioned as “service” and monthly income of Rs.33,750/-.

2.   There was no whisper about “transport business” in the petition or the evidence of the claimants.

3.    In 2007-2008 IT Return, the business income was shown as “nil”, although in the earlier two years’ returns, the income from transport business was shown.

4.    The Tribunal ought to have considered average of income of three years income tax returns.

HELD –

1.  That the return of 2008-2009 is the statutory document;

2.   The said return was of the highest income.

3.     The said return was closest to the death of deceased 

4.  The return is the piece of evidence.

5.  The claim petition is not a plaint and therefore, strict compliance required for a civil suit cannot be applied to MV Act.

6.   The highest income of the last return as against the income shown in the claim petition was accepted.

The appeal of the Insurer was dismissed.