Former Cabinet Minister's Status Can't Substitute Proof Of Income In Motor Accident Claim: Allahabad High Court
The Allahabad High Court has held that the profession or social standing of a person killed in a motor accident cannot by itself determine his income for the purpose of computing compensation.
It held that income has to be established by evidence on record and that an Income Tax Return, though relevant, does not by itself prove the income disclosed in it.
Justice Anil Kumar-X held,
“Thus, even in a claim arising out of a motor accident, the ordinary principles governing appreciation of evidence cannot be completely dispensed with merely because the deceased was a person of high social or professional standing. Presumption cannot take the place of proof.”
Nand Lal Singh Patel died on the spot when the Tata Sumo he was travelling in was struck by a truck driven rashly and negligently on the Allahabad-Rai Bareilly Road near village Malakiya, District Allahabad, on 15.05.1999.
The Tribunal found that he was about 48 years old, practised as an Advocate, belonged to a political party and had earlier been a Cabinet Minister in Uttar Pradesh. Taking his annual income at Rs. 90,000/- on the basis of his Income Tax Return for the assessment year 1999-2000, it deducted one-third towards personal expenses, applied a multiplier of 13 and awarded Rs. 7,84,500/-, including Rs. 2,000/- towards funeral expenses and Rs. 2,500/- towards loss of estate.
In appeal, the claimants argued that the income assessed did not match the profession and standing of the deceased, that the Income Tax Return showing Rs. 1,60,000/- per annum had been wrongly ignored and that nothing had been added for future prospects. They also sought a deduction of 1/5th rather than 1/3rd towards personal expenses given the number of dependants, and higher amounts under the non-pecuniary heads in terms of National Insurance Co. Ltd. v. Pranay Sethi.
The insurer replied that neither the income nor the return had been duly proved.
The Court held,
“An Income Tax Return is certainly a relevant piece of evidence and, where duly proved and supported by other material, may furnish a reliable basis for determining income. However, filing of an Income Tax Return by itself does not make the income stated therein conclusively proved in every case.”
There being no other satisfactory evidence of the income claimed, the Court held that the Tribunal could not be faulted for refusing that figure, and the Rs. 90,000/- it had adopted was itself on the higher side.
On future prospects, the Court noted that the Constitution Bench in National Insurance Co. Ltd. v. Pranay Sethi had standardised the addition at 25% of the established income for a self-employed person or one on fixed salary aged between 40 and 50 years. That addition works on income first determined from evidence, and the claim failed not because the deceased was self-employed but because the higher income stood unproved, it held.
“The principle of future prospects laid down in Pranay Sethi operates upon the income determined in accordance with the evidence; it cannot be employed to enlarge an income which itself has not been proved.”
Rejecting the plea for a smaller deduction, the Court held that the accident was of 1999 and the Tribunal had followed the method under the Second Schedule to the Motor Vehicles Act, which the later principles in Sarla Verma v. Delhi Transport Corporation could not by themselves reopen.
On the conventional heads, it held that the appellate court must examine the award as a whole rather than mechanically raise each component.
Holding that the compensation could not be said to be inadequate so as to warrant further enhancement, the Court declined to interfere with the award.
Case Title: Smt. Kamla Devi And Others v. The Oriental Insurance Co. Ltd. And Another 2026 LiveLaw (AB) 712
Case Citation: 2026 LiveLaw (AB) 712
Counsel for Appellant(s) :- Sharve Singh, Neerja Singh
Counsel for Respondent(s) :- Ashutosh Vaish