Posthumously Filed Income Tax Return Can Be Considered To Determine Motor Accident Compensation: Gujarat High Court

The Gujarat High Court has reiterated that posthumus filing of income tax return can be considered for deciding quantum of compensation in a motor accident claim.In doing so the court partly allowed an appeal for enhancement of compensation, after noting that the Motor Accident Tribunal had not considered the income of deceased reflected in the income tax return for assessment year 2017-2018 filed posthumously. Justice Mool Chand Tyagi in his order observed:"Perusal of the income tax return placed on record would show that the income tax return for the assessment year 2017-2018 was filed posthumously. Perusal of the income tax return would further show that the deceased has filed the income tax returns for the assessment years 2015-2016, 2016-2017 and 2017- 2018 for the income of Rs.2,63,909/-, Rs.2,78,196/- and Rs.3,10,536/-. The income tax returns would show that there is consistent rise in the income of the deceased. Further, it shows that there is no inordinate rise in the income of the deceased, therefore, the learned Tribunal ought to have considered the income as reflected in the income tax return filed for the assessment year 2017-2018".The court referred to Sayar & Others Vs. Ramkaran & Others (2025) where Supreme Court had held that Income Tax Returns filed after the accident/death can also be taken into consideration for calculation of income to award compensation. The court was hearing claimaints' appeal challenging an award of the Motor Accident Claims Tribunal which had partly allowed a claim petition and awarded compensation of Rs.34,53,120 along with interest at the rate of 9% per annum from the date of filing of claim petition till its realization.On 02.04.2017 the deceased-Vasantkumar was travelling in a Chevrolet car, when a truck came in a rash and negligent manner, without observing traffic rules and without blowing the horn and dashed with the deceased's car. The deceased sustained serious injuries and succumbed to it. At the time of accident, the deceased was aged about 25 years, was doing the business of groceries and was earning Rs.30,000 per month. Therefore, the claimants sought compensation for Rs.68,33,000. The claimants challenged quantum awared to them. The Tribunal had considered the average income of income tax returns filed for the assessment years 2015-2016 and 2016-2017; however, the Tribunal did not consider the income tax return filed for the assessment year 2017-2018. The court thus said: "Thus, considering the ratio laid down by the Hon'ble Apex Court in Sayar & Others (supra), the income of the deceased is reassessed as per income tax return filed for the assessment year 2017-2018. Hence accordingly, the income of the deceased is reassessed at Rs.3,10,536/- per annum, which comes to Rs.25,878/- per month. It is not in dispute that at the time of accident, the deceased was aged about 25 years, therefore, 40% of the income is added on account of future prospects of the deceased. Thus, after adding 40% to the monthly notional income, the monthly income would come to Rs.36,229/- i.e. (25,878+25,878X40%). At the time of accident, the deceased was the bachelor, therefore, 1/2 of the income is deducted on account of personal expenses of the deceased. Thus, after deducting 1/2 of the monthly income on account of personal expenses of the deceased, the monthly income would come to Rs.18,115/- i.e. (36,229-36,229X1/2) for calculating the loss of dependency. Thus, applying the multiplier of 18 as per age of the deceased, the future loss of dependency would come to Rs.39,12,840/- i.e. (18,115X18X12)". It further noted that the Tribunal had awarded a meager amount of compensation under the heads of loss of estate and funeral expenses and enhanced the compensation under these heads is enhanced to Rs.18,150 each. It further awarded compensation under the head of loss of consortium of Rs.96,800. The court thus enhanced the compensation to Rs. 40,45,940 from Rs. 34,53,120. It directed the insurance company to deposit the additional amount of compensation along with interest within a period of 6 weeks from the date of receipt of copy of the high court order.The appeal was partly allowed. Case title: VASUDEV KANTILAL MAHESURIYA & ORS. v/s MOHANLAL JETHALAL PUROHIT & ORS.R/FIRST APPEAL NO. 55 of 2026Click Here To Read/Download Order

Posthumously Filed Income Tax Return Can Be Considered To Determine Motor Accident Compensation: Gujarat High Court

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