Case Note & Summary
The appeal before the High Court of Bombay at Goa arose from a motor accident claim. The appellant, The New India Assurance Co. Ltd., challenged the judgment and award dated 19.01.2016 in Claim Petition No.61/2011, by which the Motor Accident Claims Tribunal awarded compensation of Rs.63,25,000 with interest at 9% per annum from the date of filing to the widow and son of late Jayant Pai Vernekar. The deceased died in a vehicular accident on 28.09.2010 when a bus coming from the opposite direction in a rash and negligent manner dashed his vehicle. The appellant's counsel did not dispute the findings on negligence or liability to pay compensation. The sole controversy in the appeal concerned the determination of the deceased's income. The Tribunal had relied on Income Tax Returns for the year 2009-10, which were admittedly filed after the death of the deceased and declared an income of Rs.7.39 lakhs, although the Tribunal took the figure at Rs.8.45 lakhs. The appellant argued that Income Tax Returns filed after death ought to be excluded from consideration, relying on V. Subbulakshmi v. S. Lakshmi, Oriental Insurance Company Ltd. v. Ramilaben and Sutinder Pal Singh Arora v. Ashok Kumar Jain. It contended that in the previous two years, income was only Rs.3 to 3.5 lakhs per annum, and the sudden spurt to Rs.7.39 lakhs was aimed at securing higher compensation. On the other hand, the respondent claimants submitted that there is no absolute bar to considering such returns. They pointed out that the deceased was an engineer from IIT Mumbai and proprietor of JVP Building Systems, a highly specialized construction diagnostics business. The claimants produced evidence from the Chartered Accountant and Auditor who deposed to the integrity of the returns, explaining that the deceased had invested around Rs.20 lakhs in diagnostic equipment in the one and a half years before his death, leading to business expansion and increased income. The claimants also argued that these expert witnesses were not appropriately cross-examined, and therefore the appellant should not be permitted to raise grounds disputing income. They relied on New India Assurance Co. Ltd. v. Mrs. Jigna Dinesh Bhatt, The New India Assurance Co. Ltd. v. Smt. Nandini Prabhakar Desai, Malarvizhi v. United India Insurance Company Ltd. and Geeta v. Dinesh Chander. The High Court noted the rival contentions and began examining the evidence of Pranav (AW1), the son of the deceased, the Chartered Accountant Sandip Bhandare (AW3) and the Auditor Nandakishor Shiolkar (AW5). Pranav deposed that his father was 53 years old at the time of death, an engineer from IIT Mumbai, and proprietor of JVP Building Systems providing consultancy and on-site concrete testing through Non-Destructive Testing, quality control and repairs/rehabilitation services. He also testified about investments in equipment and that the deceased was the only earning member. The provided judgment extract ends before the final analysis and holding; therefore the ultimate decision, ratio decidendi and operative directions are not included in the text.
Headnote
A) Motor Accident Compensation - Determination of Income - Consideration of Income Tax Returns Filed After Death of Deceased - Not mentioned - The appellant insurance company challenged the Tribunal's reliance on income tax returns for assessment year 2009-10 filed after the deceased's death, which showed a sudden increase in income to Rs.7.39 lakhs from Rs.3-3.5 lakhs in previous years; appellant argued such returns should be excluded per V. Subbulakshmi, Oriental Insurance and Sutinder Pal Singh Arora; respondent claimants argued there is no absolute bar and cogent evidence from Chartered Accountant and Auditor supported the increased income due to business expansion and investments; the High Court considered the rival contentions and evidence of AW1, AW3 and AW5 (Paras 4-9). B) Evidence - Expert Witnesses - Effect of Inadequate Cross-Examination - Not mentioned - The respondent claimants contended that the Chartered Accountant and Auditor were examined and deposed to the integrity of the returns, but were not appropriately cross-examined; therefore the appellant should not be permitted to raise grounds disputing the deceased's income; reliance was placed on New India Assurance v. Jigna Dinesh Bhatt, New India Assurance v. Nandini Prabhakar Desai, Malarvizhi v. United India Insurance and Geeta v. Dinesh Chander; the court was required to evaluate this procedural objection in the context of the available evidence (Paras 7, 9).
Issue of Consideration
Whether Income Tax Returns filed after the death of the deceased in a vehicular accident can be considered for determining the income of the deceased for computation of compensation; whether the Tribunal erred in relying on such returns and taking income at Rs.8.45 lakhs when declared income was Rs.7.39 lakhs.
Final Decision
Not mentioned in the provided judgment text; final holding not included.
Law Points
- Income Tax Returns filed after death of deceased are not absolutely barred from consideration for determining income
- cogent evidence can explain sudden spurt in income
- reliance on such returns may be upheld if supported by credible evidence
- appellant must challenge expert evidence at trial
- quantum of compensation must be based on reliable evidence of income
