ITR filed after death is valid proof for Income for Motor Accident Claim : Supreme court

By | November 28, 2025
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ITR filed after death is valid proof for Income for Motor Accident Claim : Supreme court

Case Sayar & Ors. v. Ramkaran & Ors., here is a breakdown of the case’s facts, core issue, and the Supreme Court’s decision:

1. Facts of the Case

 

  • Incident: The accident occurred on 27th June 2006.

  • Deceased: Rajendra Singh Gena (Age 32), who was self-employed and ran a transport business.

  • Cause: Collision between the deceased’s vehicle and an offending truck, resulting in fatal injuries on the spot due to the truck driver’s negligence.

  • Initial Award: The Motor Accidents Claims Tribunal (MACT) initially awarded Rs. 9.74 Lakhs in 2009, based on an assessed annual income of Rs. 84,000.

2. Core Issue

 

The central issue before the Supreme Court was the correct determination of the deceased’s annual income for the purpose of calculating “just and fair compensation” under the Motor Vehicles Act, 1988.

Specifically:

  • Whether the High Court was justified in upholding the lower court’s rejection of the deceased’s subsequent Income Tax Return (ITR) for 2005-06 (showing Rs. 1.26 Lakh) solely because it was filed posthumously (after the date of the accident).

  • Whether the compensation calculation correctly factored in an allowance for Future Prospects, given the deceased was self-employed.

3. Supreme Court’s Decision

 

The Supreme Court allowed the appeal and significantly enhanced the compensation, guided by the principle that compensation must be “forward-looking” and not purely historical, citing the precedent of Nidhi Bhargava v. National Insurance Co. Ltd.

  • Income Re-assessment: The Court rejected the static income assessment of Rs. 84,000. Instead, it determined a fresh base annual income of Rs. 1,00,000 to ensure a just outcome, acknowledging that business profits are seldom static.

  • Future Prospects: Applied a 40% increase for future prospects to the re-assessed income, resulting in a total annual income of Rs. 1,40,000 (Rs. 1,00,000 + 40%).

  • Final Award: The total compensation was enhanced to Rs. 19,09,900.

  • Order: The respondents were directed to remit the enhanced amount, along with the Tribunal’s awarded interest (7.5% p.a.), within four weeks.

Download ITR filed after Death Judgment