In a motor accident claim, how is the annual income of a deceased Income Tax Assessee to be fixed from his Income Tax Returns?

By the average of the gross income shown in the Income Tax Returns of the previous 3 Assessment years, and not the income shown in one such return. The date when the ITRs are filed is also a relevant consideration, as there may be scenarios where inflated income is showcased after death or injury; however, if sufficiently supported by financial statements, such ITRs may also be taken into consideration.

Motor Vehicles Act, 1988 — Motor Accidents Claims Tribunal — Compensation — Income Tax Returns — Average Gross Income — Future Prospects — Established income — Personal Expenses — Motor Vehicles Act, 1988 — Compensation — Income of the deceased — Average of the previous three assessment years — Held: Where the income of the deceased is shown by Income Tax Returns, the annual income is the Average Gross Income of the previous 3 Assessment years, and not the income shown in one such return. (¶14, 15) Motor Vehicles Act, 1988 — Compensation — Future Prospects — Age of the deceased at the time of accident — Held further: The addition towards Future Prospects is fixed by the age of the deceased at the time of accident and is applied to the established income, which means the income minus the tax component. (¶16) Motor Vehicles Act, 1988 — Compensation — Components of income — Statutory amount of tax deducted — Held further: Allowances beneficial to the family are added while considering the basic salary to arrive at the dependency factor, while the statutory amount of tax payable must be deducted. Compensation modified; the Insurance Company's appeal is dismissed. (¶12, 19)

One judgment a day. That's the whole habit.

Read the full text of SAVITHA BARARIA v. KALAIRAJ.V — and get the Supreme Court's output as a five-minute daily read, with plain-language headnotes and the questions each judgment settles.

Free forever plan · 30 seconds · data stays in India