ITRs Cannot Solely Determine Deceased’s Income for MACT Compensation: Orissa HC

Sumati Panda Vs Renubala Acharya (Orissa High Court)

Summary: Orissa High Court partly allowed the appeal filed by the legal heirs of deceased Kali Charan Panda seeking enhancement of compensation awarded by the Motor Accident Claims Tribunal, Berhampur. The appeal arose from an accident on 10.11.2001 in which Kali Charan Panda, travelling from Bhubaneswar to Berhampur in a Marshal vehicle, died at the spot due to severe head injury. His legal heirs had filed a claim under Section 166 of the Motor Vehicles Act, 1988, claiming Rs.25,00,000/-. The Tribunal awarded Rs.2,65,000/- with 6% interest per annum after assessing the deceased’s annual income at Rs.25,000/- primarily on the basis of his Income Tax Returns. The claimants contended that the deceased was Managing Director of Lucky Offset Private Limited and associated with the daily newspaper “Anupam Bharat” and “Lucky Furnitures”, earning substantially more, and that future prospects had not been considered in accordance with National Insurance Company Limited v. Pranay Sethi and Ors.

The High Court found that although clear evidence establishing the deceased’s actual monthly or annual income was unavailable, the Tribunal had misdirected itself by entirely relying on the Income Tax Returns. It held that the deceased’s activities and avocations also ought to have been considered and that Income Tax Returns could not constitute the sole basis for determining his income.