THE COMMISSIONER OF INCOME TAX vs. M/S. GLOBAL COKE PRODUCTS
What did the High Court hold?
The High Court held that the learned Tribunal erred in discarding the income tax returns (Ext. 10, Ext. 17, and Ext. 15) solely because they were not proven by an Income Tax Officer. The Court noted that these documents were not challenged by the opposite parties. Relying on *Kalpanaraj (supra)*, the Court determined the annual income based on the average of the last three years' income tax returns, which were Rs. 2,21,981/-, Rs. 3,01,818/-, and Rs. 1,79,992/-, resulting in an average annual income of Rs. 2,34,597/-. The Court also considered future prospects, increasing the annual income to Rs. 3,28,468/-. Regarding contributory negligence, the Court found that the Health Department and the ambulance driver did not plead or lead evidence to establish contributory negligence on the part of the deceased. The Court noted that the written statement did not specifically plead contributory negligence, and the driver's testimony about overtaking another truck was not sufficient to establish the deceased's negligence. Therefore, the deduction for contributory negligence was set aside. The Court found no illegality in the 6% interest rate awarded by the Tribunal, citing *Abati Bezbaruah Vs. Dy Director General of Geological Survey of India and another*. However, the Court modified the award, calculating the total compensation as Rs. 34,05,355/-. The State respondent was directed to pay the compensation within six weeks, failing which interest would be 9% from the date of filing the application.
What were the facts?
The appellants, claimants in MAC Case No. 2080/2012 before the Motor Accident Claims Tribunal No. 2, Kamrup (M), Guwahati, are appealing a judgment and award dated August 30, 2016. The claim arose from a motor vehicular accident on January 14, 2012, where the deceased, Poran Bordoloi @ Parijat, driving his Santro car, was allegedly hit by an ambulance belonging to the Department of Health and Family Welfare, State of Assam. The deceased sustained grievous injuries and died on the spot. The Tribunal framed two issues: negligence and entitlement to compensation. The Tribunal found contributory negligence on the part of the deceased, deducting 50% from the awarded amount of Rs. 6,05,000/-. The Tribunal also discarded the deceased's income tax returns, attributing a notional income of Rs. 8,000/-.
What were the issues?
1. Whether the learned Tribunal erred in discarding the deceased's income tax returns (Ext. 15, Ext. 17, Ext. 20) and determining a notional monthly income of Rs. 8,000/-, without proper basis, and failing to consider future prospects? 2. Whether the learned Tribunal committed an error in holding the deceased contributorily negligent, especially when no specific issue was framed on this point, no dispute was raised by the owner of the offending vehicle (Health Department), and no evidence was led by the respondents on this aspect? Assessee's Arguments: - The income tax returns should not have been discarded as they were not proven by an Income Tax Officer, citing judgments in *Runubala Pal and Others Vs. Bani Chakrabarty and Others* and *Kalpanaraj and Others vs. Tamilnadu Transport Corporation*. - The Tribunal erred in finding contributory negligence as no issue was framed, no dispute was raised by the Health Department, and no evidence was led. - Future prospects of income were not considered. - The rate of interest awarded (6%) was too low and should be 9% from the date of filing the appeal. Revenue's Arguments: - The income tax returns were rightly rejected as they were not proved by competent authorities. - Evidence from the ambulance driver established a head-on collision due to the deceased's negligent overtaking, justifying the 50% deduction for contributory negligence. - The rate of interest should not be enhanced to 9% due to falling interest rates and the economic situation. - Certain components of compensation, like loss of consortium and love and affection, should be reduced in light of *National Insurance Company Limited Vs. Pranay Sethi and Others*.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
JUDGEMENT & ORDER (CAV)
Heard Mr. S Chakrabarty, learned counsel for the appellants.
This present appeal is preferred by the claimant and directed against the judgment and award dated 30.08.2016 passed by the learned Motor Accident Claims Tribunal No. 2, Kamrup (M), Guwahati in MAC Case No.2080/2012. Page No.# 3/12
The aforesaid claim petition was preferred by the present appellants claiming compensation on the death of their husband/ father in a motor vehicular accident, which took place on 14.01.2012 at around 11.30 p.m. on National Highway 37. 4. The brief facts of the claimants pleaded before the learned Tribunal was that on the fateful day i.e. on 14.01.2012 when the deceased was driving his Santro car bearing No. AR-08-5748 and was proceeding from Jorhar towards his residence at Kakojan, Duliajan, the offending ambulance vehicle bearing registration No. AS-01 AF-9198 dashed the said car driven by the deceased husband/ father of the claimants.
In the said accident the deceased sustained grievous injuries and died on the spot. The vehicle was Government vehicle more particularly it belongs to the Department Health and Family Welfare, State of Assam.
The health department filed their written statement. Both the parties led evidences and exhibited certain documents. The learned Tribunal below basically framed two issues for determination which are quoted herein below: “(i) Whether on 14.01.2012, at about 11.30 pm, on the National Highway No. 37, about 7 K.M. west of Teok Police Station, an accident has arisen due to the rash and negligent driving of the Ambulance Vehicle bearing registration No. AS-01 AF-9198 on the part of its driver and the said accident has caused the death of the deceased Poran Bordoloi @ Parijat? (ii) If so, whether the claimants are entitled to compensation, and if yes, what should be the quantum and by whom amongst the opposite parties, the said compensation amount will be payable?”
After completion of trial the learned Tribunal below came to a conclusion that there are contributory negligence of the decease husband/ father of the Page No.# 4/12 claimants appellants and accordingly deducted 50% of the total awarded amount in view of such finding and calculated the award to be Rs. 6,05,000/-.
While determining the income, the learned Tribunal below disbelieved/ discarded the income tax return exhibited as Ext. 15, Ext. 17 and Ext. 20 and for the reason that no Income Tax Officer came and proved the return and accordingly a notional income of Rs. 8,000/- was calculated and award was passed on the basis of such income.
In the aforesaid backdrop, the claimant has preferred the present appeal basically on two counts i.e. the learned Tribunal below has wrongly discarded the income tax return of the deceased and determined the income to be Rs. 8,000/- without any basis. The second contention is that the learned Tribunal has committed serious error of law as well as fact in holding that deceased husband contributed the accident inasmuch as there were no issues framed nor any dispute was raised by the owner of the vehicle i.e. the Health Department pleading that there are contributory negligence on the part of the driver of the Santro, the deceased husband/ father of the claimants appellants.
It is also contended by Mr. Chakrabarty that even no evidence was led on that point. The further contention of Mr. Chakrabarty is that while deciding the compensation, the learned Tribunal below has not considered the future prospect of income of deceased husband/ father of the claimants/ appellants.
To buttress his points that the learned Tribunal has erroneously discarded the reported in 1998 3 GLT 85 and of the Hon’ble Apex Court in Kalpanaraj Page No.# 5/12 SCC 764. 12. The learned counsel further relies on a recent decision of the Hon’ble Apex court dated 10.08.2022 passed in Civil Appeal No. 21077/2019 (Jonabai Vs. M/s ICICI Lombard Insurance Company Ltd. Mr. Chakrabarty). He further contends that rate of interest of 6% was lower and it ought to have been awarded @ 9% on the date of filing of the appeal.
Mr. Upamanyu, learned standing counsel for Health Department has not disputed that the vehicle belongs to State of Assam, Department of Health and Family Welfare and also has not disputed that the driver was Government driver of the offending vehicle under Health Department.
Mr. Upamanyu, learned counsel submits that from the evidence of driver of the alleged offending vehicle, it is established that there was a head on collusion between the two vehicles and the deceased was driving the Santro negligently and the collusion took place when the deceased over took another truck in the road. Therefore, the learned counsel submits that the Tribunal below has not committed any error holding that there were contributory negligent on the part of the deceased and accordingly, rightly reduced the quantum of compensation by 50%, taking the negligence on the part of the deceased to be 50%.
Regarding the income of the deceased and the claimant’s reliance on the income return, the learned counsel for the Health Department submits that the court has rightly rejected such document as those documents were not proved by competent authorities.
Regarding the quantum of interest, the learned counsel contends that looking at the falling interest rate as well as state of economy, the court should not enhance the interest rate from 6% to 9%.
Page No.# 6/12
The learned counsel further submits that in view of the decision in National
He further submits that award of amount of Rs. 1,00,000/- towards loss of consortium and Rs. 1,00,000/- towards loss of love and affection of father, Rs. 25,000/- for funeral expenses and Rs. 25,000/- for loss of estate cannot be awarded in view of the decision of the Hon’ble Apex Court in Pranay Sethi (supra). Accordingly, the learned counsel concludes that the appeal should be dismissed by reducing the award.
This court has given anxious consideration to the arguments advanced by the learned counsel for the parties. The material available on record including the claim petition, the written statement, the evidences laid and the cross- examination.
Law is well settled that even in case of all the head on collusion between two vehicles cannot be held that accident was due to contributory / composite negligence of drivers of both the vehicles. The law is equally well settled that a claim is determined on the basis of the foundation laid by way of pleadings and proved by way of evidence.
Firstly, in the case in hand, though the defendant Health Department as well as the driver of the Ambulance has taken a plea that the deceased was driving the Santro vehicle negligently. However, there was no specific plea that the driver of the Santro contributed to the accident. The basic ground except the statement of the driver of the Ambulance, no materials were laid by the Health
Page No.# 7/12 Department on the basis of which it can be inferred that the driver of the Santro also contributed to the accident. When a contributory negligence is alleged it is duty of the party who alleges the same to prove it. In the case in hand, as there are no specific pleadings, the learned Tribunal has even not framed any issues whether there was any contributory negligence on the part of the driver of the Santro vehicle driven by the deceased. Therefore, in the aforesaid backdrop of the pleadings, and evidence, this court un-hesitantly holds that the learned Tribunal, without even framing any issue on the contributory negligence on the part of the driver of the Santro (the deceased), ought not to have held that there was contributory negligence up to 50% on part of the deceased, only on the ground that the driver of the alleged offending vehicle stated that there was negligence on the part of the Santro vehicle and the driver of the Ambulance was not at all at fault.
Further, the Tribunal also relied on the cross-examination of the claimant, the wife of the deceased victim that there was head on collusion between the two vehicles inasmuch as in the said cross-examination, it was established that the wife was not an eye witness.
The learned Tribunal also conveniently ignored the fact and proof that a case being Teok P.S. case No. 14/2012 under Section 279/427/304 (A) IPC was registered, the FIR was exhibited and duly proved. Charge-sheet was exhibited and proved to show that after due investigation charge-sheet was laid against the driver of the Ambulance. Though lodging of the FIR and charge-sheet cannot per se be taken to be proof of negligent driving and proof of the allegation made under the aforesaid Section of law. However, being a summery proceeding, when no other evidences were available to establish that there was contribution on the part of the driver of the Santro, the learned Tribunal ought
Page No.# 8/12 not to have discarded such evidence while holding a contributory negligence. The police report exhibited has clearly depicts that the accident took place due to rash and negligent driving on the part of the driver of the Ambulance. In absence of any other convincing and cogent evidence and without framing any issue to that affect, the learned Tribunal could not have found the contributory negligence that too specifying up to the 50% only on the basis of the evidence of the driver of the offending vehicle himself, who is facing trial under Section 279/427/304(A) IPC. Therefore, this court is having no hesitation to hold that the learned Tribunal had fixed the contributory negligence at 50% without support of any convincing and cogent evidence and by overlooking the police report, charge-sheet and other materials on record. That being so, said finding is hereby set aside and quashed.
Now coming to the determination of the income of the deceased, the claimant had pleaded that deceased at the time of death was running a business of construction and his monthly income was Rs. 30,000/-. The PW1 laid evidence and in support of such claim exhibited Ext.15 to Ext. 23 in proof of such income. These are all income tax returns for different assessment years. Last three years income prior to the death of the deceased was sought to be proved through Ext. 20, Ext. 17 and Ext.
These three exhibits are income tax return certificates. The learned Tribunal below did not believe these documents being not duly proved. This court had occasion to peruse the LCR and it shows that Ext. 15 is a document, which is having registered bar code and it is income tax return verification form. Ext. 16 is the statement on the basis of which the return Ext. 15 was filed for the period 2012-13. Ext. 17 relates to the assessment year 2011-12 and Ext. 18 is the statement which shows the details including TDS etc. The Ext. 20 is tax return verification form
Page No.# 9/12 for the assessment year 2010-11. During cross-examination, the CW1, who exhibited the aforesaid documents stated that she has not submitted any document to show that her deceased husband earned Rs. 30,000/- per month. However, the Health Department did not raise any question doubting the tax return exhibit. They only doubted the statement that the monthly income of the deceased was Rs. 30,000/-. There was no question put during cross- examination raising any dispute regarding the income tax return certificate. Thus, the Ext. 10, Ext. 17 and Ext. 15 were not challenged by the Opposite Parties.
In absence of any other documentary evidence on monthly income of the deceased, the learned Tribunal below ought to have determined the monthly income on the basis of the income tax return. Such conclusion is based on the decision of the Hon’ble Apex Court reported in Kalpanaraj (supra) relied on by Mr. Chakrabarty. Therefore, in view of the aforesaid finding this court un- hesitantly holds that the income of the deceased should be determined on the basis of average of last three years income prior to the death of the deceased and the same is required to be determined on the basis of the Ext.20, Ext.17 and Ext 15 the respective assessment certificate of income tax which reflects to be Rs. 2,21,981/-, Rs. 3,01,818/- and Rs. 1,79,992/- and the average of last three years is calculated at Rs. 2,34,597/-. Accordingly, this court holds that the annual income of the deceased was Rs. 2,34,597/-.
Now coming to the rate of interest, the learned Tribunal below has granted 6% interest from the date of filing of the claim petition. Section 171 of MV Act provides for award of interest over the compensation awarded. The said provision vest a discretion with the Tribunal to award interest at ‘such rate’ and from ‘such date’ cover the compensation awarded. The said provision further
Page No.# 10/12 mandates that the learned Tribunal can award interest on simple interest rate and the same shall be payable not earlier than the date of making of the claim. No hard and first rule or specific principle can be laid down regarding the rate of interest to be awarded. While awarding interest the Tribunal is to take into consideration the fact and circumstances of each case. Therefore, the Hon’ble held at paragraph 18 as under:
“18. Three decisions were cited before us by Mr. AP Mahanty, learned counsel appearing on behalf of the appellant, in support of his contentions. No ratio has been laid down in any of the decisions in regard to the rate of interest and the rate of interest was awarded on the amount of compensation as a matter of judicial discretion. The rate of interest must be just and reasonable depending upon the facts and circumstances of each case and taking all relevant factors including inflation, change of economy, policy being adopted by Reserve Bank of India from time to time, how long the case is pending, permanent injuries suffered by the victim, enormity of suffering, loss of future income, loss of enjoyment of life etc., into consideration. No rate of interest is fixed under Section 171 of the Motor Vehicle Act, 1988. Varying rates of interest are being awarded by Tribunals, High Courts and the Supreme Court. Interest can be granted even if a claimant does not specifically plead for the same as it is consequential in the eye of law. Interest is compensation for forbearance or detention of money and that interest being awarded to a party only for being kept out of the money which ought to have been paid to him. No principle could be deducted nor can any rate of interest be fixed to have a general application in motor accident claim cases having regard to the nature of provision under Section 171 giving discretion to the Tribunal in such matter. In other matters, awarding of interest depends upon the statutory provisions, mercantile usage and doctrine of equity. Neither Section 34 CPC nor Section 4-A(3) of the Page No.# 11/12 Workmen’s compensation Act are applicable in the matter of fixing rate of interest in a claim under the Motor Vehicle Act. The courts have awarded the interest at different rates depending upon the facts and circumstances of each case. Therefore, in my opinion, there cannot be any hard and fast rule in awarding interest and the award of interest is solely on the discretion of the Tribunal or the High Court as indicated above.”
In view of the aforesaid decision, this court finds no illegality in granting 6% interest. Accordingly, in view of the aforesaid decisions and reasons the award dated 30.08.2016 is interfered with and modified to the following extent: Age of the deceased at the time of accident -38 years. Applicable multiplier (as per Sarala Verma) -15 Annual income of the deceased -Rs. 2,34,597/- Annual income after considering Future Prospect -Rs. 3,28,468/- 1/3 of annual income (as per Sarala Verma) -Rs. 1,09,479/- Annual income after deduction for computing Compensation -Rs. 2,18,957/- Compensation (Rs. 2,18,957/- X 15) -Rs. 32,84,355/- Funeral Expenses -Rs. 16,500/- Loss of Estate -Rs. 16,500/- Loss of consortium (Rs. 44,000/-X2) -Rs. 88,000/- Total Compensation -Rs. 34,05,355/-
The State respondent i.e. Department of Health and Family Welfare shall pay the compensation amount as early as possible and not beyond a period of six weeks from today inasmuch as the Department of Health and Family Welfare has not paid as stated by the learned counsel for the appellant single penny out
Page No.# 12/12 of the awarded amount though the Health Department has not challenged the said award. If the payment is not made within the aforesaid outer limit of six weeks, the interest shall be counted as 9% from the date of filing of the application.
JUDGE Comparing Assistant
More judgments on Section 171
- Pratima Reddy Muthu, Hyderabad vs ACIT., Circle-14(1), HyderabadITA 1310/HYD/2025[2010-11]Status: Disposed24 Dec 2025AY 2010-11
- The Pr Commissioner of Income Tax vs Sri Rajkumar C (HUF)ITA/583/202330 Sept 2024
- The Pr Commissioner of Income Tax vs Sri. Rajkumar C (HUF)ITA/522/202326 Sept 2024
- Ashok Sethia (Erstwhile Karta of Ashok… vs ITO, Ward-43(1), KolkataITA 132/KOL/2024[2012-13]Status: Disposed23 Jul 2024AY 2012-13
- Erki Ramesh Upadhyaya HUF, Puttur vs Income Tax Officer, Ward-1, PutturITA 476/BANG/2024[2014-15]Status: Disposed26 Jun 2024AY 2014-15
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