#income assessment

The Supreme Court ruled that income tax returns (ITRs) cannot be mechanically applied to determine compensation under the Motor Vehicles Act. Courts must evaluate ITRs contextually, considering the deceased’s employment status-salaried individuals’ ITRs reflect actual income, while self-employed claimants’ ITRs may understate earnings due to business deductions. The judgment mandates a nuanced approach to prevent unjust compensation reductions, impacting insurers, claimants, and tribunals.

The Madhya Pradesh High Court overturned a tribunal's undervalued compensation award by mandating that income for unskilled workers be calculated using the official Collector's wage rate of Rs.5,520/month, not speculative figures. This sets a binding precedent for all future claims where claimants lack formal pay slips, ensuring fairer loss-of-earnings calculations under the Motor Vehicles Act.

MP High Court rules that income assessment for motor accident compensation must align with the Minimum Wages Act circular for unskilled labour, enhancing compensation by Rs. 50,000. The ruling sets a precedent for default income benchmarks where proof of income is absent, impacting claimants and insurers alike.

The Chhattisgarh High Court has ruled that a delayed FIR cannot be used to deny compensation in motor accident claims, and significantly enhanced the deceased’s income by applying 40% future prospects and an 18-fold multiplier, setting a benchmark for low-income earners like daily wage laborers and part-time tutors. The court also mandated 6% interest on the enhanced award, reinforcing that procedural delays must not undermine victims’ right to just compensation.

Madhya Pradesh High Court rules that maintenance calculations under Section 12 of the Family Courts Act must include all income sources-including auto dealership profits and driving earnings-rejecting partial assessments. The judgment enhances maintenance to ₹7,500/month for wife and child, setting a precedent for comprehensive financial disclosure in matrimonial disputes.

Madhya Pradesh High Court holds that income of deceased medical practitioner must be assessed based on professional qualifications, not arbitrary low estimates under Motor Vehicles Act.

Madhya Pradesh High Court holds that oral testimony on deceased's income must be considered alongside minimum wage norms in accident claims when documents are absent.

Madhya Pradesh High Court clarifies that minimum wage circulars must inform, not rigidly fix, income assessment in motor accident claims where documentary proof is absent.

Madhya Pradesh High Court clarifies that minimum wage circulars guide income assessment in accident claims but cannot override credible oral evidence or realistic estimation.

Madhya Pradesh High Court holds that oral testimony of family members can form the basis for income assessment in accident claims when documentary evidence is absent, citing Supreme Court precedents.

Punjab and Haryana High Court rules that income assessment in motor accident claims must be based on last drawn salary, excluding mechanical deductions from prior employment. Key takeaways for insurance litigation.

Punjab & Haryana High Court holds that in motor accident claims, income of deceased need not be proven by documents if oral evidence aligns with minimum wage norms and economic reality.

Gujarat High Court holds that in motor accident claims, if income is unproven, tribunal must use minimum wage rates, not arbitrary notional figures, for compensation calculation.