FAO-4113-2026 (O&M) -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH 164 FAO-4113-2026 (O&M) Date of decision: 02.09.2026 United India Insurance Company Limited ....Appellant Vs. Kavita Bai and others ....Respondents CORAM : HON’BLE MR. JUSTICE HARSH BUNGER Present: Mr. Maninder Arora, Advocate for the appellant. ***** HARSH BUNGER J. Present appeal has been filed challenging the award dated 28.04.2026 passed by the learned Motor Accident Claims Tribunal, Hisar (hereinafter referred to as the “learned Tribunal”). 2. Briefly, claimants/respondents No.1 to 5 filed a petition under Section 166 of the Motor Vehicles Act, 1988 (for short the ‘1988 Act’), seeking compensation on account of death of Pankaj in a motor vehicular accident on 10.08.2025. 2.1 The aforesaid claim petition was filed by the respondents No.1 to 5 on the plea that on 10.08.2025, Pankaj was going towards his village Paju Kalan from Assandh on his scooty bearing registration No. HR-33J-9799. At about 08:00 P.M., when he reached near Milan Hotel then the offending vehicle/car bearing registration No. HR20-AS-7396 came from behind, which was being driven by Amit Kumar (respondent No.6 herein) in a rash and negligent manner at high speed and directly struck his vehicle into the vehicle of Pankaj. On account of impact, Pankaj fell down ANKIT 2026.09.03 17:47 I attest to the accuracy and integrity of this document High Court, Chandigarh FAO-4113-2026 (O&M) -2- and received multiple injuries on the vital parts of his body. Pankaj was shifted to General Hospital, Assandh, where he was declared dead by the doctor. A case FIR bearing No.444 dated 10.08.2025 under Sections 106, 281 of BNS was registered at Police Station, Assandh, against Amit Kumar (respondent No.6 herein). 2.2 The claimants are the wife, children and father of the deceased Pankaj. Deceased Pankaj is stated to be of 30 years of age at the time of accident. It was claimed that Pankaj was working at Maan Sports Wear and was earning Rs.5,55,300/-, per annum and all the claimants were dependant upon him. 2.3 Accordingly, compensation amount of Rs. Two Crores along with interest was claimed by the claimants. 3. Upon issuance of notice in the claim petition, the driver and owner of the offending vehicle appeared and filed the written statement taking various preliminary objections. On merits, they denied the accident to have been caused by Amit Kumar (driver of the offending vehicle). It was stated that the claimants have got registered a false case only to claim compensation, accordingly they denied that they are liable to pay any compensation. It is further averred that the Insurance Company is liable to pay compensation as the offending vehicle was duly insured on the date of accident. 3.1 On the other hand, the present appellant (Insurance Company) filed a separate written statement taking various preliminary objections. On merits, it was stated that the offending vehicle has been wrongly impleaded in the accident in question, just to grab the compensation. It is further ANKIT 2026.09.03 17:47 I attest to the accuracy and integrity of this document High Court, Chandigarh FAO-4113-2026 (O&M) -3- averred that the driver of the offending vehicle was not holding a valid driving license and that no information of the alleged accident was provided to the Insurance Company either by the owner or by driver of offending vehicle under Section 134(c) of the 1988 Act. The other averments of the plaint were denied and prayer for dismissal of the claim petition was made. 4. On the basis of pleading of the parties, following issues were framed by the learned Tribunal:- “1. Whether the accident in question occurred due to rash and negligent driving of the offending Car bearing registration No.HR-20AS/7396 by the respondent No.1 as prayed for? OPP 2. Whether the petitioners are entitled to recover the compensation from the respondents, if so, to what extent and from whom?OPP 3. Whether the Insurance Company is not liable to pay compensation as respondents No.1 and 2 have violated and contravened the insurance policy?OPR 4. Whether the present petition is not maintainable? OPR 5. Whether the claim petition is bad for mis-joinder and non- joinder of necessary parties? OPR 6. Whether the petitioners are estopped by their own act and conduct from filing the present claim petition? OPR 7. Relief” 5. Thereafter, the claimants as well as the driver and owner of the offending vehicle led their respective evidence. However, no oral and documentary evidence was led on behalf of the appellant (Insurance Company) and their evidence was closed on 21.04.2026. 6. The learned Tribunal after considering the pleadings as well as the evidence available on record, especially the case FIR No.444 dated ANKIT 2026.09.03 17:47 I attest to the accuracy and integrity of this document High Court, Chandigarh FAO-4113-2026 (O&M) -4- 10.08.2025, filing of challan against the driver of the offending vehicle namely Amit Kumar, statement of eye-witness (Aman as Ex. P1) and also the fact that neither the driver nor the owner of the offending vehicle appeared in the witness box, came to the conclusion that the accident in question had taken place due to rash and negligent act of Amit Kumar, who was driving the offending vehicle, which resulted into the death of Pankaj. 6.1 While determining compensation, the learned Tribunal considered the age of Pankaj (deceased) as 30 years on the basis of documentary evidence available on record. The learned Tribunal noticed that Pankaj (deceased) was running a shop under the name and style of ‘Maan Sports Wear’. The learned Tribunal further took note of the Income Tax Returns (ITR) filed by Pankaj (deceased) for the year 2025-26 (Ex. P2 and Ex. P3). The said Income Tax Returns were proved by Tinku Siwach (PW-3) from the Income Tax Office, Jind and accordingly the income of deceased-Pankaj had been assessed as Rs.5,55,300/- per annum i.e. Rs.46,275/- per month. 6.2 Further while relying upon the judgment rendered by the Hon’ble Supreme Court of India in case of “National Insurance Company Limited Vs. Pranay Sethi and others”, 2017 (4) R.C.R. (Civil) 1009, the learned Tribunal awarded 40% towards future prospects and further considering the fact that the deceased-Pankaj was married and had 5 claimants, accordingly 1/4th of the income was deducted towards the personal and living expenses of the deceased-Pankaj. Accordingly, the learned Tribunal assessed the dependancy of the claimants as Rs.48,589/- ANKIT 2026.09.03 17:47 I attest to the accuracy and integrity of this document High Court, Chandigarh FAO-4113-2026 (O&M) -5- per month. The learned Tribunal applied the multiplier of 17 considering the age of the deceased as 30 years and assessed the compensation as under:- Sr. No. Heads Calculation (i) Income 64,785/- per month (ii) 1/4th of the (i) deducted as personal expenses of the deceased 64,785-16196 = 48,589/- per month (iii) Compensation after multiplier of ‘17’ is applied 48589 × 12 × 17 = Rs.99,12,156/- (iv) Loss of Estate 15,000/- (v) Loss of consortium to petitioners No.1 to 5 2,00,000/- (Rs.40,000/- to each of the petitioner (vi) Funeral expenses 15,000/- Total Compensation awarded Rs.1,01,42,156/- in round figure Rs.1,01,42,000/- 6.3 The learned Tribunal had further concluded that on the date of accident, the offending vehicle was duly insured with the appellant (Insurance Company) and also that Amit Kumar was the driver of offending vehicle whereas Abhishek was the owner of the offending vehicle. Accordingly, the learned Tribunal held the driver and owner as well as the Insurance Company jointly and severally liable to pay compensation to the claimants. The learned Tribunal further awarded interest @ 9% per annum on the awarded amount from the date of filing of the claim petition till its realization vide award dated 28.04.2026. 7. In the aforementioned circumstances, present appeal has been filed before this Court. 8. Learned counsel appearing for the appellant has mainly raised only one ground that the learned Tribunal has erred in placing reliance upon only one ITR whereas an average of at least three ITRs was required, to assess the fair compensation. ANKIT 2026.09.03 17:47 I attest to the accuracy and integrity of this document High Court, Chandigarh FAO-4113-2026 (O&M) -6- 9. I have heard the learned counsel for the appellant and perused the paperbook with his able assistance. 10. At the outset, it is apposite to refer to a recent judgment by the Hon’ble Supreme Court of India in case of “Rashmirekha Tripathy versus The Branch manager (Legal Claims), Sriram General Insurance Company Limited and others”, (SLP (C) No.27220 of 2024; decided on 01.07.2026), wherein the Hon’ble Supreme Court has returned the following finding:- “17. In the considered view of this Court, there can be no hard and fast formula for computing the annual income of a deceased person/claimant. ITRs being a statutory document are an important reference point when it comes to assessing one’s income, for the purposes of compensation under the Motor Vehicle Act. 18. We find force in the submission put forth by Mr. J.R Midha, learned senior counsel. There must be a bifurcation made between salaried individuals and self-employed individuals when it comes to assessment of annual income. In our view, for salaried individuals, only the ITR of the previous year will be sufficient for showcasing the annual income from salary. The reason for considering only the preceding year is that the financial impact of promotions is significant and may be reflected in the ITR for only that year. A situation may also arise whereby the deceased/claimant might not have completed a year in the promoted position before the accident or might not have filed ITR for such period. In such cases the Court concerned shall take reference to the promotion letter and other corroboratory financial statements. 19. When it comes to self-employed / individuals carrying out their own business, in our view, the average of the income ANKIT 2026.09.03 17:47 I attest to the accuracy and integrity of this document High Court, Chandigarh FAO-4113-2026 (O&M) -7- specified in the ITRs of up to the previous three years is to be taken as a reference point for assessment of annual income from their business. There may also be a scenario where only one or two ITRs have been filed. Given such scenarios and the fluctuation of income in these professions, surrounding circumstances are also to be taken into consideration. These would include: a) The nature of the business (including geographic location, category etc.); b) Growth pattern of the business and impact of death on the business; c) Potential growth of business (for instance certain businesses are capital intensive at the outset and are profitable at scale/in the future); d) Negative income (certain businesses may require losses in the initial years, which may not reflect the true financial standing); and e) Any other relevant factor relating to the business. 20. The date when the ITRs are filed would also become a relevant consideration, as there may be scenarios where inflated income is showcased after death/injury. In these circumstances, the surrounding factors of the business would become more relevant. However, if sufficiently supported by financial statements, such ITRs may also be taken into consideration.” 10.1 A perusal of the above-extracted observations made by the Hon’ble Supreme Court of India would show that there is no bar in considering one or two Income Tax Returns (ITRs) in respect of the deceased, however, the same would have to be done by considering the surrounding circumstances as well, which includes the nature of business (including geographical location, category etc.), growth pattern of business, potential growth of business and/or any other relevant fact relating to the business. ANKIT 2026.09.03 17:47 I attest to the accuracy and integrity of this document High Court, Chandigarh FAO-4113-2026 (O&M) -8- 11. In the present case, learned Tribunal has taken note of the fact that the deceased-Pankaj was a proprietor of ‘Maan Sports Wear’ and as per his Income Tax Return (ITR) for the year 2025-26 (Ex. P2 and Ex. P3), which have been proved by Tinku Siwach (PW-3) from Income Tax Office, Jind; accordingly, the income of the deceased has been taken as Rs.46,275/- per month. It is a matter of record that the Insurance Company has not led any evidence (oral as well as documentary) to counter the aforesaid evidence led on behalf of the claimants. 11.1 Further, it is a mater of common knowledge that business of sports wear is a flourishing business from the last many years and has good potential for growth. Accordingly, I see no reason to discard the evidence led on behalf of the claimants to prove that deceased-Pankaj was earning Rs.46,275/- per month. 12. Considering the totality of circumstances, I am of the considered view that the learned Tribunal below was justified in awarding the compensation of Rs.1,01,42,000/- along with interest @ 9% per annum from the date of filing of the petition till its realization, on the basis of evidence available on record. 13. Resultantly, the present appeal fails and the same is accordingly dismissed. 14. All the pending application(s), if any, shall also stand closed. (HARSH BUNGER) 02.09.2026 JUDGE Ankit Whether speaking/reasoned: Yes/No Whether reportable: Yes/No ANKIT 2026.09.03 17:47 I attest to the accuracy and integrity of this document High Court, Chandigarh