Delhi High Court
Cholamandalam Ms General ... vs Sandesh Kumar & Ors on 10 November, 2022
NEUTRAL CITATION NO: 2022/DHC/004810
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* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Reserved on: 19.10.2022
Pronounced on: 10.11.2022
+ MAC.APP. 664/2015
CHOLAMANDALAM MS GENERAL
INSURANCE CO LTD ..... Petitioner
Through: Ms. Suman Bagga &
Mr.Pankaj Gupta, Advocates
versus
SANDESH KUMAR & ORS ..... Respondents
Through: Mr. M. K. Singh, Advocate
for R-1/claimant
CORAM:
HON'BLE MR. JUSTICE GAURANG KANTH
JUDGMENT
GAURANG KANTH, J.
1. The present appeal has been preferred by the Appellant under
Section 173 of the Motor Vehicles Act, 1988 against the Award
dated 21.05.2015 (hereinafter referred to as "impugned Award"
passed by the Court of learned Presiding Officer, Motor
Accident Claims Tribunal-1, (North), Rohini, Delhi.
2. By way of the impugned Award dated 21.05.2015, the learned
Claims Tribunal awarded a compensation of Rs. 18,50,409.60/-
with interest @ 9 % per annum from the date of filing of the
claim petition till realization of the amount and directed the
Insurance Company to pay the entire awarded amount within a
period of one month.
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SUBMISSION OF THE APPELLANT
3. Mr. Pankaj Gupta, learned counsel for the Appellant/Insurance
Company contended that the Impugned Award is perverse and
has been passed without appreciating the principles of law,
documents and the evidence on record. Learned counsel further
contended that in terms of dicta of Hon‟ble Supreme Court in the
case of National Insurance Co. Ltd Vs Pranay Sethi & Ors.
reported as (2017) 16 SCC 680, compensation under the head
„Future Prospects‟ is to be paid by adding 40% of the assessed
income of the claimant instead of 50%, as awarded by the
learned Claims Tribunal. Learned counsel, while placing
reliance on the judgment of Pranay Sethi (supra) further
contended that the respondent No. 1/claimant was 30 years of
age at the time of the incident and the learned Claims Tribunal
erred in calculating the compensation under the head „Loss of
Future Income‟ by taking the multiplier of 30 instead of 17.
Learned counsel further contended that as per the disability
certificate the functional disability was assessed at 68% in
relation to both lower limbs and learned Claims Tribunal took
the functional disability as 68% for the whole body. Learned
counsel further contended that the learned Claims Tribunal while
calculating the compensation under the head „Loss of Future
Income‟ erred in ignoring the fact that the respondent No.
1/claimant has neither placed any proof on record with respect to
his work nor placed any document to prove that because of his
disability, he was unable to work. In order to substantiate his
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arguments, learned counsel placed reliance on the judgment
passed by Hon‟ble Supreme Court in the case of Raj Kumar Vs
Ajay Kumar & Anr. reported as 2011 (1) SCC 343.
SUBMISSION OF THE RESPONDENT NO. 1/CLAIMANT
4. Mr. M. K. Singh, learned counsel appearing on behalf of
respondent No. 1/claimant contended that the appeal is liable to
be dismissed and no interference in the impugned order is called
for by this Court. Learned counsel further contended that as per
the disability certificate, the respondent No. 1/claimant has
suffered 68% disability and the learned Claims Tribunal has
correctly assessed the disability for the grant of compensation
under the head „Loss of Future Earning‟ as 68% for the whole
body.
COURT'S REASONING
5. Brief facts of the case as noted by the learned Tribunal are as
under:-
"...on 17.04.2009, he alongwith his friend namely Vicky
Jain was going to Bangalore for some work. They were on
a motorcycle bearing no. DL 4S BE 8405. When they
reached NH 211 road, Vasi, a truck bearing no. HR 55E
3412, driven by resp. no.l (GaniMohd.) rashly and
negligently came from front side and hit their motorbike.
Both of them fell down on road and suffered multiple
injuries. Some unknown persons took them to Civil
hospital, Osmanabad, from where, they were referred to
Sh CSM Hospital. Sholapur, Maharashtra...."
6. At this stage, it is relevant to mention that the Motor Vehicles
Act, 1988 (herein after referred to as 'Act‟) is a beneficial
legislation. The Hon‟ble Supreme Court time and again has
reiterated that the Act stipulates that there should be grant of
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"just compensation". Thus, it becomes a challenge for the court
of law to determine "just compensation" which is neither a
bonanza nor a windfall, and simultaneously, should not be a
pittance. The Courts should pragmatically compute the loss
sustained which has to be in the realm of realistic
approximation.
7. In the case of Pappu Deo Yadav Vs Naresh Kumar and Ors
reported as 2020 SCC Online SC 752, the Hon‟ble Supreme
Court while dealing with the issue of granting compensation to
an accident victim has held that severe limitations inflicted due
to such injuries undermine the dignity (which is now
recognized as an intrinsic component of the right to life of an
individual under Article 21 of the Constitution), thus depriving
the person of the essence of the right to a whole some life
which she or he had lived, hitherto, relevant portion of the same
reads as under:-
"In parting, it needs to be underlined that Courts should
be mindful that a serious injury not only permanently
imposes physical limitations and disabilities but too often
inflicts deep mental and emotional scars upon the victim.
The attendant trauma of the victim's having to live in a
world entirely different from the one she or he is born
into, as an invalid, and with degrees of dependence on
others, robbed of complete personal choice or autonomy,
should forever be in the judge's mind, whenever tasked to
adjudge compensation claims. Severe limitations inflicted
due to such injuries undermine the dignity (which is now
recognized as an intrinsic component of the right to life
under Article 21) of the individual, thus depriving
theperson of the essence of the right to a wholesome life
which she or he had lived, hitherto. From the world of the
able bodied, the victim is thrust into the world of the
disabled, itself most discomfiting and unsettling. If courts
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nit-pick and award niggardly amounts oblivious of these
circumstances, there is resultant affront to the injured
victim."
8. Learned counsel for the Appellant contended that as per the
disability certificate, the functional disability was assessed at
68% in relation to both lower limbs and learned Claims
Tribunal while calculating the compensation under the head
„Loss of Future Income‟ erred in treating the functional
disability as 68% for the whole body. In this context, it is
necessary to recapitulate the observations made by the learned
Claims Tribunal, relevant portion of which reads as under:-
"On the other hand. ld Counsel for petitioner submits that
the injured was working in a manufacturing unit of leather
garments and his job was to operate sewing machine. He
had to use his legs. Due to permanent disability of his
lower limbs, petitioner is not able to operate said machine
now and hence, his functional disability should be
calculated at the same percentage i.e. 68% as opined by
the medical board. Ld. Counsel referred a case titled as
Basappa V; T Ramesh and Another, 2014(9) LRC228(SC).
It was a case of permanent disability of 58% of whole
body. The Motor Accident Claim Tribunal as well as the
High Court concerned accepted the injury certificate
produced by the doctor. The High Court fixed functional
disability of appellant at 25%. Holding that as the High
Court had itself accepted the evidence of doctor, who
treated the appellant and issued disability certificate as
credible and reliable, the Apex court came to a conclusion
that there was no reason to treat functional disability of
the injured at 25%. It is worth mentioning that the
appellant/ injured was working as a Gaundi i.e. at
building construction sites i.e. such a work requires good
health and extreme fitness, as it is a strenuous task, which
involves lot of physical activities. There is no straight
jacket formula, provided either by the legislature or by the
higher Courts as to how functional disability is to be
calculated for a person suffering permanent disability of
some limbs. In such circumstances, it can vary from case
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to case particularly as per occupation of injured. As
mentioned above, appellant/ injured in Basappas case
(Supra) was a worker at building construction site, such a
work required good health and extreme fitness.
Considering all this, the apex court fixed functional
disability of injured at85%. While according to treating
doctor the said patient/ injured had suffered 58%
permanent disability in relation to his whole body.
Coming to the case in hands, as claimed by the
petitioner, he was working in leather factory. He was
required to operate sewing machine by legs and to sew
leather pieces. In this way, petitioner was earning his
livelihood, by use of his lower limbs particularly legs. In
these circumstances, I think it proper to take 68%
functional disability of petitioner, in calculating his
future loss of income."
9. The test for determining the effect of permanent disability on
future earning capacity has been laid down by the Hon‟ble
Supreme Court in the case of Chanappa Nagappa
Muchalagoda v. Divisional Manager, New India Insurance
Company Limited reported as 2020 1 SCC 796, relevant
portion of which reads as under:-
"13. Ascertainment of the effect of the permanent disability on
the actual earning capacity involves three steps. The Tribunal
has to first ascertain what activities the claimant could carry on
in spite of the permanent disability and what he could not do as a
result of the permanent disability (this is also relevant for
awarding compensation under the head of loss of amenities of
life). The second step is to ascertain his avocation, profession
and nature of work before the accident, as also his age. The third
step is to find out whether (i) the claimant is totally disabled
from earning any kind of livelihood, or (ii) whether in spite of the
permanent disability, the claimant could still effectively carry on
the activities and functions, which he was earlier carrying on, or
(iii) whether he was prevented or restricted from discharging his
previous activities and functions, but could carry on some other
or lesser scale of activities and functions so that he continues to
earn or can continue to earn his livelihood."
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10. While dealing with the issue of calculating the compensation
under the head „Loss of Future Earning‟, the learned Claims
Tribunal accepted the version of the claimant that he was
working in a leather factory. The learned Claims Tribunal
further accepted that the claimant was indulged in the sewing
of leather pieces for which he has to operate sewing machine
and treated 68% functional disability of claimant in calculating
the compensation. Moreover, while deciding the issue of
income of the claimant, the learned Claims Tribunal on the
basis of evidence adduced by the claimant has accepted the
testimony of the claimant and treated the claimant as skilled
worker, however, on evaluating the documents produced by the
claimant, the learned Claims Tribunal declared that the
claimant failed to produce any evidence that he was earning
Rs.10,000/- per month and took into account the prevailing
rates of minimum wages for the purposes of determining the
income of the claimant. It is pertinent to point out that no
evidence was led by the Insurance Company during the trial to
substantiate their objection in relation to the claimant not being
a skilled worker employed in a leather factory indulging in
sewing of leather pieces. As such, this Court is of the opinion
that the learned Claims Tribunal has rightly assessed the
functional disability of claimant as 68%.
11. The other argument raised by the learned counsel for the
Appellant is purely legal and based on the law settled by the
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Hon‟ble Apex Court in the case of Pranay Sethi (Supra). In
terms of Pranay Sethi (Supra) case an addition of 40% of the
established income of the respondent No.1/claimant has to be
granted under the head „Future Prospects' as respondent No.
1/claimant was of the age of 30 years at the time of the alleged
incident. The Hon‟ble Apex Court in the case of Pranay Sethi
(Supra) with regard to grant of compensation under the head
„Future Prospects' has held as under:-
"....The degree-test has to have the inbuilt concept of
percentage. Taking into consideration the cumulative
factors, namely, passage of time, the changing society,
escalation of price, the change in price index, the human
attitude to follow a particular pattern of life, etc., an
addition of 40% of the established income of the
deceased towards future prospects and where the
deceased was below 40 years an addition of 25% where
the deceased was between the age of 40 to 50 years
would be reasonable.
60. The controversy does not end here. The question still
remains whether there should be no addition where the
age of the deceased is more than 50 years. Sarla Verma
thinks it appropriate not to add any amount and the same
has been approved in Reshma Kumari. Judicial notice can
be taken of the fact that salary does not remain the same.
When a person is in a permanent job, there is always an
enhancement due to one reason or the other. To lay down
as a thumb Rule that there will be no addition after 50
years will be an unacceptable concept. We are disposed to
think, there should be an addition of 15% if the deceased
is between the age of 50 to 60 years and there should be
no addition thereafter. Similarly, in case of self-employed
or person on fixed salary, the addition should be 10%
between the age of 50 to 60 years. The aforesaid yardstick
has been fixed so that there can be consistency in the
approach by the tribunals and the courts."
(emphasis supplied)
12. In the case of Joginder Singh and Ors.
Vs. ICICI Lombard General Insurance Company reported in
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2012 SCC Online Mad 3922, the Hon‟ble Supreme Court
while dealing with issue of multiplier in an accident case has
held that:-
"The issue with respect to whether the Multiplier to be
applied in the case of a bachelor, should be computed on
the basis of the age of the deceased, or the age of the
parents, is no longer res integra. This issue has been
recently settled by a three Judge bench of this Court
in Royal Sundaram Alliance Insurance Co.
Ltd. v. Mandala Yadagari Goud and Ors. , (2019) 5 SCC
554 wherein it has been held that the Multiplier has to be
applied on the basis on the age of the deceased. The Court
held that:
10. A reading of the judgment in Sube Singh
(supra) shows that where a three Judge Bench
has categorically taken the view that it is the age
of the deceased and not the age of the parents
that would be the factor for the purposes of taking
the multiplier to be applied. This judgment
undoubtedly relied upon the case of Munna Lal
Jain (supra) which is also a three Judge Bench
judgment in this behalf. The relevant portion of
the judgment has also been extracted. Once again
the extracted portion in turn refers to the
judgment of a three Judge Bench in Reshma
Kumari and Ors. v. Madan Mohan and Anr. :
(2013) 9 SCC 65. The relevant portion of Reshma
Kumari in turn has referred to Sarla Verma
(supra) case and given its imprimatur to the
same. The loss of dependency is thus stated to be
based on: (i) additions/deductions to be made for
arriving at the income; (ii) the deductions to be
made towards the personal living expenses of
the deceased; and (iii) the multiplier to be
applied with reference to the age of the deceased.
It is the third aspect which is of significance and
Reshma Kumari categorically states that it does
not want to revisit the law settled in Sarla Verma
case in this behalf.
11. Not only this, the subsequent judgment of the
Constitution bench in Pranay Sethi (supra) has
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NEUTRAL CITATION NO: 2022/DHC/004810
also been referred to in Sube Singh for the
purpose of calculation of the multiplier.
12. We are convinced that there is no need to
once again take up this issue settled by the
aforesaid judgments of three Judge Bench and
also relying upon the Constitution Bench that it is
the age of the deceased which has to be taken into
account and not the age of the dependents."
(emphasis supplied)
13. Further, in terms of dicta laid down in case of Sarla Verma &
Ors. Vs DTC & Anr. reported in (2009) 6 SCC 121 which is
upheld in the judgment of Pranay Sethi (Supra) whereby it was
held that for the purposes of selection of multiplier, the age of
the deceased has to be taken into account. The Hon‟ble Supreme
Court in the case of Sarla Verma (Supra) while determining the
multiplier in an accident case has held that:-
"21. We therefore hold that the multiplier to be used
should be as mentioned in column (4) of the Table above
(prepared by applying Susamma Thomas, Trilok Chandra
and Charlie), which starts with an operative multiplier of
18 (for the age groups of 15 to 20 and 21 to 25 years),
reduced by one unit for every five years, that is M-17 for
26 to 30 years, M-16 for 31 to 35 years, M-15 for 36 to
40 years, M-14 for 41 to 45 years, and M-13 for 46 to 50
years, then reduced by two units for every five years, that
is, M-11 for 51 to 55 years, M-9 for 56 to 60 years, M-7
for 61 to 65 years and M-5 for 66 to 70 years."
(emphasis supplied)
14. Multiplier to be used as per dicta of SarlaVarma (Supra) is as
under:-
Colu Upto 15 21 26 31 36 41 46 51 56 61 Abo
mn 15 to to to to to to to to to to ve
yrs 20 25 30 35 40 45 50 55 60 65 65
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NEUTRAL CITATION NO: 2022/DHC/004810
yrs yrs yrs yrs yrs yrs yrs yrs yrs yrs yrs
(4) 15 18 18 17 16 15 14 13 11 9 7 5
15. Since in the present case, the age of claimant was 30 years at
the time of alleged incident, multiplier of 17 is to be taken
while computing the compensation under the head „Loss of
Future Income‟.
16. In view of the above discussion, the impugned Award dated
21.05.2015 is modified as under:-
1. Rs. 6537/- (monthly income) + 40% (Rs. 2615/-)
= Rs. 9152/-
2. Rs. 9152/- X 12 = Rs. 1,09,824/- (Annual
Income)
3. Rs. 1,09824/-X 68/100 = Rs.74680/-
(Loss of Income due to functional disability)
4. Rs.74,680/-X 17 = Rs. 12,69,560/-
(Future Loss of Income)
17. Accordingly, the compensation granted by the learned Claims
Tribunal is reduced/modified as under:-
S. No. On account of Amount (Rs.)
1. Towards medical expenses Rs. 25,152.50/-
2. Towards conveyance Rs. 25,000/-
3. Towards future loss of Rs. 12,69,560/-
income
4. Towards pain and suffering Rs. 1,00,000/-
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DHIRANIA
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5. Towards loss of enjoyment of Rs. 1,00,000/-
life
Total Rs.15,19,712.5-
18. The compensation amount is reduced from Rs. 18,50,409.60/- to
Rs.15,19,712.5/-
19. This Court, vide order dated 21.08.2015, while staying the
operation of the impugned Award in the present Appeal, directed
the Appellant/Insurance Company to deposit the entire decretal
amount with the Registrar General of this Court. This Court
further directed for the release of the 50% of the decretal amount
to respondent No. 1/claimant. Balance 50% was to be kept in an
interest-bearing FDR with UCO Bank, Delhi High Court
Branch. The registry is directed to deduct the differential amount
from the said FDR and release the said amount with up-to-date
interest to the Appellant/Insurance Company. Balance, if any,
may be released to respondent No. 1/claimant in terms of the
Award dated 21.05.2015. The statutory deposit may also be
released to the Appellant.
20. With the above directions, appeal stands disposed of. No order
as to costs.
GAURANG KANTH
(JUDGE)
NOVEMBER 10, 2022
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DHIRANIA
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