Delhi High Court
National Insurance Co Ltd vs Manoj Prasad & Ors on 20 July, 2023
$~7 & 8
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of decision: 20.07.2023
+ MAC.APP. 454/2017 & CM APPL. 20382/2022
NATIONAL INSURANCE CO LTD
..... Appellant
Through: Mr.Arihant Jain & Mr.Shantha
Devi Raman, Advs.
versus
MANOJ PRASAD & ORS
..... Respondent
Through: Mr.S.N. Parashar, Adv. for R-1.
+ MAC.APP. 588/2018
MANOJ PRASAD
..... Appellant
Through: Mr.S.N. Parashar, Adv.
versus
HARINDER MEHTA & ORS (NATIONAL INSURANCE
COMPANY LTD )
..... Respondent
Through: Mr.Arihant Jain & Mr.Shantha
Devi Raman, Advs. for R-3.
CORAM:
HON'BLE MR. JUSTICE NAVIN CHAWLA
NAVIN CHAWLA, J. (ORAL)
1. These cross appeals have been filed by the Insurance
Company and also by the Claimant, challenging the Impugned
Award dated 28.02.2017 passed by the learned Motor Accidents
Claims Tribunal, Dwarka Courts, New Delhi (hereinafter
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referred to as the „Tribunal‟) in MACP No. 285/13/14, titled as
Sh. Manoj Prasad v. Sh. Harinder Mehta & Ors..
2. It is not in dispute in the appeals that consequent upon the
accident, the Claimant has suffered "post traumatic Paraparesis
with fracture D3 with permanent physical disability of 75%
(seventy five percent) in relation to both lower limbs". The
learned Tribunal has awarded compensation in favour of the
Claimant on the following heads:-
S. HEADS AMOUNT (In
No Rupees)
1 Attendant Charges 50,000/-
2 Conveyance &Special Diet 1,00,000/-
3 Loss of enjoyment of life &amenities 1,00,000/-
4 Disability &Future Loss of Earning 1,04,11,200/-
5 Loss of Income 2,89,200/-
6 Medicines, Treatment and equipment 3,77,089/-
7 Pain & Suffering 1,00,000/-
Total Rs.1,14,27,489/-
Challenge regarding addition of incentive to determine the
income of the claimant:
3. The first challenge of the Insurance Company is to the
addition of Rs.15,000/- per month claimed to be the incentive
received by the Claimant from his employer, that is, M/s LBF
Travel India Pvt. Ltd (hereinafter referred to as the
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"Employer"). The learned counsel for the Insurance Company
submits that the pay slips of the Claimant for the months of
June to September, 2013 [Ex PW1/B (colly.)] do not show any
payment being made as incentive to the Claimant. He submits
that PW1- Shri Gopal Bhandari, Sr. H.R. Executive of the
Employer did not mention about any incentive being paid to the
Claimant. However, PW-4- Shri Dalip Kumar, Sr. Admin.
Executive, of the Employer stated that while the salary slips
[EX.PW-1/B)(Colly)] did not show payment of any incentive to
the Claimant, but volunteered that the Claimant was entitled for
incentives and was getting incentives through cash. The
witness, however, did not produce any record to substantiate
this statement. He submits that, therefore, there was no evidence
on record to establish that the Claimant was receiving
Rs.15,000/- from the employer as an incentive, and the learned
Tribunal has erred in adding the same to his income.
4. On the other hand, the learned counsel for the Claimant
submits that the payment of incentives is evident from the
statement of the bank account of the Claimant maintained with
the ICICI Bank as also from a certificate/statement issued by
the ICICI Bank which reflects a payment of Rs.30,000/- being
credited to the Claimant‟s bank account on 21.09.2013, and
further amounts of Rs.14,695/- and Rs.11,786/- being credited
to his account on 19.10.2013 and 31.10.2013. He submits that
these amounts reflect the payment of incentive by the employer
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to the Claimant. To a query of this Court as to whether any
witness of the Claimant has testified to the effect that these
entries, in fact, relate to payment of incentive by the employer
to the Claimant, he fairly admits that no witness has deposed to
this effect. He submits that amounts reflected in the statement,
however, duly correspond to the claim of the Claimant that an
amount of Rs.15,000/- per month was being paid by the
employer to the Claimant as incentive.
5. I am unable to agree with the submission made by the
learned counsel for the Claimant. As has been held by the
Supreme Court in Central Bureau of Investigation v. V.C.
Shukla (1998) 3 SCC 410, entries in a statement of account are
not primary evidence of the fact; they are merely corroborative
and have to be proved through primary evidence. In the present
case, PW-1 Mr.Gopal Bhandari, Senior H.R. Executive with the
LBF Travels India Pvt. Ltd. did not mention payment of any
incentive to the Claimant. PW-4 stated that such incentive was
being paid in cash by the employer to the Claimant. Therefore,
it was not the case of the employer that the payment of
incentive has been made through any banking transactions. The
case now set up by the Claimant is, therefore, even beyond the
evidence that was produced by the Claimant before the learned
Tribunal, and cannot be accepted.
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6. The Claimant, in his cross-examination, stated that he has
filed his Income Tax Returns. However, even these were not
produced before the learned Tribunal.
7. I, therefore, hold that the Claimant has been unable to
prove that he was receiving an incentive of Rs.15,000/- per
month from the employer and that the same deserves to be
added to his monthly income. The Impugned Award insofar as
it adds a sum of Rs.15,000/- to the income of the Claimant is,
therefore, set aside.
Challenge regarding non deduction of Income Tax
8. The learned counsel for the Insurance Company submits
that the learned Tribunal has also erred in not deducting the
income tax that would be payable by the Claimant on his salary.
He submits that taking the salary of the Claimant to be
Rs.33,200/- per month, the Claimant would fall in the income
tax slab of 10% and, therefore, from his determined income,
10% amount should have been deducted towards income tax.
9. On the other hand, the learned counsel for the Claimant,
while not denying that a deduction towards income tax should
have been made by the learned Tribunal, submits that the
deduction has to be made after giving the benefit of the
standard deduction, as provided under the Income Tax Act,
1961, to the Claimant.
10. I agree with the submissions made by the learned counsel
for the Claimant. While the learned Tribunal has erred in not
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deducting the income tax amount from the income of the
Claimant, at the same time, for making such deduction, the
standard deductions that a salaried employee is entitled to claim
from his gross income, have to be taken into account.
Accordingly, the Impugned Award shall stand modified to the
above extent.
Challenge regarding Conveyance and Medical Allowance
11. The third challenge of the Insurance Company to the
Impugned Award is the inclusion of the conveyance and the
medical allowance that was reflected in the pay slip of the
Claimant as being received from the Employer. The learned
counsel for the Insurance Company, placing reliance on the
judgment of the Supreme Court Kalpanaraj and Ors. v. Tamil
Nadu State Transport Corpn., (2015) 2 SCC 764; and of this
Court in Asha Devi & Ors. v. Oriental Insurance Co. Ltd.,
2015 SCC OnLine Del 7114, submits that allowances like the
travelling allowance, which are incidental to employment,
ought to have been deducted from the income of the Claimant.
12. On the other hand, the learned counsel for the Claimant,
placing reliance on the judgment of the Supreme Court in Sunil
Sharma & Ors. v. Bachitar Singh & Ors., (2011) 11 SCC 425;
and of this Court in The Oriental Insurance Co Ltd. v.
Kamlesh Kumari & Ors., 2016 SCC OnLine Del 1289, submits
that for determining the income, the Court has to consider not
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only the pay package that the employee carries home at the end
of the month, but also other perks which are beneficial to the
members of the entire family. Therefore, allowances like the
travel allowance and the medical allowance cannot be deducted
from the income of the injured/Claimant.
13. I have considered the submissions made by the learned
counsels for the parties. The pay slips produced on record
before the learned Tribunal shows that the Claimant was being
paid conveyance allowance of Rs.800/- per month and medical
allowance of Rs. 1250/- per month. It is not shown by the
Insurance Company that these allowances required the
Claimant to actually spend any amount on such heads. These
were clearly the benefits that the Claimant took home from the
employer irrespective of any expenditure incurred by him on
these heads. These were not incidental to the employment, but
emoluments received by the Claimant for his employment and
for his service.
14. In Sunil Sharma & Ors. (Supra), the Supreme Court,
placing reliance on the earlier judgment in National Insurance
Co. Ltd. v. Indira Srivastava & Ors., AIR 2008 SC 845, has
held that having regard to the change in societal conditions, the
Court must consider the question of determination of the
income not only having regard to the pay package the employee
carries home at the end of the month, but also other perks which
are beneficial to the members of the entire family. The Court
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held that taking into account the said principle, payments made
on account of house rent allowance, medical allowance, etc., are
to be added to the income of the deceased/injured. The same
view has been expressed by this Court in its judgment in
Kamlesh Kumari & Ors. (Supra).
15. In Kalpanaraj and Ors. (Supra), the issue of deducting
the amounts received by an employee as travelling allowance
etc., was not in issue. In fact, the Supreme Court held that in
that case, the High Court had erred in making deductions under
various heads and taking into account only the net income
instead of ascertaining the gross income of the deceased therein.
The said judgment, therefore, is not relevant to the issue in
hand.
16. In Asha Devi & Ors. (Supra), though the Court held that
the amount received by the employee towards conveyance
allowance deserves to be deducted, it is not evident from the
judgment whether the amount received in that case was as a
reimbursement or as a monthly perk. The Judgment in Sunil
Sharma & Ors. (Supra) was also not drawn to the notice of the
High Court.
17. In view of the above, I find no merit in the challenge of
the Insurance Company on this account.
Challenge regarding determination of Functional Disability
18. The next challenge of the Insurance Company to the
Impugned Award and the corresponding challenge of the
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Claimant thereto is on account of the functional disability of the
Claimant being determined by the learned Tribunal in the
Impugned Award as 75%.
19. The learned counsel for the Insurance Company submits
that the Claimant, at the time of the accident, was working as a
Team Leader with the employer. He submits that the claimant‟s
job being a desk job, the injury suffered by the Claimant being
only in the lower limbs, the functional disability could not have
been taken as 75% as the disability was only in relation to the
lower limbs.
20. On the other hand, the learned counsel for the appellant
submits that looking into the nature of the injury suffered by the
Claimant, the functional disability should have been assessed at
100%. He submits that it had been proved on record that due to
the injury suffered, the Claimant had to, in fact, resign from his
job and that itself in turn proves the entire loss of income
suffered by the Claimant due to the accident.
21. I have considered the submissions made by the learned
counsels for the parties.
22. In Raj Kumar v. Ajay Kumar and Another, (2011) 1
SCC 343, on the question of determination of functional
disability in case of permanent disability suffered by the
Claimant, the Supreme Court has held that the Tribunal should
ascertain the actual extent of permanent disability of the
Claimant based on the medical evidence and also determine
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whether such permanent disability has affected or will affect the
Claimant‟s earning capacity. For this purpose, 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. The second step is to
ascertain his avocation, profession and the nature of work
before the accident, and also his age. The third step is to find
out whether the Claimant is totally disabled from earning any
kind of livelihood or whether in spite of the permanent
disability, the Claimant could still effectively carry on the
activities and functions which he was earlier carrying on before
the accident occurred, and whether by the injury suffered he is
prevented or restricted from discharging his previous activities
and functions, however, at the same time can carry out some
other or lesser scale of activities and functions so that he
continues to earn or can continue to earn his livelihood.
23. In the present case, the injury suffered by the Claimant
has been reproduced hereinabove. The Claimant has proved that
due to the injury suffered, he had to resign from his
employment. The Claimant was aged about 33 years and was
working as a Team Leader with a travel company. His job
would clearly require him to travel and be more presentable. At
the same time, with the injury suffered, it cannot be said that the
plaintiff would be unable to carry out any vocation or earn a
livelihood. Keeping in view the above circumstances, the
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assessment of the learned Tribunal of the Claimant‟s permanent
disability at 75%, therefore, cannot be faulted. The challenge of
the Claimant and the Insurance Company, therefore are not
accepted on this account.
Challenge regarding compensation under the head of 'Loss
of enjoyment of life and amenities' & 'pain and suffering'
24. The further challenge of the Insurance Company as also
the Claimant to the Impugned Award is on account of the
compensation awarded in favour of the Claimant for „loss of
enjoyment of life and amenities‟ and „pain and suffering‟. While
the learned counsel for the Insurance Company, placing
reliance on the judgment of the Supreme Court in Raj Kumar
(Supra), submits that once the loss of income of the Claimant
has been determined taking 75% as functional disability, only a
token or nominal amount can be awarded in favour of the
Claimant under the head of loss of enjoyment of life and
amenities and for pain and suffering.
25. On the other hand, the learned counsel for the Claimant,
placing reliance on the judgment of this Court in Shriram
General Insurance Co. Ltd. v. Neetu Lodhi &Ors., 2019 SCC
OnLine Del 12310, submits that in the said case, though the
functional disability was determined at 100%, compensation of
Rs.3 lacs each was awarded towards mental and physical shock,
and pain and suffering and towards loss of enjoyment of life
and amenities. He submits that this judgment on the above
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aspect was approved by the Supreme Court vide its judgment
dated 11.07.2023 passed in Civil Appeal No. 4360-61/2023.
26. The learned counsel for the Claimant further places
reliance on the judgment of this Court in Ashok Kumar v. M/s
Viva International & Anr. (IFFCO Tokio General Insurance
Co Ltd.), 2023 SCC OnLine Del 1308, to submit that in the said
case as well, though the functional disability was taken as
100%, amount of Rs.2 lacs was awarded towards loss of
enjoyment of life and amenities.
27. I have considered the submissions made by the learned
counsels for the parties. In Raj Kumar (Supra), the Supreme
Court on the award under the head of loss of amenities has
observed as under:-
"15 It may be noted that when compensation
is awarded by treating the loss of future
earning capacity as 100% (or even anything
more than 50%), the need to award
compensation separately under the head of
loss of amenities or loss of expectation of life
may disappear and as a result, only a token or
nominal amount may have to be awarded
under the head of loss of amenities or loss of
expectation of life, as otherwise there may be a
duplication in the award of compensation. Be
that as it may."
28. Therefore, there is no hard and fast rule that in every case
where the functional disability has been assessed at more than
50%, no amount can be awarded on the heads of loss of
amenities or pain and suffering. Each case has to be determined
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on its own facts. In the present case, as noted hereinabove, from
the injuries that have been suffered by the Claimant, his age,
and the fact that he had to resign from his job, the award on the
head of loss of enjoyment of life and amenities at Rs.1 lac and
of an equivalent amount towards pain and suffering, by the
Tribunal are found reasonable and are upheld.
Challenge regarding Attendant Charges
29. The Claimant challenges the Impugned Award also
insofar as it restricts the compensation on account of attendant
charges to Rs. 50,000/- only. The learned counsel for the
Claimant, placing reliance on the judgment of this Court in
Ashok Kumar (Supra), submits that compensation towards
attendant charges need to be enhanced taking into account the
minimum wages for an unskilled worker and also the fact that
the Claimant would require an attendant throughout his life to
support him. He submits that as the Claimant expired in the
year 2021, attendant charges at least till that date should have
awarded by the learned Tribunal.
30. On a query from this Court, if any evidence was lead
before the learned Tribunal on the Claimant having incurred
any expenses on the attendant, he admits that no such evidence
was produced before the learned Tribunal. The Claimant had
suffered „post traumatic Paraparesis with fracture D3‟ due to
the accident. The learned counsel for the Claimant has not
drawn my attention to any evidence that would suggest that the
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Claimant was unable to perform his daily work without the help
of an attendant.
31. In absence of any such evidence, in my view, the learned
Tribunal has awarded a reasonable amount in favour of the
Claimant on this head and the Award, therefore, does not
deserve any interference.
Challenge regarding Grant of Interest at the rate of 10%
per annum
32. The last challenge of the Insurance Company to the
Impugned Award is to the grant of interest at the rate of 10%
per annum on the awarded amount in favour of the Claimant.
Placing reliance on the judgment of this Court in National
Insurance Co. Ltd. v. Yad Ram and Ors., 2023 SCC OnLine
Del 1849, the learned counsel for the Insurance Company
submits that taking into account the bank rate of interest
relevant to the year of the accident, interest of not more than
6% per annum should have been granted in favour of the
Claimant.
33. On the other hand, the learned counsel for the Claimant
submits that the interest awarded by the Impugned Award is
reasonable and deserves no interference of this Court.
34. In Yad Ram and Ors. (Supra), this Court taking into
account the rate of interest as was prevalent on the date of the
accident therein, had held the Claimants therein to be entitled to
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receive interest at the rate of 7.5% per annum. The learned
counsels for the parties agree that in the year 2013, that is,
around the period when the accident had taken place, the rate of
the interest was between 8.75% and 9.10%. Keeping in view
the above, the rate of interest awarded by the learned Tribunal
is found to be excessive and is reduced to 9% per annum. The
Impugned Award shall be modified to the above extent.
35. As various heads of the compensation awarded in the
Impugned Award have been modified by the present order, the
parties, that is, the Insurance Company and the Legal Heirs of
the Claimant, shall appear before the learned Tribunal on 29th
August, 2023. The learned Tribunal shall re-determine the
compensation payable to the Claimant/his Legal Heirs in
accordance with its Award as modified by the present order.
The awarded amount shall be released to the Claimant/his Legal
Heirs in accordance with the schedule as prescribed in the
Impugned Award. In case any excess amount is found to have
been deposited by the Insurance Company, such excess amount
along with proportionate interest thereon, shall be released to
the Insurance Company.
36. The appeals and the pending application are disposed of
in the above terms.
NAVIN CHAWLA, J
JULY 20, 2023/rv/am
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