[Cites 13, Cited by 0]
Punjab-Haryana High Court
National Insurance Company Ltd vs Bal Chand And Ors on 23 April, 2026
Author: Sudeepti Sharma
Bench: Sudeepti Sharma
FAO-3803-2015 (O&M) &
XOBJC-176-CII-2015 -1-
IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
FAO-3803-2015 (O&M) &
XOBJC-176-CII-2015
NATIONAL INSURANCE COMPANY LTD.
....Appellant
Vs.
BAL CHAND (SINCE DECEASED) THROUGH HIS LRs AND OTHERS
....Respondents
Reserved on : 08.04.2026
Pronounced on: 23.04.2026
Uploaded on : 27.04.2026
Whether only the operative part of the judgment is pronounced? NO
Whether full judgment is pronounced? YES
CORAM : HON'BLE MRS. JUSTICE SUDEEPTI SHARMA
Present : Mr. Rajneesh Malhotra, Advocate
for the appellant-Insurance Company.
Mr. Gaurav Sharma, Advocate
for cross-objectors/respondent No.1(i) & (ii).
Mr. Sandeep Berwal, Advocate
for respondent No.2.
Respondent No.3 was proceeded against ex parte
vide order dated 03.11.2015.
Mr. D.K. Dogra, Advocate
for respondent No.-4-Insurance Company.
****
SUDEEPTI SHARMA, J.
FAO-3803-2015 (O&M)
1. The present appeal has been preferred against award dated
02.01.2015 passed by the learned Motor Accident Claims Tribunal, Chandigarh
(for short, 'the Tribunal') in the claim petition filed under Section 166 of the
authenticity of this order/judgment.
FAO-3803-2015 (O&M) &
Motor Vehicles Act, 1988, wherein, the appellant/insurance company was held
liable to pay the compensation to the claimants/respondent Nos.1 to 3 to the tune
of Rs.18,81,404/- along with interest @7.5%, on the ground of quantum of
compensation to be on higher side.
XOBJC-176-CII-2015
2. The present cross-objections have been preferred by
cross-objector/legal heirs of claimant-Bal Chand against the award dated
02.01.2015 passed by the learned Motor Accident Claims Tribunal, Chandigarh
in the claim petition filed under Section 166 of the Motor Vehicles Act, 1988, for
enhancement of compensation, granted to Bal Chand (since deceased) to the tune
of Rs.18,81,404/- along with interest @7.5% per annum on account of injuries
suffered by Bal Chand (since deceased) in the accident.
3. Since the appeal filed by the Insurance Company and the cross-
objections filed by the cross-objectors/legal heirs of the claimant are arising out
of the same award dated 02.01.2015 passed by the learned Tribunal, therefore,
FAO-3803-2015 and XOBJC-176-CII-2015 are decided vide this common
judgment.
4 As sole issue for determination in the present appeal/cross-objection
is confined to quantum of compensation awarded by the learned Tribunal, a
detailed narration of the facts of the case is not required to be reproduced here
for the sake of brevity.
SUBMISSIONS OF LEARNED COUNSELS FOR THE PARTIES
5. Learned counsel for the appellant-Insurance Company submits that
the compensation awarded by the learned Motor Accident Claims Tribunal is
excessive and not in consonance with the evidence on record. He further
authenticity of this order/judgment.
FAO-3803-2015 (O&M) &
contends that the learned Tribunal has erred in awarding sum of ₹18,01,404/-
towards loss of future income without due appreciation of the fact that the
claimant (since deceased) was in permanent employment and continued to draw
salary even after the accident. He further contends that the evidence reveals that
the claimant was earning ₹18,196/- per month at the time of the accident, which
subsequently increased to ₹29,064/-, thereby demonstrating the absence of any
actual loss of earning capacity. On this premise, it is urged that the amount
awarded under the head of loss of future income is unsustainable and liable to be
set aside, and consequently, the overall compensation deserves to be reduced.
The appellant, therefore, prays for allowing the present appeal.
6. Per contra, learned counsel appearing on behalf of the claimant-
cross-objector submits that the compensation awarded by the Tribunal is, in fact,
inadequate. He further contends that the Tribunal has rightly granted
compensation towards loss of future earning capacity, as the injuries sustained in
the accident have adversely impacted the claimant's functional efficiency and
future prospects, notwithstanding the continuation of employment. He further
contends that the amount awarded under the heads of pain and suffering, loss of
amenities, and other non-pecuniary damages is meagre and does not reflect just
and reasonable compensation in light of the nature and extent of injuries
suffered. Accordingly, it is prayed that the appeal filed by the Insurance
Company be dismissed and the cross-objections filed by the claimant be allowed,
with suitable enhancement of the compensation.
7. I have heard learned counsel for the parties and perused the whole
record of this case.
authenticity of this order/judgment.
FAO-3803-2015 (O&M) &
SETTLED LAW ON COMPENSATION
8. Hon'ble Supreme Court has settled the law regarding grant of
compensation with respect to the disability. The Apex Court in the case of Raj
Kumar Vs. Ajay Kumar and Another (2011) 1 Supreme Court Cases 343,
has held as under:-
General principles relating to compensation in injury cases
5. The provision of the Motor Vehicles Act, 1988 ('Act' for short)
makes it clear that the award must be just, which means that
compensation should, to the extent possible, fully and adequately
restore the claimant to the position prior to the accident. The object
of awarding damages is to make good the loss suffered as a result of
wrong done as far as money can do so, in a fair, reasonable and
equitable manner. The court or tribunal shall have to assess the
damages objectively and exclude from consideration any
speculation or fancy, though some conjecture with reference to the
nature of disability and its consequences, is inevitable. A person is
not only to be compensated for the physical injury, but also for the
loss which he suffered as a result of such injury. This means that he
is to be compensated for his inability to lead a full life, his inability
to enjoy those normal amenities which he would have enjoyed but
for the injuries, and his inability to earn as much as he used to earn
or could have earned. (See C.K. Subramonia Iyer v. T. Kunhikuttan
Nair, AIR 1970 Supreme Court 376, R.D. Hattangadi v. Pest Control
(India) Ltd., 1995 (1) SCC 551 and Baker v. Willoughby, 1970 AC
467).
6. The heads under which compensation is awarded in personal
injury cases are the following :
Pecuniary damages (Special Damages)
(i) Expenses relating to treatment, hospitalization, medicines,
transportation, nourishing food, and miscellaneous expenditure.
(ii) Loss of earnings (and other gains) which the injured would have
made had he not been injured, comprising :
(a) Loss of earning during the period of treatment;
(b) Loss of future earnings on account of permanent
disability.
(iii) Future medical expenses. Non-pecuniary damages (General
Damages)
(iv) Damages for pain, suffering and trauma as a consequence of
the injuries.
(v) Loss of amenities (and/or loss of prospects of marriage).
(vi) Loss of expectation of life (shortening of normal longevity).
In routine personal injury cases, compensation will be awarded only
under heads (i), (ii)(a) and (iv). It is only in serious cases of injury,
authenticity of this order/judgment.
FAO-3803-2015 (O&M) &
where there is specific medical evidence corroborating the evidence
of the claimant, that compensation will be granted under any of the
heads (ii)(b), (iii), (v) and (vi) relating to loss of future earnings on
account of permanent disability, future medical expenses, loss of
amenities (and/or loss of prospects of marriage) and loss of
expectation of life.
xxx xxx xxx xxx
19. We may now summarise the principles discussed above :
(i) All injuries (or permanent disabilities arising from injuries), do
not result in loss of earning capacity.
(ii) The percentage of permanent disability with reference to the
whole body of a person, cannot be assumed to be the percentage of
loss of earning capacity. To put it differently, the percentage of loss
of earning capacity is not the same as the percentage of permanent
disability (except in a few cases, where the Tribunal on the basis of
evidence, concludes that percentage of loss of earning capacity is
the same as percentage of permanent disability).
(iii) The doctor who treated an injured-claimant or who examined
him subsequently to assess the extent of his permanent disability can
give evidence only in regard the extent of permanent disability. The
loss of earning capacity is something that will have to be assessed
by the Tribunal with reference to the evidence in entirety.
(iv) The same permanent disability may result in different
percentages of loss of earning capacity in different persons,
depending upon the nature of profession, occupation or job, age,
education and other factors.
20. The assessment of loss of future earnings is explained below
with reference to the following
Illustration 'A' : The injured, a workman, was aged 30 years and
earning Rs. 3000/- per month at the time of accident. As per
Doctor's evidence, the permanent disability of the limb as a
consequence of the injury was 60% and the consequential
permanent disability to the person was quantified at 30%. The loss
of earning capacity is however assessed by the Tribunal as 15% on
the basis of evidence, because the claimant is continued in
employment, but in a lower grade. Calculation of compensation will
be as follows:
a) Annual income before the accident : Rs. 36,000/-.
b) Loss of future earning per annum
(15% of the prior annual income) : Rs. 5400/-.
c) Multiplier applicable with reference to age : 17
d) Loss of future earnings : (5400 x 17) : Rs. 91,800/-
Illustration 'B' : The injured was a driver aged 30 years, earning
Rs. 3000/- per month. His hand is amputated and his permanent
disability is assessed at 60%. He was terminated from his job as he
could no longer drive. His chances of getting any other employment
was bleak and even if he got any job, the salary was likely to be a
authenticity of this order/judgment.
FAO-3803-2015 (O&M) &
pittance. The Tribunal therefore assessed his loss of future earning
capacity as 75%. Calculation of compensation will be as follows :
a) Annual income prior to the accident : Rs. 36,000/- .
b) Loss of future earning per annum
(75% of the prior annual income) : Rs. 27000/-.
c) Multiplier applicable with reference to age : 17
d) Loss of future earnings : (27000 x 17) : Rs. 4,59,000/-
Illustration 'C' : The injured was 25 years and a final year
Engineering student. As a result of the accident, he was in coma for
two months, his right hand was amputated and vision was affected.
The permanent disablement was assessed as 70%. As the injured
was incapacitated to pursue his chosen career and as he required
the assistance of a servant throughout his life, the loss of future
earning capacity was also assessed as 70%. The calculation of
compensation will be as follows :
a) Minimum annual income he would
have got if had been employed as an
Engineer : Rs. 60,000/-
b) Loss of future earning per annum
(70% of the expected annual income) : Rs. 42000/-
c) Multiplier applicable (25 years) : 18
d) Loss of future earnings : (42000 x 18) : Rs. 7,56,000/-
[Note : The figures adopted in illustrations (A) and (B) are
hypothetical. The figures in Illustration (C) however are based on
actuals taken from the decision in Arvind Kumar Mishra (supra)].
9. Hon'ble Supreme Court in the case of National Insurance
Company Ltd. Vs. Pranay Sethi & Ors. [(2017) 16 SCC 680] has clarified the
law under Sections 166, 163-A and 168 of the Motor Vehicles Act, 1988, on the
following aspects:-
(A) Deduction of personal and living expenses to determine
multiplicand;
(B) Selection of multiplier depending on age of deceased;
(C) Age of deceased on basis for applying multiplier;
(D) Reasonable figures on conventional heads, namely, loss of
estate, loss of consortium and funeral expenses, with escalation;
(E) Future prospects for all categories of persons and for different
ages: with permanent job; self-employed or fixed salary.
The relevant portion of the judgment is reproduced as under:-
" Therefore, we think it seemly to fix reasonable sums. It
seems to us that reasonable figures on conventional heads,
namely, loss of estate, loss of consortium and funeral
expenses should be Rs.15,000, Rs.40,000 and Rs.15,000
respectively. The principle of revisiting the said heads is an
authenticity of this order/judgment.
FAO-3803-2015 (O&M) &
acceptable principle. But the revisit should not be fact-centric
or quantum-centric. We think that it would be condign that
the amount that we have quantified should be enhanced on
percentage basis in every three years and the enhancement
should be at the rate of 10% in a span of three years. We are
disposed to hold so because that will bring in consistency in
respect of those heads."
10. Hon'ble Supreme Court in the case of Erudhaya Priya Vs. State
Express Tran. Corpn. Ltd. 2020 ACJ 2159, has held as under:-
" 7. There are three aspects which are required to be examined by
us:
(a) the application of multiplier of '17' instead of '18';
The aforesaid increase of multiplier is sought on the basis of
age of the appellant as 23 years relying on the judgment in National
Insurance Company Limited v. Pranay Sethi and Others, 2017 ACJ
2700 (SC). In para 46 of the said judgment, the Constitution Bench
effectively affirmed the multiplier method to be used as mentioned in
the table in the case of Sarla Verma (Smt) and Others v. Delhi
Transport Corporation and Another, 2009 ACJ 1298 (SC) . In the
age group of 15-25 years, the multiplier has to be '18' along with
factoring in the extent of disability.
The aforesaid position is not really disputed by learned
counsel for the respondent State Corporation and, thus, we come to
the conclusion that the multiplier to be applied in the case of the
appellant has to be '18' and not '17'.
(b) Loss of earning capacity of the appellant with permanent
disability of 31.1%
In respect of the aforesaid, the appellant has claimed
compensation on what is stated to be the settled principle set out in
Jagdish v. Mohan & Others, 2018 ACJ 1011 (SC) and Sandeep
Khanuja v. Atul Dande & Another, 2017 ACJ 979 (SC). We extract
below the principle set out in the Jagdish (supra) in para 8:
"8. In assessing the compensation payable the settled
principles need to be borne in mind. A victim who suffers a
permanent or temporary disability occasioned by an accident
is entitled to the award of compensation. The award of
compensation must cover among others, the following
aspects:
(i) Pain, suffering and trauma resulting from the accident;
(ii) Loss of income including future income;
(iii) The inability of the victim to lead a normal life together
with its amenities;
(iv) Medical expenses including those that the victim may
be required to undertake in future; and
(v) Loss of expectation of life."
[emphasis supplied]
authenticity of this order/judgment.
FAO-3803-2015 (O&M) &
The aforesaid principle has also been emphasized in an
earlier judgment, i.e. the Sandeep Khanuja case (supra) opining
that the multiplier method was logically sound and legally well
established to quantify the loss of income as a result of death or
permanent disability suffered in an accident.
In the factual contours of the present case, if we examine the
disability certificate, it shows the admission/hospitalization on 8
occasions for various number of days over 1½ years from August
2011 to January 2013. The nature of injuries had been set out as
under:
"Nature of injury:
(i) compound fracture shaft left humerus
(ii) fracture both bones left forearm
(iii) compound fracture both bones right forearm
(iv) fracture 3rd, 4th & 5th metacarpals right hand
(v) subtrochanteric fracture right femur
(vi) fracture shaft femur
(vii) fracture both bones left leg
We have also perused the photographs annexed to the
petition showing the current physical state of the appellant,
though it is stated by learned counsel for the respondent State
Corporation that the same was not on record in the trial
court. Be that as it may, this is the position even after
treatment and the nature of injuries itself show their extent.
Further, it has been opined in para 13 of Sandeep Khanuja
case (supra) that while applying the multiplier method, future
prospects on advancement in life and career are also to be
taken into consideration.
We are, thus, unequivocally of the view that there is
merit in the contention of the appellant and the aforesaid
principles with regard to future prospects must also be
applied in the case of the appellant taking the permanent
disability as 31.1%. The quantification of the same on the
basis of the judgment in National Insurance Co. Ltd. case
(supra), more specifically para 61(iii), considering the age of
the appellant, would be 50% of the actual salary in the
present case.
(c) The third and the last aspect is the interest rate claimed
as 12%
In respect of the aforesaid, the appellant has watered
down the interest rate during the course of hearing to 9% in
view of the judicial pronouncements including in the
Jagdish's case (supra). On this aspect, once again, there was
no serious dispute raised by the learned counsel for the
respondent once the claim was confined to 9% in line with the
interest rates applied by this Court.
CONCLUSION
8. The result of the aforesaid is that relying on the settled
principles, the calculation of compensation by the appellant,
authenticity of this order/judgment.
FAO-3803-2015 (O&M) &
as set out in para 5 of the synopsis, would have to be adopted
as follows:
Heads Awarded
Loss of earning power Rs. 9,81,978/-
(Rs.14,648 x 12 x 31.1/100
Future prospects (50 per cent Rs.4,90,989/-
addition)
Medical expenses including Rs.18,46,864/-
transport charges,
nourishment, etc.
Loss of matrimonial prospects Rs.5,00,000/-
Loss of comfort, loss of Rs.1,50,000/-
amenities and mental agony
Pain and suffering Rs.2,00,000/-
Total Rs.41,69,831/-
The appellant would, thus, be entitled to the compensation of
Rs. 41,69,831/- as claimed along with simple interest at the rate of
9% per annum from the date of application till the date of payment.
11. A perusal of the award shows that the contention raised by the
appellant-Insurance Company, to the effect that no loss of future income has
been suffered by the claimant (since deceased), is devoid of merit and contrary to
the evidence available on record.
12. It clearly transpires from the record that the injured (since deceased)
had sustained grievous injuries, including Traumatic brain injury accompanied
by right hemiparesis (moderate) and mild ataxia, besides fractures to the
shoulder and ribs. The nature of these injuries, particularly the neurological
impairment, is of a serious and lasting character, directly impacting the
functional abilities of the claimant (since deceased).
13. Further, the disability certificate (Exhibit PW4/A), duly proved by
PW-4 Dr. Arvind Malhotra, Associate Professor, Department of Surgery,
authenticity of this order/judgment.
FAO-3803-2015 (O&M) &
Government Medical College and Hospital, Sector 32, Chandigarh, establishes
that the injured suffered 75% permanent physical disability in relation to the
whole body. The said witness has categorically deposed that, owing to the
aforesaid disability, the claimant (since deceased) would not be able to perform
his daily job in the same manner as prior to the accident. Such uncontroverted
medical evidence leaves little scope for doubt that the disability was not merely
physical in nature but had a direct bearing on the earning capacity and functional
efficiency of the claimant.
14. In this backdrop, the learned Tribunal has rightly treated the
assessed permanent disability as functional disability for the purposes of
determining loss of earning capacity. The learned Tribunal has also correctly
appreciated that even if the claimant (since deceased) continued in service, the
impact of such severe disability would inevitably diminish his efficiency, restrict
his working capacity, and adversely affect his future prospects. The concept of
"loss of future income" is not confined to actual cessation of salary but extends
to impairment of earning capacity and reduction in the ability to effectively
discharge professional duties.
15. Reference in this regard may be made to the judgment of the
Hon'ble Supreme Court in United India Insurance Co. Ltd. v. Joginder Pal,
2023(1) TAC 705, wherein it has been held that assessment of functional
disability and its effect on earning capacity is of paramount consideration, and
compensation under the head of loss of future income is justified where the
disability adversely impacts the claimant's ability to work, even if there is no
immediate loss of employment. The relevant portion of the same is reproduced
as under:-
authenticity of this order/judgment.
FAO-3803-2015 (O&M) &
"4. The learned counsel for the appellant would
strenuously contend that the High Court has committed an
error in enhancing the compensation by awarding amount
under the head of 'loss of earning capacity' since the
respondent who was admittedly a Government employee had
not lost his job nor was there any reduction in earning. In that
view, though he was entitled to compensation under the other
heads the compensation as presently awarded under the head
of loss of earning capacity is not justified and is to be reduced
in the contention.
5. The learned counsel for the respondent would however,
seek to sustain the judgment passed by the High Court. It is
contended that though he was an employee, the better
prospects of getting another employment or the promotion
from the very post where he was working at the time of
accident was denied to the respondent due to the injuries
suffered and the respondent not being able to show his
efficiency in the work was not considered for higher
responsibility, thereby progression was denied.
8. Therefore, if all these aspects of the matter are kept
in view to arrive at the conclusion, we are convinced that the
High Court in the facts and circumstance of this case was
justified in its conclusion. Hence, to that extent the judgment
dated 04.11.2015 passed by the High Court on the quantum of
compensation does not call for interference. However, we are
of the view that the interest awarded from the date of the
claim at 9% on the enhanced portion would not be justified.
The same is modified and we hold that the compensation
enhanced by the High Court is payable with 6% interest from
the date of the judgment of the High Court in respect of the
enhanced portion. The balance amount payable shall be
deposited before the MACT by the Insurance company within
a period of 6 weeks from the date of receipt of a copy of this
authenticity of this order/judgment.
FAO-3803-2015 (O&M) &
judgment whereupon the amount shall be disbursed to the
appellant(s)/claimant(s)."
16. In view of the aforesaid discussion and the settled legal position,
this Court finds that the learned Tribunal has adopted a just and reasonable
approach in awarding compensation under the head of loss of future income. The
findings recorded in this regard are well-supported by the medical evidence on
record and do not suffer from any perversity or illegality so as to warrant
interference by this Court.
17. A further perusal of the award reveals that meager amount is granted
by the learned Tribunal under the heads of pain and suffering, special diet,
transportation and loss of amenities of life and no amount is awarded for future
prospects. Therefore, the award requires indulgence of this Court.
RELIEF
18. In view of the above, the appeal filed by the Insurance Company is
dismissed being devoid of any merits, whereas cross-objections filed by the
cross-objectors/legal heirs of claimant-Bal Chand are allowed. The award dated
02.01.2015 is modified accordingly. The cross-objectors/legal heirs of claimant-
Bal Chand are held entitled to enhanced compensation as per the calculations
made here-under:-
Sr. No. Heads Compensation Awarded
1 Income Rs.18,196/-
2 Loss of future prospects (15%) Rs.2,730/-
(15% of Rs.18,196/-)
3 Annual Income Rs.2,50,992/-
(Rs.20,916/- X 12)
4 Loss of future earning on Rs.1,88,244/-
account of 75% disability (Rs.2,50,992 X 75%)
5 Multiplier of 11 Rs.20,70,684/-
(Rs.1,88,244/-X 11)
authenticity of this order/judgment.
FAO-3803-2015 (O&M) &
6 Pain and suffering Rs.5,00,000/-
7 Attendant Charges Rs.50,000/-
8 Transportation Charges Rs.50,000/-
9 Special Diet Rs.50,000/-
10 Loss of Ameneties Rs.50,000/-
11 Total compensation awarded:- Rs.27,70,684/-
12 Deduction:- Rs.18,81,404/-
Amount awarded by Tribunal
Enhanced amount of Rs.8,89,280/-
compensation (27,70,684- 18,81,404)
19. So far as the interest part is concerned, as held by Hon'ble Supreme
Court in Dara Singh @ Dhara Banjara Vs. Shyam Singh Varma 2019 ACJ
3176 and R.Valli and Others VS. Tamil Nadu State Transport Corporation
(2022) 5 Supreme Court Cases 107, the enhanced amount shall carry interest @
9% per annum from the date of filing of the claim petition, till the date of
realization.
20. Appellant-Insurance Company is directed to deposit the enhanced
amount along with interest with the Tribunal within a period of two months from
the date of receipt of copy of this judgment. The learned Tribunal is directed to
disburse the enhanced amount of compensation along with interest to the legal
heirs of the claimant-Bal Chand in equal rates. The legal heirs of late Sh. Bal
Chand are directed to provide their bank details to the learned Tribunal.
21. Pending application(s), if any, also stand disposed of.
27.04.2026 (SUDEEPTI SHARMA)
JUDGE
Whether speaking/non-speaking : Yes/No
Whether reportable : Yes
authenticity of this order/judgment.
