Arvind Kumar Mishra Vs.
New India Assurance Co. Ltd. & ANR. [2010] INSC 808 (29 September 2010)
Judgment
IN THE SUPREME COURT
OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. 5510 OF 2005 Arvind
Kumar Mishra ...... Appellant New India Assurance Co. Ltd. and Anr. ......
Respondents
R.M. LODHA, J.
1.
The
present appeal, by special leave, raises the issue, indeed the only issue, of
assessment of loss of earnings in respect of the victim of a motor accident who
was certified 70% permanent disablement.
2.
Arvind
Kumar Mishra - appellant - a student of engineering final year at Birla
Institute of Technology, Mesra (B.I.T.) at the time of accident was seriously
injured as a result of a truck bearing registration No. DEG 3291 being
negligently driven on June 23, 1993. The truck coming from the opposite
direction hit the motorcycle and the appellant riding the motorcycle was thrown
on the road. He sustained multiple injuries; diffused multifocal damage of
brain with interventricular hemorrhage; optic atrophy in right eye and 3+
relative afferent papillary in left eye; amputation of right hand distal to
carpometacarpal joint level; compound fracture of shaft of tibia (left); total
bronchial plexus palsy; blocking of anterior wall of the trachea at the level
of the 3rd and 4th cartilaginous rings and disfiguration. He was treated by
several doctors at various hospitals namely, R.M.C.H, Ranchi, C.C.L .Hospital,
Gandhinagar, Christian Medical College and Hospital, Vellore and Shankar
Netralaya, Madras. He had to undergo few surgical operations. After a little
recovery, he made an application under Section 166 of the Motor Vehicles Act,
1988 (`the 1988 Act') claiming total compensation in the sum of Rs. 22 lakhs
which included the expenditure already incurred by him up to that time to the
extent of Rs. 1,50,000/- for his treatment.
3.
The
offending vehicle was insured with the New India Assurance Company Ltd. (`the
insurer'). The owner as well as insurer contested the claim petition. The
appellant passed out Bachelor of Engineering during the pendency of the claim
petition.
He examined himself
and tendered some of the doctors who treated him in evidence. The vouchers of
the expenditure incurred by him on his treatment at various hospitals were also
produced.
4.
The
Motor Vehicle Accident Claims Tribunal, Ranchi (for short `the Tribunal') in
its award dated December 19, 2002 held that the accident occurred due to rash
and negligent driving of the truck bearing registration No. DEG 3291. It also
held that the owner of the vehicle and the insurer were liable to pay the
compensation to the appellant. As regards quantum of compensation, the Tribunal
allowed the total compensation of Rs. 2,50,000/- along with the interest @ 9%
per annum from August 7, 2002 by considering the matter as follows:
".......under
the head of pecuniary damages the amount which has been amended (sic) by the
claimant in his treatment including medical expenditure other material loss, a
total lump sum compensation amount of Rs. 1,50,000/- (Rupees one lac and fifty
thousand only) 3 is being granted to the claimant. So far as non- pecuniary
damages are concerned from the evidence itself it is very much clear that
injured was a brilliant student of engineering Final year at B.I.T. Mesra, and
due to said accident he has lost his future career. He has also suffered from
mental and physical shock and has to be suffered in future. There is also
damages and the loss of expectation of life on account of the injuries
sustained by him. He has to face inconvenience, hardship, discomfort
disappointment and mental stress till his life, therefore, a lump sum compensation
amount of Rs. 1,00,000/- (Rupees one lac only) is being granted to the
claimant. The total compensation came to Rs. 2,50,000/- (Rupees two lac and
fifty thousand only) which the claimant is entitled with interest @ 9% per
annum."
5.
The
claimant, dissatisfied with the assessment of compensation by the Tribunal,
approached the High Court of Jharkhand, Ranchi. The High Court increased the
amount of compensation from Rs. 2,50,000/- to Rs. 3,50,000/- having considered
the matter thus:
"On an application
under Section 166 of the Motor Vehicles Act, 1988 vide Compensation Case No.
183 of 1993 the Motor Vehicles Accident Claims Tribunal, Ranchi, assessed a sum
of Rs. 1,50,000/- to be paid to him under the head pecuniary damages i.e. the
amount which was expended by him towards his treatment including the medical
expenses and a sum of Rs. 1,00,000/- was granted towards non pecuniary damages.
i.e. for his permanent disablement to the extent of 70% for the loss of right
wrist and paralysis of right upper limb as also for loss of vision in his right
eye.
Keeping into
consideration the nature of disability the appellant had to sustain and loss of
his future expectancy in life, we are of the view that he was entitled to a sum
of Rs. 2,00,000/- on account of non pecuniary loss. Accordingly, we modify the
impugned judgment and award to the extent that instead of total amount of
Rs.2,50,000, the claimant is entitled to get Rs. 3,50,000/-. It is stated that
the award amount with interest granted by the tribunal had already been paid.
Hence, we make it
clear that there will be no interest payable on the compensation amount if the
said amount is deposited before the tribunal within six weeks, failing which
the interest @9% per annum as granted by the tribunal shall be payable on the
enhanced amount also from 07/08/2002."
6.
It
is not necessary to discuss the liability of the respondents. That was
disputed, but the matter has been considered, and the Tribunal found that due
to rash and negligent driving by the driver of the truck (DEG 3291), the
accident took place in which the appellant sustained serious multiple injuries
and, therefore, owner and insurer were liable to him for the damage.
There was no appeal
with regard to that matter before the High Court.
7.
We
do not intend to review in detail state of authorities in relation to
assessment of all damages for personal injury. Suffice it to say that the basis
of assessment of all damages for personal injury is compensation. The whole
idea is to put the claimant in the same position as he was in so far as money
can. Perfect compensation is hardly possible but one has to keep in mind that
the victim has done no wrong; he has suffered at the hands of the wrongdoer and
the court must take care to give him full and fair compensation for that he had
suffered. In some cases for personal injury, the claim could be in respect of
life time's earnings lost because, though he will live, he cannot earn his
living. In others, the claim may be made for partial loss of earnings. Each
case has to be considered in the light of its own facts and at the end, one
must ask whether the sum awarded is a fair and reasonable sum. The conventional
basis of assessing compensation in personal injury cases - and that is now
recognized mode as to the proper measure of compensation - is taking an
appropriate multiplier of an appropriate multiplicand.
8.
In
General Manager Kerala State Road Transport Corporation, Trivandrum v.. Susamma
Thomas (Mrs.) and Ors1., this Court laid down the following principles:
"13. The
multiplier method involves the ascertainment of the loss of dependency or the
multiplicand having regard to the circumstances of the case and capitalizing
the multiplicand by an appropriate multiplier. The choice of the multiplier is
determined by the age of the 1 (1994) 2 SCC 176 6 deceased (or that of the
claimants whichever is higher) and by the calculation as to what capital sum,
if invested at a rate of interest appropriate to a stable economy, would yield
the multiplicand by way of annual interest. In ascertaining this, regard should
also be had to the fact that ultimately the capital sum should also be
consumed-up over the period for which the dependency is expected to last."
17. The multiplier
represents the number of years' purchase on which the loss of dependency is
capitalised. Take for instance a case where annual loss of dependency is Rs
10,000. If a sum of Rs 1,00,000 is invested at 10% annual interest, the
interest will take care of the dependency, perpetually. The multiplier in this
case works out to 10. If the rate of interest is 5% per annum and not 10% then
the multiplier needed to capitalise the loss of the annual dependency at Rs
10,000 would be 20. Then the multiplier, i.e., the number of years' purchase of
20 will yield the annual dependency perpetually. Then allowance to scale down
the multiplier would have to be made taking into account the uncertainties of
the future, the allowances for immediate lump sum payment, the period over
which the dependency is to last being shorter and the capital feed also to be
spent away over the period of dependency is to last etc. Usually in English
Courts the operative multiplier rarely exceeds 16 as maximum. This will come
down accordingly as the age of the deceased person (or that of the dependants,
whichever is higher) goes up."
9.
The
principles laid down in Susamma Thomas1 still hold the field; the only
variation has been in respect of maximum multiplier. In the present case the
Tribunal as well as the High Court seriously erred in not assessing the
compensation for personal injury to the appellant in accord with the recognized
mode i.e., by taking an appropriate multiplier of an appropriate multiplicand.
10.
The
appellant at the time of accident was a final year engineering (Mechanical)
student in a reputed college. He was a remarkably brilliant student having
passed all his semester examinations in distinction. Due to the said accident
he suffered grievous injuries and remained in coma for about two months. His
studies got interrupted as he was moved to different hospitals for surgeries
and other treatments. For many months his condition remained serious; his right
hand was amputated and vision seriously affected. These multiple injuries
ultimately led to 70% permanent disablement. He has been rendered incapacitated
and a career ahead of him in his chosen line of mechanical engineering got
dashed for ever. He is now in a physical condition that he requires domestic
help throughout his life. He has been deprived of pecuniary benefits which he
could have reasonably acquired had he not suffered permanent disablement to the
extent of 70% in the accident.
11.
On
completion of Bachelor of Engineering (Mechanical) from the prestigious
institute like B.I.T., it can be reasonably assumed that he would have got a
good job. The appellant has stated in his evidence that in the campus interview
he was selected by Tata as well as Reliance Industries and was offered pay
package of Rs. 3,50,000/- per annum. Even if that is not accepted for want of
any evidence in support thereof, there would not have been any difficulty for
him in getting some decent job in the private sector.
Had he decided to
join government service and got selected, he would have been put in the pay
scale for Assistant Engineer and would have at least earned Rs. 60,000/- per
annum. Wherever he joined, he had a fair chance of some promotion and remote
chance of some high position. But uncertainties of life cannot be ignored
taking relevant factors into consideration. In our opinion, it is fair and
reasonable to assess his future earnings at Rs. 60,000/- per annum taking the
salary and allowances payable to an Assistant Engineer in public employment as the
basis. Since he suffered 70% permanent disability, the future earnings may be
discounted by 30% and, accordingly, we estimate upon the facts that the
multiplicand should be Rs.42,000/- per annum. The appellant at the time of
accident was about 25 years. As per the decision of this Court in Sarla Verma
(Smt.) and Ors. v. Delhi Transport Corporation and Anr1. the operative
multiplier would be 18. The loss of future earnings by multiplying the
multiplicand of Rs. 42,000/- by a multiplier of 18 1 (2009) 6 SCC 121 comes to
Rs. 7,56,000/-. The damages to compensate the appellant towards loss of future
earnings, in our considered judgment, must be Rs. 7,56,000/-. The Tribunal
awarded him Rs. 1,50,000/- towards treatment including the medical expenses.
The same is maintained as it is and, accordingly, the total amount of
compensation to which the appellant is entitled is Rs. 9,06,000/- .
12.
Before
we close, we must notice in all fairness to the learned counsel for the insurer
his submission that the appellant is entitled to compensation in accordance
with the Second Schedule appended to the 1988 Act only. This submission
overlooks the fact that the appellant made his claim under Section 166 of the
1988 Act and not under Section 163A. It is true that in Reshma Kumari &
Ors. v. Madan Mohan & Anr.,1 a two-Judge Bench of this Court has referred
the question whether multiplier specified in the Second Schedule should be
taken to be a guide for calculation of the amount of compensation payable in a
case falling under Section 166 to the larger bench and the said question is not
yet authoritatively decided.
However, in a case
such as the present case, we find no justification to await decision of the
larger bench on the aforenoticed question as there are already few decisions of
this Court taking a view that the 1 (2009) 13 SCC 422 Second Schedule has no
application to the claim petition made under Section 166 of the 1988 Act.
13.
In
the result, the appeal is allowed in part and the compensation awarded by the
High Court in the sum of Rs. 3,50,000/- is enhanced to Rs. 9,06,000/-. The
appellant shall be entitled to 9% simple interest per annum on the enhanced
amount from August 7, 2002 until the date of actual payment. The appellant
shall also be entitled to the costs of this appeal which we quantify at Rs.
15,000/-.
........................
J. (Aftab Alam)
.........................
J.
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