PARMINDER SINGH versus NEW INDIA ASSURANCE CO. LTD. & ORS. on 1 July 2019

[2019] 8 S.C.R. 986

SUPREME COURT REPORTS

[2019] 8 S.C.R.

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PARMINDER SINGH

v.

NEW INDIA ASSURANCE CO. LTD. & ORS.

(Civil Appeal No. 5123 of 2019)

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JULY 01, 2019

[INDU MALHOTRA AND M. R. SHAH, JJ.]

Motor Vehicles Act, 1988 – Permannet disbaility due toaccident – Driver of the offending vehicle not possessing valid driverlicense – Liability of the Insrance Company – Principle of ‘pay andCrecover’ – Appellant-driver was driving a car in which a CabinetMinister in Punjab, was being driven from Ludhiana – Car rammedby a truck coming from the opposite direction at a very high speedand being driven in a rash and negligent manner – Accidentoccurred due to the contributory negligence of the driver of anotherDtruck which was wrongly parked on the road– Minister succumbedto the injuries while the appellant suffered grievous injuries– InClaim Petition filed by the appellant against the owners and driversof the two offending trucks, along with the insurer of the twooffending trucks viz. the Respondent-Insurance Company, MACTawarded the appellant Rs.10,43,666/- along with interest @7.5%Ep.a. – High Court enhanced the compensation to Rs.21,06,000/- –On appeal, held: MACT computed the compensation payable to theappellant on the basis of notional income of Rs.6,000/- p.m. on theground that no evidence of his income was produced – Appellanthas produced an affidavit by his employer as per which the appellantFwas earning Rs.10,000/- p.m. at the time of the accident – Takingthe income of the appellant as Rs.10,000/- p.m., with future prospects@50% as awarded by the High Court, the total income of theAppellant would come to Rs.15,000/- p.m - Appellant was 23 yearsold at the time when the accident occurred – Applying the multiplierof 18, the loss of future earnings suffered by the appellant wouldGwork out to Rs. 15,000 X 12 X 18 =Rs. 32,40,000/- – High Courtrightly assessed the functional disability of the appellant as 100%– Appellant is suffering from hemiplegia due to which the left sideof his body is barely functioning – On account of the permanent H

disability suffered, the Appellant was deprived of getting marriedand having a normal family life – His capacity to earn a living hasbeen completely shattered and he has a become fully dependantperson – Compensation awarded towards his medical expenses ishighly insufficient – Appellant has undergone 5 surgeries, includinga surgery for a severe head injury, and 3 throat surgeries –Rs.7,50,000/- awarded towards hospitalization and medical expensesincurred in the past– Rs. 10,00,000/- awarded towards medicalexpenses and attendant charges – View of the High Court that theRespondent is absolved of the liability to bear the compensation, asevidence has been produced from the office of the RegionalTransport Office to prove that the drivers of the two offending truckswere driving with invalid driving licenses, affirmed – Respondententitled to recover the amount from the owners and drivers of thetwo offending trucks.

Allowing the appeal, the Court

Conclusion

Allowing the appeal, the Court

HELD : 1.1 The MACT has computed the compensationpayable to the Appellant on the basis of a notional income ofRs. 6,000/- p.m. on the ground that no evidence of his incomewas produced. The Appellant has however, produced an Affidavitby his employer in Supreme Court. As per the said Affidavit, theAppellant was earning Rs. 10,000/- p.m. at the time of the accident.On the basis of the Affidavit filed by the employer of the Appellant,it is accepted that the income of the Appellant was Rs.10,000/-p.m. at the time of the accident, for the purpose of computing thecompensation payable to him. Taking the income of the Appellantas Rs. 10,000/- p.m., with Future Prospects @50% as awardedby the High Court, the total income of the Appellant would cometo Rs. 15,000/- p.m. The Appellant was 23 years old at the timewhen the accident occurred. Applying the multiplier of 18, theloss of future earnings suffered by the Appellant would work outto Rs. 15,000 X 12 X 18 = Rs. 32,40,000/-. The High Court hasrightly assessed the functional disability of the Appellant as 100%.The Appellant is suffering from hemiplegia due to which the leftside of his body is barely functioning. On account of the permanentdisability suffered, the Appellant was deprived of getting marriedand having a normal family life. His capacity to earn a living has ABC

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Abeen completely shattered for the rest of his life, and he has abecome fully dependant person. [Paras 5, 5.1-5.5] [993-B-G]

1.2 In the present case, it is an admitted position that it isnot possible for the Appellant to get employed as a driver, or doany kind of manual labour, or engage in any agricultural operationsBwhatsoever, for his sustenance. In such circumstances, the HighCourt has rightly assessed the Appellant’s functional disability at100% insofar as his loss of earning capacity is concerned. TheAppellant is, therefore, awarded Rs. 32,40,000/- towards loss ofearning capacity. The compensation awarded to the Appellanttowards his medical expenses is highly insufficient. The AppellantChas undergone 5 surgeries, including a surgery for a severe headinjury, and 3 throat surgeries. The Appellant has not been awardedany amount whatsoever either by the MACT, or the High Courtfor the successive hospitalizations, surgeries andmedical treatment. In view of the facts and circumstances of theDcase, it would be just and fair to award a lump sum amount ofRs. 7,50,000/- towards hospitalization and medical expensesincurred in the past by the Appellant. The Appellant was producedbefore the Court. He was in an extremely pitiable state. Onaccount of the removal of the frontal bone of the skull, half of hishead has caved in. Furthermore, a deep circular incision was madeEin his throat, and his body was in an unstable condition,undergoing tremors. The Appellant is further suffering fromhemiplegia, due to which the left side of his body is not functioningproperly. Given the debilitated state of the Appellant, no amountof money can compensate him. He has been in this condition Fsince the age of 22 years when the accident took place, and willremain like this throughout his life. The Appellant has also beendeprived of having a normal married life with a family, and wouldrequire medical assistance from time to time. Being completelydependant, he would require the help of an attendant throughout his life. In view of these uncontroverted facts, a lump sum amountGof Rs. 10,00,000/- is awarded to the Appellant towards medicalexpenses and attendant charges. [Paras 5.6-5.9] [996-D-H;997-A-D]

1.3 The Appellant is entitled to the following amounts: (i)Rs. 32,40,000/- to be awarded towards loss of future earnings byH

taking the income of the Appellant at Rs.10,000/- p.m., andgranting Future Prospects @50%; (ii) Rs. 7,50,000/- to beawarded towards repeated hospitalizations and medicalexpenses for undergoing 5 surgeries and medical treatment;(iii) Rs. 10,00,000/- to be awarded towards future medicalexpenses and attendant charges; (iv) Interest @ 9% awarded bythe High Court from the date of the Claim Petition, till the dateof recovery to be maintained. On the issue of liability to pay thecompensation awarded, the view taken by the High Court thatthe Respondent–Insurance Company is absolved of the liabilityto bear the compensation, as evidence has been produced fromthe office of the Regional Transport Office to prove that thedrivers of the two offending trucks were driving on the basis ofinvalid driving licenses, is affirmed. The owners and drivers ofthe offending trucks have not appeared at any stage of theproceedings, including this Court. The Respondent – InsuranceCompany is entitled to recover the amount from the owners anddrivers of the two offending trucks. [Paras 6, 7] [997-E-H;998-A-E]

Govind Yadav v. The New India Insurance CompanyLtd., (2011) 10 SCC 683 ; K. Suresh v. New IndiaAssurance Company Ltd., (2012) 12 SCC 274 : [2012]11 SCR 414 ; Raj Kumar v. Ajay Kumar and Ors., (2011)1 SCC 343 : [2010] 13 SCR 179 ; Shamanna & Ors. v.The Divisional Manager, The Oriental Insurance Co.Ltd. & Ors. 2018 (9) SCC 650 [2018] 9 SCR 486– relied on.

From the Judgment and Order dated 20.09.2017 of the High Courtof Punjab and Haryana at Chandigarh in F.A.O. No. 10473 of 2014(O&M).

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ABikash Chandra, Dinesh Mohan Sinha, Varinder Kumar Sharma,Advs. for the Appellant.

S. L. Gupta, Ms. Shalu Sharma, Advs. for the Respondents.

The Judgment of the Court was delivered by BINDU MALHOTRA, J. Leave granted.

1. The present Civil Appeal has been filed by the claimant tochallenge the Judgment and Order dated 20.09.2017 passed in FAO No.10473 of 2014 by the Punjab & Haryana High Court at Chandigarh.

2. The background facts in which the present Civil Appeal hasCbeen filed, briefly stated, are as follows:

2.1. On 29.03.2009, the Appellant – driver, was driving a HyundaiElantra car in which Captain Kanwaljit Singh, a CabinetMinister in Punjab, was being driven from Ludhiana.

2.2. At about 5:15 p.m., when the car reached near VillageDKhanpur, a truck bearing Registration No. HR-55-B-9491was being driven in a rash and negligent manner, whichcame from the opposite direction at a very high speed, andrammed into the car. The accident occurred due to thecontributory negligence of the driver of another truck bearingERegistration No. HR-58-A-9791, which was wrongly parkedon the road.

2.3. As a result of the accident, Captain Kanwaljit Singh andthe Appellant – driver sustained grievous injuries. CaptainKanwaljit Singh succumbed to his injuries on the same dayFwhile undergoing treatment in the hospital. The Appellant –driver survived, but became permanently disabled.

2.4. The Appellant suffered from grievous injuries, including ahead injury with traumatic subarachnoid hemorrhage, andhad to undergo a hemi-craniotomy i.e. removal of front boneGof the skull. He further suffered fracture of both jaw bones,and disfiguration of his face. Due to the severe head injury,his left arm and leg were not functioning properly. TheAppellant had to undergo 5 surgeries for which he requiredsuccessive hospitalizations. He had to visit PGI, Chandigarhon various dates for follow-up treatment as an outdoorHpatient.

2.5. The Appellant was assessed by a Medical Board onA08.09.2010, and on examination it was found to be anoperated case with hemiplegia i.e. weakness of one half ofthe body on the left side. The doctor opined that the Appellantshall not be able to work as a labourer, or do agriculturalwork, or work as a driver. His disability was assessed atB75%, which was permanent in nature.

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2.6. The Appellant filed a Claim Petition before the MACT,Panchkula against the owners and drivers of the twooffending trucks, along with the insurer of the two offendingtrucks viz. the Respondent – Insurance Company.

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The Appellant contended that he was earning an income ofRs. 10,000/- p.m. as a driver prior to the accident.

2.7. The Respondent – Insurance Company pleaded that thedrivers of the two offending vehicles were driving the truckswithout valid driving licenses. The Insurance Companyproduced a Licensing Clerk from the RTO Office atMathura, U.P. who deposed that the driving licenses hadnot been issued in the name of the drivers by their office.The licenses had been issued in the name of some otherpersons.

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2.8. The MACT, Panchkula vide Award dated 25.01.2013,allowed the Claim Petition, and awarded compensation ofRs. 10,43,666/- to the Appellant.

The MACT proceeded on the basis of a notional income ofRs. 6,000/- p.m., which worked out to Rs. 72,000/- perannum, on the ground that the Appellant did not produceany evidence, nor examine any witness to prove his income.

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The loss of income due to functional disability was assessedat 75% which came to about Rs. 54,000/- per annum. Byapplying the multiplier of 18 to the income of the Appellant,the compensation on account of loss of future earningsworked out to Rs. 9,72,000/-. The Appellant was awardeda total amount of Rs. 10,43,666/- along with Interest @7.5%p.a. for the injuries suffered by him.

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On the question of liability to pay compensation, the driversof both the offending trucks were found not to be holdingvalid and effective driving licenses at the time of theaccident. As a result, the MACT held the owners anddrivers of the two offending trucks jointly and severallyliable to pay compensation to the Appellant. The InsuranceCompany was absolved of the liability to pay compensation.

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2.9. The Appellant filed FAO NO. 10473 of 2014 before thePunjab & Haryana High Court for enhancement of thecompensation awarded by the MACT.

The High Court vide Interim Order dated 11.07.2017,directed the Appellant to be re-assessed by a Medical Boardat the Government Hospital, Sector 6, Panchkula. Aftergoing through the nature of injuries suffered, and theDisability Certificate, the High Court was of the view thatthe disability suffered by the Appellant was 100% insofaras his earning capacity was concerned, and he had becomefully dependant on his family for survival.

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The High Court vide the impugned Judgment and Orderdated 20.09.2017 partially allowed the FAO, and enhancedthe compensation awarded to Rs.21,06,000/-. Thecompensation was enhanced since the Appellant hadsuffered from 100% disability with respect to his earningcapacity. The High Court granted Future Prospects @50%to the income of the Appellant.

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The Respondent – Insurance Company was directed to paycompensation to the Appellant in the first instance, andrecover the same from the owners and drivers of the twooffending trucks.

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3. The present Civil Appeal has been filed by the Appellant forenhancement of the compensation to Rs. 1,75,61,000/- since he isGpermanently disabled, leading a miserable life, and requires a permanentattendant.

4. We have heard the learned Counsel appearing for the Appellant.The Appellant was produced before the Court at the time of hearing.We have also heard the learned Counsel appearing for the RespondentH– Insurance Company, and perused the pleadings on record.

PARMINDER SINGH v. NEW INDIA ASSURANCE CO. LTD.[INDU MALHOTRA, J.]

The owners and drivers of the two offending trucks did not appearthroughout the proceedings.

5. We find that the MACT has computed the compensationpayable to the Appellant on the basis of a notional income ofRs. 6,000/- p.m. on the ground that no evidence of his income wasproduced.

5.1. The Appellant has however, produced an Affidavit by hisemployer in this Court. As per the said Affidavit, theAppellant was earning Rs. 10,000/- p.m. at the time of theaccident.

5.2. On the basis of the Affidavit filed by the employer of theAppellant, we accept that the income of the Appellant wasRs. 10,000/- p.m. at the time of the accident, for the purposeof computing the compensation payable to him.

5.3. Taking the income of the Appellant as Rs. 10,000/- p.m.,with Future Prospects @50% as awarded by the HighCourt, the total income of the Appellant would come toRs. 15,000/- p.m.

5.4. The Appellant was 23 years old at the time when theaccident occurred. Applying the multiplier of 18, the loss offuture earnings suffered by the Appellant would work outto Rs. 15,000 X 12 X 18 = Rs. 32,40,000/-.

5.5. The High Court has rightly assessed the functional disabilityof the Appellant as 100%. The Appellant is suffering fromhemiplegia due to which the left side of his body is barelyfunctioning. On account of the permanent disability suffered,the Appellant was deprived of getting married and having anormal family life. His capacity to earn a living has beencompletely shattered for the rest of his life, and he has abecome fully dependant person.

In Govind Yadav v. The New India InsuranceCompany Ltd.,[1] this Court held that:

“18. In our view, the principles laid down in ArvindKumar Mishra v. New India Assurance Company Ltd.

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(supra) and Raj Kumar v. Ajay Kumar (supra) mustbe followed by all the Tribunals and the High Courtsin determining the quantum of compensation payableto the victims of accident, who are disabled eitherpermanently or temporarily. If the victim of theaccident suffers permanent disability, then effortsshould always be made to award adequatecompensation not only for the physical injury andtreatment, but also for the loss of earning and hisinability to lead a normal life and enjoy amenities,which he would have enjoyed but for the disabilitycaused due to the accident.”

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In K. Suresh v. New India Assurance Company Ltd.,[2]this Court held that:

“10. It is noteworthy to state that an adjudicatingauthority, while determining quantum ofcompensation, has to keep in view the sufferings ofthe injured person which would include his inabilityto lead a full life, his incapacity to enjoy the normalamenities which he would have enjoyed but for theinjuries and his ability to earn as much as he usedto earn or could have earned. Hence, whilecomputing compensation the approach of thetribunal or a court has to be broad based.Needlessto say, it would involve some guesswork as therecannot be any mathematical exactitude or a preciseformula to determine the quantum of compensation.In determination of compensation the fundamentalcriterion of ‘just compensation’ should be inhered.”

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In Raj Kumar v. Ajay Kumar and Ors.,[3] this Courtheld that:

“Ascertainment of the effect of the permanentdisability on the actual earning capacity involves 2 (2012) 12 SCC 274H3 (2011) 1 SCC 343

three steps. The Tribunal has to first ascertain whatactivities the claimant could carry on in spite of thepermanent disability and what he could not do as aresult of the permanent ability (this is also relevantfor awarding compensation under the head of lossof amenities of life). The second step is to ascertainhis avocation, profession and nature of work beforethe accident, as also his age. The third step is to findout whether (i) the claimant is totally disabled fromearning any kind of livelihood, or (ii) whether inspite of the permanent disability, the claimant couldstill effectively carry on the activities and functions,which he was earlier carrying on, or (iii) whetherhe was prevented or restricted from discharging hisprevious activities and functions, but could carry onsome other or lesser scale of activities and functionsso that he continues to earn or can continue to earnhis livelihood.

For example, if the left hand of a claimant isamputated, the permanent physical or functionaldisablement may be assessed around 60%. If theclaimant was a driver or a carpenter, the actual lossof earning capacity may virtually be hundred percent,if he is neither able to drive or do carpentry.On theother hand, if the claimant was a clerk in governmentservice, the loss of his left hand may not result inloss of employment and he may still be continued asa clerk as he could perform his clerical functions;and in that event the loss of earning capacity willnot be 100% as in the case of a driver or carpenter,nor 60% which is the actual physical disability, butfar less. In fact, there may not be any need to awardany compensation under the head of ‘loss of futureearnings’, if the claimant continues in governmentservice, though he may be awarded compensationunder the head of loss of amenities as a consequenceof losing his hand. Sometimes the injured claimantmay be continued in service, but may not foundsuitable for discharging the duties attached to the A

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post or job which he was earlier holding, on accountof his disability, and may therefore be shifted to someother suitable but lesser post with lesser emoluments,in which case there should be a limited award underthe head of loss of future earning capacity, takingnote of the reduced earning capacity. It may be notedthat when compensation is awarded by treating theloss of future earning capacity as 100% (or evenanything more than 50%), the need to awardcompensation separately under the head of loss ofamenities or loss of expectation of life may disappearand as a result, only a token or nominal amount mayhave to be awarded under the head of loss ofamenities or loss of expectation of life, as otherwisethere may be a duplication in the award ofcompensation. Be that as it may.”

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5.6. In the present case, it is an admitted position that it is notpossible for the Appellant to get employed as a driver, or doany kind of manual labour, or engage in any agriculturaloperations whatsoever, for his sustenance.

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In such circumstances, the High Court has rightlyassessed the Appellant’s functional disability at 100% insofaras his loss of earning capacity is concerned. The Appellantis, therefore, awarded Rs. 32,40,000/- towards loss ofearning capacity.

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5.7. We further find that the compensation awarded to theAppellant towards his medical expenses is highly insufficient.The Appellant has undergone 5 surgeries, including a surgeryfor a severe head injury, and 3 throat surgeries. TheAppellant has not been awarded any amount whatsoeverGeither by the MACT, or the High Court for the successivehospitalizations, surgeries and medical treatment.

In view of the facts and circumstances of the case, itwould be just and fair to award a lump sum amount ofRs. 7,50,000/- towards hospitalization and medical expensesincurred in the past by the Appellant.

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5.8. The Appellant was produced before us. He was in anAextremely pitiable state. On account of the removal of thefrontal bone of the skull, half of his head has caved in.Furthermore, a deep circular incision was made in his throat,and his body was in an unstable condition, undergoingtremors. The Appellant is further suffering from hemiplegia,Bdue to which the left side of his body is not functioningproperly.

5.9. Given the debilitated state of the Appellant, no amount ofmoney can compensate him. He has been in this conditionsince the age of 22 years when the accident took place,Cand will remain like this throughout his life. The Appellanthas also been deprived of having a normal married life witha family, and would require medical assistance from timeto time. Being completely dependant, he would require thehelp of an attendant throughout his life.

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In view of these uncontroverted facts, we deem it fitand appropriate to award a lump sum amount ofRs. 10,00,000/- to the Appellant towards medical expensesand attendant charges.

6. In view of the aforesaid discussion, the Appellant is entitled tothe following amounts:

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i)Rs. 32,40,000/- to be awarded towards loss offuture earnings by taking the income of the Appellant atRs. 10,000/- p.m., and granting Future Prospects @50%;

ii)Rs. 7,50,000/- to be awarded towards repeatedFhospitalizations and medical expenses for undergoing 5surgeries and medical treatment;

iii)Rs. 10,00,000/- to be awarded towards future medicalexpenses and attendant charges;

iv)Interest @ 9% awarded by the High Court from the date ofGthe Claim Petition, till the date of recovery to be maintained.

7. On the issue of liability to pay the compensation awarded, weaffirm the view taken by the High Court that the Respondent – InsuranceCompany is absolved of the liability to bear the compensation, as evidencehas been produced from the office of the Regional Transport Office to H

Aprove that the drivers of the two offending trucks were driving on thebasis of invalid driving licenses. It is also relevant to note that the ownersand drivers of the offending trucks have not appeared at any stage ofthe proceedings, including this Court.

7.1. This Court in Shamanna & Ors. v. The DivisionalBManager, The Oriental Insurance Co. Ltd. & Ors., heldthat if the driver of the offending vehicle does not possessa valid driving license, the principle of ‘pay and recover’can be ordered to direct the insurance company to the paythe victim, and then recover the amount from the owner ofthe offending vehicle.[4]

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7.2. We deem it just and fair to direct the Respondent –Insurance Company to pay the enhanced amount ofcompensation as indicated in Para. 6 above, to the Appellantwithin a period of 12 weeks from the date of this judgment.The Respondent – Insurance Company is directed to makeDout a Demand Draft in the name of the Appellant, whichcan be used for his care for the rest of his life. TheRespondent – Insurance Company is entitled to recoverthe amount from the owners and drivers of the two offendingtrucks.

EThe Civil Appeal is allowed in the aforesaid terms. All pendingApplications, if any, are accordingly disposed of.

Ordered accordingly.

FDivya Pandey

Appeal allowed.

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4 (2018) 9 SCC 650