Karnataka High Court
Sri Sudhakar Shetty vs G Nithyananda Shenoy on 22 June, 2020
Bench: B.V.Nagarathna, Ravi V Hosmani
1
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 22ND DAY OF JUNE 2020
PRESENT
THE HON'BLE MRS. JUSTICE B.V. NAGARATHNA
AND
THE HON'BLE MR. JUSTICE RAVI V. HOSMANI
M.F.A.NO. 2669 OF 2015 (MV-D)
C/W
M.F.A NO. 7304 OF 2014(MV-D)
M.F.A.NO. 2669 OF 2015:
BETWEEN
SRI. SUDHAKAR SHETTY
AGED ABOUT 52 YEARS
REP. BY HIS NEXT FRIEND WIFE
SUNITHA S SHETTY
W/O SUDHAKAR SHETTY
AGED ABOUT 45 YEARS
R/AT, DEEPA PRIYA HOUSE
AJEKAR, MARNE VILLAGE
KARKALA TALUK
UDUPI- 34 ...APPELLANT
(BY SRI. PRATHEEP K.C., ADVOCATE)
AND
1. G. NITHYANANDA SHENOY
S/O, LATE RAGHURAM SHENOY
AGED ABOUT 47 YEARS
R/AT, ASHWINI NIVAS, HIRGANA
KARKALA TALUK
UDUPI DISTRICT - 34
2
2. THE UNITED INDIA INSURANCE CO. LTD
DIVISIONAL MANAGER
DIVISIONAL OFFICE
JEWEL PLAZA,M OPP. SRINIDHI MEDICAL
NEAR CHITTHARANJAN CIRCLE
UDUPI - 78. ...RESPONDENTS
(BY SRI. S.V. HEGDE MULKHAND, ADVOCATE FOR R2
SRI. H. JAYAKARA SHETTY ADVOCATE FOR R1)
M.F.A NO. 7304 OF 2014:
BETWEEN:
UNITED INDIA INSURANCE CO., LTD.,
UDUPI DIVISION OFFICE,
THROUGH ITS DIVISION OFFICE,
JEWEL PLAZA. OPP: SRINIDHI MEDICAL,
NEAR : CHITTHARANJAN CIRCLE,
UDUPI - 574 101.
REP. BY ITS DIVISIONAL MANAGER ...APPELLANT
(BY SRI. K.S LAKSHMI NARASAPPA, ADVOCATE FOR
SRI. B.C. SHEETHA RAMA RAO, ADVOCATE)
AND:
1. SRI. SUDHAKAR SHETTY,
AGED ABOUT 52 YEARS,
REP. BY HIS NEXT FRIEND & WIFE
SMT. SUNITHA S SHETTY,
AGED ABOUT 43 YEARS
RESIDING AT "DEEPA PRIYA HOUSE" ,
AJEKAR, MARNE VILLAGE,
KARKALA TALUK,
UDUPI DISTRICT - 574 104
2. G. NITHYANANDA SHENOY,
AGED ABOUT 47 YEARS,
3
S/O LATE RAGHURAM SHENOY,
RESIDING AT "ASHWINI NIVAS",
HIRGANA,
KARKALA TALUK
UDUPI DISTRICT - 574 104.
(OWNER- CUM-DRIVER OF
AUTO NO.KA. 20/A - 805) ...RESPONDENTS
(BY SRI. H. JAYAKARA SHETTY, ADVOCATE FOR R2
SRI. PRATHEEP K.C., ADVOCATE FOR R1)
THESE MISCELLANEOUS FIRST APPEALS ARE FILED U/S
173(1) OF MV ACT AGAINST THE JUDGMENT AND AWARD
DATED 11.O9.2014 PASSED IN MVC NO.319/2012 ON THE FILE
OF THE PRINCIPAL SENIOR CIVIL JUDGE, UDUPI, ADDITIONAL
MACT, UDUPI, PARTLY ALLOWING THE CLAIM PETITION FOR
COMPENSATION AND SEEKING ENHANCEMENT OF
COMPENSATION.
THESE APPEALS COMING ON FOR ADMISSION, THIS DAY,
RAVI V HOSMANI J., DELIVERED THE FOLLOWING:
JUDGMENT
Both these appeals are listed for admission, with the consent of learned counsel on both sides, they are heard finally and disposed of by this judgment.
2. M.F.A.No.2669/2015 has been filed by the claimant seeking enhancement of compensation; while M.F.A.No.7304/2014 has been filed by the United India Insurance Co., Ltd., questioning the liability to 4 satisfy the judgment and award passed by the Additional Motor Accident Claims Tribunal & Prl. Senior Civil Judge, Udupi (hereinafter referred to as 'Claims Tribunal' for the sake of convenience), dated 11.09.2014 in MVC No.319/2012.
3. For the sake of convenience, the parties shall be referred to in terms of their status and ranking before the Tribunal.
4. The brief facts leading to filing of these appeals are that, on 06-06-2011, the claimant-
Sudhakar Shetty was riding his motor-bike bearing registration No.KA-20-J-9726 from Karkala to Hebri.
At about 2.30 p.m. when he was in front of the shop premises of Harish at Hirgana, driver of an autorikshaw bearing registration No.KA-20-A/805 came in a rash and negligent manner from the opposite direction and dashed against the motor-bike.
As a result, claimant sustained grievous injuries. He 5 was shifted to K.M.C. hospital. Despite, treatment he suffered permanent physical disability and consequent loss of earning capacity. Hence, he filed the claim petition under Section 166 of the M.V. Act 1988 (hereinafter referred to as 'Act' for short) claiming compensation of Rs.65,05,000/- from respondent No.1 - owner and respondent No.2 - insurer of the offending autorikshaw.
5. In response to the notice issued by the Claims Tribunal, respondent No.1, entered appearance, but did not file any written statement.
Respondent No.2 entered appearance and filed his written statement. Though, it admitted coverage under the policy, it was contended that the driver of the offending vehicle was not holding a valid and effective driving licence to drive the goods autorikshaw at the time of the accident. It filed an application under Section 170 of the M.V. Act, which 6 was allowed. Hence, sought for dismissal of the claim petition.
6. On the basis of the pleadings, the Claims Tribunal framed the following issues:
1. Whether the petitioner proves that the accident in question occurred due to the rash and negligent driving of the vehicle bearing Reg. No. KA-20-A-805 by its driver ?
2. Whether the 2nd respondent proves that the accident in question occurred due to the negligent riding by the vehicle bearing Reg.No. KA-20-J-9726 by the petitioner?
3. Whether the 2nd respondent proves that the rider of the vehicle bearing Reg. No. KA-20-A- 805 had no valid and effective driving license on the date and time of the accident ?
4. Whether the petitioner is entitled for compensation? If so, to what amount and from whom?
5. What award or order?
7. In support of his case, the claimant examined Dr. Arjun Chaco, who treated him, as P.W.1; Sunitha Shetty - wife of the claimant as P.W.2 and three other 7 witnesses as P.W.3 to P.W.5. Documents as Exhibits P.1 to P.27 were marked. R.W1 and R.W.2 were examined on behalf of respondent No.2 and got marked five documents at Exs.P.1 to P.5.
8. Thereafter the Claims Tribunal answered issue No.1 in the affirmative; issue Nos.2 and 3 in the negative; issue No.4 partly in the affirmative and issue No.5 as per final order awarding a total compensation of Rs.22,29,640/- with interest at the rate of 8% per annum from the date of the petition till the date of actual deposit and directed respondent No.2 - insurer to pay the compensation.
9. We have heard Sri. Prateep K.C. learned counsel for the claimant - appellant who appeared in person and Sri. K.S. Lakshmi Narasappa, learned counsel for Sri. B.C. Seetharam Rao, learned counsel on behalf of the insurance company, through Video 8 Conference and also learned counsel Sri. H Jayakara Shetty, who appeared for respondent No.2 - owner of the vehicle, who appeared in person. We have perused the material on record as well as original record.
10. Learned counsel for the claimant-appellant submitted that the driver of the autorikshaw cab had obtained a driving licence for LMV transport and also had a badge. Though the driving licence had lapsed prior to the date of the accident, it was renewed after the accident. Thus, the Claims Tribunal was not justified in passing the award of pay and recover against the insurer. The issue is covered by the judgment of a Co-ordinate Bench of this Court in M.F.A.No.103680/2015. The learned counsel also submitted that as a result of the injuries suffered in the accident, the claimant is paralyzed, due to which he is bed-ridden. Though, the doctor has assessed 9 permanent physical disability at 75%, the claimant has lost 100% earning capacity. However, the Claims Tribunal has not considered loss of earning capacity at 100%. Hence, the same calls for interference.
It was further contended that though the claimant was entitled for future prospects, the Claims Tribunal has passed an award taking actual salary into account. It was further submitted that the claimant's wife, who was an Anganawadi worker, was forced to resign from her job in order to take care of her bed-
ridden husband. However, adequate compensation is not awarded towards attendant charges nor towards loss of her income. He also sought for enhancement of the rate of interest from 8% per annum to 12% per annum.
11. On the other hand, the learned counsel for the insurer contended that the offending vehicle in question was a goods autorikshaw. The owner -
10insured himself was driving it at the time of the accident. Though he had a driving licence to drive an autorikshaw - cab from 20.09.2001 to 19.09.2004, it was renewed upto 19.09.2007. The accident occurred on 06.06.2011. The licence was renewed on 12.10.2011 upto 11.10.2014, which is much later than the date of the accident. As the driver of the insured vehicle was not having a valid and effective driving licence at the time of the accident, there was violation of terms of the policy and the insurer cannot be held liable to pay the compensation.
12. On the point of quantum of compensation, it was submitted that the doctor has assessed the permanent physical disability at 75 % and therefore there was no scope for further enhancement. It was also urged that normally in a personal injury claim, future prospects are not awarded. He submitted that 11 the compensation awarded is just and proper and does not call for any enhancement.
13. We have heard learned counsel for the respective parties. The following points would arise for our consideration:
i) Whether the Tribunal was right in fastening the liability on the insurance company and directing it to satisfy the award and to recover the same from the owner of the vehicle?
ii) Whether the injured claimant-appellant is entitled to enhanced compensation?
iii) Whether the tribunal was right in granting interest at the rate of 8% per annum on the compensation awarded by it?
iv) What order?
14. In the above appeal, the claimant is not only seeking for enhancement of compensation, but also questioning the direction to pay and recover issued in the instant case. The insurer is in appeal only on its liability to satisfy the award. Thus, the 12 occurrence of the accident on 6.6.2011 between the motorbike bearing registration No.KA-20-J-9726 of the claimant and autorikshaw bearing registration No.KA - 20 - A -805 is not in dispute. It is also not in dispute that the claimant suffered grievous injuries and permanent physical disability. The dispute in the claimant's appeal is with regard to quantum of compensation and liability of the insurer as the driver of the autorikshaw was not possessing a valid and effective driving licence at the time of the accident.
Reg. Point No.1:
15. In support of its contention, the insurer has examined the R.T.O. as R.W.1 and also got marked the B-extract and copy of the driving licence of the driver of the autorikshaw cab. Perusal of Ex.R.3, B -
registrar extract and Ex.R.4 - Driving licnece extract reveal that driver of the autorikshaw had obtained a driving licence for autoriskhaw cab from 20.09.2001 13 to 19.09.2004 and had it renewed upto 19.09.2007 and from 12.10.2011 to 11.10.2014. It has been clearly admitted by the RTO - R.W.1 that, renewal was within a period of five years and that the driver of the autorikshaw cab was unfit to get the badge on the date of the accident and Driving licence could be got renewed without undergoing fresh test. The point, whether a case of non-renewal of driving licence can be equated to a case of non-possession of driving licence is no longer res integra. A division of this Court of which one of us (Nagarathna, J.), was a member in MFA No.103680 of 2015 c/w M.F.A.No.103681 of 2015 disposed of on 08.02.2019, Nagappa @ Nagaraja & Others Vs. Ravi Kupaluru & others, has answered it against the insurer on a detailed examination of the law on the point. There was no submission at the Bar, that said judgment has been challenged before the 14 Hon'ble Supreme Court and is stayed. Hence, the same would bind this Court.
The relevant paragraphs of the said judgment read as under:
"20. The first point of controversy is with regard to the liability of the insurer to satisfy the award. On this aspect having regard to Section 149(2)(ii)(a) of the Act, the Insurance Company can avoid its liability if a driver of a vehicle is not duly licenced or if on the fatal date the vehicle has been driven by a person who has been disqualified from holding or obtaining a driving licence and have driven the vehicle during the period of its disqualification. The crucial expression in the form of a defence that could be taken by an insurer is "not duly licenced." If a person who is not duly licenced, drives a vehicle and causes an accident, then the Insurance Company can avoid its liability. The expression 'driving licence' is defined in Section 15 2(10) of the Act to mean the licence issued by a competent authority under Chapter II authorizing the person specified therein to drive, otherwise than as a learner, a motor vehicle or a motor vehicle of any specified class or description. Section 3(1) deals with the necessity for driving licence and it states that no person shall drive a motor vehicle in any public place unless he holds an effective driving licence issued to him authorizing him to drive the vehicle; and no person shall so drive a transport vehicle other than motor cab or motorcycle hired for his own use or rented under any scheme made under Section 75(2) unless his driving licence specifically entitles him so to do.
21. Section 5 says that no owner or person in charge of a motor vehicle shall cause or permit any person who does not satisfy the provisions of Section 3 or Section 4 to drive the vehicle. Section 4 deals with the age limit in connection with driving the 16 motor vehicles. The grant of driving licence is dealt with in Section 9 and the form and contents of licences to drive is dealt with in Section 10. Section 11(1) states that any person holding a driving licence to drive any class or description of motor vehicles, who is not for the time being disqualified for holding or obtaining a driving licence to drive any other class or description of motor vehicles, may apply to the licensing authority having jurisdiction in the area in which he resides or carries on his business in such form and accompanied by such documents and with such fees as may be prescribed by the Central Government for the addition of such other class or description of vehicles to the licence. Section 14 which deals with currency of licences to drive motor vehicles inter alia states in sub-section (2) that a driving licence issued or renewed under the Act shall, in the case of a licence to drive a transport vehicle, be effected for a period of three years.17
22. Section 15 has been referred to by learned counsel for the Insurance Company which deals with renewal of driving licence. Sub-section (1) of Section 15 states that any licensing authority may, on application made to it, renew a driving licence issued under the provisions of this Act with effect from the date of its expiry. The proviso states where the application for the renewal of a licence is made more than thirty days after the date of its expiry, the driving licence shall be renewed with effect from the date of its renewal; that means in other cases, the renewal will take place from the date of its expiry.
The other provisions of Section 15 are not relevant for the purpose of this case. The aforesaid provisions have been considered and interpreted by the Hon'ble Supreme Court in the case of Swaran Singh and after dealing with a catena of judgments, the summary of its findings are noted in paragraph 105 as under:
18"105. The summary of our findings to the various issues as raised in these petitions are as follows:
(i) Chapter XI of the Motor Vehicles Act, 1988 providing compulsory insurance of vehicles against third party risks is a social welfare legislation to extend relief by compensation to victims of accidents caused by use of motor vehicles. The provisions of compulsory insurance coverage of all vehicles are with this paramount object and the provisions of the Act have to be so interpreted as to effectuate the said object.
(ii) Insurer is entitled to raise a defence in a claim petition filed under Section 163 A or Section 166 of the Motor Vehicles Act, 1988 inter alia in terms of Section 149(2)(a)(ii) of the said Act.
(iii) The breach of policy condition e.g. disqualification of driver or invalid driving licence of the driver, as contained in sub-section (2)(a)(ii) of Section 149, have to be proved to have been committed by the insured for avoiding liability by the insurer. Mere absence, fake or invalid driving licence or disqualification of the driver for driving at the relevant time, are not in themselves defences available to the insurer against either the insured or the third parties. To avoid its liability towards insured, the insurer has to prove that the insured was guilty of negligence and failed to exercise reasonable care in the matter of fulfilling the condition of the policy regarding use 19 of vehicles by duly licensed driver or one who was not disqualified to drive at the relevant time.
(iv) The insurance companies are, however, with a view to avoid their liability must not only establish the available defence(s) raised in the said proceedings but must also establish 'breach' on the part of the owner of the vehicle; the burden of proof wherefore would be on them.
(v) The court cannot lay down any criteria as to how said burden would be discharged, inasmuch as the same would depend upon the facts and circumstance of each case.
(vi) Even where the insurer is able to prove breach on the part of the insured concerning the policy condition regarding holding of a valid licence by the driver or his qualification to drive during the relevant period, the insurer would not be allowed to avoid its liability towards insured unless the said breach or breaches on the condition of driving licence is/ are so fundamental as are found to have contributed to the cause of the accident. The Tribunals in interpreting the policy conditions would apply "the rule of main purpose" and the concept of "fundamental breach" to allow defences available to the insured under Section 149(2) of the Act.
(vii) The question as to whether the owner has taken reasonable care to find 20 out as to whether the driving licence produced by the driver, (a fake one or otherwise), does not fulfil the requirements of law or not will have to be determined in each case.
(viii) If a vehicle at the time of accident was driven by a person having a learner's licence, the insurance companies would be liable to satisfy the decree.
(ix) The claims tribunal constituted under Section 165 read with Section 168 is empowered to adjudicate all claims in respect of the accidents involving death or of bodily injury or damage to property of third party arising in use of motor vehicle. The said power of the tribunal is not restricted to decide the claims inter se between claimant or claimants on one side and insured, insurer and driver on the other. In the course of adjudicating the claim for compensation and to decide the availability of defence or defences to the insurer, the Tribunal has necessarily the power and jurisdiction to decide disputes inter se between insurer and the insured. The decision rendered on the claims and disputes inter se between the insurer and insured in the course of adjudication of claim for compensation by the claimants and the award made thereon is enforceable and executable in the same manner as provided in Section 174 of the Act for enforcement and execution of the award in favour of the claimants.21
(x) Where on adjudication of the claim under the Act the tribunal arrives at a conclusion that the insurer has satisfactorily proved its defence in accordance with the provisions of Sections 149(2) read with sub-section (7), as interpreted by this Court above, the Tribunal can direct that the insurer is liable to be reimbursed by the insured for the compensation and other amounts which it has been compelled to pay to the third party under the award of the tribunal. Such determination of claim by the Tribunal will be enforceable and the money found due to the insurer from the insured will be recoverable on a certificate issued by the tribunal to the Collector in the same manner under Section 174 of the Act as arrears of land revenue. The certificate will be issued for the recovery as arrears of land revenue only if, as required by sub-section (3) of Section 168 of the Act the insured fails to deposit the amount awarded in favour of the insurer within thirty days from the date of announcement of the award by the tribunal.
(xi) The provisions contained in sub- section (4) with proviso thereunder and sub-section (5) which are intended to cover specified contingencies mentioned therein to enable the insurer to recover amount paid under the contract of insurance on behalf of the insured can be taken recourse of by the Tribunal and be extended to claims and defences of insurer against insured by relegating them to the remedy before regular court in cases where on given facts and 22 circumstances adjudication of their claims inter se might delay the adjudication of the claims of the victims."
23. Clause 6 of the summation is relevant. It states that even where the insurer is able to prove breach on the part of the insured concerning the policy condition regarding holding of a valid licence by the driver or his qualification to drive during the relevant period, the insurer would not be allowed to avoid its liability towards insured unless the said breach or breaches on the condition of driving licence is/are so fundamental as are found to have contributed to the cause of the accident. The Tribunals in interpreting the policy conditions should apply "the rule of main purpose" and the concept of "fundamental breach" to allow defences available to the insured under Section 149(2) of the Act. A reading of the same would imply that every breach of the policy condition regarding licence would not ipso facto, be so fundamental so as to enable the Insurance Company to avoid its liability.
23The breach with regard to the condition of possessing a driving licence must be so fundamental so as to have contributed to the cause of accident. Thus, there must be a nexus between the absence of a valid and effective driving license by the driver of the offending vehicle and the accident. The same would imply that the driver of the offending vehicle is not duly licenced to drive the vehicle and in absence of possessing the skill to drive a vehicle has driven the same in a rash and negligent manner. It could also be a case where the driver is disqualified for holding or obtaining a driving licence and during the period of disqualification, has driven the vehicle in a rash and negligent manner and caused the accident. Therefore, the aforesaid interpretation of the Hon'ble Supreme Court is in the context of the expression used in Section 149(2)(a)(ii) of the Act.
24. Applying the aforesaid decision to the instant case, it is noted 24 that the driver of the offending vehicle had the licence to drive a non-transport vehicle for the period from 24.07.1998 to 23.07.2018. He also had the authorization to drive a transport vehicle for the period from 03.02.2009 up to 02.02.2012. The licence to drive a non-transport vehicle was renewed on 02.06.2012. It is in the interregnum i.e., on 05.04.2012 the accident occurred. Could it be inferred that the breach in the policy condition was so fundamental so as to have resulted in the driver of the offending vehicle causing the accident? We do not think so. This is not a case where the driver of the offending vehicle did not possess any licence at all to drive any vehicle; neither is it a case where the driver of the offending vehicle did not possess an authorization (transport endorsement) to drive a heavy goods vehicle at all (which is the offending lorry in the instant case). This is a case where the authorization to drive such a transport vehicle had expired on 02.02.2012 and 25 it was subsequently renewed on 02.06.2012 i.e., four months later. But on the date of the accident that is on 05.04.2012, he had not got his licence renewed. This is a case of a non-renewal of a license and not a case of not possessing a license to drive a heavy goods vehicle. A non-renewal of the licence is totally different from the case of non-possession of the licence or driving a vehicle on being disqualified. In the latter two cases, the Insurance Company may have to be exonerated of its liability if the aforesaid reasons had a nexus with the occurrence of the accident as that is precisely what has been stated in the defences of the insurer under Section 149(2) of the Act. But insofar as non-renewal of a licence is concerned or absence of a transport endorsement to drive a particular transport vehicle but otherwise having a license to drive such a vehicle i.e., a non-transport vehicle, it cannot be equated to a case of non-possession of a licence or a case where a driver who 26 was disqualified from driving the vehicle drove the same. It is only in the latter two cases where the insurer can avoid its liability.
25. A Co-ordinate Bench of this Court in the case of K.G.Srinivasamurthy Vs. Habib Khathun, reported in 2002 ACJ 557 has observed after referring to Section 15 of the Act that, if the application for renewal is made within thirty days after the date of expiry of the licence, the same shall be renewed from the date of its expiry. However, if the application is made more than thirty days after the date of its expiry, the driving licence shall be renewed with effect from the date of its renewal. The above said provisions also show that the licensing authority has no power to refuse renewal of licence unless the application is filed beyond the period of five years from the date of expiry in view of the proviso to Sub-section (4) to Section 15. That when the application for renewal is more than five 27 years after the driving licence has ceased to be effective, the licensing authority may refuse to renew the driving licence, unless the applicant undergoes and passes to its satisfaction the test of competence to drive referred to in Sub-section (3) of Section 9. Therefore, if the application for renewal is made within five years after the expiry of the driving licence for renewal, the authority cannot refuse to renew the licence if the prescribed fee is paid and if only the application is made beyond the period of five years from the date of expiry of the driving licence, the applicant has to undergo and pass to the satisfaction of the licensing authority the test of competence to drive referred to in Sub-section (3) of Section 9. Thus if a person has not made an application for renewal of his license within a period of five years from the date of expiry of the license, such a driver entails a disqualification to drive the vehicle and has to undergo a fresh driving test and obtain a fresh driving license.
2826. In the said case also, the offending driver was holding a driving licence which was renewed. However, there was delay in getting the licence renewed as the application had been made more than 30 days after the expiry of the period of licence, the renewal was made from the date of application and not from the date of expiry of the licence. Therefore, the question considered was as to whether the owner of the vehicle had handed over the vehicle to a person who was not holding any licence.
27. The Co-Ordinate Bench has held after referring to various judgments that even if there is no renewal endorsement, it cannot be said that the person driving the vehicle was not a licensed driver. It is not a case where the insured entrusted the vehicle to a person who does not hold a driving licence rather admittedly the driver to whom the vehicle was entrusted by the 29 insured was having a valid driving licence duly granted by transport authority. Merely because of expiry of the period of licence and the omission of the driver to get the licence renewed, it cannot be said by any stretch of imagination that there is breach of condition of policy for which insurance company can be exonerated from the liability. The driver was authorised to drive a transport vehicle and the vehicle was entrusted by the insured to the licensed driver and, therefore, the insurance company cannot absolve itself from the liability. Therefore, it is clear that mere fact that the driver of the vehicle had not got his driving licence renewed on the date of the accident and got it renewed subsequently would not amount to breach of condition of the policy as it cannot be said that there was violation of the condition of the policy. Further, in view of the above findings, the Division Bench also held that the question of ordering any 30 recovery of the amount by the insurance company from the insurer did not arise."
Following the same, we answer point No.1 in favour of the appellant-claimant and against the insurance company and hold that the insurance company is liable to satisfy the judgment and award.
Reg. Point No.2:
16. In the instant case, the claimant has suffered the following injuries:
Multiple lacerations over head 1x1x0.5cm each over right middle/ring/little fingers.
3x2x1cm abrasions over right knee.
3x2x1cm over right side of face.
5x3x2cm lacerations over inferior aspect of the chin.
Open head injury.
Dr. Arjun Chaco, a neurologist in KMC hospital, who treated the claimant has been examined as P.W.1. He has stated that the claimant was injured on 31 the medulla and there was bleeding in the medulla part and also from the nose. There was contusion in the brain and claimant was in coma. After a prolonged treatment in ICU, condition of the claimant stabilized and he was discharged. The said witness has clarified that the discharge of the injured was on account of the fact that there was no possibility of recovery/improvement in the near future. He has stated that the claimant is bed-ridden and is not in a position to talk. The said evidence gives a clear indication that the claimant has suffered loss of earning capacity to an extent of 100%. A useful reference in this regard can be made to the decision of the Hon'ble Supreme Court in the case of RAJ KUMAR VS. AJAY KUMAR reported in 2011(1) SCC 343, in the matter of assessment of permanent disability, the relevant paragraphs of which read as under:32
"8. Disability refers to any restriction or lack of ability to perform an activity in the manner considered normal for a human being. Permanent disability refers to the residuary incapacity or loss of use of some part of the body, found existing at the end of the period of treatment and recuperation, after achieving the maximum bodily improvement or recovery which is likely to remain for the remainder life of the injured.
Temporary disability refers to the incapacity or loss of use of some part of the body on account of the injury, which will cease to exist at the end of the period of treatment and recuperation. Permanent disability can be either partial or total. Partial permanent disability refers to a person's inability to perform all the duties and bodily functions that he could perform before the accident, though he is able to perform some of them and is still able to engage in some gainful activity. Total permanent disability refers to a person's inability to perform any avocation or employment related activities as a result 33 of the accident. The permanent disabilities that may arise from motor accidents injuries, are of a much wider range when compared to the physical disabilities which are enumerated in the Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995 ("the Disabilities Act", for short). But if any of the disabilities enumerated in section 2(i) of the Disabilities Act are the result of injuries sustained in a motor accident, they can be permanent disabilities for the purpose of claiming compensation.
9. The percentage of permanent disability is expressed by the Doctors with reference to the whole body, or more often than not, with reference to a particular limb. When a disability certificate states that the injured has suffered permanent disability to an extent of 45% of the left lower limb, it is not the same as 45% permanent disability with reference to the whole body. The extent of disability of a limb (or part of the body) 34 expressed in terms of a percentage of the total functions of that limb, obviously cannot be assumed to be the extent of disability of the whole body. If there is 60% permanent disability of the right hand and 80% permanent disability of left leg, it does not mean that the extent of permanent disability with reference to the whole body is 140% (that is 80% plus 60%). If different parts of the body have suffered different percentages of disabilities, the sum total thereof expressed in terms of the permanent disability with reference to the whole body cannot obviously exceed 100%.
10. Where the claimant suffers a permanent disability as a result of injuries, the assessment of compensation under the head of loss of future earnings would depend upon the effect and impact of such permanent disability on his ea rning capacity. The Tribunal should not mechanically apply the percentage of permanent disability as the percentage of 35 economic loss or loss of earning capacity. In most of the cases, the percentage of economic loss, that is, percentage of loss of earning capacity, arising from a permanent disability will be different from the percentage of permanent disability. Some Tribunals wrongly assume that in all cases, a particular extent (percentage) of permanent disability would result in a corresponding loss of earning capacity, and consequently, if the evidence produced show 45% as the permanent disability, will hold that there is 45% loss of future earning capacity. In most of the cases, equating the extent (percentage) of loss of earning capacity to the extent (percentage) of permanent disability will result in award of either too low or too high a compensation.
11. What requires to be assessed by the Tribunal is the effect of the permanent disability on the earning capacity of the injured; and after assessing the loss of earning capacity in terms of a percentage of 36 the income, it has to be quantified in terms of money, to arrive at the future loss of earnings (by applying the standard multiplier method used to determine loss of dependency). We may however note that in some cases, on appreciation of evidence and assessment, the Tribunal may find that percentage of loss of earning capacity as a result of the permanent disability, is approximately the same as the percentage of permanent disability in which case, of course, the Tribunal will adopt the said percentage for determination of compensation. (See for example, the decisions of this Court in Arvind Kumar Mishra v. New India Assurance Co. Ltd. and Yadava Kumar v. National Insurance Co. Ltd.)
12. Therefore, the Tribunal has to first decide whether there is any permanent disability and, if so, the extent of such permanent disability. This means that the 37 Tribunal should consider and decide with reference to the evidence:
(i) whether the disablement is permanent or temporary;
(ii) if the disablement is permanent, whether it is permanent total disablement or permanent partial disablement;
(iii) if the disablement percentage is expressed with reference to any specific limb, then the effect of such disablement of the limb on the functioning of the entire body, that is, the permanent disability suffered by the person.
If the Tribunal concludes that there is no permanent disability then there is no question of proceeding further and determining the loss of future earning capacity. But if the Tribunal concludes that there is permanent disability then it will proceed to ascertain its extent. After the Tribunal ascertains the actual extent of 38 permanent disability of the claimant based on the medical evidence, it has to determine whether such permanent disability has affected or will affect his earning capacity.
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 ability (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 39 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.
14. For example, if the left hand of a claimant is amputated, the permanent physical or functional disablement may be assessed around 60%. If the claimant was a driver or a carpenter, the actual loss of earning capacity may virtually be hundred per cent, if he is neither able to drive or do carpentry. On the other hand, if the claimant was a clerk in government service, the loss of his left hand may not result in loss of employment and he may still be continued as a clerk as he could perform his clerical functions; and in that event the loss of earning capacity will not be 100% as in the case of a driver or carpenter, nor 60% which is the actual 40 physical disability, but far less. In fact, there may not be any need to award any compensation under the head of "loss of future earnings", if the claimant continues in government service, though he may be awarded compensation under the head of loss of amenities as a consequence of losing his hand. Sometimes the injured claimant may be continued in service, but may not found suitable for discharging the duties attached to the post or job which he was earlier holding, on account of his disability, and may therefore be shifted to some other suitable but lesser post with lesser emoluments, in which case there should be a limited award under the head of loss of future earning capacity, taking note of the reduced earning capacity.
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 41 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.
16. The Tribunal should not be a silent spectator when medical evidence is tendered in regard to the injuries and their effect, in particular, the extent of permanent disability. Sections 168 and 169 of the Act make it evident that the Tribunal does not function as a neutral umpire as in a civil suit, but as an active explorer and seeker of truth who is required to "hold an enquiry into the claim" for determining the "just compensation". The Tribunal should therefore take an active role to ascertain the true and correct position so that it can assess the "just compensation". While dealing with personal injury cases, the 42 Tribunal should preferably equip itself with a medical dictionary and a handbook for evaluation of permanent physical impairment (for example, Manual for Evaluation of Permanent Physical Impairment for Orthopedic Surgeons, prepared by American Academy of Orthopedic Surgeons or its Indian equivalent or other authorised texts) for understanding the medical evidence and assessing the physical and functional disability. The Tribunal may also keep in view the First Schedule to the Workmen's Compensation Act, 1923 which gives some indication about the extent of permanent disability in different types of injuries, in the case of workmen.
17. If a doctor giving evidence uses technical medical terms, the Tribunal should instruct him to state in addition, in simple non-medical terms, the nature and the effect of the injury. If a doctor gives evidence about the percentage of 43 permanent disability, the Tribunal has to seek clarification as to whether such percentage of disability is the functional disability with reference to the whole body or whether it is only with reference to a limb. If the percentage of permanent disability is stated with reference to a limb, the Tribunal will have to seek the doctor's opinion as to whether it is possible to deduce the corresponding functional permanent disability with reference to the whole body and, if so, the percentage.
18. The Tribunal should also act with caution, if it proposed to accept the expert evidence of doctors who did not treat the injured but who give "ready to use"
disability certificates, without proper medical assessment. There are several instances of unscrupulous doctors who without treating the injured, readily giving liberal disability certificates to help the claimants. But where the disability certificates are given by duly constituted 44 Medical Boards, they may be accepted subject to evidence regarding the genuineness of such certificates. The Tribunal may invariably make it a point to require the evidence of the Doctor who treated the injured or who assessed the permanent disability. Mere production of a disability certificate or discharge certificate will not be proof of the extent of disability stated therein unless the doctor who treated the claimant or who medically examined and assessed the extent of disability of claimant, is tendered for cross- examination with reference to the certificate. If the Tribunal is not satisfied with the medical evidence produced by the claimant, it can constitute a Medical Board (from a panel maintained by it in consultation with reputed local hospitals/medical colleges) and refer the claimant to such Medical Board for assessment of the disability.
19. We may now summarise the principles discussed above:
45(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 46 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."
A Co-ordinate Bench of this Court of which one of us (Nagarathna J.,) was a member applied these principles in M.D. Somnath Vs. Manjunath H. Bandi and Another [M.D.Somnath] in M.F.A.NO.2915/ 2017 disposed of on 30.01.2020. It referred to several other cases where these principles were applied.
17. Considering the nature of injuries referred supra and the treatment undergone by the claimant, it 47 is seen that he has suffered severe pain and trauma.
Hence, a sum of Rs.1,30,000/- towards pain and suffering is just and proper and does not call for any interference.
Since, the Claims Tribunal has chosen to reimburse the actual amount spent towards medical expenses by referring to the medical bills, the same also does not call for any interference.
While awarding compensation under the head incidental expenses, the Claims Tribunal has taken note of the duration of treatment as an inpatient (about 90 days) and number of visits to the hospital, awarded a sum of Rs.60,000/- in total. However, considering nominal expenses towards incidental charges, we deem it just and proper to award a sum of Rs.1,20,000/- instead of Rs.60,000/- as awarded by the Claims Tribunal.
48In support of the claim towards attendant charges, it has been stated that Rs.200/- per day was paid to the attendant. For some duration, an assistant viz., Suresh and afterwards one Ramya, a relative was also appointed for some time. Since, the cost of the attendant was unbearable, the claimant's wife, who was an Anganawadi worker, resigned from her job and dedicated herself to attending to the claimant. To establish her employment and loss of earning, attendance register and salary statement were produced. The same is corroborated from the evidence of P.W.5 - the CDPO. Perusal of Ex.P.25, indicates that the monthly payment of the claimant's wife was Rs.2,755/-. Even if, nominal attendant charges of Rs.3,000/- per month is considered, it would be Rs.3,000 X 12 X 11= Rs.3,96,000/-. Hence, we deem it just and proper to award a lumpsum of 49 Rs.4,00,000/- towards future attendant charges by bearing in mind loss of earning of wife of the claimant.
As per Ex.P.12 - salary certificate, claimant was working as a manager in Ajekar Co-operative Agricultural Society Ltd., and was earning a sum of Rs.16,330.50 per month. Though, it is claimed that he was also working as a LIC agent, and earning commission of Rs.5,000/- per month, the Claims Tribunal has rightly ignored the same as no evidence was led in support of it. Out of the salary of Rs.16,330/- a sum of Rs.200/- has to be deducted towards professional tax. It has already been held that the claimant has suffered loss of earning capacity to an extent of 100 %. The claimant was aged about 51 years at the time of the accident. As per the decision of the Hon'ble Supreme Court in the case of Sarla Varma and Others vs. Delhi Transport Corporation and Another, reported in (2009) 6 50 SCC 121, the multiplier applicable would be '11'.
Thus, the loss of future earning capacity would be 100% of Rs.16,130/- X 12 X 11 = Rs.21,29,160/-.
The same is awarded to the claimant.
The Claims Tribunal has also awarded a sum of Rs.20,000/- towards permanent disability;
Rs.30,000/- for shortening of life span and Rs.40,000/- towards loss of amenities, which are grossly inadequate. Referring to the decision in M.D Somnath's case (supra), a lumpsum of Rs.3,00,000/- is awarded towards loss of amenities in lieu of the above. In the result, point No.2 is answered in favour of the appellant-claimant and the total compensation is enhanced to Rs.33,35,930/- as against Rs.22,29,640/- under the following heads:
1) Pain and suffering Rs.1,30,000/-
2) Medical Expenses Rs.2,56,770/-
3) Incidental charges Rs.1,20,000/-
4) Loss of future earning capacity Rs.21,29,160/-51
5) Future attendant charges Rs.4,00,000/-
6) Loss of amenities Rs.3,00,000/-
Total Rs.33,35,930/- Reg. Point no.3:
18. This Court has been normally awarding interest @ 6% per annum on the compensation awarded in accident claims. The Claims Tribunal has not assigned any special reasons to award interest @ 8% per annum, which is the higher side. Hence, the issue is answered in favour of the insurance company and rate of interest is reduced from 8% to 6% per annum. However, the claimant is not entitled for interest on Rs.4,00,000/-, which is awarded towards future attendant charges.
In the result, both the appeals are allowed in part and disposed of in the aforesaid terms. The amount in deposit in MFA No.7304/2014 is ordered to be transmitted to the Claims Tribunal for disbursal.
52The insurer is directed to deposit the balance compensation with up-to-date interest at the rate of 6% per annum from the date of the claim petition deposit before the Claims Tribunal within a period of six weeks from the date of receipt of certified copy of this judgment.
Upon deposit, the Claims Tribunal is directed to deposit 75% of the enhanced compensation amount along with up-to-date interest in the Post Office and in any Nationalised Bank earning highest interest for an initial period of ten years, which shall be free from encumbrances. He shall be entitled to periodical interest on the said deposit. The balance compensation shall be released in favour the wife of the claimant after due identification, taking note of the fact that the claimant is represented by his wife in this appeal.
53Office to return original record to the Claims Tribunal forthwith.
Parties to bear their respective costs.
Sd/-
JUDGE Sd/-
JUDGE Psg*