Supreme Court of India
ICICI LOMBARD GENERAL INSURANCE CO. LTD.versusAJAY KUMAR MOHANTY & ANR.
- Citation
- 2018 INSC 207
- Decided
- 6 March 2018
- Disposal
- Disposed off
- Bench
- DIPAK MISRA
Holding
The Supreme Court held that the disability was temporary, the tribunal’s computation was erroneous, and directed a compensation of Rs 9,10,000 with 9% interest.
Summary
The claimant, Ajay Kumar Mohanty, suffered a 55% temporary disability in a motor accident. The Motor Accident Claims Tribunal awarded Rs 22,85,322 compensation, assuming permanent disability and using inconsistent income figures. The insurer appealed; the High Court reduced the award to Rs 12,00,000 without providing reasons. The Supreme Court held that the tribunal erred in its computation and that the disability was temporary, not permanent. It recalculated loss of earnings at Rs 79,877 per year and awarded Rs 5,00,000 for loss of income, Rs 2,00,000 for trauma and pain, and Rs 2,09,622 for medical expenses, totaling Rs 9,10,000 with 9% interest from the filing date. The High Court's order was set aside and the appeals were disposed of.
Issues considered
- Whether the tribunal erred in computing the claimant's loss of earnings and total compensation.
- Whether the claimant's disability should be treated as permanent or temporary for purposes of compensation under Section 166 of the Motor Vehicles Act.
- Whether the High Court's reduction of the compensation award was justified in the absence of reasoned findings.
Legislation cited
- Motor Vehicles Act, 1988s. 166
Subjects
Motor accidentCompensationDisabilityTemporary disabilityLoss of earningsSection 166Computation errorInsurance
Judgment
42 [2018]
SUPREME COURT 3 S.C.R. 42
REPORTS [2018] 3 S.C.R.
A ICICI LOMBARD GENERAL INSURANCE CO. LTD.
v.
AJAY KUMAR MOHANTY & ANR.
B (Civil Appeal No. 7181 of 2015)
MARCH 06, 2018
[DIPAK MISRA, CJI, A. M. KHANWILKAR AND
DR. D. Y. CHANDRACHUD, JJ.]
C Motor Vehicles Act, 1988: s. 166 – Compensation –
Computation of – Rash and negligent act of the driver of the vehicle
– Claimant met with an accident sustaining disability – Evidence of
the doctor that the disability to the extent of 55 % – Award of
Rs. 22,85,322/- as compensation by the tribunal, however, High
D Court reduced the amount to Rs. 12,00,000/- – On appeal, held:
While calculating the income, the tribunal committed an error of
computation – Claim for compensation on the basis that the disability
was permanent not established – Annual loss of income comes to
Rs. 79,877/- – Disability being of a temporary nature, compensation
of Rs. 5 lakhs is awarded towards loss of income, Rs. 2 lakhs towards
E trauma, pain and suffering, and Rs. 2,09,622/- towards medical
expenses – Thus, Rs. 9,10,000/- awarded with interest @ 9 per cent
p.a. from the date of the filing of the petition.
Claimant sustained disability as a result of a motor accident.
Tribunal awarded Rs. 22,85,322/- as compensation. Appellant-
F
Insurer filed an appeal challenging the compensation amount.
The High Court reduced the compensation to Rs. 12,00,000/-
and interest from 7.5 per cent per annum to 7.0 per cent per
annum. Hence, the present appeal.
G Disposing of the appeals, the Court
HELD: 1.1 On perusing the order of the tribunal, there is
merit in the submission of the insurer that while calculating the
income, the tribunal committed an error of computation. The
tribunal on the basis of the income tax returns for 2007, 2008
H and 2009 arrived at an average income of Rs. 1,45,231/-. However,
42
ICICI LOMBARD GENERAL INSURANCE CO. LTD. v. AJAY 43
KUMAR MOHANTY & ANR.
the tribunal thereafter noted that the average income comes to A
Rs. 2,62,372/-. Ultimately, the tribunal proceeded on the annual
income of Rs. 2,22,000/- on the basis of the testimony of the
claimant that he was earning Rs. 18,500/- per month. This is
contradictory. On the basis of the finding of the tribunal that the
average income of the claimant for the previous three years was
B
Rs. 1,45,231/-, it would be necessary to take into account the
evidence of PW2-doctor that the disability is to the extent of 55
per cent. In other words, the loss of earning as a result of the
said disability would work out to Rs. 79,877/- per year. [Para 7]
[47-C-E]
1.2 In the instant case, the doctor admitted to having made C
an interpolation in the disability certificate. The evidence indicates
that the disability is temporary and not permanent. The doctor
admitted that the disability certificate indicated a tick mark on
the word ‘permanent’ by mistake. He further stated that the
disability in the instant case was likely to improve. Having regard D
to all the facts and circumstances, the claim for compensation on
the basis that the disability was permanent was clearly not
established. [Para 11, 12] [50-B-D]
1.3 There was no basis to award an amount of
Rs.20,75,700/-. The tribunal awarded an amount of E
Rs. 2,09,622/- towards medical expenses. The figure of an annual
loss of income of Rs. 79,877/- is accepted. The disability being of
a temporary nature, compensation of Rs. 5 lakhs is awarded
towards loss of income. Compensation of Rs. 2 lakhs is awarded
towards trauma, pain and suffering. In addition, the claimant is
entitled to medical expenses of Rs. 2,09,622/-. The ends of justice F
would be met by directing a payment of Rs. 9,10,000/- . The
claimant would be entitled to interest at the rate of 9 per cent per
annum from the date of the filing of the petition. The impugned
judgment and order of the High Court is set aside. [Para 13]
[50-F] G
Sri Laxman @ Laxman Mourya v Divisional Manager,
Oriental Insurance Co. Ltd (2011) 12 SCALE
658 ; Govind Yadav v New India Insurance Company
Limited (2011) 10 SCC 683 ; R.D. Hattangadi v Pest
Control (India) (P) Ltd. (1951) 1 SCC 551 ; Nizam’s H
44 SUPREME COURT REPORTS [2018] 3 S.C.R.
A Institute of Medical Sciences v Prasanth S. Dhananka
[2009] 9 SCR 313 : (2009) 6 SCC 1 ; Reshma Kumari
v Madam Mohan [2009] 11 SCR 305 : (2009) 13 SCC
422 ; Arvind Kumar Mishra v New India Assurance Co.
Ltd .[2010] 11 SCR 857 : (2010) 10 SCC 254 ; Raj
Kumar v Ajay Kumar [2010] 13 SCR 179 : (2011) 1
B
SCC 343 ; Subulaxmi v MD Tamil Nadu State Transport
Corporation [2012] 9 SCR 962 : (2012) 10 SCC 177
– referred to.
Case Law Reference
C
2011 (12) SCALE 658 referred to Para 9
(2011) 10 SCC 683 referred to Para 9
(1951) 1 SCC 551 referred to Para 9
D
[2009] 9 SCR 313 referred to Para 9
[2009] 11 SCR 305 referred to Para 9
2010 (11) SCR 857 referred to Para 9
E
[2010] 13 SCR 179 referred to Para 9
[2012] 9 SCR 962 referred to Para 9
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 7181
F of 2015.
From the Judgment and Order dated 15.04.2015 of the High
Court of Orissa at Cuttack in M.A C A. No. 1020 of 2014
WITH
G
Civil Appeal No.1879 of 2016.
Ms. Neerja Sachdeva, Ms. Meera Mathur, Pranaya Kumar
Mohapatra, Advs for the Appellant.
H
ICICI LOMBARD GENERAL INSURANCE CO. LTD. v. AJAY 45
KUMAR MOHANTY & ANR.
The Judgment of the Court was delivered by A
DR. D. Y. CHANDRACHUD, J. 1. In a claim for compensation
under Section 166 of the Motor Vehicles Act, arising out of a disability
sustained by the claimant as a result of a motor accident, the Tribunal
awarded an amount of Rs. 22,85,322/-. The High Court in an appeal
filed by the insurer reduced the compensation to Rs. 12,00,000/-Interest B
was reduced from 7.5 per cent per annum to 7.0 per cent. The only
reasoning contained in support of the order of the High Court reads as
follows:
“Considering the grounds taken in appeal and the submissions
made by the learned counsel for the parties and keeping in view C
the findings of the learned Tribunal given in the impugned award
with regard to the quantum of compensation amount awarded
and the basis on which the same has been arrived at, I feel, the
interest of justice would be best served, if the awarded
compensation amount of Rs. 22,85,322/- is modified and reduced
D
to Rs. 12,00,000/-. The award of interst @ 7.5% per annum is
also modified and reduced to 7% only. Accordingly, the claimant
is entitled to the modified compensation amount of Rs. 12,00,000/
- along with interest @ 7% per annum from the date of filing of
the Claim application. The impugned award is modified to the
said extent.” E
2. Ex-facie, there has been no application of mind by the High
Court to the evidence on the record and to the relevant facts and
circumstances. The above extract cannot be regarded as the expression
of a reasoned view. Ordinarily, we would have remitted the case back to
the High Court for a fresh determination. However, we are inclined not F
to do so in order to prevent a miscarriage of justice which delay in itself
is likely to occasion. The accident took place on 25 April 2009 when the
appellant was 32 years of age. The judgment of the Tribunal was rendered
on 26 February 2014. The High Court delivered its judgment on 15 April
2015. Leave was granted by this Court on 25 February 2016. Hence,
we have heard the learned counsel appearing on behalf of the contesting G
parties on merits and proceed to resolve the dispute so as to render
finality to the case.
3. The accident in question took place on 25 April 2009 when the
claimant was proceeding from Keonjhar to Badbil. The vehicle fell over
H
46 SUPREME COURT REPORTS [2018] 3 S.C.R.
A a bridge of NH 215. The claimant was rescued by the villagers and was
shifted to hospital for treatment. He suffered from a fracture to the left
elbow and femur. The Tribunal entered a finding of fact that the evidence
of the claimant remained unshaken and that the accident was caused by
the rash and negligent act of the driver of the vehicle. The vehicle was
insured with ICICI Lombard General Insurance Company Ltd. (the
B
insurer).
4. While assessing the claim for compensation, the Tribunal noted
the evidence of PW2, the Doctor who had issued a disability certificate
to the claimant. The Doctor opined that the disability was temporary and
not permanent. It appears that an admission was elicited during the course
C of the cross-examination to the effect that he had made certain
interpolations in the disability certificate without the consent or knowledge
of the CDMO. The Tribunal held that whether the disability was
permanent or temporary, it was duty bound to make an assessment.
From the income tax returns of the claimant for 2007, 2008 and 2009,
D the Tribunal observed that his annual income would work out to Rs.
1,45,231/-. The Tribunal thereafter observed that the annual income was
Rs. 2,62,372/-. The Tribunal however accepted the evidence of the
claimant which placed his income at a lower amount of Rs. 2,22,000/-
annually on the basis of the evidence of the claimant that as a B-Class
contractor, he was earning Rs. 18,500/- per month. The Tribunal applied
E a multiplier of 17 per cent. Treating the disability to be 55 per cent, on
the basis of the certificate of the District Medical Board, Bhadrak, the
Tribunal computed the compensation at Rs. 20,75,700/-. In addition, an
amount of Rs. 2,09,622/- was awarded on account of medical expenses.
A total quantum of Rs. 22,85,322/- was awarded.
F 5. Learned counsel appearing on behalf of the insurer submits
that the order of the Tribunal is contradictory and contrary to the weight
of the evidence. The error has been compounded by the failure of the
High Court to attribute reasons. Counsel submits that the Tribunal
proceeded on the manifestly erroneous basis that the claimant suffered
G a permanent disability. It was urged that the evidence of PW 2, the
doctor, indicates that the disability certificate was unauthorizedly
interpolated by him. The admissions of the doctor in the course of his
evidence that the injury was of a temporary nature and was likely to
improve have been ignored. Moreover, it has been submitted that the
judgment of the Tribunal, especially paragraph 10, would indicate that
H
ICICI LOMBARD GENERAL INSURANCE CO. LTD. v. AJAY 47
KUMAR MOHANTY & ANR. [DR. D.Y. CHANDRACHUD, J.]
the Tribunal has committed serious and apparent errors of computation A
and there is an internal inconsistency in its reasoning.
6. On the other hand, learned counsel appearing on behalf of the
claimant submits that while PW 2 admits having interpolated the disability
certificate, this should in fact weigh in favour of the claimant as the
nature of the interpolation would indicate. Like the insurer, the claimant B
also has a grievance in regard to the fact that the order of the High
Court is not reasoned. However, what the claimant submits is that there
was no justification for the High Court to reduce the quantum of
compensation awarded by the Tribunal.
7. On perusing the order of the Tribunal, we find merit in the C
contention of the insurer that while calculating the income in paragraph
10 of its order, the Tribunal has committed an error of computation. The
Tribunal has on the basis of the income tax returns for 2007, 2008 and
2009 arrived at an average income of Rs. 1,45,231/-. However, the
Tribunal has thereafter noted that the average income comes to Rs.
2,62,372/-. Ultimately, the Tribunal proceeds on the annual income of D
Rs. 2,22,000/- on the basis of the testimony of the claimant that he was
earning Rs. 18,500/- per month. This is contradictory. In our view, on the
basis of the finding of the Tribunal that the average income of the claimant
for the previous three years was Rs. 1,45,231/-, it would be necessary to
take into account the evidence of PW2 that the disability is to the extent E
of 55 per cent. In other words, the loss of earning as a result of the
aforesaid disability would work out to Rs. 79,877/- per year.
8. In arriving at the quantification of compensation, we must be
guided by the well-settled principle that compensation can be granted
both on account of permanent disability as well as loss of future earnings, F
because one headrelates to the impairment of the person’s capacity and
the other to the sphere of pain and suffering on account of loss of
enjoyment of life by the person himself.
9. In SriLaxman @ Laxman Mourya v Divisional Manager,
Oriental Insurance Co. Ltd1, this Court held thus: G
“The ratio of the above noted judgments is that if the victim of an
accident suffers permanent or temporary disability, then efforts
should always be made to award adequate compensation not only
for the physical injury and treatment, but also for the pain, suffering
1
2011 (12) SCALE 658 H
48 SUPREME COURT REPORTS [2018] 3 S.C.R.
A and trauma caused due to accident, loss of earnings and victim’s
inability to lead a normal life and enjoy amenities, which he would
have enjoyed but for the disability caused due to the accident.”
In Govind Yadav v New India Insurance Company
Limited2,this Court after referring to the pronouncements in R.D.
B Hattangadi v Pest Control (India) (P) Ltd.3 , Nizam’s Institute of
Medical Sciences v Prasanth S. Dhananka4, Reshma Kumari v
Madam Mohan5, Arvind Kumar Mishra v New India Assurance
Co. Ltd.6, Raj Kumar v Ajay Kumar7 held thus:
“18. In our view, the principles laid down in Arvind Kumar Mishra
C v. New India Assurance Co. Ltd. and Raj Kumar v. Ajay Kumar
must be followed by all the Tribunals and the High Courts in
determining the quantum of compensation payable to the victims
of accident, who are disabled either permanently or temporarily.
If the victim of the accident suffers permanent disability, then
efforts should always be made to award adequate compensation
D not only for the physical injury and treatment, but also for the loss
of earning and his inability to lead a normal life and enjoy amenities,
which he would have enjoyed but for the disability caused due to
the accident.” (Id at page 693)
These principles were reiterated in a judgment delivered by one
E of us (Justice Dipak Misra, as the learned Chief Justice then was) in
Subulaxmi v MD Tamil Nadu State Transport Corporation8.
10. In the present case, the evidence of PW2 Dr Umakanta Jena
indicates that he had initially, before issuing the disability certificate,
examined the shoulder joint, elbow joint and left femur as per the discharge
F certificate. The discharge certificate indicated that the injuries sustained
were grievous in nature. The Doctor initially placed a tick mark over the
word ‘permanent’. However, subsequently he made an interpolation by
cutting the word ‘permanent’ and “not likely to improve”. The evidence
of the Doctor is reproduced below, insofar as it is material:
G 2
(2011) 10 SCC 683
3
(1951) 1 SCC 551
4
(2009) 6 SCC 1
5
(2009) 13 SCC 422
6
(2010) 10 SCC 254
7
(2011) 1 SCC 343
8
H (2012) 10 SCC 177
ICICI LOMBARD GENERAL INSURANCE CO. LTD. v. AJAY 49
KUMAR MOHANTY & ANR. [DR. D.Y. CHANDRACHUD, J.]
“4) The disability is temporary but not permanent. The disability is A
likely to improve. The disability certificate is the original one. By
mistake, I gave a tick mark on the word “permanent”. Per day
about one hundred disability certificates are issued. So, I committed
this wrong. I have not mentioned which documents I verified prior
to issuance of this disability certificate. There is nothing in the
B
certificate to show that there was nailing. Particularly in this case,
the disability may improve. Any fracture of extremity will cause
disability. I cannot give any authority to the opinion of my above
sentence.
5) It is not a fact that the percentage of disability has been made
by me being gained over by the injured and that there was no C
disability. It is not a fact that being gained over by the injured I
gave this disability certificate.
TO COURT:-
Q. No. 1:- Whether the certificate issued by you
D
is creating confusion?
Ans; Yes.
Q. No. 2: Whether you will be paid T.A. and
D.A. from State Exchequer for your
mistake? E
Ans:, No, I should be paid.
Q. No. 3:- Whether my attendance in the court
is a govt. duty or C.L.?
Ans: For my mistake I should take C.L.
Q. No. 4:- Can you explain why you interpolated F
the certificate which was signed
by 4 doctors including CDMO,
Bhadrak?
Ans: I cannot explain.
G
Q. No. 5:- Was not it desirable to obtain the
consent of other three doctors
before cutting and putting tick mark
and making interpolation on an
already prepared public document?
H
50 SUPREME COURT REPORTS [2018] 3 S.C.R.
A Ans: I should have obtained the consent and
signature of all other signatories before
interpolating the document.”
11. The doctor has admitted to having made an interpolation in the
B disability certificate. The above evidence indicates that the disability is
temporary and not permanent. The Doctor admitted that the disability
certificate indicated a tick mark on the word ‘permanent’ by mistake.
He further stated that the disability in the present case was likely to
improve.
C 12. Having regard to all these facts and circumstances, we find
merit in the contention that the claim for compensation on the basis that
the disability was permanent was clearly not established. There was no
basis to award an amount of Rs. 20,75,700/-. The Tribunal has awarded
an amount of Rs. 2,09,622/- towards medical expenses. We accept the
figure of an annual loss of income of Rs. 79,877/-. The disability being of
D
a temporary nature, we award compensation of Rs. 5 lakhs towards
loss of income. We allow compensation of Rs. 2 lakhs towards trauma,
pain and suffering. In addition, the claimant is entitled to medical expenses
of Rs. 2,09,622. We are of the view that the ends of justice would be
met by directing a payment of Rs. 9,10,000/-. The claimant shall be
E entitled to interest at the rate of 9 per cent per annum from the date of
the filing of the petition. The insurer shall deposit the compensation along
with interest before the Tribunal within twelve weeks which shall be
disbursed to the claimant on proper identification.
13. For the above reasons, we set aside the impugned judgment
F and order of the High Court. Both the appeals are disposed of in terms
of the directions issued above. There shall be no order as to costs.
Nidhi Jain Appeals disposed of.
G
H
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