The New India Assurance Company Ltd. v. P. Narayani and Musthafa So. Kizhekkepurath Imbichikoya

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MR.JUSTICE C.T.RAVIKUMAR** ## **&** **THE HONOURABLE MR. JUSTICE B.SUDHEENDRA KUMAR FRIDAY, THE 20TH DAY OF OCTOBER 2017 / 28TH ASWINA, 1939** ## **MACA.No. 2170 of 2005** **AGAINST THE AWARD IN OPMV 1173/2000 of MOTOR ACCIDENT CLAIMS TRIBUNAL , MANJERI DATED 05-02-2005** ## **APPELLANT/S:** **THE NEW INDIA ASSURANCE COMPANY LTD. REP. BY ITS ASST. ADMINISTRATIVE OFFICER,, REGIONAL OFFICE, M.G.ROAD, KOCHI-11.** ## **BY ADV. SRI.N.S.MOHAMMED USMAN** ## **RESPONDENT/S:** **1 P.NARAYANI AGED 52 YEARS, `CHAITHANYA', IRUVETTY P.O.,, AREACODE (VIA), ERNAD TALUK, MALAPPURAM DIST. 2 MUSTHAFA SO.KIZHEKKEPURATH IMBICHIKOYA, AGED 30 YEARS, KIZHEKKEPURATH, HOUSE, MANHAPATTA, ELANKUR P.O., ERNAD TALUK. 3 ALAVI SO.ALI AGED 48 YEARS, CHELADATHIL HOUSE,, MANHAPATTA, ELANKUR P.O., MALAPPURAM DIST.[DELETED] [RESPONDENT NO.3 IS DELETED FROM THE PARTY ARRAY AT THE RISK OF THE APPELLANT AS PER ORDER DATED 02.12.2015 IN IA 4038/15.]** ## **BY ADV. SRI.BABU S. NAIR** **THIS MOTOR ACCIDENT CLAIMS APPEAL HAVING BEEN FINALLY HEARD ON 20.10.2017, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** -2- ## JUDGMENT ## Ravikumar, J. A legal conundrum is to be resolved in this appeal. For identifying the same and to answer the same, a succinct narration of the factual aspects is inevitable. Ergo it is narrated as hereunder:- This appeal is directed against the award dated 5-2-2005 passed by the Motor Accidents Claims Tribunal, Manjeri, in O.P. No. 1173 of 2000. The appellant herein was the 3rd respondent and the respondents herein were respectively the petitioner and respondents 1 and 2, therein. Hereafter in this judgment the parties are referred to in accordance with their rank and status in this regard. The first respondent herein filed the said claim petition under Section 166 of the Motor ## **MACA.No. 2170 of 2005** Vehicles Act, seeking compensation for the personal injuries sustained by her in a motor vehicle accident and resulted in permanent disability. She claimed an amount of Rs. 4,00,000/- as compensation. The Tribunal, as per the impugned award, granted an amount of Rs. 216,127.60 as compensation with interest at the rate of 6% per annum from the date of petition till realisation. 2. This appeal is filed by the 3rd respondent, the insurer raising various contentions to mount challenge against the award. It is contended that the Tribunal went wrong in granting compensation to the first respondent for permanent disability ignoring the fact that the permanent disability had not resulted in her termination from service. At the relevant point of time, the first respondent was working as the Secretary to ## **MACA.No. 2170 of 2005** Thrikkalangode Grama Panchayath. The undisputed position is that despite incurring permanent disability, she continued in service and therefore, there can be no dispute regarding the fact that the accident in question had not actually resulted in loss of earning capacity during her pre-retiral period. The contention is that in such circumstances, the injured/claimant viz., the first respondent would not be entitled to get compensation for permanent disability since the disability and at the same time, in such circumstances, she is entitled only to the compensation for loss of amenities. 3. We are afraid that the aforesaid contention cannot be upheld. True that in the case on hand, the first respondent met with an accident while traveling in a Jeep bearing Registration No.KLW 3242. During the ## **MACA.No. 2170 of 2005** -5- course of journey, it hit on the rear side of a stationary lorry. Consequently, the petitioner sustained injuries and the fact that such injuries resulted in permanent disability is not in dispute. Going by Ext. X1, which is a disability certificate issued by a duly constituted medical Board, the extent of the disability of the petitioner is 20%. As noticed hereinbefore, despite incurring such an extent of permanent disability she continued in service or in otherwords the disability did not result in her termination from service. True that in such circumstances, the petitioner could continue and in fact, continued in service till the age of retirement on superannuation. But the question is : can it be said that in a case where an employee sustained injuries resulting in permanent disability but not in loss of employment, there would not be any reduction of earning capacity and ## **MACA.No. 2170 of 2005** -6- therefore, he/she is not entitled to get compensation. Therefore, we will deal with this issue a little later. 4. Even in the circumstances as above, there can be doubt with respect to the position that after the retirement, permanent disability would show its impact in his/her life. In these days, one cannot think that a retiree will sit idle without pursuing any kind of work. In short, permanent disability may affect the earning capacity would take effect only after retirement. But, even in such eventuality, such a person cannot approach the Tribunal after retirement, seeking for a review of the fixation of the compensation. In such circumstances, while fixing the just compensation, the Court or the Claims Tribunal has to take into consideration all such factors and situations. When a person, in permanent ## **MACA.No. 2170 of 2005** -7- employment sustains injuries in a motor vehicle accident due to the negligence on the part of another for the loss of bodily integrity even if it had not resulted in reduction of earning capacity, certainly that person is entitled to get compensation for loss of his bodily integrity. A Clerk in permanent employment in a department may who is a right hander not lose his employment even if his left hand is amputated as a result of the injuries sustained in a motor vehicle accident. He may be in a position to write smoothly with his right hand even thereafter. How he will be able to handle the records and files. Every now that then he may have to seek the assistance of others for discharging his duties. True that for the deprivation of enjoyment of life he would get compensation under the head 'loss of amenities'. ## **MACA.No. 2170 of 2005** 5. In Oriental Insurance Co.Ltd. v Hariprasad reported in 2005 (4) KLT 977 (FB), a Full Bench of this Court had considered the question whether compensation could be awarded separately on account of permanent disability as also on account of loss of earning capacity. It was answered in the negative. In other words, an injured in a motor vehicle accident who incurred permanent disability could be compensated either for permanent disability or for loss of earning capacity and not for both, reckoning the common factor of disability, certainly in addition to compensation for loss of amenities. 6. In the case on hand, we are actually called upon to consider the question, the manner in which compensation for permanent disability, which had not ## **MACA.No. 2170 of 2005** resulted in loss of earning power, could be assessed in the case of a government employee. Admittedly, in this case, the first respondent who sustained injuries which resulted in permanent disability to the extent of 20% did not lose her employment. Ext. X1 is the disability certificate issued by a duly constituted Medical Board certifying the extent of permanent disability as 20%. There is no challenge against Ext. X1. We have already found that even in such circumstances, the petitioner is entitled to get compensation for permanent disability in addition to compensation for loss of amenities. The only recognized method for calculating compensation for permanent disability is multiplicand-multiplier method. As regards, identification of multiplier the position is settled by the decision of the Apex Court in Sarala Verma v. Delhi Transport Corporation [(2009) 6 SCC 121] and it attained ## **MACA.No. 2170 of 2005** finality with the approval of the dictum laid therein, by a three Judge Bench Decision in Reshma Kumari and Others v. Madan Mohan and Another [(2013) 9 SCC 65] which was followed by yet another three Judge Bench in Munna Lal Jain and Another v. Vipin Kumar Sharma and Others [(2015) 6 SCC 347]. Therefore, the dispute is only with respect to the fixation of multiplicand for the purpose of calculating compensation. 7. The learned counsel appearing for the appellant submitted that when there is no loss of earning power, such an employee would get the same rate of salary or higher rate due to passage of time by grant of increments or on obtaining promotion and in such circumstances, the entire income cannot be taken for the purpose of fixing the multiplicand all throughout. Essentially, the contention is that after retirement an employee would not ## **MACA.No. 2170 of 2005** -11- be getting salary at the same rate as he has been drawing while in service. This can be taken as a general condition for considering the aforesaid question. Certainly, the learned counsel is justified in contending that in a case where the left over period of service, a particular injuredemployee is lesser than the multiplier applicable with reference to his age of the injured fixing monthly income by accepting the entire salary at the time of the accident all throughout would result in oppression to the respondents in view of the fact normally such a person would not be earning the same rate of income after retirement. We will deal with the said issue appropriately. 8. We will firstly consider the question where the left over period of service of an injured/government **MACA.No. 2170 of 2005** employee who incurred permanent disability which is higher than the multiplier applicable with reference to the age at the time of the accident. It is the contention of the learned counsel for the first respondent that Tribunals and Courts used to fix monthly income notionally only in the absence of cogent evidence regarding the income. It is submitted that in a case where there is cogent evidence regarding income, the question of fixation of income notionally would not arise. In elucidation, it is submitted that ignoring cogent evidence regarding income in such circumstances would also result in discrimination. It is submitted that in a case where due to the absence of cogent evidence regarding income, under similar circumstances, for calculating compensation for permanent disability, if the income of the injured is fixed notionally, it would be applied ## **MACA.No. 2170 of 2005** -13- throughout and no further reduction in the multiplicand would be made taking into account the age of that person. If a manual worker sustained injuries in a motor vehicle accident and they resulted in permanent disability, but had not reduced his earning capacity, while fixing the compensation for permanent disability, necessarily, his monthly income has to be fixed notionally. After fixing such monthly income for calculation purpose notionally, the compensation would be quantified in this case by taking into account the proper multiplier applicable and by applying the other relevant factors. In short, no reduction or deduction of the monthly income fixed notionally would be effected. The contention such notionally fixed income would be taken all throughout, without reference to his age. Certainly, age would be looked into for the purpose of identifying the multiplier. ## **MACA.No. 2170 of 2005** -14- The submission is to the effect that in such circumstances, when cogent evidence is available regarding the income of a government servant, that factor shall not be reckoned to his prejudice and it should be taken for calculation purpose calculating compensation under multiplicand multiplier method. Normally, the Tribunal or this Court used to fix the monthly income for calculation purpose notionally only in the absence of cogent evidence regarding income. When there is cogent evidence regarding monthly income, there would not be any justification or purpose for fixing the monthly income notionally. No authority has been brought to our notice laying down a law which is to be followed based on the rules of precedent or by force of the provision under Article 141 of the Constitution of India, to the contrary and to effect deduction of the monthly income even in ## **MACA.No. 2170 of 2005** -15- such circumstances. 9. But in a case where an injured employee in a motor vehicle accident himself files an application for compensation for having sustained injuries in an accident, there would be cogent evidence regarding his/her income and therefore, there is no scope or rather necessity to fix the multiplicand notionally for calculation purpose. In short, the question of notional fixation would arise only in a case where there is absence of a cogent evidence regarding the income. We have already found that the contention that the disability did not result in loss of earning power of such a person cannot be permitted to be advanced to defeat the right of a person who lost his bodily integrity due to the tortious action of another to get compensated for that. So long as that can be quantified ## **MACA.No. 2170 of 2005** -16- only by following the multiplier method, in an application filed under Section 166 of the Act and when cogent evidence is available regarding the income of the personal concerned, there would not be any justification for calculating the same notionally. In short, in such circumstances, the net salary of the said person is less the amount payable towards the income tax and other statutory deductions should be the income to be reckoned for the said purpose. 10. In the said said circumstances, we do not find any justification or reason in the argument by the learned counsel for the insurer. The long and short of the discussion is that in the case of a Government employee who sustained injuries in a motor vehicle accident resulted in permanent disability, sans the impact of ## **MACA.No. 2170 of 2005** -17- reduction of earning power, for the purpose of fixing the multiplicand for calculating compensation for permanent disability, his net salary, in the manner aforesaid shall be taken to fix his monthly income for calculation purpose. 11. Now we will consider the case where an employee in a Government permanent occupation with salary in a time scale, sustained injuries in a motor vehicle accident resulting in permanent disability, but without loss of earning capacity and wherein the multiplier applicable with reference to his age is higher than the left over period of service. How, compensation for permanent disability could be assessed in such circumstances. While deciding the said question, it is relevant to refer to decisions of this Court in Oriental Insurance Company Ltd v. Valsa [2015 (1) KLT 781 and also the decision of yet another Division Bench in Kumaran v. Roy Mathew [2017 ## **MACA.No. 2170 of 2005** -18- ## . (1) KLT 668] 12. While computing compensation in such cases, we are of the considered view that we shall bear in mind the position that an award should be just compensation to the claimant and at the same time, it should not be extravagant or exemplary as relates the respondent. Therefore, in a case where the left over service of a person in permanent employment is less than the multiplier applicable to him with reference to his age, we are of the view that the principle of splitting the multiplier should be applied. But, even in such circumstances, for the left over period in service, the said person is a entitled to get compensation for permanent disability and for that purpose, the multiplicand has to be fixed by taking into account his net income, as held hereinbefore. But, the question is whether the same rate of income should be ## **MACA.No. 2170 of 2005** -19- taken for the balance period. No special wisdom is required to understand that person normally, after his retirement one would not get an income as before. It would not always be desirable to take 50% of the net salary while he was in service for that purpose. In short, we are of the view that in such circumstances for the balance period covered by the multiplier, taking into account the facts and circumstances of each case, a notional fixation of the income has to be made for calculation purpose. 1 13. In the case on hand, the injured was a Secretary to Thrikkalangode Grama Panchayath who sustained injury at the age of 47 years. She was then drawing Rs.8,306/- as monthly income. Admittedly, the injury sustained by her did not result in termination from ## **MACA.No. 2170 of 2005** -20- service and she continued in employment. In other words, there was no loss of earning power. She was granted compensation for disability. She sustained 20% disability going by Ext.X1 disability certificate issued by a duly constituted Medical Board. The grievance raised in this appeal filed by the insurer is that the Tribunal ought not to have granted compensation for disability in view of the admitted position that there was no loss of income or loss of earning power. We have already held that even in such circumstances, a person is entitled to get compensation for the loss of bodily integrity due to the negligence of a motor vehicle accident. 14. The main contention is that since the Tribunal had not taken into account the aforesaid aspect, the compensation granted to the petitioner is exorbitant. ## **MACA.No. 2170 of 2005** -21- While considering the question whether what was granted to the petitioner as compensation is exorbitant warranting appellate interference, certain crucial aspects have to be taken into account. On perusal of the impugned award would reveal that for the purpose of fixing the compensation for disability, the entire monthly income of the appellant was not taken into account. What taken into account was only to 2/3rd of the income. The multiplier applicable with reference to the age of the injured/respondent, at the time of the accident, is 13. Evidently, at the time of the accident, she was left with 8 years service. In the light of our decision, the appellant was entitled to get compensation for permanent disability by adopting the split multiplier. But at the same time, for 8 years service, the multiplicand ought to have been taken with reference to the income which she was getting, in the ## **MACA.No. 2170 of 2005** -22- manner aforesaid. A notional fixation or any deduction from her salary ought to have been made only for the remaining period which for 5 years. As noticed hereinbefore, in this case for the entire period covered by the multiplier, only 2/3rd of the income of her salary was taken into account. 15. In such circumstances, we are of the considered view that the compensation granted to the petitioner cannot be said to be exorbitant warranting appellate interference. The first respondent has not filed an independent appeal or a cross objection, seeking enhancement of quantum of compensation. In the light of the said situations obtained, we are of the view that this appeal is devoid of any merit and therefore, it is liable to dismissed. Accordingly, this appeal is dismissed. ## **MACA.No. 2170 of 2005** Before parting with the case, we deem it only appropriate to express our appreciation of the able assistance rendered by Adv.Sri.Sheji P.Abraham. The tenacity with which he assisted this Court on being appointed as an amicus curiae to decide this matter, is really appreciable and we acknowledge it. **JUDGE** **Sd/- B. SUDHEENDRA KUMAR, JUDGE** Scl/ani/21/5/2019 /true copy/