THE HON'BLE SRI JUSTICE B. SESHASAYANA REDDY AND THE HON’BLE SRI JUSTICE P.DURGA PRASAD MACMA No.848 of 2007 Date:25th February, 2011 Between: The New India Assurance Co. Ltd., rep. by its Divisional Manager, Tanuku. ... Appellant a n d 1. Vemuri Gopala Krishna & Ors. … Respondents *** THE HON'BLE SRI JUSTICE B. SESHASAYANA REDDY AND THE HON’BLE SRI JUSTICE P.DURGA PRASAD MACMA No.848 of 2007 JUDGMENT: (Per Hon’ble Sri Justice B.Seshasayana Reddy) This appeal is directed against the order dated 24.07.2006 passed in O.P.No.604 of 2004 on the file of the Chairman, Motor Vehicle Accidents Claims Tribunal (District Judge), Eluru, West Godavari District, (for short, ‘the Tribunal’), whereby and whereunder the learned Chairman of the Tribunal allowed the O.P. in-part and granted compensation of Rs.14,85,000/- with interest at 7.5% p.a. from the date of petition till the date of realisation. 2. The 1st respondent is the claimant in O.P.No.604 of 2004. He filed the O.P. under Section 166 of the Motor Vehicles Act and Rule 455 of the A.P. Motor Vehicle Rules claiming compensation of Rs.15,00,000/- for the injuries sustained by him in the accident occurred on 20.05.2004. He was aged 28 years and was a contractor earning Rs.20,000/- per month. On 20.05.2004 at about 8.00 A.M. he was returning from Saibaba temple on a cycle. On reaching Vinayaka temple situated at Tadepalligudem-Eluru road, a lorry bearing No.AP 37 U 7765 driven by Chintagunta Naveen Babu in a rash and negligent manner, dashed the cycle, as a result, the cyclist/claimant fell on the road and the lorry ran over the right portion of his body. His right leg and right hand got badly damaged. He was shifted to Government Hospital, Tadepalligudem for treatment and from there to Vamsi Hi-Tech Super Speciality Hospital and Research Institution in Tanuku. His right hand upto upper 1/3rd got amputated and steel rods came to be inserted in his right thigh. He underwent various surgeries. He claimed compensation of Rs.15,00,000/- under various heads. The 1st respondent being the driver, the 2nd respondent being the owner and the 3rd respondent being the insurer of the offended vehicle are liable to pay the compensation. The owner and the driver of the offended vehicle remained ex parte before the Tribunal. The insurer filed written statement resisting the claim of the claimant. The sum and substance of the written statement of the insurer is that the claim made by the claimant is excessive. The offended vehicle had no valid registration certificate, fitness certificate and other necessary documents. The Tribunal framed the following issues for trial: 1) Whether the accident occurred due to rash and negligent driving of the auto bearing No.AP 37 U 7765 driven by its driver-the 1st respondent? 2) Whether the petitioner is entitled to claim any compensation? if so, to what amount and against which of the respondents? 3) To what relief? On behalf of the claimant, he got himself examined as PW.1 and examined four more witnesses as PWs.2 to 5 and marked 13 documents as Exs.A1 to A13. On behalf of the insurer, except marking copy of the Insurance Policy as Ex.B1, no ocular evidence was adduced. The Tribunal, on considering the evidence brought on record and on hearing the counsel appearing for the parties, came to the conclusion that the accident occurred due to rash and negligent driving of the driver of the offended vehicle and that the claimant is entitled to the compensation of Rs.14,85,000/- along with interest at 7.5% p.a. from the date of petition till the date of realisation and accordingly, allowed the O.P. in part, by order dated 24.07.2006. Hence, this appeal by the insurer. 3. Heard learned counsel appearing for the appellant/insurer and learned counsel appearing for the 1st respondent/claimant. 4. Learned counsel appearing for the appellant/insurer submits that the Tribunal assessed the annual income of the claimant at Rs.1,50,000/- without there being any basis and therefore, the compensation awarded by the Tribunal is required to be reduced considerably. Learned counsel took us to the evidence of PW.1. 5. Learned counsel appearing for the 1st respondent/claimant submits that the 1st respondent/claimant was a contractor and because of amputation of his right hand upto upper 1/3rd, he lost his total earning capacity and therefore, the Tribunal awarded Rs.14,85,000/- as compensation and the same is just and proper, in which case, it is not required to be interfered with in this appeal. 6. The only issue that calls for adjudication in this appeal is, whether the quantum of compensation granted by the Tribunal is just and proper? 7. The provision of the Motor Vehicles Act, 1988 (“the Act”, for short) makes it clear that the award must be just, which means that compensation should, to the extent possible, fully and adequately restore the claimant to the position prior to the accident. The object of awarding damages is to make good the loss suffered as a result of wrong done as far as money can do so, in a fair, reasonable and equitable manner. The Court or the Tribunal shall have to assess the damages objectively and exclude from consideration any speculation or fancy, though some conjecture with reference to the nature of disability and its consequences, is inevitable. A person is not only to be compensated for the physical injury, but also for the loss which he suffered as a result of such injury. This means that he is to be compensated for his inability to lead a full life, his inability to enjoy those normal amenities which he would have enjoyed but for the injuries, and his inability to earn as much as he used to earn or could have earned. 8. The head under which compensation is awarded in personal injury cases are the following: Pecuniary damages (Special damages) (i) Expenses relating to treatment, hospitalization, medicines, transportation, nourishing food, and miscellaneous expenditure. (ii) Loss of earnings ( and other gains) which the injured would have made had he not been injured, comprising: (a) Loss of earning during the period of treatment; (b) Loss of future earnings on account of permanent disability. (iii) Future medical expenses. Non-pecuniary damages (General damages) (iv) Damages for pain, suffering and trauma as a consequence of the injuries. (v) Loss of amenities (and/or loss of prospects of marriage) (vi) Loss of expectation of life (shortening of normal longevity) 9. In routine personal injury cases, compensation will be awarded only under heads (i), (ii)(a) and (iv). It is only in serious cases of injury, where there is specific medical evidence corroborating the evidence of the claimant, that compensation will be granted under any of the heads (ii)(b), (iii), (v) and (vi) relating to loss of future earnings on account of permanent disability, future medical expenses, loss of amenities (and/or loss of prospects of marriage) and loss of expectation of life. 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 earning capacity. The tribunal should not mechanically apply the percentage of permanent disability as the percentage of economic loss or loss of earning capacity. In most of the cases, the percentage of economic loss, that is, the percentage of loss of earning capacity, arising from a permanent disability will differ from the percentage of permanent disability. 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 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). 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 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. 12. 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 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. It is not in dispute that PW.1 sustained amputation of his right hand upto upper 1/3rd. Indisputably, the claimant has not placed on record any material to substantiate his contention that he was earning Rs.1,50,000/- p.a. There is no basis for the Tribunal to fix the annual income of the 1st respondent/claimant at Rs.1,50,000/-. However, a suggestion was put to PW.1 by the insurer that he was earning Rs.40,000/- to Rs.50,000/- p.a. Therefore, the annual earnings of the 1st respondent/claimant can be taken at Rs.50,000/-. His disability has been assessed at 60%. Therefore, the annual loss of earnings can be arrived at Rs.50,000/- x 60/100=Rs.30,000/-. He was aged about 28 years as on the date of accident. The proper multiplier as per Sarla Verma v. DTC[1]’s case, is 17. Thus, the total loss of earnings comes to Rs.5,10,000/-. The 1st respondent/claimant incurred medical expenses of Rs.1,34,992.91 ps., which is evidenced by Ex.A5 bunch of medical bills. The Tribunal considered the said medical bills and awarded Rs.1,35,000/- which we were not inclined to interfere. Since the 1st respondent/claimant suffered amputation of right hand, we deem it appropriate to grant Rs.15,000/- towards pain and suffering; Rs.25,000/- towards the cost of artificial hand and Rs.25,000/- towards loss of prospects of marriage. In all the 1st respondent/claimant is entitled to Rs.7,10,000/-. 14. Accordingly, the appeal is partly allowed reducing the compensation from Rs.14,85,000/- to Rs.7,10,000/- with interest at the rate of 7.5% p.a. No order as to costs. _________________________ B. SESHASAYANA REDDY, J. ___________________ P.DURGA PRASAD, J. Date:25th February, 2011. cs THE HON'BLE SRI JUSTICE B. SESHASAYANA REDDY AND THE HON’BLE SRI JUSTICE P.DURGA PRASAD MACMA No.848 of 2007 (Judgment of the Division Bench delivered by Hon’ble Sri Justice B.Seshasayana Reddy) Date:25th February, 2011 [1] (2009) 6 SCC 121