AGK IN IN IN THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL CIVIL CIVIL APPELLATE JURISDICTION APPELLATE JURISDICTION APPELLATE JURISDICTION FIRST FIRST FIRST APPEAL NO.1887 OF 2007. APPEAL NO.1887 OF 2007. APPEAL NO.1887 OF 2007. The Manager, The Oriental Insurance Co Ltd., Branch Fonda Ghat (Sindhudurg). ...Appellant Versus. Shri Abhinandan Suresh Shete & Ors. ...Respondents --- Shri S.S.Vidyarathi for the Appellant. Shri N.J.Patil for the Respondent No.1. --- CORAM CORAM CORAM : ABHAY S.OKA, J. : ABHAY S.OKA, J. : ABHAY S.OKA, J. DATED DATED DATED : 30th JANUARY, 2008. : 30th JANUARY, 2008. : 30th JANUARY, 2008. JUDGMENT: JUDGMENT: JUDGMENT: 1. Heard the learned counsel appearing for the appellant and the learned counsel appearing for the 1st respondent. The challenge by the appellant-insurance company is to the judgment and award dated 21st March, 2006 passed by the learned Member of the Motor Accident Claims Tribunal, Sangli. The first respondent is the original claimant who filed a claim petition under section 166 of the Motor Vehicles Act, 1988 (hereinafter referred to as the said Act). 2. On 13th January, 1997 the first respondent was travelling alongwith his friend by a scooter. After completing the work at Kolhapur they were coming back towards Miraj. The first respondent was driving scooter : 2 : 2 : 2 : and his friend was on the pillion seat. Near Herle, a jeep came in a fast speed. Noticing the jeep, the first respondent reduced the speed. However, jeep gave a dash to the scooter. After giving a dash to the scooter, the jeep dashed against a wall of the nearby bridge. 3. The first respondent sustained serious injuries including a fracture of skull. He was unconscious. He was admitted in Mission hospital at Miraj for a period of 15 days. He was advised rest for a period of five months. In the claim petition an allegation was made by the first respondent that the driver of the jeep was driving the vehicle in a rash and negligent manner. The jeep was insured with the appellant on the date of the accident. 4. The Tribunal held that the driver of the jeep was negligent. Compensation of Rs.2,60,000/- was awarded by the Tribunal. The Tribunal awarded interest at the rate of 12% per annum form the date of institution of the claim petition till the realisation of the compensation amount. 5. The learned advocate for the appellants submitted that the compensation awarded by the Tribunal is exorbitant. Infact, he submitted that the compensation awarded on all counts is on higher side. : 3 : 3 : 3 : He placed reliance on various decisions of the Apex Court for contending that the interest at the rate of 12% per annum awarded by the Tribunal is on the higher side. He placed reliance on a decision of the Apex Court in the case of New India Assurance Co Ltd. Vs. Smt Kalpana and others [2007 (1) T.A.C. 795 (S.C.)]. He also placed reliance on decision of the Apex Court in the case of New Indian Assurance Company Ltd Vs. Charlie and another (2005 ACJ Page 1131). He submitted that considering the trend of latest judgments of the Apex Court, the rate of interest could not have exceeded 7.5% per annum. 6. The learned counsel appearing for the first respondent supported the impugned judgment and award by contending that there was every justification for grant of interest at the rate of 12% per annum. He submitted that infact compensation granted is on the lower side. He submitted that no interference was called for. 7. In so far as injuries sustained by the first respondent are concerned, in paragraph No.24 of the judgment the Tribunal has held thus: "24. Now it is necessary to turn towards the evidence of Dr.Dipak Kamle (A.W.5). His evidence is at Exhibit 58. His evidence goes : 4 : 4 : 4 : to show that on 13/1/1997 applicant was admitted in Mission Hospital. He was having two injuries on his person. (1) CLW frontal region, 15 X 1 X 1 cm, injury was grievous, clinically fracture of right frontal bone and (2) CLW right leg, upper 1/3rd of tibia, posterior aspect 10 X 1 X 1 cm, injury was simple. According to him there was injury to his brain subarchoid hemorrhage. There was scanning of said patient in hospital. There was fracture of frontal bone involving frontal signs, fracture of right zygoma bone, fracture of gretal wing of spheroid bone. According to him Dr.S.M.Kulkarni issued certificate. Dr.Kulkarni was neuro surgeon. Said certificate is at Exhibit 59. Injury certificate is at Exhibit 60 and case papers are at Exhibit 61. According to him if there is brain injury then consequences of brain injury will follow for some time. In cross examination he admitted that when patient was in hospital he has provided treatment to him. He admitted that there is likelihood of complications of loosing memory, weakness, behavioural changes, epilepsy attacks etc. According to him if there is regular consumption of tablets, then there is : 5 : 5 : 5 : possibility to avoid such type of complications". In paragraph No.25 of the judgment the Tribunal accepted the aforesaid evidence adduced by the first respondent. 8. The Tribunal found that due to the skull injury sustained by the first respondent he suffered from hypertension, nervousness, cervical spondilitis etc. The Tribunal found that documents showing expenditure of Rs.18,893/- on medical treatment were produced by the first respondent. Therefore, on account of hospital and medicine charges, the Tribunal granted compensation of Rs.19,000/-. Considering the hospitalisation for 15 days, a sum of Rs.10,000/- has been granted on account of charges of attendant, special diet, expenses on conveyance incurred by the family members etc. 9. Considering the aforesaid injuries, the Tribunal awarded a sum of Rs.25,000/- on account of pain and suffering. The said amount is obviously very reasonable. The Tribunal accepted the evidence of the first respondent which shows that lifelong he will be required to spend a sum of Rs.450/- to Rs.500/- per month on medicines. The Tribunal accepted the evidence of the medical practitioners and came to the conclusion that the first respondent will have to be continuously : 6 : 6 : 6 : on medication. Taking the yearly expenses on medicines at Rs.6,000/- after applying multiplier of 16, a sum of Rs.96,000/- has been awarded by the Tribunal. Considering the age of the first respondent, multiplier of 16 has been adopted. Record shows that the age of the first respondent at the time of accident was 29 years. It must be stated here that the Tribunal has taken the fixed amount of Rs.500/- per month without taking into consideration the possibility of rise in prices of the medicine in future. Therefore, on this count a sum of Rs.96,000/- has been awarded. The evidence of Dr.Kulkarni disclosed that the first respondent is required to undergo at least one more surgery in future. On that count a sum of RS.10,000/- have been awarded. 10. On the basis of a licence granted under the Bombay Shops and Establishments Act, 1948 and other documents, the Tribunal accepted the case made out by the first respondent that he was running a shop under the name and style of M/s.Dhanalaxmi Medical and General Stores. The Tribunal has taken reasonable monthly income of Rs.5,000/-. The Tribunal accepted the case of the first respondent that he was required to keep shop closed for a period of 5 months during which he was under treatment. Thus, on account of actual loss of earning only a sum of Rs.25,000/- has been awarded. : 7 : 7 : 7 : 11. The appellant suffered a fracture of the skull. As a result of the injuries sustained, his movements have become restricted and he is not able to stand for a longer time. Only a sum of Rs.75,000/- has been awarded on account of loss of income. Thus, the total amount of Rs.2,60,000/- has been fixed by way of compensation. It is very difficult to find fault with the quantum of compensation fixed by the Tribunal. 12. The learned advocate for the appellant has relied upon judgments of the Apex Court where interest awarded on compensation amount is at the rate of 6% per annum or 7.5% per annum. Reliance is placed on the decision of the Apex Court in the case of New India Assurance Company Ltd Vs. Charlie and another where in a case of the accident of the year 1997, interest at the rate of 7.5% has been awarded. The submission is that as per the trend in the latest judgments of the Apex Court, the rate of interest cannot exceed 7.5% per annum. In this behalf it will be necessary to refer to the decision of the Apex Court in the case of Abati Bezbaruah Vs. Deputy Director General, Geological Survey of India and another [(2003) 3 Supreme Court Cases 148]. In the said case where the accident was of the year 1990 the Apex Court fixed the rate of interest at 9% per annum. In paragraph No.6 of the said : 8 : 8 : 8 : decision, the Apex Court held that the question as to what should be the rate of interest is dependent upon the facts and circumstances of each case. The Apex Court held that normally interest will have to be computed by taking into consideration the bank rate prevailing at the relevant time. The Apex Court further observed that section 171 of the said Act gives a discretion to the Tribunal as regards fixation of the rate of interest. It was further held that the fixation of the rate of interest depends on facts of each case and relevant factors such as inflation and the policy of Reserve Bank of India from time to time. The Tribunal has to also consider the time required for disposal of the case, the nature of the permanent injuries suffered by the victim. 13. It is not axiomatic that in every claim petition of the year 1997 onwards interest at the rate of 7.5% deserves to be awarded. It is true that the interest at the rate of 12% per annum awarded by the Tribunal is extremely on the higher side considering the bank rates of interest prevailing in the year 1997 onwards. It must be stated here that we are dealing with a case where the claimant suffered fracture of skull and consequently an injury to the brain. The accident is of the year 1997. The claim petition was filed on 11th July, 1997 and was decided on 24th March, 2006. Though : 9 : 9 : 9 : in 1997 rates of interest were on the lower side, during the last couple of years the rates of interest have gone up. This is a case where the first respondent is going to suffer lifelong due to injuries sustained in the accident. The estimation of the income of the first respondent made by the Tribunal is very conservative considering that the first respondent was running a medical and general shop. If all these factors are considered, though interest at the rate of 12% cannot be sustained, the rate of interest will have to be fixed at 9% per annum and to that extent the impugned award will have to be modified. 14. Hence, I pass the following order: (i) The impugned judgment and award is modified only to the extent that interest payable will be at the rate of 9% per annum instead of 12% per annum as provided in clause No.3 of the operative part of the impugned judgment and award. (ii) There will be no order as to costs. Judge. Judge. Judge.