Whether it is duty of respondent in motor accident claim petition to prove that victim could make up for the loss of income by changing his vocation or by adopting another means of livelihood?

 Any scaling down of the compensation should require something more tangible than a hypothetical conjecture that notwithstanding the disability, the victim could make up for the loss of income by changing his vocation or by adopting another means of livelihood. The party advocating for a lower amount of compensation for that reason must plead and show before the Tribunal that the victim enjoyed some legal protection (as in the case of persons covered by the Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995) or in case of the vast multitude who earn their livelihood in the unorganised sector by leading cogent evidence that the victim had in fact changed his vocation or the means of his livelihood and by virtue of such change he was deriving a certain income. {Para 13}

IN THE SUPREME COURT OF INDIA

Civil Appeal No. 2567 of 2020

Decided On: 17.09.2020

Pappu Deo Yadav Vs. Naresh Kumar and Ors.

Hon'ble Judges/Coram:

L. Nageswara Rao, Krishna Murari and S. Ravindra Bhat, JJ.

Author: S. Ravindra Bhat, J.

Citation:  MANU/SC/0696/2020, AIR 2020 SUPREME COURT 4424, AIRONLINE 2020 SC 733.

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Bombay HC: Multiplier method is to be used to quantify the loss of income as a result of death or permanent disability suffered in an accident.

  A useful reference in this context can be made in the Judgment of the Supreme Court in the case of Sandeep Khanuja V. Atul Dande and Another MANU/SC/0108/2017 : 2017, SCC 351wherein the Supreme Court, after adverting to the previous pronouncements, observed that it is now well settled principle repeatedly stated and re-stated time and again by the Supreme Court that in awarding compensation the multiplier method is logically sound and legally well established. This method, known as "principle of multiplier" has been evolved to quantify the loss of income as a result of death or permanent disability suffered in an accident. {Para 17}

IN THE HIGH COURT OF BOMBAY

First Appeal No. 2144 of 2011

Decided On: 04.01.2022

Hareshwar Harischandra Mistry Vs. Pravin B. Nayak and Ors.

Hon'ble Judges/Coram:

N.J. Jamadar, J.

Citation:  MANU/MH/0012/2022.

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Bombay HC: Claimant Entitled to compensation for Future Loss Of Income Proportionate To Extent Of Disability Though There Is No Total Loss Of Income

13. B] Loss of future earnings:-

The tribunal was of the view that since the Income Tax return for the period ending 31st March, 1997 (Exh. 45) indicated that there was no loss of income reported, despite disability, the applicant did not suffer any loss of income. Opining that mere disability was not sufficient, the tribunal proceeded to award a sum of Rs. 50,000/- towards the disability. Whether this approach of the tribunal is justifiable?

14. First and foremost, the tribunal seems to have committed an error in appreciating the facts. The accident had occurred on 27th December, 1996. The income tax return was filed for the period of 1st April 1996 to 31st March, 1997. Almost 9 months income was reported by the applicant. In that view of the matter, the claim of the applicant could not have been discarded on the ground that no loss of income was reported as the applicant could earn for the substantial part of the financial year.

15. Secondly, from the perusal of the deposition of the applicant, it becomes evident that the claim of the applicant that on account of the injuries sustained in the accident he was unable to squat, run, sit cross legged, and the movements of his right leg were restricted, went unchallenged. The applicant further affirmed that he was doing the business of fabrication and civil contractor. Post accident, he could not do the said business and was forced to seek employment at a salary of Rs. 6,500/- per month. This claim of the applicant was also not traversed during the course of the cross examination.

16. It is true that the applicant did not claim that he suffered total loss of income. Nor the applicant claimed that he was incapacitated to perform any work. In the face of the material on record to indicate that the applicant had filed income tax return for the financial year 1996-97, it could not have been disputed that the applicant was gainfully self employed. In such circumstances, even assuming the notional income at Rs. 5,000/- per month, the 20% permanent disability suffered by the applicant, would have entailed, in the minimum, corresponding 20% loss of income, resulting in the loss of Rs. 12,000/- per annum. Once, the annual loss of income is determined, the appropriate method to arrive at just compensation is multiplying the said multiplicand with appropriate multiplier, depending upon the age of the claimant.

IN THE HIGH COURT OF BOMBAY

First Appeal No. 2144 of 2011

Decided On: 04.01.2022

Hareshwar Harischandra Mistry Vs. Pravin B. Nayak and Ors.

Hon'ble Judges/Coram:

N.J. Jamadar, J.

Citation:  MANU/MH/0012/2022.

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Supreme court: In cases of permanent disablement caused by a motor accident, the claimant is entitled to future prospects

FUTURE PROSPECTS

17. The High Court has not applied the quantum for future prospect in the compensation granted. In its reasoning, the High Court has stated that the Income tax returns relied upon by the Appellant show that despite the injury the Appellant's income had subsequently increased and hence it cannot be said that there is a loss of future earnings.

18. It is a well settled position of law that in cases of permanent disablement caused by a motor accident, the claimant is entitled to not just future loss of income, but also future prospects. It has been reiterated by this Court in multiple instances that "just compensation" must be interpreted in such a manner as to place the claimant in the same position as he was before the accident took place.

19. The accident that caused the injury took place on 12.06.2009. The acknowledgement of both the Income Tax Returns produced by the Appellant show that Tax Returns were till 31.03.2008 and 31.03.2009. Both the Income Tax Returns produced as proof of income were from before the accident took place, and hence the High Court's finding that the income of the Appellant has increased after the disability is incorrect.

20. It is also to be noted that even if the income of the Appellant had increased after the accident, it would not be enough grounds to disable the Appellant from claiming compensation for future prospect as the rise in income may be attributed to multiple other factors.

21. In light of National Insurance Co. Limited v. Pranay Sethi and Ors. MANU/SC/1366/2017 : (2017) 16 SCC 680, the applicable 40% addition of future prospects will be given as compensation to the Appellant herein.

IN THE SUPREME COURT OF INDIA

Civil Appeal Nos. 9070-9071 of 2022.

Decided On: 09.12.2022

Mohd. Sabeer Vs. Regional Manager, U.P. State Road Transport Corporation

Hon'ble Judges/Coram:

Krishna Murari and S. Ravindra Bhat, JJ.

Author: Krishna Murari, J.

Citation:  MANU/SC/1597/2022, 2022 SCCONLINE 1701.

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