SAGAR v. Location: HIGH

12. Per contra, learned counsel for respondent No.2/ Insurance Company, submits that the Tribunal has assessed the compensation appropriately and there is no need for reconsideration of the same. He submits that the disability considered by the Tribunal at 10% cannot be interfered with, since the petitioner solely relies on the Disability Certificate at Ex.P12 to establish that he suffers from disability of 51%. There being no material on record to show the functional disability, there should have been material to show the hemiparesis and such other disability. Therefore, the contentions of the petitioner regarding hemiparesis, loss of hearing in the left ear cannot be accepted. He further contends that the adoption of the ratio laid down in Master Mallikarjun's case (supra) by the Tribunal is justifiable and therefore, the appeal is 4 2013 SCW 5037 - 10 - NC: 2025:KHC-K:3234 MFA No. 201430 of 2023 HC-KAR bereft of any merits. He further submitted that the judgment of the Apex court in Kishan Gopal's case (supra) considers the annual notional income of Rs.30,000/- in respect of the minors. Such notional income having been adopted by the Apex Court has to be followed, but he would distinguish the judgments of Master Mallikarjun and Kumari Kiran through her father Vs. Sajjan Singh and others5, on the ground that these judgments do not adhere to notional income criteria which was used by the Apex Court in the case of Kishan Gopal (supra). Therefore, he submits that the method used by the Apex Court in the case of Kishan Gopal is to be followed.

13. The above submissions by both the sides raise the following aspects to be considered in this appeal: (A) Since the petitioner was a minor on the date of the accident, which method of calculation of compensation is to be adopted? (B) What is the disability suffered by the petitioner and what is the quantum of compensation? 5 (2015) 1 SCC 539 - 11 - NC: 2025:KHC-K:3234 MFA No. 201430 of 2023 HC-KAR Re.Point No.(A)

14. The calculation of the compensation in respect of injuries to a minor was the subject matter of a catena of decisions by the Apex court. What is required to be determined by the Tribunal is just and reasonable compensation for the injuries suffered by him/her in the road traffic accident. The method of calculation gets complicated as the future of the minor is not known. The imponderables of the career of a minor pose a difficult situation for the Tribunals, for, the compensation can be awarded only once. The calculation of the compensation involves (a) determination of the notional income, (b) selecting appropriate multiplier and (c) in what circumstances future prospects is to be added. (a) Notional Income of Minors.

15. The Apex Court has adopted a compensation depending on the nature of the injury and the disability suffered by the minor in the initial years. - 12 - NC: 2025:KHC-K:3234 MFA No. 201430 of 2023 HC-KAR Later, it seems, the compensation is related to the age, the nature of the injuries suffered and the formulae laid down in the Schedule to the Motor Vehicles Act. An effort was made to iron out the anomalies that may creep into the method of calculation and the difficulty to adopt standard formulae to all the cases. It is in this back ground, the method of calculation of compensation for an injury suffered by the minor has to be considered.

16. There are catena of judgments concerning the assessment of the compensation concerning the minors, which show the development of the law in this regard. They are as below: (a) In the case of Sapna vs. United India Insurance Company Limited and another6, the Apex Court adopted Schedule II of M.V. Act, and calculated the compensation of a 12 year old minor by adopting the Multiplier of 15. It was observed as below: 6 (2008) 7 SCC 613 - 13 - NC: 2025:KHC-K:3234 MFA No. 201430 of 2023 HC-KAR "2. What should be the fair and adequate compensation for permanent disability suffered by a twelve-year-old girl in an accident involving a motor vehicle is the question involved herein. On 3-9- 1999, at about 10.00 a.m., Sapna, while going to a temple, was hit by a “jeep”, used as a taxi. She was dragged along with the jeep to a distance of about 15-20 ft. She suffered compound fracture of left knee and dislocation of patella/bone of left knee and skin and muscles above and below came out and veins got cut and knee got completely damaged and bones of left leg became bare due to tearing of skin and flesh and left leg bent at 90 degree at knee as a result whereof she has become crippled and completely disabled to walk. The skin of right leg from thigh to ankle was also peeled off resulting in serious wounds.

8. The principles governing a claim petition for assessing the damages in case of bodily injury suffered is that while awarding the compensation, the Tribunal should consider all relevant factors so as to enable the insured to be put in the same position as if he had not sustained any injury. The principle of restitutio in integrum may be applied in a case of this nature. Pecuniary loss and non- pecuniary loss are required to be pressed under - 14 - NC: 2025:KHC-K:3234 MFA No. 201430 of 2023 HC-KAR certain heads. So far as the pecuniary loss is concerned, the same can be ascertained. What is required to be done is a balancing act by awarding such sum which, on the one hand, shall take care of the loss suffered by the claimant for the present time and future pecuniary benefits and, on the other, pecuniary advantages which from whatever source comes to them by reason of such injuries. So far as non-pecuniary loss is concerned, the same has to be assessed broadly under certain heads, namely, damages for physical pain, mental suffering, etc. besides the amount spent on medical treatment, if any.

10. The principle that is to be applied in a case of this nature that the amount of compensation should be just and fair is not in dispute. What would, however, be just and fair amount of compensation is required to be determined having regard to the facts and circumstances of the case involved. In given cases, the courts may deviate from the structured formula. In terms of the Second Schedule, where the deceased or injured were not having any income, the statute presumes an income of or about Rs 15,000 per month. If having regard to the age of the appellant, the multiplier of 15 is applied, a sum of Rs 2,25,000 would be payable. Besides the said - 15 - NC: 2025:KHC-K:3234 MFA No. 201430 of 2023 HC-KAR sum, not only some amount of compensation should be awarded under the heading of mental agony but also some provision should be made for future treatment.” (b) In the case of Priya Vasant Kalgutkar vs. Murad Shaikh and another,7 also, the Apex Court adopted Schedule II of the M.V. Act by observing as below: "5. Indisputably, the appellant was a child at that time. She had no earning. What amount could be awarded towards future loss of earning or prospective loss of earning could not have been determined on the basis of any legal principle. Compensation for the injuries suffered by a person in a motor vehicle accident can be determined either on the basis of the actual damages suffered or upon application of the structured formula. Although for the purpose of invoking the provisions of Section 163-A of the Act, a legal principle may be found in the Second Schedule thereof.” (c) In the case of Master Mallikarjun vs. Divisional Manager, National Insurance Co. Ltd. and another, [(2014) 14 SCC 396], the Apex Court laid down a fixed 7 (2009) 15 SCC 54 - 16 - NC: 2025:KHC-K:3234 MFA No. 201430 of 2023 HC-KAR compensation formula which is relatable to the percentage of disability suffered by the minor. It was held as below: "9.Sapna v. United India Insurance Co. Ltd. [(2008) 7 SCC 613] is the case of a 12 year old girl who suffered 90% disability in her left leg. This Court granted a lump sum amount of Rs 2,00,000 on these heads.

10. In Iranna v. Mohammadali Khadarsab Mulla [2004 ACJ 1396 (Kar)], a Division Bench of the Karnataka High Court granted an amount of Rs 4,00,000 on these heads to the child who suffered 80% permanent disability.

11. In Michael v. Oriental Insurance Co. Ltd. [(2013) 14 SCC 774], this Court considered the case of an eight year old child suffering a fracture on both legs with total disability only to the tune of 16%. It was held that the child should be entitled to an amount of Rs 3,80,000 on these counts.

12. Though it is difficult to have an accurate assessment of the compensation in the case of children suffering disability on account of a motor vehicle accident, having regard to the relevant factors, precedents and the approach of various High Courts, we are of the view that the appropriate compensation on all other heads in - 17 - NC: 2025:KHC-K:3234 MFA No. 201430 of 2023 HC-KAR addition to the actual expenditure for treatment, attendant, etc. should be, if the disability is above 10% and up to 30% to the whole body, Rs 3 lakhs; up to 60%, Rs 4 lakhs; up to 90%, Rs 5 lakhs and above 90%, it should be Rs 6 lakhs. For permanent disability up to 10%, it should be Rs 1 lakh, unless there are exceptional circumstances to take a different yardstick." (d) In the case of Kishan Gopal (supra), the Apex Court held that though Schedule II of the M.V. Act, prescribes Rs.15,000/- per annum as the notional income, much water having flown after the said Schedule was introduced in the year 1994, there is a need for reconsidering the same and held that such income has to be considered at Rs.30,000/- per annum. It was observed as below: "38. In our considered view, the aforesaid legal principle laid down in Lata Wadhwa v. State of Bihar, [(2001) 8 SCC 197] with all fours is applicable to the facts and circumstances of the case in hand having regard to the fact that the deceased was 10 years old, who was assisting the - 18 - NC: 2025:KHC-K:3234 MFA No. 201430 of 2023 HC-KAR appellants in their agricultural occupation which is an undisputed fact. We have also considered the fact that the rupee value has come down drastically from the year 1994, when the notional income of the non-earning member prior to the date of accident was fixed at Rs 15,000. Further, the deceased boy, had he been alive would have certainly contributed substantially to the family of the appellants by working hard.

39. In view of the aforesaid reasons, it would be just and reasonable for us to take his notional income at Rs 30,000 and further taking the young age of the parents, namely, the mother who was about 36 years old, at the time of accident, by applying the legal principles laid down in Sarla Verma v. DTC [(2009) 6 SCC 121], the multiplier of 15 can be applied to the multiplicand. Thus, 30,000 × 15 = 4,50,000 and 50,000 under conventional heads towards loss of love and affection, funeral expenses, last rites as held in Kerala SRTC v. Susamma Thomas [(1994) 2 SCC] , which is referred to in Lata Wadhwa case [ (2001) 8 SCC 197] and the said amount under the conventional heads is awarded even in relation to the death of children between 10 to 15 years old. In this case also we award Rs 50,000 under conventional heads. In our view, for the aforesaid - 19 - NC: 2025:KHC-K:3234 MFA No. 201430 of 2023 HC-KAR reasons the said amount would be fair, just and reasonable compensation to be awarded in favour of the appellants.” (e) In the case of Kumari Kiran through her father vs. Sajjan Singh and others,[(2015)1 SCC 539] the Apex Court followed the method of calculation of compensation as laid down in the case of Master Mallikarjun (supra) and observed as below: "14. Hence, this Court in accordance with the principles laid down by this Court in Mallikarjun case [ (2014) 14 SCC 396] , and after examining the facts, evidence on record and circumstances of the case on hand, we deem it fit and proper to award Rs 3,00,000 towards permanent disability of the appellant minors viz. Kumari Kiran and Master Sachin, since they have suffered 30% and 20% permanent disability respectively, due to the shortening of their right legs by one inch after the injuries sustained in the motor accident. Further, upon considering the age of appellant minors, they have a long journey ahead of them in their lives, during which they along with their parents will have to endure an immeasurable amount of agony and uncertain medical expenses due to this motor - 20 - NC: 2025:KHC-K:3234 MFA No. 201430 of 2023 HC-KAR vehicle accident. Thus, based on the principles laid down in the above case, we award Rs 25,000 each towards agony to parents and Rs 25,000 each towards future medical expenses." (f) Thereafter, in the case of Kajal vs. Jagdish Chand and others,8 observing that the income of Rs.15,000/- per annum being grossly inadequate, it was held that the income as per the Minimum Wages Act has to be considered. The relevant paragraphs are reproduced below: "20. Both the courts below have held that since the girl was a young child of 12 years only notional income of Rs 15,000 p.a. can be taken into consideration. We do not think this is a proper way of assessing the future loss of income. This young girl after studying could have worked and would have earned much more than Rs 15,000 p.a. Each case has to be decided on its own evidence but taking notional income to be Rs 15,000 p.a. is not at all justified. The appellant has placed before us material to show that the minimum wages payable to a skilled workman is Rs 4846 per month. In our 8 (2020) 4 SCC 413 - 21 - NC: 2025:KHC-K:3234 MFA No. 201430 of 2023 HC-KAR opinion, this would be the minimum amount which she would have earned on becoming a major. Adding 40% for the future prospects, it works to be Rs 6784.40 per month i.e. 81,412.80 p.a. Applying the multiplier of 18, it works out Rs.14,65,430.40, which rounded off Rs.14,66,000.

21. Though the claimant would have been entitled to separate attendant charges for the period during which she was hospitalised, we are refraining from awarding the same because we are going to award her attendant charges for life. At the same time, we are clearly of the view that the tortfeasor cannot take benefit of the gratuitous service rendered by the family members. When this small girl was taken to PGI, Chandigarh, or was in her village, 2 to 3 family members must have accompanied her. Even if we are not paying them the attendant charges they must be paid for loss of their wages and the amount they would have spent in hospital for food, etc. These family members left their work in the village to attend to this little girl in the hospital at Karnal or Chandigarh. In the hospital, the claimant would have had at least two attendants, and taking the cost of each at Rs 500 per day for 51 days, we award her Rs 51,000." - 22 - NC: 2025:KHC-K:3234 MFA No. 201430 of 2023 HC-KAR g) In the case of Divya vs. National Insurance Co. Ltd. and Another9 the Apex Court holds that the multiplier of '18' is to be applied for the age group of 15 to 18 years. The said judgment reads as below. "16. We are of the considered view that the selection of multiplier ‘15’ for the age group upto 15 years by the three-Judge Bench in Reshma Kumari's case is having a sound basis. It is common knowledge that the age group of 21 to 25 years is regarded as the commencement of normal productive years as referred specifically by the two-Judge Bench in Sarla Verma's case at paragraph 39. True that in Sarla Verma's case the same multiplier viz., ‘18’ is selected for the age group 15 to 20 years. In this context, it is relevant to refer to the Child and Adolescent Labour (Prohibition and Regulation) Act, 1986, which is an enactment to prohibit the engagement of children in all occupation and to prohibit the engagement of adolescence in hazardous occupations and process and matters connected therewith and incidental thereto.” 9 2022 SCC OnLine SC 1488 - 23 - NC: 2025:KHC-K:3234 MFA No. 201430 of 2023 HC-KAR (h) In the case of Baby Sakshi Greola vs. Manzoor Ahmad Simon and Another,10 the Apex Court added future prospects to the annual income by relying on the judgment in the case of Pranay Sethi (supra). The relevant paras of the said judgment read as below: "28. The learned Tribunal on appreciation of the medical evidence came to a conclusion that, since the appellant was only seven years at the time of the accident, it would be appropriate to take notional income as per the MV Act to be Rs.15,000/- per annum. The learned Tribunal applied a multiplier of 15 which was taken up-to the age of fifteen years. Therefore, an amount of 15,000/- × 15 × 75/100 = Rs.1,68,750/- was awarded by the learned Tribunal. The High Court did not enhance the amount awarded under this head.

29. This Court in the case of Kajal (supra) has held that taking notional income is not the correct approach. Instead, the minimum wages payable to a skilled workman in the concerned State has to be taken into consideration because, that would be the minimum amount which she would have 10 2024 SCC OnLine SC 3692 - 24 - NC: 2025:KHC-K:3234 MFA No. 201430 of 2023 HC-KAR earned on becoming a major. In this case, the minimum wage payable to a skilled workman in the State of Delhi at the time of the accident, i.e., 2nd June 2009, was Rs.4,358/- per month.

30. Further, a Constitution Bench of this Court in of National Insurance Company Limited v. Pranay Sethi in paragraph 59 recorded its conclusion as follows: “59. In view of the aforesaid analysis, we proceed to record our conclusions:

59.1. The two-Judge Bench in Santosh Devi [(2012) 6 SCC 421 ] should have been well advised to refer the matter to a larger Bench as it was taking a different view than what has been stated in Sarla Verma [ (2009) 6 SCC 121 ], a judgment by a coordinate Bench. It is because a coordinate Bench of the same strength cannot take a contrary view than what has been held by another coordinate Bench.

59.2. As Rajesh [ (2013) 9 SCC] has not taken note of the decision in Reshma Kumari [ (2013) 9 SCC 65 ], which was delivered at earlier point of time, the decision in Rajesh [(2013) 9 SCC 54 is not a binding precedent. - 25 - NC: 2025:KHC-K:3234 MFA No. 201430 of 2023 HC-KAR

59.3. While determining income, an addition of 50% of actual salary to the income of the deceased towards future prospects, where the deceased had a permanent job and was below the age of 40 years, should be made. The addition should be 30%, if the age of the deceased was between 40 to 50 years. In case the deceased was between the age of 50 to 60 years, the addition should be 15%. Actual salary should be read as actual salary less tax.

59.4. In case the deceased was self-employed or on a fixed salary, an addition of 40% of the established income should be the warrant where the deceased was below the age of 40 years. An addition of 25% where the deceased was between the age of 40 to 50 years and 10% where the deceased was between the age of 50 to 60 years should be regarded as the necessary method of computation. The established income means the income minus the tax component.

59.5. For determination of the multiplicand, the deduction for personal and living expenses, the tribunals and the courts shall be guided by paras 30 to 32 of Sarla Verma [(2009) 6 SCC 121 ] which we have reproduced hereinbefore. - 26 - NC: 2025:KHC-K:3234 MFA No. 201430 of 2023 HC-KAR

59.6. The selection of multiplier shall be as indicated in the Table in Sarla Verma [(2009) 6 SCC 121 ] read with para 42 of that judgment.

59.7. The age of the deceased should be the basis for applying the multiplier.

59.8. Reasonable figures on conventional heads, namely, loss of estate, loss of consortium and funeral expenses should be Rs.15,000, Rs.40,000 Rs.15,000 respectively. The aforesaid amounts should be enhanced at the rate of 10% in every three years.” (emphasis supplied)

31. Accordingly, to arrive at the compensation to be awarded under the head of loss of income and earnings due to disability, 40% should be added for future prospects and a multiplier of 18 would have to be applied in view of the age of the appellant.

32. The same approach was adopted by this Court in cases of Kajal (supra) and Master Ayush (supra)." “ - 27 - NC: 2025:KHC-K:3234 MFA No. 201430 of 2023 HC-KAR (i) In the case of Rushi vs. Oriental Insurance Co. Ltd.,11 it is observed as below: “Leave granted. On 13-4-2013, when she was still a child of less than twelve years of age, the appellant was involved in an accident that left her permanently disabled to the extent of 75%. The vehicle in which she was travelling with her father was hit by the Max Pick Up Van bearing Registration No. AS 01CC 3349. In the result, she suffers from severe Hemiparesis in her left upper and lower limbs.

12. At this stage, we may note that this Court had occasion to consider a similar case involving a twelve- year-old child in Kajal v. Jagdish Chand [(2020) 4 SCC 413]. In that case, the child had suffered 90% permanent disability due to the accident. The argument before this Court was that as the child was just twelve years of age, notional income of Rs 15,000 p.a. should be adopted. However, this Court rejected this argument and adopted the minimum wages payable to a skilled workman for quantifying the notional loss of earnings of the child. 11 (2025) 1 SCC 635 - 28 - NC: 2025:KHC-K:3234 MFA No. 201430 of 2023 HC-KAR

13. In the case on hand, the High Court adopted the minimum wages payable to unskilled labour i.e. Rs 169 per day, but there is no justification for the same as the appellant was a schoolgoing child at the time of her accident. The minimum wages payable to a skilled workman, as per the Notification dated 1-3-2013 of the Government of Assam, stood at Rs 175 per day, which is more acceptable. On that basis, the notional loss of income of the appellant would work out to Rs 5250 per month and the multiplier applicable would be 15, considering her age at the time of the accident. In effect, the notional loss of earnings would work out to Rs 9,45,000 (Rs 5250×12×15).

14. The High Court failed to consider the loss of future prospects @ 40% of the monthly salary, in terms of the law laid down by this Court in Kajal [ (2020) 4 SCC 413]. Therefore, a further sum of Rs 3,78,000 (Rs 2100×12×15) would be payable to the appellant under that head. The sum of Rs 3 lakhs computed by the High Court for pain, suffering and loss of amenities is just and warrants no interference. Similarly, compensation of Rs 3 lakhs for loss of marriage prospects is sufficient.” Thus, from the above decisions it is clear that the Apex Court initially adopted the compensation as - 29 - NC: 2025:KHC-K:3234 MFA No. 201430 of 2023 HC-KAR contemplated under Schedule II of the Motor vehicles Act, at Rs.15,000/- per annum, and then it shifted towards enhancing the compensation by doubling Rs.15,000/-. Thereafter, in Kajal’s case even the said method was deviated and the minimum wages contemplated under the Minimum Wages act was adopted for calculation of the compensation. The inadequacies the method of calculation by adopting a fixed quantum have led the Apex Court to shift towards the regime of Minimum Wages Act. Thereafter, it has held that future prospects are also to be considered while determining the multiplicand.

17. Recently, a division bench of this Court, in the case of Smt. Mariyamma and others Vs. Sri Suyambulingam V., and another12 after referring the judgment in the case of Jakir Hussein Vs. Sabir13; Smt. Neeta and others Vs. Divisional Manager MSRTC, Kolhapur14 ; Kala Devi and others Vs. Bhagwan Das ORDER (1) The appeal is allowed in part. (2) The petitioner is entitled for a sum of Rs.26,57,080/- in addition compensation awarded by the Tribunal - 52 - NC: 2025:KHC-K:3234 MFA No. 201430 of 2023 HC-KAR along with interest at 6% p.a. (excluding interest for the delayed period of 279 days in filing the appeal as per order dated

27.3.2023) from the date of the petition till its deposit by the Insurer. However, a sum of Rs.50,000/- awarded towards 'future medical expenses' does not carry any interest. (3). Rest of the order by the Tribunal regarding fixed deposit and release remain unaltered. Sd/- (C M JOSHI) JUDGE tsn* List No.: 19 Sl No.: 1