Nithin Maheswari vs National Insurance Company Limited And Anr

The 1st respondent in MACA No.2066/2014 who is also the Cross Objector in C.O. No.200/2014, has filed this review petition against the judgment

dated 13.07.2020 in the said MACA. The review petitioner is the petitioner in OP(MV) No.1234/2011 of the Principal Motor Accident Claims

Tribunal, Kozhikode, from which the MACA arose.

The MACT passed Award in the OP(MV) granting a compensation ofR s. 24,09,000/- to the review petitioner. The Insurer filed MACA and the

review petitioner filed Cross Objection. This Court dismissed the MACA and granted additional compensation ofR s. 40,000/- to the Review

Petitioner/Cross Objector. The said judgment is sought to be reviewed by the Cross Objector/Review Petitioner.

The short ground for review is that while calculating compensation for loss of future earning power/disability, this Court deducted 50% of income

towards personal expenses. In injury cases, such deduction is impermissible.

The learned Standing Counsel for the 1st respondent-Insurer resisted the review petition. The learned Standing Counsel argued that this Court

found that the petitioner is entitled to 50% enhancement of income towards loss of future prospects and deduction of 50% towards personal expenses.

Since the proposed enhancement and deduction is of the same percentage, this Court did not revise the notional income of the review petitioner. In

fact, the review petitioner is not entitled to insist that while fixing his notional income, enhancement should be given towards loss of future prospects.

According to the Standing Counsel for the 1st respondent, allowances for loss of future prospects are made only for calculating compensation in death

cases.

The Standing Counsel further argued that the Tribunal has granted compensation liberally and the compensation is much on a higher side. This

Court enhanced the total compensation further. The functional disability of the injured was fixed at 66%. For this reason also, the deduction towards

personal expenses is justified while fixing notional income.

Heard learned counsel for the review petitioner and learned Standing Counsel for the 1st respondent.

This Court in the judgment in MACA, while agreeing with the Tribunal’s findings as to the monthly income of the review petitioner asR s.

15,000/-, held as follows:-

“It is seen that the Tribunal has not considered future prospects, while fixing the notional monthly income for the purpose of calculating disability

compensation. Going by the judgments of the Apex Court in National Insurance Co. Ltd. v. Pranay Sethi and others [(2017) 16 SCC 680 ]and Rajesh

and others v. Rajbir Singh and others [2013 (3) KLT 89], the 1st respondent should be granted an addition of 50% towards future prospects. But,

since the 1st respondent was a bachelor at the time of the accident, going by the judgment in Sarla Verma and others v. Delhi Transport Corporation

and another [(2009) 6 SCC 121], 50% of the income has to be deducted towards personal and living expenses of the 1st respondent. The Tribunal has

not deducted any amount towards personal expenses. Since the addition towards future prospects and deduction towards personal and living expenses,

both stands at 50%, there is no requirement for changing the notional income fixed by the Tribunal.â€​

Normally, deductions towards personal and living expenses are made while calculating the notional income of a person who died in the motor

accident. Deductions are made towards personal and living expenses on the premises that had the deceased been alive, he would have expended

some amount towards his personal expenses and only the remaining income would have been expended for the family. It is for this reason that such

deductions are made.

When a person survives a motor accident with injuries and disability, he would be spending amounts towards personal and living expenses during his

life. Therefore, making deduction towards personal expenses for arriving at notional income of an injured person, would indeed result in injustice.

As regards the argument of the Standing Counsel for the 1st respondent that no enhancement need be made in the notional income of the review

petitioner towards future prospects since future prospects are allowed only in death cases, this Court finds that the Hon'ble Apex Court has

considered the issue in Pappu Deo Yadav v. Naresh Kumar and others [CDJ 2020 SC 727 ]and has granted enhancement towards future prospects,

in a case of injury. Therefore, the argument that enhancement in notional income counting future prospects cannot be made in an injury case, cannot

be accepted.

In the Award, the Tribunal did not make any provision for future prospects of the injured. Going by the age and percentage of disability, the review

petitioner was entitled to be compensated for loss of future prospects. However, this Court observed that even if 50% is enhanced towards future

prospects, still when deduction is made for personal and living expenses, there would be in effect no change in the notional income of the petitioner.

The fact that deduction towards personal expenses is not to be made in an injury case, was omitted to be noted by this Court and to that extent, this

Court is of the opinion that a review of the judgment is warranted.

Accordingly, the following part of paragraph 15 namely,

“But, since the 1st respondent was a bachelor at the time of the accident, going by the judgment in Sarla Verma and others v. Delhi Transport

Corporation and another [(2009) 6 SCC 121], 50% of the income has to be deducted towards personal and living expenses of the 1st respondent. The

Tribunal has not deducted any amount towards personal expenses. Since the addition towards future prospects and deduction towards personal and

living expenses, both stands at 50%, there is no requirement for changing the notional income fixed by the Tribunal.â€​,

would stand deleted and in its place, the following findings should be substituted:-

Accordingly, the notional income of the petitioner for calculating compensation for loss of future earning power should be fixed as Rs. 22,500/- (Rs.

15,000/- + 50% thereof). The petitioner will therefore be eligible for a compensation of Rs. 30,29,400/- (Rs. 2,70,000 x 17 x 66/100) under the head.

The Tribunal has awarded Rs. 20,19,600/- under this head. The 1st respondent therefore, would be entitled to an additional compensation of Rs.

10,09,800/- under the head compensation for loss of future earning power.

The amount Rs. 40,000/-, the additional compensation to which the review petitioner is found entitled to in the operative portion of the judgment in

MACA, contained in the last paragraph (page 16) of the judgment, would stand substituted as Rs. 10,49,800/- .

Review petition is allowed as above.