If a person suffers permanent disability in an accident caused by a vehicle, the compensation due to him should be computed taking into account not only the victim's present earnings but also future loss of income, Supreme Court has ruled.
The SC distinguished between claim for damages and compensation and said damages were given for an injury whereas compensation stood on a slightly higher footing.
While damages were given for atonement of injury caused, the intention behind compensation was to put back the injured party as far as possible in the same position as if the injury has not taken place, by way of grant of pecuniary relief, it said.
The case before a Bench comprising Justices G S Singhvi and A K Ganguly was of a painter, Yadava Kumar, who in a road accident in Karnataka suffered 30-40% permanent disability preventing him from resuming his profession or even taking up manual labour.
The high court had granted him a compensation of Rs 72,000 rejecting his plea to consider the future loss of income as he could no longer do painting jobs.
The SC took serious view of this incompassionate approach of the HC.
Justice Ganguly, writing the judgment for the Bench, said, "In this case, the approach of the HC in totally refusing to grant any compensation for loss of future earnings is not a correct one."
While ordering National Insurance Company to pay Kumar Rs 2 lakh, which was computed by the SC after taking into account future loss of earnings, Justice Ganguly said, "In the determination of the quantum of compensation, the court must be liberal and not niggardly in as much as in a free country, law must value life and limb on a generous scale."
It added, "It goes without saying that in matters of determination of compensation, both the Motor Accident Claims Tribunal and the courts are statutorily charged with a responsibility of fixing 'just compensation'.
It is obviously true that determination of a just compensation cannot be equated to a bonanza.
At the same time, the concept of 'just compensation' obviously suggests application of fair and equitable principles and a reasonable approach on the part of the tribunals and courts."