JUDGMENT : CIMA No. 66/2014, MP No. 86/2014 1. The appellant-Insurance Company is in appeal against the judgment and award of the Motor Accident Claims Tribunal, Jammu (for short the Tribunal), whereby in a claim application under section 166 of the Motor Vehicles Act, 1988 (for short the Act) the learned Tribunal has awarded compensation of Rs. 18,40,000/ to respondent No. 1 (hereinafter to be referred to as the claimant). Liability of paying the compensation has been foisted on the appellant. 2. Heard. I have perused the record. 3. On 11.06.2002 the claimant, a Naik in Indian Army, was traveling by a passenger bus bearing registration No. JK 01Y-0381 from Jammu to Srinagar. The bus met with accident on Jammu-Srinagar National Highway at Banihal. It fell down in a 400 feet deep gorge. Claimant received injuries, which caused him disablement and he was discharged from the Army. Eight year after the accident, he filed the claim application in November, 2010. The Tribunal on inquiry found that the accident had occurred due to negligent driving by the driver of the offending bus. Learned Tribunal found further that as per the disability certificate, claimant suffered 40 per cent permanent disability due to injuries sustained in the accident leading to his discharge from the Army and awarded compensation of Rs. 18,40,000/ to the him comprising of Rs. 18,04,262/ as compensation for loss of future income, Rs. 10,000/ each on account of pain and sufferings, loss of amenities and transport expenses and Rs. 6,000/ on account of diet expenses. 4. The appellant-insurance company has challenged the impugned judgment and award on various grounds. Learned counsel for the appellant, Mr. Rupinder Singh, however, restricted the appellant’s assail to the extent of the quantum of compensation awarded on account of the loss of future income. Learned counsel for the claimant, Mr. R. K. Bhatia, however, raised preliminary objection about maintainability of the appeal by the insurance company, which I take up first. 5. The objection raised by Mr. Bhatia was that the appellant had not obtaining leave from the learned Tribunal in terms of the section 170 of the Act to take over the defenses available to the insured (owner of the offending bus) so it cannot assail the judgment and award passed by the Tribunal on the question of the quantum of compensation awarded to the claimant. Mr. Mr. Bhatia urged that under section 149(2) limited and specified defense is available to the insurer so the insurer can defend the claim or file appeal on those grounds only. Appeal on the other grounds including the question of quantum of compensation can be filed by the insurer, only in a case where it had been granted leave by the Claims Tribunal in terms of section 170. Mr. Bhatia relied upon Rekha Jain and another v National Insurance Company Limited, AIR 2013 SC 3458 . 6. Per contra, Mr. Rupinder Singh, learned counsel for the appellant, opposed the claimant’s contention that the appellant had not obtained leave under section 170 of the Act from the learned Tribunal and submitted that application in this regard was filed by the appellant before the Tribunal in the course of inquiry. On the point of law, learned counsel argued that in a case where the claimant has impleaded the insurer as party respondent in the claim application, the insurer can contest the claim on all those grounds, which are available to the insured, including the quantum of compensation claimed by the claimant without seeking leave in terms of section 170 and likewise insurer can question the award of the Tribunal on all available grounds including quantum of compensation. Learned counsel urged that requirement of leave under section 170 of the Act arises only in a case where insurer was not impleaded as party respondent by the claimant and was only issued notice by the Tribunal in terms of section 149. Learned counsel relied upon United Insurance Company Limited v Sheela Dutta and others, 2011 ACJ 2729 . 7. The minutes of proceedings recorded in the file of the Tribunal reveal that application under section 170 of the Act was filed on behalf the appellant (insurer) on 23.05.2013. However, no order in this application seems to have ever been passed by the learned Tribunal and in that it can be said that, whereas the insurer had sought leave from the Tribunal to contest the claim application even on the grounds other than those available to the insurer under section 149 (2), but such leave was neither refused nor granted by the Tribunal. 8. 8. Permission in terms of section 173, however, has no significance in context of the maintainability of appeal in a case where the insurer was impleaded as party respondent by the claimants in the claim application, in view of the judgment in Sheela Dutta’s case supra. Learned Three-judge Bench of the Supreme Court in Sheela Dutta has held that if a claimant impleads the insurer as a party respondent, for whatever reason, then as such respondent, the insurer will be entitled to urge all contentions and grounds which may be available to resist the claim. 9. In Rekha Jain’s case (supra), the learned Two- Judge Bench of the Supreme Court has indeed reiterated on the basis of an earlier learned Three-Judge Bench decision of the same Court in National Insurance Company Limited v Nicolletta Rohtagi and ors, (2002) 7 SCC 456 that insurer has no right to challenge the quantum of compensation in absence of the leave from the Tribunal to avail the defence on behalf of the insured as required under section 170 of the Act. It is, however, evident that in Rekha Jain’s case the decision in Sheela Dutta’s case, which is earlier in time, has not been considered by the learned Bench. It is important to note that decision in Sheela Dutta’s case would show that the principle laid down by the learned Three-Judge Bench in Nicolletta Rohtagi’s case will apply only in a case where in the claim application before the Tribunal, the insurer is only a noticee in terms of section 149(2) of the Act but not in a case where the insurer has been impleaded as party respondent by the claimant for any reason whatsoever. 10. When confronted with the principle laid down in Sheela Dutta’s case, an attempt was made by Mr. Bhatia, learned counsel for the claimants, which I can say was a vain attempt, to impress that even though in view of the said decision the insurer, when it is impleaded as party respondent by the claimant, would be entitled to contest the claim application on all the grounds other than those provided to the insurer under section 149(2) of the Act without any leave under section 170, the same principle would not percolate to the right to file appeal in such a case. The contention of learned counsel is without any substance. The contention of learned counsel is without any substance. It needs to be pointed out that in Sheela Dutta’s case, the legal position has been discussed in backdrop of a question as to whether an insurer can prefer an appeal under section 173 of the Act questioning the quantum of compensation awarded. Clarification, if any required, is available in a learned Three Judge Bench decision of Allahabad High Court in United India Insurance Company Limited v Shashi Prabha, 2015 ACJ 2161. Learned Three-Judge Bench in this case on analyzing the decisions in Nicolletta Rohtagi and Sheela Dutta has enumerated inter alia that where Insurance Company has already been impleaded as a party respondent by the claimant in the claim application, it would be entitled to contest the claim application by raising all grounds without being restricted to statutory defences under section 149 (2) and “consequently, in the appeal, the insurer would not be restricted to contesting the award only on the basis of statutory defences available under section 149 (2) but can challenge the award on all grounds available to the insured or the person against whom the claim has been made”. 11. The legal position, therefore, is clear too. Where in the claim application the claimant impleads the insurer as party respondent, the insurer can contest the claim on all the grounds, which are available to the insurer as well as the insured including the quantum of compensation without obtaining leave under section 170 of the Act. Likewise, the insurer in such a case would be entitled to assail the award passed by the learned Tribunal in appeal on any count, including the quantum of compensation. Position, however, would be otherwise in a case where the claimant does not implead the insurer as party respondent and only a statutory notice in terms of section 149 (2) of the Act has been issued to the insurer by the Tribunal. In that case the insurer, unless he obtains leave of the Tribunal under section 170 of the Act, would be entitled to defend the claim only on the statutory defences available to the insurer under section 149(2) of the Act. In that case the insurer, unless he obtains leave of the Tribunal under section 170 of the Act, would be entitled to defend the claim only on the statutory defences available to the insurer under section 149(2) of the Act. In the case on hand, the insurer was impleaded by the claimants as party respondent in the claim application and is, therefore, entitled to contest the claim and file appeal on all the available grounds including quantum of compensation even if it is presumed that leave under Section 170 was not granted. 12. In the matter of the compensation for loss of future income, the judgment and award of the learned Tribunal is assailed on the grounds, firstly, that the claimant has failed in proving the factum and the extent of disability suffered by him inasmuch as no doctor was produced as a witness before the Tribunal and secondly, that the learned Tribunal has erred in taking the 40 per cent disability of left upper limb as disability of the entire body and hundred per cent loss of earning capacity. 13. Mr. Rupinder Singh, the learned counsel for the appellant, pointed out, firstly, that no evidence to prove that the claimant had suffered any disability was led before the Tribunal by the claimant. Referring to the ‘orthopedically handicapped certificate’ issued under the seal and signature of Orthopedic Surgeon, District Hospital, Karwar, Government of Karnataka, produced by the claimant before the Tribunal, learned counsel pointed out that it shows 40 per cent disability only without specifying whether the same was permanent or temporary. Learned counsel pointed out also that as per the evidence of the claimant recorded by the learned Tribunal, he had suffered fracture to his left arm and injuries to his head and back, besides breaking of two teeth and as per the aforementioned certificate there was fracture of left humorous bone. Learned counsel thus, urged that even if it is presumed that the claimant had suffered 40 per cent disability, such disability was in respect of left upper limb only and not of the entire body so loss of earning capacity could not have been taken more than 40 per cent and in no case hundred per cent. Learned counsel thus, urged that even if it is presumed that the claimant had suffered 40 per cent disability, such disability was in respect of left upper limb only and not of the entire body so loss of earning capacity could not have been taken more than 40 per cent and in no case hundred per cent. Learned counsel relied upon Supreme Court judgment in Raj Kumar v Ajay Kumar and others, 2011 ACJ 1 and pointed out that the said judgment was even referred to by the learned Tribunal but not followed for unexplained reason. 14. Per contra, Mr. R. K. Bhatia, learned counsel appearing on behalf of the claimant supported the award. Learned counsel urged that the fact that the disability suffered by the claimant resulted into his discharge from Army proves that he suffered 100 per cent disability to continue with his service in the Army, which he would have rendered for another sixteen years. 15. The method adopted by the Tribunal in assessing the compensation payable for the loss of future income suffered by the claimant has been noticed. Learned Tribunal on the basis of the evidence found the monthly salary of the claimant as at the time of his discharge from the Army as Rs. 7831/ and annual income as Rs. 93,972/. By relating the 40 per cent disability suffered by the claimant to his discharge from the Army, learned Tribunal took the yearly loss of income suffered by the claimant as Rs. 93,972/, that is, equivalent to his annual salary as at the time of the discharge from Army. Relying upon the Supreme Court judgment in Sarla Verma’s case, AIR 2009 SC 3104 , learned Tribunal increased the annual income of the claimant by 50 per cent to Rs. 1,40,958/, which has been taken as the multiplicand. Having regard to the age of the claimant as 36 years as at the time of accident and assuming that the claimant would have retired 16 years thereafter at the age of 52 years, learned Tribunal applied multiplier of 16 and assessed the compensation for loss of future income as Rs.22,55,328/(1,40,958x16). Learned Tribunal, however, deducted Rs. 4,51,066/ towards 20 per cent income tax on the said amount and awarded compensation of Rs. 18,04,262. Learned Tribunal, however, deducted Rs. 4,51,066/ towards 20 per cent income tax on the said amount and awarded compensation of Rs. 18,04,262. It is thus, clear that the learned Tribunal in assessing the compensation for loss of future income has taken it to be a case of 100 per cent loss of income suffered by the claimant. 16. It is well settled that the extent of the loss of future income due to the physical disability cannot be equated with the extent of the disability of the body. Generally percentage of the loss of future income will be less than the percentage of the physical disability of the body though in some cases it may be higher than the percentage of disability. It is also well settled that percentage of disability of a particular limb (part of the body) cannot be equated with the functional disability with respect to the whole body and the percentage of the disability of the whole body generally is less than that of a particular limb (part of the body). 17. The loss in earning capacity of a person due to a disability suffered by him will differ from case to case depending upon the nature of limb (part of body) involved, the nature of the occupation of the person prior to the disability, the activities which the person would be unable to undertake or continue with and the activities which he can still undertake or continue with. 18. The assessment of the loss of future income due to permanent disability of the body in a claim application has been discussed in detail and principle laid down by the Supreme Court in Raj Kumar’s case (supra). It is useful to refer to and extract important paragraphs from the reporting of the judgment: “7. The percentage of permanent disability is expressed by the Doctors with reference to the whole body, or more often than not, with reference to a particular limb. When a disability certificate states that the injured has suffered permanent disability to an extent of 45 per cent of the left lower limb, it is not the same as 45 per cent permanent disability with reference to the whole body. When a disability certificate states that the injured has suffered permanent disability to an extent of 45 per cent of the left lower limb, it is not the same as 45 per cent permanent disability with reference to the whole body. The extent of disability of a limb (or part of the body) expressed in terms of a percentage of the total functions of that limb, obviously cannot be assumed to be the extent of disability of the whole body. If there is 60 per cent permanent disability of the right hand and 80 per cent permanent disability of left leg, it does not mean that the extent of permanent disability with reference to the whole body is 140 per cent (that is 80 per cent plus 60 per cent). If different parts of the body have suffered different percentages of disabilities, the sum total thereof expressed in terms of the permanent disability with reference to the whole body, cannot obviously exceed 100 per cent.” “8. Where the claimant suffers a permanent disability as a result of injuries, the assessment of compensation under the head of loss of future earnings, would depend upon the effect and impact of such permanent disability on his earning capacity. The Tribunal should not mechanically apply the percentage of permanent disability as the percentage of economic loss or loss of earning capacity. In most of the cases, the percentage of economic loss, that is, percentage of loss of earning capacity, arising from a permanent disability will be different from the percentage of permanent disability. Some Tribunals wrongly assume that in all cases, a particular extent (percentage) of permanent disability would result in a corresponding loss of earning capacity, and consequently, if the evidence produced show 45 per cent as the permanent disability, will hold that there is 45 per cent loss of future earning capacity. In most of the cases, equating the extent (percentage) of loss of earning capacity to the extent (percentage) of permanent disability will result in award of either too low or too high a compensation. In most of the cases, equating the extent (percentage) of loss of earning capacity to the extent (percentage) of permanent disability will result in award of either too low or too high a compensation. What requires to be assessed by the Tribunal is the effect of the permanent disability on the earning capacity of the injured; and after assessing the loss of earning capacity in terms of a percentage of the income, it has to be quantified in terms of money, to arrive at the future loss of earnings (by applying the standard multiplier method used to determine loss of dependency). We may however note that in some cases, on appreciation of evidence and assessment, the Tribunal may find that percentage of loss of earning capacity as a result of the permanent disability, is approximately the same as the percentage of permanent disability in which case, of course, the Tribunal will adopt the said percentage for determination of compensation [(see for example, the decisions of this court in Arvind Kumar Mishra v. New India Assurance Co.Ltd. – 2010 ACJ 2867 (SC) and Yadava Kumar v. Divisional Manger, National Insurance Co. Ltd. - 2010 ACJ 2713 (SC)]” 19. In para 10 Their Lordships have laid down a guiding principles for ascertainment of the effect of the permanent disability of the body on the actual earning capacity, which needs to be followed by all the Tribunals. This reads: “10. Ascertainment of the effect of the permanent disability on the actual earning capacity involves three steps. The Tribunal has to first ascertain what activities the claimant could carry on in spite of the permanent disability and what he could not do as a result of the permanent ability [sic disability] (this is also relevant for awarding compensation under the head loss of amenities of life). The second step is to ascertain his avocation, profession and nature of work before the accident, as also his age. The second step is to ascertain his avocation, profession and nature of work before the accident, as also his age. The third step is to find out whether (i) the claimant is totally disabled from earning any kind of livelihood, or (ii) whether in spite of the permanent disability, the claimant could still effectively carry on the activities and functions, which he was earlier carrying on, or (iii) whether he was prevented or restricted from discharging his previous activities and functions, but could carry on some other or lesser scale of activities and functions so that he continues to earn or can continue to earn his livelihood. For example, if the left hand of a claimant is amputated, the permanent physical or functional disablement may be assessed around 60 per cent. If the claimant was a driver or a carpenter, the actual loss of earning capacity may virtually be hundred per cent, if he is neither able to driver or do carpentry.” 20. As regards the assessment of the compensation for loss of future income by a Government employee, their Lordships in para 10 have observed: “on the other hand, if the claimant was a clerk in government service, the loss of his left hand may not result in loss of employment and he may still be continued as a clerk as he could perform his clerical functions; and in that event the loss of earning capacity will not be hundred per cent as in the case of a driver or carpenter, nor 60 per cent which is actual physical disability, but far less. In fact, their may not be any need to award any compensation under the head of ‘loss of future earnings’, if claimant continues in government service, though he may be awarded compensation under the head of “loss of amenities” as a consequence of losing his hand” 21. Their Lordships in that case also dealt with the manner in which medical evidence as regards the disability has to be dealt with. In this regard, in para 12, their Lordships have held that “if a doctor gives evidence about the percentage of permanent disability, the Tribunal has to seek clarification as to whether such percentage of disability is the functional disability with respect to the whole body or whether it is only with reference to a limb. In this regard, in para 12, their Lordships have held that “if a doctor gives evidence about the percentage of permanent disability, the Tribunal has to seek clarification as to whether such percentage of disability is the functional disability with respect to the whole body or whether it is only with reference to a limb. If the percentage of permanent disability is stated with respect to a limb, Tribunal will have to seek the doctor’s opinion as to whether it is possible to deduce the corresponding functional permanent disability with reference to the whole body and if so the percentage.” 22. In para 12, Their Lordship have observed: “The Tribunal should also act with caution, if it proposed to accept the expert evidence of doctors who did not treat the injured but who give `ready to use' disability certificates, without proper medical assessment. There are several instances of unscrupulous doctors who without treating the injured, readily giving liberal disability certificates to help the claimants. But where the disability certificates are given by duly constituted Medical Boards, they may be accepted subject to evidence regarding the genuineness of such certificates. The Tribunal may invariably make it a point to require the evidence of the Doctor who treated the injured or who assessed the permanent disability. Mere production of a disability certificate or Discharge Certificate will not be proof of the extent of disability stated therein unless the Doctor who treated the claimant or who medically examined and assessed the extent of disability of claimant, is tendered for cross- examination with reference to the certificate. If the Tribunal is not satisfied with the medical evidence produced by the claimant, it can constitute a Medical Board (from a panel maintained by it in consultation with reputed 14 local Hospitals/Medical Colleges) and refer the claimant to such Medical Board for assessment of the disability.” 23. The principles laid down by the Supreme Court in Raj Kumar’s case have been referred to with approval in Mohan Sohani v Ram Avtar Tomar, 2012 ACJ 583 and later in Syed Sadeeq and ors v Divisional Manager, United Insurance Co. Limited 2014 ACJ 627 . 24. It is noticed with surprise and disapproval that learned Tribunal in this case has referred to and quoted the principles laid down in the Raj Kumar’s case, however, only in breach thereof. Limited 2014 ACJ 627 . 24. It is noticed with surprise and disapproval that learned Tribunal in this case has referred to and quoted the principles laid down in the Raj Kumar’s case, however, only in breach thereof. Learned Tribunal has ignored the relevance and importance of the evidence of a doctor in assessment of compensation in an injury case in particular for ascertaining the nature and extent of the functional disability and loss of future income consequent thereto. Learned Tribunal seems to have accepted the extent of the disability suffered by the claimant as 40 per cent on the basis of the aforementioned certificate produced by the claimant and equated the same with total functional disability and loss of future income. 25. As the principles of the Evidence Act governing the leading of evidence cannot be strictly applied in the proceedings in claim application as these proceedings are in the nature of summary inquiry, the reliance by the learned Tribunal on certificate produced by the claimant cannot be disapproved. But it needs to be stated that this certificate coupled with the discharge of the claimant from the Army can be construed to have proved at the most that the accident had caused 40 per cent permanent disability to the left upper limb of the claimant due to which he could not be continued in Army and was discharged. There is, however, no evidence to show, much less to prove, that the 40 per cent disability of upper limb has caused total functional disability inasmuch as he has been incapacitated for undertaking any activity after his discharge from the Army and thereby caused 100 per cent loss of future income. Even the claimant's own deposition before the Tribunal does not explain as to how 40 per cent disability of upper limb has totally incapacitated him from undertaking any activity and caused 100 per cent loss of future income though he has stated that he cannot do any work which, however, does not suffice. To make out a case of total loss of future income or loss of earning capacity more than the extent of disability to his left upper limb, claimant was required to produce evidence, in particular medical evidence to explain as to how no other activity could have been undertaken by the claimant. 26. To make out a case of total loss of future income or loss of earning capacity more than the extent of disability to his left upper limb, claimant was required to produce evidence, in particular medical evidence to explain as to how no other activity could have been undertaken by the claimant. 26. The view taken by the learned Tribunal in equating 40 per cent disability to one upper limb with total functional disability and loss of future income only because of discharge of the claimant from Army is unknown to law, totally unjustified and not tenable. In taking such a view, learned Tribunal has acted in a mechanical manner without application of mind. In absence of any evidence, in no case the loss of future income suffered by the claimant could have been taken more than the extent of disability suffered by him. 27. For aforementioned, the method applied by the learned Tribunal in assessing the compensation for future loss of future income cannot be approved and the future loss of income suffered by the claimant cannot be taken more than the percentage of disability suffered by him, that is, 40 per cent of his salary as at the time of the accident. The annual salary of the claimant as at the time of accident was Rs. 93,972/ and, in absence of any evidence to the contrary, it can be presumed that the income to this extent was not liable to levy of any income tax. This is enhanced by 50 per cent to Rs. 1, 40,958/, having regard to the age of the claimant and the fact that he was in a settled Government job; 40 per cent of the said income, that is, Rs. 56,384, say Rs. 56,400/, would be the estimated loss of future income suffered by the claimant per annum. This would be taken as multiplicand for assessment of compensation future loss of income. The deceased was 36 and therefore, for the purpose of selecting multiplier, he is to be bracketed in the age of group of above 35 but below 40, for which the applicable multiplier as per Sarla Verma’s case is 15. The compensation payable on account of the loss of future income, therefore, amounts to Rs. 8,46,000 (56,400x15). Cross Appeal No. 05/2014 28. The claimant assails the impugned judgment and award on the grounds that the compensation of Rs. The compensation payable on account of the loss of future income, therefore, amounts to Rs. 8,46,000 (56,400x15). Cross Appeal No. 05/2014 28. The claimant assails the impugned judgment and award on the grounds that the compensation of Rs. 10,000/ each awarded under the heads “pain and suffering”, “loss of amenities” and “Transport expenses” and Rs. 6,000 under the head “diet charges” is much on lower side. The challenge is also on the ground that the Tribunal has wrongly declined to grant interest on compensation for loss of future income and that the income tax has been wrongly deducted and compensation under various heads have not been granted. In support, learned counsel relies upon Syed Sadiq’s case supra. 29. Upon hearing learned counsel on both sides and perusal of record on the file of the Tribunal, it is noticed that no evidence has been led by the claimant to prove the amount of expenses incurred towards transport charges and special diet as also to prove that compensation was available on any count other than that awarded by the learned Tribunal. However, having regard to the precedent in similar cases, I am inclined to agree with learned counsel for the claimant that the compensation of Rs. 10,000/ each awarded under conventional heads “pain and suffering” and “loss of amenities” is much on lower side and is required to be enhanced to Rs. 60,000/ and 40,000/ respectively. I also agree with the learned counsel for the claimant that learned Tribunal has fallen in error by deducting 20 per cent from the compensation for loss of future income towards income tax for the reason that such deduction is to be made from the gross income for determining the net income as at the time of the accident/disability. Likewise, taking clue from the Syed Sadiq’s case (supra), I am inclined to agree with the learned counsel for the claimant that the learned Tribunal has fallen in error by refusing interest on the compensation for loss of future income. Conclusion: 30. For all that said and discussed above, both these appeals are allowed by holding that the claimant is entitled to compensation as per the below with 7.5 per cent per annum interest from the date of filing of the claim application: Loss of future income: Rs. 8,46,000/- Pain and sufferings: RS. 60,000/- Loss of amenities: Rs. 40,000/- Transport expenses: Rs. 10,000/- Diet expenses: Rs. 8,46,000/- Pain and sufferings: RS. 60,000/- Loss of amenities: Rs. 40,000/- Transport expenses: Rs. 10,000/- Diet expenses: Rs. 6,000/- Total: Rs. 9,62,000/- 31. The impugned judgment and award stand modified accordingly. The amount, if deposited in this Court, shall be released in favour of the claimant subject to the aforementioned modification and the excess amount, if any, along with up to date interest on that amount shall be released in favour of the appellant. 32. Record of the Tribunal be remitted back along with a copy of this order.