Court case(1998) 4 SCC 39

Harjol Ahluwalia, a young child, was taken by his parents to Spring Meadows Hospital, a private hospital, and was admitted for treatment of a fever. In the hospital an injection was administered to him by a nurse on the instructions of a doctor, without the care the drug and the child's condition required; soon afterwards the child collapsed with a cardiac arrest. He survived but suffered irreversible brain damage and was reduced to a vegetative state, needing lifelong care. His parents complained to the National Commission against the hospital and the doctors. The National Commission held the hospital negligent and awarded compensation to the child and, separately, to the parents for their mental agony; the hospital (and its insurer) appealed to the Supreme Court.

The Supreme Court (G.B. Pattanaik J.) dismissed the appeal. The hospital was vicariously liable for the negligence of its doctor and nurse; administering the injection in that manner was negligence for which the hospital answered. The parents, who hired the hospital's services for their son, and the son, the beneficiary of those services, were both consumers under s. 2(1)(d), so compensation could be awarded to each for the injury each suffered: to the child for the destruction of his life and future, and to the parents for their acute mental agony and the burden of caring for him. The award of the National Commission (Rs 12.5 lakh to the child and Rs 5 lakh to the parents) was upheld, and the insurer was held liable to indemnify the hospital under its policy.