/2022 INSC 0991/
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOS.8598­8599 OF 2022
(Arising out of Special Leave Petition (C) Nos.11730­11731 of 2021)
T. J. PARAMESHWARAPPA @
PARAMESHWARAPPA @ 
J.T. PARAMESHWARAPPA @
TALALKENA GOWDRA PARAMESHWARAPPA        .....APPELLANT
VERSUS
THE BRANCH MANAGER, 
NEW   INDIA   ASSURANCE   CO.   LTD.   &   ORS.
…..RESPONDENT(S)
J  U  D  G  M  E  N  T
NAGARATHNA J. 
Leave granted.
2. These appeals assail the correctness of the judgment and award
passed by the High Court of Karnataka at Bengaluru in M.F.A. No.48
of   2017   connected   with   M.F.A.   No.7972   of   2016   (MV)   dated
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16.10.2020. M.F.A. No.48 of 2017 was filed by the insurer – New India
Assurance   Co.   Ltd.,   while   M.F.A.   No.7972   of   2016   (MV)   was   filed   by
the   insured   claimant,   both   being   aggrieved   by   the   judgment   and
award dated 16.09.2016 passed by the Ist Addl. Senior Civil Judge &
IVth   MACT   at   Chitradurga   in   MVC   No.1091   of   2015.     By   the   said
judgment   and   award,   the   Motor   Accidents   Claims   Tribunal
(hereinafter referred to as “the Tribunal”, for the sake of convenience)
awarded   a   sum   of   Rs.21,08,400/­   (Rupees   Twenty­one   lakhs   eight
thousand   and   four   hundred   only)   with   interest   at   8%   p.a.   from   the
date   of   filing   of   the   claim   petition   till   date   of   deposit.   This   was   in
respect   of   an   accident   that   occurred   on   15.05.2015   in   which   the
appellant­   claimant   was   injured.   Being   aggrieved   by   the   reduction   in
the   total   compensation   by   the   High   Court   from   Rs.21,08,400/­   to
Rs.7,37,604/­   with   interest   at   the   rate   of   6%   p.a.   from   the   date   of
petition   till   its   realization,   the   injured­   claimant   has   filed   these
appeals. 
3. It is no longer in dispute that on 15.05.2015 at about 03:35 p.m.
appellant­ claimant was travelling in the Tanker Lorry bearing No.KA­
01­AG­2266  as a cleaner  from Kidlike to  Hassan  along with  driver P.
Jagadeesh.   Near   the   RTO   Office,   Chitradurga,   on   NH­4   flyover,   the
driver   of   the   tanker   lorry   drove   the   same   in   a   rash   and   negligent
manner   and   with   high   speed   and   dashed   into   the   hind   portion   of
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another   lorry   bearing   No.KA­16­B­6247,   as   a   result   of   which,
appellant­   claimant   sustained   comminuted   fracture   of   tibia   bones   of
both   legs   and   other   injuries   on   his   body.   He   was   shifted   to   B.M.C.
Hospital   and   Research   Centre,   Chitradurga   where   he   took   treatment
as   an   inpatient   from   15.05.2015   to   13.06.2015   and   thereafter   took
follow­up treatment as an outpatient. During treatment, he underwent
surgery of both legs and rod and screws were inserted.
 
4. It is contended by the appellant that as a result of the accident
he became permanently disabled and due to fracture of tibia bones of
both legs and other injuries, he is unable to discharge his duties as a
cleaner in the tanker lorry and hence, he has suffered both financially
and   physically.     That   he   is   also   unable   to   perform   his   daily   routine
activity   as   he   has   sustained   permanent   disability.     That   he   was
working   as   a   cleaner   in   a   tanker   lorry   and   was   earning   Rs.18,000/­
per month and due to the disability, he is unable to earn any income.
He   therefore,   filed   the   claim   petition   seeking   compensation   of   Rs.20
lakhs   on   account   of   the   injuries   sustained   by   him   in   the   road   traffic
accident.   On contest, the Tribunal by its judgment and award dated
16.09.2016,   awarded   a   sum   of   Rs.21,08,400/­   together   with   interest
at   8%   p.a.   from   the   date   of   petition   till   date   of   deposit,   under   the
following heads:
“Sl. No. Description  Amount in Rs.
1.   Pain and suffering  5,00,000/­
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2.   Medical and incidental Expenses  4,00,000/­
3.   Permanent disability 
(40% of Rs.6,500 x 12 x 17) 5,30,400/­
4.   Future Medical Expenses 2,00,000/­
5.   Conveyance and attendant Charges  2,00,000/­
 
6.   Future Prospects  78,000/­
(12 Months x 6,500)
7.   Marriage prospects  2,00,000/­
___________
Total  21,08,400/­”
In fact, the compensation awarded by the Tribunal was over and
above   what   was   sought   by   the   appellant   –   claimant   in   the   claim
petition i.e. Rs.20,00,000/­. 
5. Being   aggrieved   by   the   said   award,   both   the   insurer   as   well   as
insured   claimant   filed   the   aforementioned   appeals   before   the   High
Court. The High Court noted that the claimant had suffered lacerated
wound   over   his   forehead   and   fracture   of   mid   1/3 rd
  tibia   of   right   and
left legs, as per Exhibit­P6. The High Court also noted that the award
of   compensation   was   on   the   higher   side   and   hence,   High   Court
reduced   the   compensation   to   Rs.7,37,604/­   under   the   following
heads: ­ 
Sl. No. Description  Amount   in
Rs.
1.   Permanent disability 
(20% of Rs.9,000 x 12 x 17) 3,67,200/­
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2.   Pain and suffering    50,000/­
3.   Medical and incidental Expenses        1,20,404/­
4.   Future Medical Expenses    50,000/­
5.   Conveyance charges     30,000/­
6.          Income during laid up period             45,000/­
7.   Loss of amenities    75,000/­
__________
Total  7,37,604/­
No   compensation   was   awarded   towards   loss   of   marriage
prospects   and   loss   of   future   prospects.   Consequently,   the   appeals
were disposed of in the above terms by the High Court.  
6. We   have   heard   the   learned   counsel   for   the   appellant­   claimant
and respondent – insurer and perused the material on record. 
7. The sum and substance of the contention of learned counsel for
the appellant is that the assessment of permanent physical  disability
should   be   at   54%   but   the   High   Court   had   erroneously   reduced   it   at
20%   which   was   34%   less   and   therefore,   these   appeals   have   been
preferred.   It   was   further   contended   that   the   appellant   was   earning
Rs.18,000/­   per   month   as   a   cleaner   of  the   tanker   lorry   but  the   High
Court   has   assessed   his   notional   income   as   Rs.9,000/­   per   month
only, which is on the lower side. It was further contended that owing
to   the   fracture   of   both   legs,   the   appellant   is   unable   to   carry   out   his
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duties as a cleaner of the tanker lorry and the percentage of disability
has been erroneously assessed at 20% while the doctor had assessed
the   permanent   disability   of   54%.   Hence,   the   appellant   has   sought
enhancement of compensation.
8. Per   contra ,   learned   counsel   for   the   respondent   –   insurer
supported   the   judgment   of   the   High   Court   and   submitted   that   these
appeals ought to be dismissed as being devoid of merit. 
          Before proceeding to consider the appeals on merits, it would be
useful   to  refer  to   the  judgment  of  this  Court in   Raj   Kumar   vs.   Ajay
Kumar and Another (2011) 1 SCC 343,  authored by Raveendran, J.
wherein   the   general   principles   relating   to   compensation   in   injury
cases; assessment of loss of future earnings on account of permanent
disability;   assessment   of   compensation   in   injury   cases,   have   been
discussed at length. The relevant paragraphs of the said judgment are
extracted as under:   
“5.   The provision of the Motor Vehicles Act, 1988 (“the
Act”, for  short) makes it clear that the award must be
just,   which   means   that   compensation   should,   to   the
extent   possible,   fully   and   adequately   restore   the
claimant   to   the   position   prior   to   the   accident.   The
object   of   awarding   damages   is   to   make   good   the   loss
suffered as a result of wrong done as far as money can
do so, in a fair, reasonable and equitable manner. The
court or the Tribunal shall have to assess the damages
objectively   and   exclude   from   consideration   any
speculation   or   fancy,   though   some   conjecture   with
reference   to   the   nature   of   disability   and   its
consequences, is inevitable. A person is not only to be
compensated   for   the   physical   injury,   but   also   for   the
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loss which he suffered as a result of such injury. This
means that he is to be compensated for his inability to
lead   a   full   life,   his   inability   to   enjoy   those   normal
amenities   which   he   would   have   enjoyed   but   for   the
injuries, and his inability to earn as much as he used
to   earn   or   could   have   earned.   [See   C.K.   Subramania
Iyer   v.   T. Kunhikuttan Nair   [(1969) 3 SCC 64 : AIR
1970   SC   376]   ,   R.D.   Hattangadi   v.   Pest   Control
(India)   (P)   Ltd.   [(1995)   1   SCC   551   :   1995   SCC   (Cri)
250]   and   Baker   v.   Willoughby   [1970   AC   467   :
(1970) 2 WLR 50 : (1969) 3 All ER 1528 (HL)].  
6.   The heads under which compensation is awarded in
personal injury cases are the following:
Pecuniary damages (Special damages)
( i )   Expenses   relating   to   treatment,
hospitalisation,   medicines,   transportation,
nourishing   food,   and   miscellaneous
expenditure.
( ii )   Loss   of   earnings   (and   other   gains)
which   the   injured   would   have   made   had
he not been injured, comprising:
( a ) Loss of earning during the period of
treatment;
( b )   Loss   of   future   earnings   on   account
of permanent disability.
( iii ) Future medical expenses.
Non­pecuniary   damages   (General
damages)
( iv )   Damages   for   pain,   suffering   and
trauma as a consequence of the injuries.
( v )   Loss   of   amenities   (and/or   loss   of
prospects of marriage).
( vi )   Loss   of   expectation   of   life   (shortening
of normal longevity).
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In routine personal injury cases, compensation will be
awarded  only  under  heads  ( i ),  ( ii )( a )  and  ( iv ).  It  is  only
in   serious   cases   of   injury,   where   there   is   specific
medical   evidence   corroborating   the   evidence   of   the
claimant, that compensation will be granted under any
of   the   heads   ( ii )( b ),   ( iii ),   ( v )   and   ( vi )   relating   to   loss   of
future   earnings   on   account   of   permanent   disability,
future medical expenses, loss of amenities (and/or loss
of prospects of marriage) and loss of expectation of life.
7.   Assessment   of   pecuniary   damages   under   Item   (i)
and   under   Item   (ii)(a)   do   not   pose   much   difficulty   as
they   involve   reimbursement   of   actuals   and   are   easily
ascertainable   from   the   evidence.   Award   under   the
head   of   future   medical   expenses—Item   (iii)—depends
upon   specific   medical   evidence   regarding   need   for
further treatment and cost thereof. Assessment of non­
pecuniary   damages—Items   (iv),   (v)   and   (vi)—involves
determination of lump sum amounts with reference to
circumstances   such   as   age,   nature   of
injury/deprivation/disability   suffered   by   the   claimant
and the effect thereof on the future life of the claimant.
Decisions   of   this   Court   and   the   High   Courts   contain
necessary   guidelines   for   award   under   these   heads,   if
necessary.   What   usually   poses   some   difficulty   is   the
assessment   of   the   loss   of   future   earnings   on   account
of permanent disability—Item (ii)(a). We are concerned
with that assessment in this case.
Assessment   of   future   loss   of   earnings   due   to
permanent disability
8.   Disability   refers   to   any   restriction   or   lack   of   ability
to   perform   an   activity   in   the   manner   considered
normal for a human being. Permanent disability refers
to the residuary incapacity or loss of use of some part
of  the  body, found  existing  at the end of  the  period of
treatment   and   recuperation,   after   achieving   the
maximum   bodily   improvement   or   recovery   which   is
likely   to   remain   for   the   remainder   life   of   the   injured.
Temporary disability refers to the incapacity or loss of
use of some part of the body on account of the injury,
which   will   cease   to   exist   at   the   end   of   the   period   of
treatment   and   recuperation.   Permanent   disability   can
be   either   partial   or   total.   Partial   permanent   disability
refers   to   a   person's   inability   to   perform   all   the   duties
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and  bodily  functions that   he  could  perform  before  the
accident,   though   he   is   able   to   perform   some   of   them
and   is   still   able   to   engage   in   some   gainful   activity.
Total permanent disability refers to a person's inability
to   perform   any   avocation   or   employment   related
activities   as   a   result   of   the   accident.   The   permanent
disabilities   that   may   arise   from   motor   accident
injuries, are of a much wider range when compared to
the   physical   disabilities   which   are   enumerated   in   the
Persons   with   Disabilities   (Equal   Opportunities,
Protection   of   Rights   and   Full   Participation)   Act,   1995
(“the   Disabilities   Act”,   for   short).   But   if   any   of   the
disabilities   enumerated   in   Section   2(i)   of   the
Disabilities Act are the result of injuries sustained in a
motor accident, they can be permanent disabilities for
the purpose of claiming compensation.
9.   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%   of the left lower limb, it is not the same
as   45%   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%               permanent
disability   of   the   right   hand   and   80%
permanent   disability   of   left   leg,   it   does   not   mean   that
the extent of permanent disability with reference to the
whole body is 140% (that is 80% plus 60%). 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%.
10.   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
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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,   the   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%   as   the   permanent   disability,   will
hold that there is 45% 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.
11.   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   the   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)   10   SCC   254   :   (2010)   3
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SCC  (Cri)   1258   :  (2010)  10   Scale  298]  and   Yadava
Kumar   v.   National   Insurance   Co.Ltd.       [(2010)   10
SCC   341:(2010)   3   SCC   (Cri)   1285:   (2010)   8   Scale
567]  )
12.   Therefore, the Tribunal has to first decide whether
there is any permanent disability and, if so, the extent
of   such   permanent   disability.   This   means   that   the
Tribunal should consider  and decide with reference to
the evidence:
( i )   whether   the   disablement   is   permanent
or temporary;
( ii ) if the disablement is permanent, whether
it   is   permanent   total   disablement   or
permanent partial disablement;
( iii )   if   the   disablement   percentage   is
expressed   with   reference   to   any   specific
limb,then the effect of such disablement of
the    limb on the functioning of the entire
body,   that       is,   the   permanent   disability
suffered    by     the person.
If   the   Tribunal   concludes   that   there   is   no   permanent
disability   then   there   is   no   question   of   proceeding
further   and   determining   the   loss   of   future   earning
capacity.   But   if   the   Tribunal   concludes   that   there   is
permanent     disability then it will proceed to ascertain
its     extent.       After   the   Tribunal   ascertains   the   actual
extent   of   permanent   disability   of   the   claimant   based
on   the   medical   evidence,   it   has   to   determine   whether
such   permanent   disability   has   affected   or   will   affect
his             earning capacity.
13.   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
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result of the permanent disability (this is also relevant
for   awarding   compensation   under   the   head   of   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 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.
xxx
19.   We   may   now   summarise   the   principles   discussed
above:
( i )   All   injuries   (or   permanent   disabilities
arising from injuries), do not result in loss
of earning capacity.
( ii ) The percentage of  permanent  disability
with   reference   to   the   whole   body   of   a
person,   cannot   be   assumed   to   be   the
percentage   of   loss   of   earning   capacity.   To
put it differently, the percentage of loss of
earning   capacity   is   not   the   same   as   the
percentage of permanent disability (except
in  a   few   cases,   where  the  Tribunal  on  the
basis   of   evidence,   concludes   that   the
percentage   of   loss   of   earning   capacity   is
the   same   as   the   percentage   of   permanent
disability).
( iii )   The   doctor   who   treated   an   injured
claimant   or   who   examined   him
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subsequently   to   assess   the   extent   of   his
permanent   disability   can   give   evidence
only   in   regard   to   the   extent   of   permanent
disability.   The   loss   of   earning   capacity   is
something that will have to be assessed by
the Tribunal with reference to the evidence
in entirety.
( iv )   The   same   permanent   disability   may
result   in   different   percentages   of   loss   of
earning   capacity   in   different   persons,
depending   upon   the   nature   of   profession,
occupation   or   job,   age,   education   and
other factors.
9. Applying the aforesaid principles to the instant case, it is noted
that   the   appellant   herein   let   in   his   evidence   as   PW­1   and   his   doctor
(Dr. M.S. Rajesh) was examined as PW­2. He produced documents at
Exhibit­P1 to Exhibit­P126 in support of their evidence. On the other
hand, the  respondents did not lead any  evidence. However, a copy of
the Exhibit ­R1, i.e., Insurance Policy was exhibited by consent.  
10. It is noted that the appellant herein sustained comminuted bone
fracture   of   tibia   on   both   legs.   He   was   operated   upon   twice   and   was
hospitalized  for  thirty­six  days  cumulatively.  As  per   PW­2  (the   doctor
who treated him), there was 54% disability despite the treatment given
to   the   appellant   herein.   The   appellant   was   treated   as   an   inpatient
from   15.05.2015   to   13.06.2015.   He   underwent   wound   debridement
OR & IF with interlocking nail and on 26.05.2015 secondary suturing
of   right   leg   was   done.   Later   in   the   year   2016   the   claimant   was
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hospitalized   from   02.03.2016   to   07.03.2016   and   treated   with
freshening   of   the   ends   of   fractured   fragments   and   cotico­cancellous
bone   grafting   from   the   contra   lateral   iliac   crest   with   partial
fibulectomy   done   on   03.03.2016.   He   also   took   treatment   as   an
outpatient on 30.06.2015 and 30.12.2015.
  
11. PW­2­ doctor, who treated the appellant­ claimant has assessed
permanent   disability   of   54%   which   we   find   is   on   the   higher   side.   As
the   claimant   sustained   comminuted   fracture   of   tibia   bones   of   both
legs,   we  assess  the   whole­body  disability  at  30%.  We  also   propose  to
enhance the compensation under the heads of pain and suffering due
to two surgeries undergone and future surgeries to be undergone. Also
towards   loss   of   future     amenities   and   towards   loss   of   income   during
laid   up   period   for   a   period   of   twelve   months   compensation   is
enhanced. 
12.   In   view   of   the   aforesaid   evidence   let   in   by   the   claimant,   we
propose to reassess the compensation as under:
Sl. No. Description  Amount   in
Rs.
1.   Pain and suffering  1,00,000/­
2.   Medical Expenses 1,20,405/­
3.   Incidental hospital Expenses     35,000/­
4.   Loss of future earning capacity 
(30% of Rs.10,000 x 12 x 17) 6,12,000/­
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5.   Loss of income during laid up period
  (Rs.10,000 x 12)     1,20,000/­
6.   Loss of Future amenities  1,00,000/­
7.   Conveyance and attendant Charges     30,000/­
8.   Future medical expenses    50,000/­
___________
Total            Rs.11,67,405/­
The aforesaid compensation shall carry interest at the rate of 6%
per annum from the date of filing of the claim petition till realization.  
13. In the result, the judgment and award passed by the High Court
is modified by enhancing the award of compensation to the appellant
herein   from   Rs.7,37,604/­   to   Rs.11,67,405/­which   shall     carry
interest   at   the   rate   of   6%   per   annum   from   the   date   of   filing   of   claim
petition till realization.  The amount shall be deposited within a period
of six weeks from the date of receipt of certified copy of this judgment.
On   deposit   of   the   said   amount,   the   Tribunal   shall   deposit   a   sum   of
Rs.3,00,000/­ in any nationalized bank for a period of five years. The
appellant   shall   be   entitled   to   draw   periodical   interest   on   the   said
deposit. The balance amount shall be paid to the appellant herein.
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14. The appeals are allowed in part in the aforesaid terms.
Parties to bear their respective costs.
…………………………………….J
[B.R. GAVAI]
……………………………………...J
[B.V. NAGARATHNA]
NEW DELHI;
18 th
 NOVEMBER, 2022.
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