8 July 2024


Supreme Court

Jithendran Vs. The New India Assurance Co. Ltd. and Ors.



Motor Vehicles

Loss of earning capacity must be fixed at 100%, when injured is incapacitated for life

Present appeal arises out of a motor accident claim following the serious injuries suffered by the Appellant, when the motor cycle (where the Appellant was riding pillion), was hit by a car. Both riders were impacted, resulting in severe head injuries to the Appellant. Dissatisfied with the awarded sum, the claimant is before present Court.

A person is not only to be compensated for the injury suffered due to the accident but also for the loss suffered on account of the injury and his inability to lead the life he led, prior to the life-altering event. The Courts should strive to provide a realistic recompense having regard to the realities of life, both in terms of assessment of the extent of disabilities and its impact including the income generating capacity of the claimant. In cases of similar nature, wherein the claimant is suffering severe cognitive dysfunction and restricted mobility, the Courts should be mindful of the fact that, even though the physical disability is assessed at 69%, the functional disability is 100% in so far as claimant’s loss of earning capacity is concerned.

The extent of economic loss arising from a disability may not be measured in proportions to the extent of permanent disability. In cases such as this, the Tribunal and the Courts must be conscious of the fact that, the permanent disability suffered by the individual not only impairs his cognitive abilities and his physical facilities but there are multiple other non-quantifiable implications for the victim. The very fact that a healthy person turns into an invalid, being deprived of normal companionship, and incapable of leading a productive life, makes one suffer the loss of self-dignity.

The impact on the earning capacity for the claimant by virtue of his 69% disability must not be measured as a proportionate loss of his earning capacity. The earning life for the Appellant is over and as such his income loss has to be quantified as 100%. There is no other way to assess the earning loss since the Appellant is incapacitated for life and is confined to home. In such circumstances, his loss of earning capacity must be fixed at 100%.

The efforts must be to substantially ameliorate the misery of the claimant and recognize his actual needs by accounting for the ground realities. The measures should however be in correct proportion. As is aptly said by Justice R.V Raveendran, while speaking for the Division Bench in Sarla Verma and Others Vs. Delhi Transport Corporation and Another, just compensation is adequate compensation and the Award must be just that- no less and no more.

The plea of the victim suffering from a cruel twist of fate, when asking for some more, is not extravagant but is for seeking appropriate recompense to negotiate with the unforeseeable and the fortuitous twists is his impaired life. Therefore, while the money awarded by Courts can hardly redress the actual sufferings of the injured victim (who is deprived of the normal amenities of life and suffers the unease of being a burden on others), the Courts can make a genuine attempt to help restore the self-dignity of such claimant, by awarding ‘just compensation’. The impugned judgment of the High Court stands modified. Appeal allowed.

Tags : Award Compensation Enhancement

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