Compensation Awarded in Disability Case: Appellant vs. Insurance Company

In a landmark decision by the Supreme Court of India, compensation has been awarded in a disability case involving the Appellant and the Insurance Company. The Appellant, who suffered severe injuries in an accident, underwent extensive medical treatment leading to permanent disability. The Court’s assessment of 100% functional disability has resulted in the Appellant receiving compensation of Rs. 4,83,984. This ruling sets an important precedent in the realm of disability rights and legal judgments.


  • The Appellant, a heavy vehicle driver, met with an accident on 13.05.2006 resulting in severe injuries to his right leg.
  • He underwent a total of 65 days hospitalization at Government Hospital, Ratnagiri, and KIMS Hospital, Hubli.
  • The injuries included an Anterior Cruciate Ligament and a Collateral Ligament Tear, leading to permanent disability.
  • Plastic surgery was performed on his right leg.
  • The Appellant filed a claim under the Workmen’s Compensation Act against the Truck Owner and the Insurance Company seeking compensation of Rs. 5,00,000.
  • The Appellant suffered 37% whole-body disability as opined by Dr. Patil, rendering him unfit for truck driving.
  • The accident occurred due to an axle cut while driving a truck loaded with sand.
  • Dr. S.D. Patil confirmed the Appellant’s physical limitations post the accident.
  • The compensation computed at Rs. 1,81,494 given the Appellant’s age at the time of the accident was 33 years.
  • The Truck Owner acknowledged the accident and the Appellant’s injuries in his Written Statement.
  • The Commissioner assessed the Appellant’s income at Rs. 3,000/- p.m. and determined that he had lost 50% of his earning capacity.
  • The Court considered the functional disability of the Appellant and found that the assessment of 50% by the Commissioner was on the lower side. It increased the assessment to 60% as the Appellant could no longer earn his livelihood as a driver and could not stand for long periods.
  • Due to the increased functional disability assessment, the compensation was enhanced to Rs. 2,90,390/- with interest at 12% per annum payable from one month after the date of the accident.
  • The High Court accepted the Appellant’s income at Rs. 4,000/- per month as per the statement provided by the employer.

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  • The first step is to determine the claimant’s abilities despite the permanent disability and what they cannot do as a result.
  • This assessment is crucial in awarding compensation for the loss of amenities in life.
  • The second step involves understanding the claimant’s avocation, profession, nature of work before the accident, and age.
  • The third step is to decide if the claimant is totally disabled from earning any livelihood, if they can still continue previous activities despite the disability, or if they are restricted from previous activities but can still earn a living through other means.

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  • Compensation for loss of future earning capacity should be assessed based on the claimant’s specific vocation
  • If loss of future earning capacity is treated as 100% or more, compensation under loss of amenities or expectation of life may not be necessary
  • In cases where claimant’s vocation is severely impacted, compensation may be close to 100%
  • Extent of permanent physical or functional disablement can determine percentage of compensation for loss of earning capacity
  • In some cases, claimants may still be employed but in a different role due to disability, leading to a reduced earning capacity
  • Not all cases require compensation under loss of future earnings if claimant can continue in a different role with reduced capacity
  • In K. Janardhan v. United India Insurance Co. Ltd., the case of a tanker driver who lost one of his legs due to amputation was examined.
  • The Commissioner for Workmen’s Compensation assessed the functional disability of the tanker driver as 100% and awarded compensation based on that.
  • In Raj Kumar v. Ajay Kumar and Ors., the Court explained that ascertaining the effect of permanent disability on earning capacity involves three steps.
  • The High Court initially assessed loss of a leg on amputation as resulting in only a 60% loss of earning capacity based on Schedule I to the Workmen’s Compensation Act, 1923.
  • This decision was overturned by the Supreme Court which held that since the workman could no longer work as a tanker driver due to the loss of one leg, the functional disability should be assessed as 100%.
  • In S. Suresh v. Oriental Insurance Co. Ltd. & Anr., the Court determined that the individual had lost 100% of his earning capacity as a lorry driver due to the amputation of his right leg below knee.
  • The Appellant has not received any reimbursement for medical expenses from the Commissioner or the High Court.
  • The Appellant is unable to secure manual labor jobs without assistance due to mobility issues and discomfort.
  • The functional disability of the Appellant is assessed at 100%.

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  • The Appellant’s income is assessed at Rs. 4,000/- per month as per evidence from his employer.
  • The High Court judgment is affirmed.
  • The Appellant underwent 65 days of hospitalization for medical treatment and surgical operations.
  • A lump sum amount of Rs. 1,00,000/- is awarded towards hospitalization and medical expenses.
  • The Insurance Company is directed to pay the enhanced compensation amount with 6% interest calculated from one month after the accident until payment within 4 weeks.
  • The Appellant’s functional disability is assessed at 100% with a relevant factor of 201.66 as per Schedule IV of the Act.
  • The compensation payable to the Appellant is Rs. 4,83,984/- under Section 4 of the Act.
  • The Civil Appeal is allowed based on the above terms.


Case Number: C.A. No.-009306-009306 / 2019

Click here to read/download original judgement

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