R. Halle vs. Reliance General Insurance Company Limited

2026 INSC 260
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO(S). OF 2026
(Arising out of SLP (Civil) No(s). of 2026)
(Diary No(s).37186 of 2023)

R. HALLE ….APPELLANT(S)

VERSUS

RELIANCE GENERAL
INSURANCE COMPANY
LIMITED ….RESPONDENT(S)

J U D G M E N T
Mehta, J.

1. Heard. Delay condoned.
2. Leave granted.
3. The instant appeal arises out of judgment and
th
order dated 11 January, 2022 passed by High Court
1
of Judicature at Madras in Civil Miscellaneous
Appeal No. 3595 of 2021. The said appeal was
2
preferred by appellant herein seeking enhancement
Signature Not Verified

1
Hereinafter, being referred to as the “High Court”.
2
Hereinafter, being referred to as the “appellant-claimant”.
Digitally signed by
SONIA BHASIN
Date: 2026.03.18
17:17:38 IST
Reason:
1


of maintenance as awarded by Motor Accidents
Claims Tribunal, Special Subordinate Judge,
3 nd
Coimbatore. By its award dated 22 January, 2020,
the MACT granted compensation in the sum of
Rs.65,53,811/- (Rupees Sixty-Five Lakh Fifty-Three
Thousand Eight Hundred Eleven Only) along with
interest at the rate of 7.5% per annum from the date
of petition till its realization to the appellant-claimant
and directed the Reliance General Insurance
4
Company Limited, to satisfy the award. The MACT,
however, granted liberty to the respondent-insurer to
recover the said amount from the driver-cum-owner
5
of the offending vehicle, namely, R. Chinnadurai , in
accordance with law.
4. The High Court, vide the impugned judgment
dismissed the appeal filed by appellant-claimant
6
seeking enhancement and partly allowed the appeal
filed by the respondent-insurer thereby reducing the
amount of compensation of Rs.65,53,811/- as

3
Hereinafter, being referred to as the “MACT”.
4
Hereinafter, being referred to as the “respondent-insurer”.
5
R. Chinnadurai was impleaded as party-Respondent No. 2 in the present
SLP. However, his name came to be deleted from the array of parties vide
th
order dated 13 December, 2024.
6
Civil Miscellaneous Appeal No. 464 of 2021.
2


awarded by MACT to Rs.35,61,000/- (Rupees Thirty-
Five Lakh Sixty-One Thousand Only).
5. For the sake of convenience, the chart
indicating the various heads under which
compensation was awarded to appellant-claimant by
the MACT as well as the High Court, along with the
amounts granted thereunder, is reproduced
hereinbelow: -

3

Brief Facts: -
6. The facts in a nutshell relevant and essential for
disposal of the appeal are as follows.
th
7. On the night of 5 May, 2016, at about 10:00
p.m., the appellant-claimant was proceeding on his
motorcycle bearing Registration No. TN-38-BY-9380
along Mettupalayam Road at Periyanaickenpalayam,
travelling from south to north. At that juncture,
another motorcycle bearing Registration No. TN-38-
CD-5823, driven by R. Chinnadurai, approached
from the opposite direction. It is the case of appellant-
claimant that the said vehicle was being driven in a
rash and negligent manner and collided head-on with
his motorcycle.
8. As a result of the impact, the appellant-claimant
was thrown onto the road and sustained grievous
injuries, including a fracture of the left leg, facial
4


injuries, and a severe head injury. He was
immediately taken to Ganga Hospital, Coimbatore,
where he was admitted as an inpatient and
underwent treatment. In connection with the said
occurrence, an FIR bearing Crime No.236 of 2016
th
was registered on 7 May, 2016 against R.
Chinnadurai for the offences punishable under
Sections 279 and 338 of the Indian Penal Code, 1860,
at Police Station Periyanaickenpalayam, Coimbatore
District, Tamil Nadu.
9. After undergoing treatment for nearly a month,
the appellant-claimant was discharged from the
th
hospital on 29 May, 2016. It is the case of the
appellant-claimant that notwithstanding prolonged
treatment, he was left with a permanent disability
assessed at 65%, which, according to him, has
substantially impaired his functional capacity and
earning potential.
10. The appellant-claimant thereafter approached
the MACT seeking compensation, contending that at
the time of the accident he was about 30 years of age,
hale and healthy, and employed as a Manager at
Flyjac Logistics Pvt. Ltd., Chennai, earning a monthly
income of Rs.25,000/-. Alleging that the accident
5


occurred solely due to the rash and negligent driving
7
of R. Chinnadurai, he filed a claim petition, claiming
a sum of Rs.30,00,000/- (Rupees Thirty Lakh Only)
from R. Chinnadurai and respondent-insurer
towards loss of income, medical expenses, pain and
suffering, and other consequential damages.
11. Upon a comprehensive and meticulous
evaluation of the oral and documentary evidence
adduced on record, including the testimony of the
appellant-claimant (PW-1) and PW-2, the medical
records, the disability certificate issued by the
competent Medical Board, and the salary documents
exhibited on behalf of the appellant-claimant,
coupled with the fact that the driver-cum-owner
remained ex parte and there was no contra evidence
from the respondent-insurer, the MACT arrived at a
categorical finding that the accident had occurred
solely due to the rash and negligent driving of R.
Chinnadurai and that the appellant-claimant had
satisfactorily established the nature and extent of the
injuries sustained by him. The MACT, placing due
reliance on the disability certificate, assessed the

7
Motor Accidents Claim Original Petition No. 1372 of 2016.
6


permanent disability at 63% as certified therein,
holding the same to have a direct bearing on the
appellant-claimant’s functional and earning
capacity.
12.
The MACT, having accepted the disability
certificate issued by the Medical Board, proceeded to
determine the impact of such disability on appellant-
claimant’s earning capacity. Applying the multiplier
8
method in view of the settled legal position and
taking into consideration appellant-claimant’s age,
monthly income inclusive of future prospects
[Rs.29,108/- + (40% of Rs.29,108/-) = Rs.40,751
(Rounded off to Rs.40,000/-) ], and the functional
consequences of the injuries sustained, the MACT
computed the loss of future earning capacity at
Rs.51,40,800/- (Rs.40,000/- x 12 x 63% (Disability)
x 17). In addition, thereto, it awarded amounts under
the heads of medical expenses, loss of amenities, pain
and suffering, transportation, extra nourishment,
and other incidental expenses. On such computation
under the various permissible heads, the MACT
quantified the total compensation at Rs.65,53,811/-

8
Multiplier was taken to be “17” since the age of appellant-claimant was
fixed as 30 years.
7


(Rupees Sixty-Five Lakh Fifty-Three Thousand Eight
Hundred Eleven Only) along with interest at the rate
of 7.5% per annum from the date of petition till its
realization and awarded the said sum to the
appellant-claimant, as detailed supra . The MACT
directed the respondent-insurer to satisfy the award,
while granting it liberty to recover the said amount
from the driver-cum-owner of the offending vehicle,
namely, R. Chinnadurai, in accordance with law.
13. Being aggrieved by the award passed by the
MACT, the respondent-insurer preferred Civil
Miscellaneous Appeal No. 464 of 2021 before the
High Court, contending that the compensation
awarded was excessive and disproportionate to the
injuries sustained and the disability suffered by the
appellant-claimant. Simultaneously, the appellant-
claimant also preferred Civil Miscellaneous Appeal
No. 3595 of 2021 seeking enhancement of the
compensation awarded, asserting that the amount
granted by the MACT was inadequate having regard
to the nature of injuries, extent of permanent
disability, and the consequential loss suffered by
him.
8


14. The High Court, upon reappreciation of the
evidence on record, observed that though the Medical
Board had assessed the physical disability of the
appellant-claimant at 63%, the same could not be
mechanically adopted for the purpose of determining
loss of earning capacity. Upon an independent
evaluation of the nature of injuries and the impact of
such injuries on the appellant-claimant’s avocation
as a Manager in a private concern, the High Court
adjudged the functional disability suffered by the
appellant-claimant at 30%. In view of the said
finding, the High Court, vide its common judgment
th
and order dated 11 January, 2022, dismissed the
appeal preferred by the appellant-claimant seeking
enhancement of compensation and partly allowed the
appeal filed by the respondent-insurer, thereby
reducing the total compensation awarded by the
MACT from Rs.65,53,811/- to Rs.35,61,000/-
(Rupees Thirty-Five Lakh Sixty-One Thousand Only),
as detailed , modifying the award of the MACT
supra
to that extent.
15. Being dissatisfied with the dismissal of his
appeal seeking enhancement of compensation as
awarded by the MACT, the appellant-claimant has
9


preferred the instant appeal by special leave before
this Court.
Submissions on behalf of appellant-claimant: -
16. Ms. Haripriya Padmanaban, learned senior
counsel appearing on behalf of appellant-claimant,
assailed the impugned judgment of the High Court on
the following counts: -
A. That the High Court failed to appreciate that the
Medical Board had categorically assessed the
physical disability of the appellant-claimant at
63%, which finding was based on a duly
constituted medical examination and stood
substantiated by the disability certificate placed
on record. The Medical Board had recorded that
the case involved a head injury treated
conservatively, facial injury, and left femur
fracture treated by surgical intervention, and that
the said injuries had resulted in partial
blindness, cognitive impairment, and partial
loss of range of motion and stability of the left
knee. It was submitted that the MACT had
correctly placed reliance on the said expert
medical opinion and there was no justifiable
reason for the High Court to dilute the effect of the
10


certified disability while computing the loss of
earning capacity.
B. That the appellant-claimant had suffered severe
head injury in the accident, resulting in serious
cognitive impairments, as reflected in the
neuropsychological assessment report. The said
report demonstrated that the Memory Scale of the
patient, i.e., appellant-claimant indicated severe
impairment of both verbal and visual memory;
tests relating to frontal lobe functioning revealed
impairment; while parietal lobe functioning was
found to be intact. It was further submitted that
the appellant-claimant’s IQ score of 65 placed him
within the category of Mild Intellectual Disability,
thereby evidencing substantial neurological
degradation having direct bearing on his
functional abilities and employability.
C. That both the High Court and the MACT failed to
properly appreciate that although the physical
disability had been assessed at 63% by the
Medical Board, the functional disability suffered
by the appellant-claimant, having regard to the
nature of brain injury and its consequences, was
in effect 100%, as the cognitive deficits and
11


neurological damage had rendered the appellant-
claimant totally incapable of resuming his
previous avocation or engaging in any gainful
employment, resulting in a complete loss of
earning capacity.
D. That the appellant-claimant placed reliance upon
several precedents of this Court to contend that
in appropriate cases this Court has enhanced
compensation by taking into consideration the
educational background, and socio-economic
status of the victim, so as to ensure that just
compensation is awarded to the victim. It was
further urged that this Court has consistently
restricted untenable legal defences raised by
insurance companies and has emphasized that
the burden lies upon them to establish any
limited statutory defence. It was specifically
contended that the respondent-insurer had failed
to place any material on record to demonstrate
that the functional disability suffered by the
appellant-claimant was lesser than the
percentage determined by the MACT, and in the
absence of any contra evidence, the reduction of
compensation effected by the High Court was
12


wholly unjustified. In the light of the settled
principles governing award of just compensation
under the Motor Vehicles Act, 1988, it was
submitted that the appellant-claimant is entitled
to enhancement of compensation over and above
what was awarded by the MACT.
On the aforesaid grounds, learned senior counsel
urged that the impugned judgment of the High Court
does not withstand judicial scrutiny, being founded
on an erroneous appreciation of the evidence and a
misapplication of the settled principles governing
assessment of disability and loss of earning capacity.
It was submitted that the judgment, having
disregarded material and unimpeachable
documentary evidence available on record, deserves
to be set aside. It was further prayed that this Court
may be pleased to enhance the compensation
appropriately by holding that the functional disability
suffered by the appellant-claimant is 100%, and by
recalculating the loss of future earning capacity and
other consequential heads in accordance with law.


13


Submissions on behalf respondent-insurer: -
17. Ms. Prerna Mehta, learned counsel appearing
on behalf of respondent-insurer, supported the
impugned judgment to the hilt and urged that the
same calls for no interference by this Court, inter alia ,
on the following grounds: -
A. That the High Court has rightly and justly
exercised its appellate jurisdiction upon a proper
reappreciation of the evidence on record, and the
impugned judgment is well-reasoned, balanced
and in consonance with the settled principles
governing assessment of compensation under the
Motor Vehicles Act, 1988. It was submitted that no
perversity or patent illegality has been
demonstrated in the High Court’s reasoning
warranting interference by this Court.
B. That the High Court correctly held that physical
disability assessed by the Medical Board cannot
ipso facto be equated with functional disability for
the purpose of determining loss of earning
capacity. It was contended that the High Court,
upon considering the nature of employment of the
appellant-claimant and the material placed on
record, justifiably concluded that though the
14


physical disability was assessed at 63%, the
functional disability suffered by the appellant-
claimant ought to be taken at 30% for the purpose
of computation of compensation.

C. That the evidence on record does not establish
that the disability suffered by the appellant-
claimant has resulted in a complete loss of income
or total incapacity to earn. It was urged that the
injuries sustained by the appellant-claimant were
treated, and the disability certificate itself
indicates disability to the extent of 63%. In the
absence of cogent evidence demonstrating total
incapacitation or inability to undertake any form
of gainful employment, it cannot be contended
that the appellant-claimant has suffered 100%
functional disability or has lost his entire earning
capacity.
On these grounds, learned counsel submitted that
the impugned judgment of the High Court is legally
sound and does not warrant interference, and
accordingly prayed that the present appeal be
dismissed.

15


Analysis and Discussion: -
18. We have heard and considered the submissions
advanced by learned counsel for the parties and have
carefully gone through the impugned judgment as
well as the material placed on record.
19. At the outset, it must be noted that insofar as
the determination of monthly income and the
addition towards future prospects are concerned,
there is no serious dispute before us. The controversy
in the present appeal lies within a narrow compass.
The principal issue which falls for our consideration
is with regard to the assessment of extent of disability
for the purpose of computing loss of earning capacity,
and more particularly, the soundness of the High
Court’s determination of functional disability at 30%
as against 63% assessed by the Medical Board and
affirmed by the MACT. The consequential effect of the
above exercise would be to determine whether the
appellant-claimant is entitled to any further
enhancement of compensation over and above the
amount awarded by the MACT.
20. At the first instance, the MACT, upon
appreciation of the oral and documentary evidence
including the disability certificate (Exh.C-1), the
16


neuropsychological assessment report, and the
nature of avocation of the appellant-claimant as a
Manager in a private concern, accepted the
permanent physical disability assessed by the
Medical Board at 63% and proceeded to compute the
loss of future earning capacity by applying the
multiplier method established by a long line of
binding precedents. The MACT took note of the fact
that the injuries included a head injury resulting in
cognitive impairment, partial blindness, and
restriction of movement and stability of the left knee,
and recorded a finding that such disability had a
direct bearing on the appellant-claimant’s earning
capacity.
21. However, the High Court, while observing that
physical disability cannot be mechanically equated
with functional disability, reduced the functional
disability suffered by the appellant-claimant from
63% to 30% without adverting in detail to the medical
evidence on record, particularly the findings of the
Medical Board and the neuropsychological report
evidencing cognitive deficits suffered by the
appellant-claimant as a consequence of the injuries
suffered in the accident. No independent contra
17


material was placed on record by the respondent-
insurer to displace the evidentiary value of the
disability certificate. In our considered view, such
reduction of the functional disability, in the absence
of convincing evidence impeaching the credibility of
the medical certificates placed on record by the
appellant-claimant and without assigning cogent
reasons, was not at all justified. For ready reference,
the relevant extract from the impugned judgment is
reproduced hereinbelow: -
“10. According to the claimant he was earning a sum
of Rs.29,108/- per month by working as a Manager
in a private concern, which has been proved through
Exs.21 to 25. Thus, the Tribunal has arrived the
amount under the head of loss of earning power, by
multiplying the disability as 63%. It appears to be on
Though the Medical Board has
the higher side.
assessed the physical disability of the claimant
as 63%, after going through the records, we have
come to the conclusion that the functional
disability suffered by the claimant would be 30%.
After adding 40% towards future prospectus, the
total income of the claimant is arrived at
Rs.40,751/-, rounded off to Rs.40,000/-. Thereby,
the claimant is entitled for an amount of
Rs.24,48,000/- (Rs.40,000/- x 12 x 30% x 17);
Rs.1,00,000/- for Loss of amenities; Rs.2,00,000/-
under Pain and sufferings; since the claimant was
unmarried at the time of accident and sustained
grievous injuries in the accident, an amount of
Rs.2,00,000/- is granted towards loss of marital
prospectus; The amounts awarded under the heads
of Medical expenses, Transportation to hospital,
18


Extra nourishment and Damage to clothing and
articles are confirmed.”
[Emphasis supplied]

22. A careful reading of the aforesaid extract
indicates that the High Court merely adverted to the
general principles governing assessment of disability
and, without undertaking any independent analysis
of the evidence on record, abruptly concluded that
the functional disability suffered by the appellant-
claimant would be 30%. There is no discussion as to
why the medical findings, the disability certificate
issued by the competent Medical Board, or the
neuropsychological report were doubtful or
insufficient to sustain the conclusion reached by the
MACT. Equally, while reducing the quantum of
compensation, no specific or cogent reasons have
been assigned for curtailing the amounts awarded
under the heads of “Loss of Amenities” and “Pain and
Suffering,” which were based on the nature and
gravity of the injuries sustained by the appellant-
claimant. In our considered opinion, such
conclusions, abruptly arrived at without proper
reappreciation of the evidence and without recording
adequate reasons, are in the nature of presumptions
19


and assumptions and cannot be sustained in the
eyes of law.
23. Ordinarily, where a Court exercising appellate
jurisdiction reverses or modifies a finding of fact
recorded by the Court of first instance without a
proper reappreciation of the evidence or without
assigning cogent reasons, this Court would be
justified in setting aside the impugned judgment and
remitting the matter for fresh consideration on merits
and in accordance with law. In the present case, the
assessment of functional disability, which had a
direct bearing on the determination of just
compensation, necessarily required a careful
scrutiny of the medical evidence and its impact on
the avocation of the injured. The failure to undertake
such an exercise would, in the normal course,
warrant a remand.
24. However, we cannot be oblivious of the fact that
the accident occurred in the year 2016 and that the
appellant-claimant has been engaged in litigation for
nearly a decade, first before the MACT, thereafter
before the High Court and now before this Court. A
remand at this stage would only prolong the
proceedings and compound the agony already
20


suffered by the appellant-claimant. In these
circumstances, in order to do complete justice
between the parties, we deem it appropriate to
examine the issue on merits and determine the issue

of functional disability on the basis of the material
available on record.
25. In order to determine the functional disability
suffered by the appellant-claimant, it is necessary to
advert to the findings recorded by the Medical Board
with respect to the permanent physical disability, as
well as the neuropsychological assessment report
placed on record. Both these documents remained
uncontroverted and hence, they provide credible
expert evidence so as to assess the extent and nature
of disability. The true nature and extent of the
injuries, and their impact on the cognitive and
functional abilities of the appellant-claimant, can be
properly appreciated only upon a careful
consideration of these materials. For ready reference,
the relevant extracts from the said documents are
reproduced hereinbelow: -
“ Neuropsychological Assessment Report:
Interpretation & Conclusion
• Memory Scale shows that his verbal and Visual
memory is impaired severely.
21


• On tests for frontal lobe functioning-
impairment.
• On the test for parietal lobe functioning,
normal performance shows that the lobe
function is intact.
• The IQ range of 65, fall into the category of
Mild Intellectual Disability.
Report of the Medical Board
Case of Head injury treated conservatively, facial
injury x left femur fracture treated by surgical
intervention. Above injury has resulted in partial
blindness, cognitive impairment and partial lom
of Rom and stability of left knee.
His disability due to above injuries sixty three
percent (63%).”
[Emphasis supplied]

26. Having bestowed our anxious consideration to
the material placed on record, we find that the
disability certificate issued by the Medical Board
clearly records that the appellant-claimant had
suffered a head injury treated conservatively, facial
injury, and left femur fracture treated by surgical
intervention. These injuries progressively resulted in
partial blindness, cognitive impairment and partial
loss of range of motion and stability of the left knee.
The neuropsychological assessment further
evidences severe impairment in verbal and visual
memory, impairment of frontal lobe functions and an
IQ score of 65, placing the appellant-claimant in the
22


category of Mild Intellectual Disability. These
findings, read conjointly, demonstrate that the
injuries suffered by the appellant-claimant were not
merely orthopedic in nature, but had significant
neurological sequelae directly impacting his
functional and cognitive abilities.
9
27. This Court, in Raj Kumar v. Ajay Kumar , has
authoritatively laid down the principles governing
assessment of permanent and functional disability
for the purpose of awarding compensation. It has
been held that the percentage of permanent disability
assessed by a medical expert cannot be mechanically
equated with the percentage of loss of earning
capacity. What is required to be determined is the
actual impact of such disability on the earning
capacity of the injured, having regard to his
avocation, age and the nature of work performed. The
Tribunal is required to undertake a structured
analysis to ascertain the activities the claimant can
or cannot perform post-injury, the nature of his
profession prior to the accident, and whether the
disability has resulted in total incapacity or merely

9
(2011) 1 SCC 343
23


restricted or reduced earning capacity. For ready
reference, the relevant extracts from the said
judgment are reproduced hereinbelow: -
“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 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
24


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 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])
[……]
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 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
25


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.”
[Emphasis supplied]

28. In view of the principles laid down by this Court
in Raj Kumar (supra) , as consistently affirmed
thereafter, the assessment of functional disability
must be grounded in a realistic appraisal of the
impact of the injury on the claimant’s capacity to
earn. The inquiry is not confined to the numerical
percentage of physical impairment certified by the
Medical Board, but extends to evaluating whether the
claimant, in light of his educational background, skill
set and nature of employment, is capable of
meaningfully pursue his avocation.
29. Reverting to the facts of the present case, the
appellant-claimant was admittedly employed as a
Manager in a private concern, a role inherently
dependent upon sustained cognitive functioning,
26


including memory retention, analytical ability,
executive decision-making, coordination and effective
communication. The neuropsychological report on
record evidences severe impairment in verbal and
visual memory, frontal lobe dysfunction, and an IQ
score of 65 placing him within the category of Mild
Intellectual Disability.
30. Further, the Medical Board has recorded that
the injuries resulted not only in cognitive impairment
but also in partial blindness and orthopedic
limitations affecting mobility and stability. When
these physical and neurological impairments are
cumulatively evaluated, it becomes manifest that the
appellant-claimant’s ability to effectively discharge
his pre-accident duties stands substantially and
irreversibly impaired. The evidence does not indicate
a mere diminution in efficiency, rather, it
demonstrates a profound erosion of the faculties
essential for gainful employment in his chosen field.
These impairments strike at the core competencies
indispensable for the effective discharge of
managerial responsibilities and substantially
undermine the appellant-claimant’s ability to
perform the essential functions inherent in such a
27


position. In such circumstances, and bearing in mind
the settled principle that functional disability must
reflect the actual loss of earning capacity, we are
persuaded to hold that the disability in the present
case, for the purpose of computation of
compensation, deserves to be reckoned at 100%. It is
beyond the pale of doubt that, having suffered such
grave medical and neurological impairments, the
appellant-claimant would neither be considered
suitable for the managerial post nor would he be
capable of effectively discharging the onerous
responsibilities attached to the said post, particularly
in light of his present condition, which is likely to
deteriorate progressively over time.
31. Consequently, in light of the foregoing
discussion and considering that the functional
disability suffered by the appellant-claimant is to be
assessed at 100% for the purpose of computing loss
of earning capacity, the compensation payable to the
appellant-claimant warrants re-determination so as
to ensure the award of just and fair compensation in
accordance with law. Accordingly, the compensation
payable to the appellant-claimant is recalculated as
per the computation set out hereunder: -
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32. Thus, the total compensation payable to the
appellant-claimant works out to Rs.97,73,011/-
(Rupees Ninety-Seven Lakh Seventy-Three Thousand
and Eleven only). The appellant-claimant shall be
entitled to interest at the rate of 7.5% per annum
from the date of filing of the claim petition till the date
of realization, as awarded by the MACT. The amount,
if any, already paid shall be duly adjusted towards
the aforesaid sum. The award shall be satisfied by the
respondent-insurer. However, as directed by the
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MACT, the respondent-insurer shall be at liberty to
recover the said amount from the driver-cum-owner
of the offending vehicle, namely, R. Chinnadurai, in
accordance with law.
33.
The respondent-insurer is directed to deposit
the balance amount of compensation along with
accrued interest within a period of six weeks from the
date of receipt of this judgment before the Motor
Accidents Claims Tribunal, Special Subordinate
Judge, Coimbatore, which shall disburse the same to
the appellant-claimant in accordance with law.
th
34. The impugned judgment dated 11 January,
2022 passed by the High Court and the award dated
nd
22 January, 2020 passed by the MACT are modified
in terms of this judgment.
35. Before parting with the matter, we deem it
appropriate to reiterate that when an appellate court
interferes with findings of fact duly recorded by the
Motor Accidents Claims Tribunal, particularly on
issues such as assessment of disability and loss of
earning capacity, it is incumbent upon it to
undertake a thorough reappreciation of the evidence
and to assign cogent, clear and convincing reasons
for departing from the conclusions arrived at by the
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Motor Accidents Claims Tribunal. Such an obligation
is heightened in proceedings under the Motor
Vehicles Act, 1988, which is a beneficial and welfare-
oriented legislation enacted with the object of
ensuring expeditious relief and just compensation to
victims of motor accidents and their families. The
statutory framework is designed to advance social
justice and to provide solace and financial security to
those who suffer on account of road accidents. Any
interference with a reasoned award of the Motor
Accidents Claims Tribunal must, therefore, be
consistent with the spirit and object of the enactment
and supported by sound judicial reasoning.
36. The appeal is allowed accordingly.
37. There shall be no order as to costs.
38. Pending application(s), if any, shall stand
disposed of.

…………….….……………………J.
(PRASHANT KUMAR MISHRA)


……………....…………………….J.
(SANDEEP MEHTA)
NEW DELHI;
MARCH 18, 2026.

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