A leg amputation rendered the mechanical engineer 100% functionally disabled for earning-capacity assessment.

The claimant, a mechanical engineering graduate aged about 28, sustained injuries in a road accident on 19 July 2006 involving his motorcycle and a truck. The injuries resulted in amputation of his leg. He sought compensation under Section 166 of the Motor Vehicles Act, 1988, alleging that the injury caused permanent disability and affected his earning capacity.

The Motor Accident Claims Tribunal awarded Rs. 8,03,980. The claimant appealed under Section 173, contending that the award inadequately assessed compensation under various heads.

Whether the claimant’s amputation, considered in light of his occupation as a mechanical engineer, resulted in 100% functional disability and corresponding loss of future earning capacity.

Whether the Tribunal’s award required enhancement, including compensation for future prospects, prosthetic needs, and other relevant heads.

Sections 166 and 173 of the Motor Vehicles Act, 1988 respectively provide for a compensation claim arising from a motor accident and an appeal against a Claims Tribunal’s award.

Compensation under the Act must be just, fair, and reasonable, assessed through a holistic and realistic approach.

Under Raj Kumar v. Ajay Kumar, the percentage of physical disability is not automatically equivalent to the percentage of loss of earning capacity; the Tribunal must assess the disability’s functional effect in light of the claimant’s occupation and circumstances.

The Court also relied on M. Paramesh v. VRL Logistics Ltd., 2026 INSC 655, on assessing functional disability and future earning loss, and V. Pathmavathi v. Bharti AXA General Insurance Co. Ltd., AIR 2026 SC 840, concerning future prospects.

The Court considered the claimant’s amputation alongside his work as a mechanical engineer, which it viewed as requiring physical activity and the use of both legs. Applying the functional-disability principles in Raj Kumar and M. Paramesh, it held that the injury resulted in 100% functional disability for assessing loss of earning capacity, rather than mechanically equating physical disability with economic loss.

It further found that the award required reassessment to account for future prospects, a prosthetic leg, attendant and related expenses, and other heads of compensation.

The Insurance Company was directed to deposit the enhanced amount and interest with the Tribunal within 12 weeks; the remaining directions of the Tribunal were left unchanged.