A temporary disability certificate cannot support compensation based on permanent disability.

The appellant-claimant, aged about 30 years, sustained injuries, including a fracture to his right leg, in a motor accident on 11 August 2021. He remained hospitalised for five days and filed a claim under the Motor Vehicles Act, 1988.

The Additional Motor Accident Claims Tribunal, Dhamtari, awarded compensation of ₹6,56,527 by award dated 27 December 2023 in Claim Case No. 214/2021.

The claimant appealed under Section 173 of the Motor Vehicles Act seeking enhancement, contending that his disability, income, and medical expenses had been assessed inadequately.

The insurer did not appear before the High Court; respondent No. 1 contended that the vehicle was insured and that liability lay upon the insurer.

Whether the Tribunal erred in assessing the claimant’s functional disability at 20%, despite a disability certificate indicating 40% disability.

Whether the claimant’s monthly income was required to be reassessed in accordance with the applicable minimum-wage notification.

Whether the amount awarded towards medical expenses required enhancement.

Whether the total compensation awarded by the Tribunal required modification and enhancement.

The appeal was governed by Section 173 of the Motor Vehicles Act, 1988, which permits an appeal against an award of a Motor Accident Claims Tribunal.

Compensation for loss of future earning capacity is to be calculated by applying the claimant’s income, the permissible addition for future prospects, the appropriate multiplier, and the percentage of functional disability.

The Court applied National Insurance Co. Ltd. v. Pranay Sethi, (2017) 16 SCC 680, on future prospects; Sarla Verma v. Delhi Transport Corporation, (2009) 6 SCC 121, on the selection of the multiplier; and Magma General Insurance Co. Ltd. v. Nanu Ram @ Chuhru Ram, (2018) 18 SCC 1305, as relied upon by the Tribunal and affirmed by the High Court.

The assessment of disability must be based on the evidence regarding permanent or functional disability and its impact on earning capacity.

The Court rejected the claimant’s challenge to the assessment of disability.

Although the disability certificate recorded 40% disability, Dr. Vinod Kumar Pandey testified that it was only a temporary-disability certificate, valid until 22 February 2023, and that the claimant’s condition could improve.

Since the claimant had undergone surgery and there was no proof of permanent disability, the Court held that the Tribunal’s assessment of functional disability at 20% was justified.

However, the Court found that the Tribunal had assessed monthly income at ₹7,800, whereas the applicable minimum-wage notification for the date of accident indicated income of ₹9,200 per month.

It therefore recalculated the loss of future income by adding 40% towards future prospects and applying the multiplier of 17: ₹9,200 + 40% = ₹12,880 per month, or ₹1,54,560 annually; multiplied by 17 and reduced by 20% disability, this resulted in ₹5,25,504.

The Court also enhanced medical expenses from ₹1,24,991 to ₹1,25,000, observing that preservation of all medical bills was not practicable.

After deducting the amount already awarded, the claimant became entitled to an additional ₹79,977.

The enhanced amount was directed to carry interest at 6% per annum from the date of filing of the claim application until realisation.

The remaining terms and conditions of the Tribunal’s award were left undisturbed.

The Registry was directed to communicate the enhanced amount to the claimant in Hindi/Devanagari, with assistance from paralegal workers where necessary.