Functional disability justifies multiplier-based compensation for loss of future income despite partial residual work capacity.

On 21 December 2019, Selvam was travelling in a Tamil Nadu State Transport Corporation bus near Rayarpalayam Bus Stop, Palladam–Tiruppur Road, when the bus allegedly was driven rashly and negligently, causing him to sustain multiple injuries, including a burst compression fracture of the D12 vertebra. He claimed to be a professional driver earning ₹25,000 per month and sought compensation of ₹40,00,000 under the Motor Vehicles Act, 1988.

The Transport Corporation denied negligence, asserting that the claimant fell inside the bus while it was crossing a speed breaker and that he was standing without holding the iron bar.

Before the Tribunal, the claimant examined himself and another witness. The Corporation examined the bus conductor but not the driver. The Tribunal relied on the FIR, the claimant’s evidence, and the conductor’s admission that he had not directly witnessed the accident, and held the bus driver negligent.

The Tribunal assessed the claimant’s functional disability at 30%, fixed his monthly income at ₹14,000, applied a multiplier of 11, added 10% towards future prospects, and awarded ₹8,73,795 in total compensation, including ₹6,09,840 for loss of future income.

The Transport Corporation filed the present appeal under Section 173 of the Motor Vehicles Act, challenging the finding of negligence and the quantum of compensation.

Whether the Tribunal was justified in fixing negligence on the bus driver despite the Corporation’s denial of liability and the non-examination of the driver?

Whether the Tribunal was justified in adopting the multiplier method and awarding ₹6,09,840 towards loss of future income on the basis of 30% functional disability, a monthly income of ₹14,000, multiplier 11, and 10% future prospects?

Whether the compensation awarded under the remaining heads was excessive or otherwise liable to be interfered with in appeal?

The Court exercised appellate jurisdiction under Section 173 of the Motor Vehicles Act, 1988.

In a motor accident claim, negligence may be determined on the basis of the overall evidence, including the injured claimant’s testimony, the FIR, and the failure of the party possessing the best evidence—such as the bus driver—to examine that witness.

For assessing loss of future earning capacity, the Court applied the principle that functional disability, rather than merely the medical percentage of disability, must be evaluated in relation to the claimant’s occupation.

It relied on Sarla Verma v. Delhi Transport Corporation, 2009 AIR (SC) 3104, for selection of the multiplier, and National Insurance Co. Ltd. v. Pranay Sethi, 2017 (2) TNMAC 609 (SC), for addition of future prospects.

The Court upheld the finding of negligence because the claimant’s evidence supported the pleaded manner of accident and the FIR had been registered against the bus driver.

The Corporation’s conductor admitted that he had not witnessed the occurrence directly, while the driver—the material witness capable of explaining how the accident occurred—was not examined. Accordingly, the Tribunal was justified in accepting the claimant’s version and fixing negligence on the bus driver.

On quantum, the Court noted that the claimant’s driving licence established that he was qualified to drive transport vehicles and supported his case that he was a professional driver.

Although the Medical Board assessed physical disability at 45%, the Tribunal reasonably assessed functional disability at 30%, finding that the spinal injuries would make it difficult for him to continue driving as before but did not completely disable his driving career.

The income of ₹14,000 per month was considered reasonable in the absence of documentary proof of the claimed ₹25,000 income. Applying multiplier 11 and adding 10% future prospects in accordance with Sarla Verma and Pranay Sethi, the award of ₹6,09,840 for loss of future income was held justified.

The amounts awarded for pain and suffering, loss of amenities, medical expenses, transportation, nourishment, attendant charges, and damage to clothing were also found reasonable considering the spinal fracture, surgery, and period of hospitalisation.

The Transport Corporation was directed to deposit the awarded amount, after deducting any amount already deposited, within six weeks from receipt of the order.

The claimant was permitted to withdraw the amount, subject to deduction of any sum already withdrawn and upon filing the appropriate application before the Tribunal.

The connected miscellaneous petition was closed, with no order as to costs.