Functional disability must reflect occupational earning loss, not mechanically halve limb disability.

The appellant, Kuldeep, sustained injuries in a motor accident in 2011 and suffered permanent disability assessed at 50% in relation to his left upper limb.

The Motor Accidents Claims Tribunal, Dwarka Courts, awarded him ₹7,20,938 with interest at 10% per annum by judgment dated 3 March 2017 in MACP No. 398/2012/14.

The appellant, who was working as an agriculturist and was 38 years old at the time of the accident, appealed seeking enhancement on the grounds that the functional disability had been understated, future prospects had not been granted, future surgery for removal of the steel plate had not been adequately provided for, and the non-pecuniary compensation was insufficient.

The insurer opposed the enhancement and contended that the award was adequate.

Whether the appellant’s functional disability should be assessed at more than 25%, having regard to his 50% permanent disability in the left upper limb and his vocation as an agriculturist?

Whether the appellant was entitled to an addition towards future prospects, and if so, at what rate?

Whether an additional amount should be awarded towards the estimated cost of future surgery for removal of the steel plate?

Whether the compensation awarded under the other non-pecuniary heads required enhancement?

The Court applied the principles laid down by the Supreme Court in Raj Kumar v. Ajay Kumar, (2011) 1 SCC 343, under which permanent physical disability cannot automatically be equated with loss of earning capacity.

The Tribunal must assess the nature and extent of permanent disability, determine its effect on the whole body, examine the claimant’s vocation and activities, and evaluate whether the disability prevents, restricts, or alters the claimant’s capacity to earn.

The percentage of functional disability must therefore be determined with reference to the claimant’s occupation, age, and actual earning capacity; a mechanical reduction of limb disability to arrive at whole-body disability is impermissible.

The Court also applied the multiplier method for computing future loss of income and granted future prospects at 40% in the circumstances of the case.

As to the estimated future surgery, the Court required the amount to be secured separately and made its withdrawal conditional upon proof that the surgery had actually been performed.

The Tribunal had mechanically reduced the appellant’s 50% left upper-limb disability to 25% functional disability.

Applying Raj Kumar, the High Court held that functional disability must be assessed by considering the claimant’s actual vocation and the impact of the injury on his earning capacity, rather than by applying an automatic mathematical reduction.

Since the appellant was an agriculturist, his work required a higher degree of mobility and physical functioning; accordingly, despite the disability being confined to the left upper limb, the Court assessed his functional disability at 40%.

As the appellant was 38 years old, the Court further awarded 40% towards future prospects.

Using a monthly income of ₹7,826, a multiplier of 15, and the revised functional disability, the loss of future income was recalculated from ₹3,52,170 to ₹7,88,860, increasing the total compensation to ₹11,57,628.

The Court declined to enhance the amounts awarded under the remaining heads.

For the proposed removal of the steel plate, it directed the insurer to deposit ₹2,00,000 separately, permitting withdrawal only upon production of the discharge summary, invoice, and payment receipt; if the procedure was not undertaken within two years, the amount with accrued interest was to be refunded to the insurer.

The Court enhanced the compensation by ₹4,36,690, raising the total award to ₹11,57,628.

Interest on the enhanced compensation was awarded at 9% per annum from the date of filing of the claim petition, instead of the Tribunal’s rate of 10%.

The enhanced amount was directed to be deposited before the Registrar General within four weeks and released to the appellant within two weeks thereafter as a lump sum.

A separate deposit of ₹2,00,000 was directed for the possible future surgery, subject to the conditions stated above.

The insurer’s recovery rights were preserved, the appeal was disposed of, and pending applications were rendered infructuous.