Physical disability percentage cannot be equated with functional disability when assessing loss of earning capacity.

On 2 September 2018, the appellant’s motorcycle was struck by a trailer allegedly driven rashly and negligently by respondent No. 1, causing grievous injuries to both legs and requiring treatment at several hospitals.

The appellant claimed compensation of ₹1,16,06,615, relying, among other things, on an asserted annual income of ₹4,71,590, a 45% disability certificate, and the need for further surgery.

The Motor Accident Claims Tribunal awarded ₹9,86,308 with interest at 7.5% per annum. The appellant appealed under Section 173 of the Motor Vehicles Act, 1988, seeking enhancement.

1. Whether the Tribunal erred in assessing the appellant’s income at ₹7,000 per month and his whole-body disability at 25% when calculating loss of earning capacity.

2. Whether the evidence justified an award for future medical expenses, particularly the anticipated removal of the implanted rod and plates.

3. Whether the awards for physical and mental agony, transportation and attendant expenses, and special diet required enhancement.

Under Section 173 of the Motor Vehicles Act, 1988, an appellate court may review a Tribunal’s compensation award.

Physical disability percentage is not, by itself, equivalent to functional disability or the percentage of loss of future earning capacity; the nature and permanence of the injuries, medical evidence, daily activities, occupation, and effect on earning capacity must be considered.

Income must be assessed on the evidence available, and an isolated income-tax return, without supporting material or subsequent returns where relevant, need not establish actual income.

Future medical expenses require reliable evidence establishing the need for future treatment and the likely expenditure.

The judgment records that the appellant relied on Malarvizhi v. United India Insurance Co. Ltd., Jithendran v. New India Assurance Co. Ltd. and R.D. Hattangadi v. Pest Control (India) (P) Ltd.; the Court did not separately apply or analyse those authorities.

The Court upheld the Tribunal’s assessment of 25% whole-body disability because the medical witness did not say that the appellant was incapable of physical work, and the disability certificate was limited to two years, with no later evidence establishing continuing disability.

It also upheld the notional income of ₹7,000 per month because the appellant produced only one year’s income-tax return and did not provide later returns or other adequate evidence of his business and income.

Although further surgery was possible, no estimate or other cogent evidence established the likely cost, so future medical expenses were not awarded.

However, considering the duration of treatment and the nature and extent of the injuries, the Court found the awards for physical and mental agony, transportation and attendant expenses, and special diet inadequate.

The Court increased compensation for physical and mental agony from ₹1,00,000 to ₹1,50,000, transportation and attendant expenses from ₹50,000 to ₹75,000, and special diet from ₹20,000 to ₹45,000.

Total compensation was enhanced from ₹9,86,308 to ₹10,86,308, with the additional amount carrying interest at 7.5% per annum from the date of the claim application until realization; the remaining terms of the Tribunal’s award were maintained.