Reassessment of functional disability and inclusion of future prospects for salaried employees in motor accident claims.

On May 27, 2017, the Appellant was driving his motorcycle when a truck driven by Respondent No. 1 in a rash and negligent manner collided with him, causing multiple fractures including compound comminuted fractures of the femur and tibia-fibula.

The Appellant, a 27-year-old Sales Executive, sought compensation of Rs. 5,00,000/-.

The Motor Accident Claims Tribunal (MACT), Surat, awarded Rs. 8,41,622/- with 6% interest via judgment dated December 18, 2024.

The Appellant challenged this award seeking enhancement, contending that the Tribunal undervalued his monthly income, failed to account for future prospects, and underestimated his functional disability.

1. Whether the Tribunal erred in assessing the Appellant's monthly income and failing to add future prospective income.

2. Whether the functional disability assessment of 18% was adequate given the nature of the injuries and the claimant's occupation.

3. Whether the compensation under the heads of pain, shock, and suffering, and loss of actual income required enhancement.

The Court primarily applied the principles of "just compensation" under the Motor Vehicles Act, 1988.

It relied on the landmark precedent of National Insurance Company Ltd. vs. Pranay Sethi (2017) 16 SCC 680 to determine the addition of 40% to the actual income for future prospects for a self-employed person or person on a fixed salary below the age of 40.

The Court also applied established principles of assessment for "functional disability" versus physical disability, particularly how physical impairments (shortened limb and restricted movement) impact the specific earning capacity of a Sales Executive.

The Court found the Tribunal’s assessment of Rs. 8,000/- per month as income to be lower than the evidence in the bank statements (Exh. 53), which showed variable earnings; the Court re-assessed the average monthly income at Rs. 12,000/-.

Applying Pranay Sethi, a 40% hike for future prospects was added, totaling Rs. 16,800/-.

Regarding disability, the Court noted the Doctor’s testimony (Exh. 52) that the Appellant’s leg was shortened by 1.5 inches, restricting movement necessary for a Sales Executive; consequently, the functional disability was raised from 18% to 25%.

The Court determined that a multiplier of 17 was appropriate for the 27-year-old claimant.

Furthermore, the Court extended the period for "Actual Loss of Income" to three months and increased the "Pain, Shock, and Suffering" and "Special Diet" heads due to the 22-day hospitalization and invasive surgical procedures.

The additional sum of Rs. 6,33,040/- was awarded with interest at 6% per annum from the date of the claim petition until realization. The Insurance Company (Respondent No. 3) was directed to deposit the enhanced amount within six weeks. The impugned judgment of the Tribunal was modified accordingly.