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Sanjay Rajpoot vs Ram Singh

Supreme Court11 February 2025Prashant Kumar Mishra · Sanjay Karol

Ratio decidendi

The rule this decision rests on

1. Where the claimant is self-employed and required to move about for the effective conduct of his business, an amputation that prevents such mobility will severely impact earning capacity, and the functional disability assessment must be determined accordingly; in motor accident compensation claims, functional disability should be assessed with regard to the specific nature and demands of the claimant's occupation. 2. The multiplier applicable to a claimant under the Sarla Verma formula is determined by the claimant's actual age at the time of the accident as evidenced by documentary proof such as matriculation certificates, Aadhaar cards, and PAN cards, and the chronological age derived from such evidence is binding on appellate courts, notwithstanding any different age recorded in lower court proceedings. 3. In determining notional monthly income for purposes of motor accident compensation where a self-employed claimant claims earnings from multiple sources, the court must assess the actual earning capacity that can be sustained, and in the absence of clear documentary evidence supporting higher income claims, a conservative figure based on recognized standards or evidence on record is to be applied. 4. Functional disability percentage in motor accident compensation, assessed at 90% for loss of a limb and severe incapacity in daily activities, must be applied as a multiplier against the annual income figure (inclusive of future prospects) to arrive at the compensation for permanent disability.

Written by Miss Lucy from the judgment below, not taken from a headnote.

Judgment

As delivered

2025 INSC 188 IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 2321 OF 2025 (Arising out of SLP(C)No.16541/2024)

SANJAY RAJPOOT … APPELLANT(S)

VERSUS

RAM SINGH & ORS. … RESPONDENT(S)

ORDER

Time taken for Time taken for Time taken for disposal of the claim disposal of the disposal of the appeal petition by MACT appeal by the High in this Court Court 1 year 6 months 2 years 9 months 6 months

Leave granted.

2. This appeal is directed against the Judgment and Order dated 14 th

October, 2022 in First Appeal from Order No.210 of 2020 passed by the High

Court of Judicature at Allahabad, which, in turn, was preferred against the

Judgment and Order dated 20th November, 2019 passed in M.A.C.P No.188 of Signature Not Verified Digitally signed by RAJNI MUKHI Date: 2025.02.11 18:46:52 IST Reason: 2018 by the Motor Accident Claims Tribunal/Special Judge S.C./S.T. Act,

Jhansi.

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3. The brief facts giving rise to this appeal are that on 3 rd April, 2018, the

claimant-appellant, aged 23 years, was going to his home on his motorcycle

bearing No.UP-13Y-1838, about 1.30 pm near the bus stand at village Gora

Machhia, the offending vehicle bearing No.DL-1PB-9197 coming from the

wrong side of the road, driving rashly and negligently, dashed into the claimant-

appellant from the front due to which he suffered serious injury, as the driver of

the offending vehicle took out the wheel of the bus from the right leg and right

hand of the claimant-appellant. He was taken to Medical College, Jhansi.

During the treatment, an injury was suffered by him, resulting in the amputation

of his right leg above the knee.

4. In connection with this incident, on 6th April, 2018, the father of the

Claimant-Appellant lodged an FIR No.57/2018, under Sections 279, 337, 338,

427 of the Indian Penal Code against the driver of the offending vehicle at

Bandagon Police Station.

5. The claimant-appellant filed an application for compensation under the

Motor Vehicles Act, 1988 seeking compensation to the tune of Rs.67,00,000/-

plus cost and interest, submitting therein that he earns Rs.10,000/- per month by

running a coaching centre for students of classes 9th and 10th and also works as

an accountant at Bablu Ghat of M/s. Vikram Construction Company for

Rs.15,000/- per month, however, as a result of the injury suffered, it has become

difficult for him to perform his day-to-day activities.

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6. The Tribunal, by its order, held that the respondents are jointly and

severally liable to pay the compensation. The insurance company was directed

to pay an amount of Rs.6,70,000/- at the rate of 6% interest, considering the

notional income as Rs.6,000/- per month and fixed the disability of the

Claimant-Appellant to be at 50%.

7. Dissatisfied with the amount of compensation awarded, the Claimant-

Appellant approached the High Court on the ground that the Tribunal had not

appropriately considered the monthly income of the Claimant-Appellant to the

tune of Rs.10,000/- and future prospects were also not awarded as per the

settled principles of law.

8. The High Court, vide the impugned judgment, enhanced the award in

favour of the Claimant-Appellant by granting Rs.1,00,000/- under the head of

pain and suffering alongwith granting 40% under the head of future prospects.

9. Yet dissatisfied, the Claimant-Appellant is now before us. The grounds of

challenge are that the Courts below have incorrectly assessed the monthly

income. He holds a three three-year Diploma Course in Mechanical Engineering

and should be treated at par with a skilled labourer for the purposes of his

notional income. Furthermore, both Courts have failed to assess his functional

disability as 90% since, due to his amputation, he is unable to perform daily

tasks. Lastly, his age was also wrongly considered as 26, whereas it should have

been 22 years as per evidence on record.

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10. We have heard the learned counsel for the parties. Respondent No. 3 -

the insurer has not entered appearance. We are unable to agree with the view

taken by the Tribunal and High Court on the functional disability suffered by

him and also the determination of his age. The Claimant-Appellant is not

salaried, but is self-employed running and managing his own business. For the

Appellant to be able to effectively run his business, he is definitely required to

move around. This has been hampered significantly by his amputation, which

proves that the functional disability of the Appellant will severely impact his

earning capacity. Therefore, the correct view would be to assess the disability of

the Claimant-Appellant as 90%.

11. Coming to the age of the Claimant-Appellant, on a perusal of Annexure

P1, P6, and P7, i.e. Matriculation Certificate, Aadhar Card and Pan Card of the

Petitioner, his date of birth is 13.11.1995. Given this evidence on record, this

Court fixes his age at the time of the incident in 2018 as 22 years of age.

Consequently, as per the exposition of this Court in Sarla Verma v. DTC,

(2009) 6 SCC 121, the multiplier to be applied is 18.

12. As a result of the discussion above, the compensation now payable to the

Claimant-Appellant is itemised as under:

FINAL COMPENSATION

Compensation Heads Amount Awarded In Accordance with:

Monthly Income Rs.6,000/- National Insurance Co. Ltd. v. Pranay Yearly Income 6000 x 12 = Rs.72,000/- Sethi (2017) 16 SCC 680 Future Prospects 72000 + 28800 = Para 42 & 59

4 (40%) Rs.1,00,800/-

Multiplier (18) 1,00,800 x 18 = Rs.18,14,400/-

Mohd. Sabeer v. Regional Manager,

Permanent Disability 18,14,400 x 90% = U.P. State Road (90%) Rs.16,32,960/- Transport Corporation 2022 SCC OnLine SC 1701 Para 16 Medical Expenses Rs.53,204/- Kajal v. Jagdish Chand Attendant Charges 6000 x 18 = (2020) 4 SCC 413 Rs.1,08,000/- Para 19 and 25

Loss of Marriage Prospect Rs.2,00,000/-

Sidram v. Divisional Special Diet & Rs.1,00,000/- Manager, United Transportation India Insurance Ltd.

(2023) 3 SCC 439 Para 89 K.S. Muralidhar v. R. Pain and Suffering Rs.3,00,000/- Subbulakshmi and Anr.

2024 SCC OnLine SC 3385 Para 13 and 14 Master Ayush v.

Branch Manager, Assistant Device Rs.5,00,000/- Reliance General Insurance Co. Ltd.

(2022) 7 SCC 738 Para 14 TOTAL Rs.28,93,494/-

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Thus, the difference in compensation is as under:

MACT High Court This Court Rs.6,70,000/- Rs.10,10,004/- Rs.28,93,494/-

13. The Civil Appeal is allowed in the aforesaid terms. The impugned award

dated 20th November, 2019 passed in M.A.C.P.No.188 of 2018 by the Motor

Accident Claims Tribunal/Special Judge S.C./S.T. Act, Jhansi as modified in

terms of the impugned order, stands further modified in the aforesaid terms.

Interest is to be paid as awarded by the Tribunal.

Pending application(s), if any, shall stand disposed of.

…………………………………..J. (SANJAY KAROL)

……………………………………J. (PRASHANT KUMAR MISHRA)

February 11, 2025;

New Delhi.

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