The Supreme Court has enhanced the compensation awarded to a motor accident victim, ruling that the High Court acted improperly in reducing the assessed disability percentage without any appeal from the Insurance Company or Transport Corporation. The Court also re-computed the monthly income of the claimant, relying on precedents regarding notional income for self-employed individuals.
Case Background
The appeal was filed by S. Shakul Hameed, a claimant who suffered disability in a motor accident. Initially, the Motor Accident Claims Tribunal awarded a compensation of Rs. 2,12,800. Upon appeal, the High Court enhanced this amount to Rs. 2,23,000, along with interest at the rate of 7.5% per annum from the date of the petition.
Dissatisfied with the quantum of compensation, the claimant approached the Supreme Court seeking further enhancement.
Arguments of the Parties
The learned counsel for the appellant submitted that the claimant was employed as a salesman earning Rs. 8,000 per month. It was argued that the Tribunal erroneously fixed the monthly income at Rs. 3,300, adopting the Schedule applicable to Section 163A of the Motor Vehicles Act, 1988, a figure left untouched by the High Court. The counsel contended that “at least the minimum wages applicable on the date of accident ought to have been taken.” Furthermore, the appellant challenged the High Court’s reduction of the disability quotient to 40%.
Conversely, the learned counsel for the respondent-Corporation argued that the application was filed under Section 163A of the MV Act and that there was “absolutely no evidence to prove the employment or the income as claimed by the appellant.” The respondent maintained that since the disability was functional, the determination of 40% by the High Court was correct.
Supreme Court’s Observations and Analysis
Nature of the Claim
The Bench, comprising Justice Ahsanuddin Amanullah and Justice K. Vinod Chandran, first addressed the nature of the claim. Although the application mentioned Section 163A of the MV Act, the Court observed that the compensation claimed was Rs. 7,40,000 and the averments alleged that the accident occurred due to the “rash and negligent manner” of the Corporation’s bus driver. The Court stated: “Hence, we are of the opinion that though Section 163A of the MV Act was mentioned in the application, the claim is one under Section 166 of the MV Act.”
Assessment of Income
Regarding the income, the Court noted that while the appellant claimed to be a vendor of electronic equipment earning Rs. 8,000, no evidence was produced. However, the Bench referred to the judgment in Ramachandrappa v. Royal Sundaram Alliance Insurance Co. Ltd. (2011) 13 SCC 236, where the income of a coolie was computed at Rs. 4,500 per month for the year 2004. Applying a nominal increase, the Court held: “We are of the opinion that the income of the appellant, hence can be safely computed at Rs.5,000/- (Rupees five thousand) per month.” Given the appellant’s age of 27 years, the Court applied a multiplier of 17 and added 40% for future prospects as the claimant was self-employed.
Assessment of Disability
The Court scrutinized the reduction of the disability percentage. The appellant had produced a certificate assessing disability at 60%. The Tribunal had fixed it at 50% noting that “only skin grafting was done.” The High Court had further reduced this to 40%. The Supreme Court held: “The High Court without any appeal by the Insurance Company reduced the disability to 40%, which was improper. Disability as assessed by the Tribunal hence has to be maintained.”
Decision
The Supreme Court allowed the appeal and modified the award for loss of income based on the revised calculations: Rs. 5,000 (income) x 12 (months) x 17 (multiplier) x 140% (future prospects) x 50% (disability). The Court calculated the loss of income as Rs. 7,14,000/-.
The Bench directed that the amounts awarded under conventional heads by the Tribunal and affirmed by the High Court would remain unchanged. The respondent was directed to pay the amounts within three months with interest at 7.5%.
Case Details:
- Case Title: S. Shakul Hameed v. Tamil Nadu State Transport Corporation Limited
- Case No: Civil Appeal No. of 2026 (@Special Leave Petition (C) No.7347 of 2024)
- Bench: Justice Ahsanuddin Amanullah and Justice K. Vinod Chandran
