Supreme Court of India
Jithendran vs The New India Assurance Co. Ltd. on 27 October, 2021Author: Hrishikesh Roy

Bench: R. Subhash Reddy, Hrishikesh Roy



(Arising out of SLP (C) No.13213 OF 2019)





Hrishikesh Roy, J.

1. Heard Mr. A. Karthik, learned counsel for the

appellant (claimant). Mr. JPN Shahi, learned counsel

appears for the insurance company (respondent no1).

2. Leave granted. This appeal arises out of a motor

accident claim following the serious injuries suffered

by the appellant on 13.4.2001 when the motor cycle

(where the appellant was riding pillion), was hit by a

car. Both riders were impacted, resulting in severe

Signature Not Verified
injuries to the appellant. He was bedridden,
Digitally signed by
Rajni Mukhi
Date: 2021.10.27
17:02:45 IST
totally immobilized and initially, remained admitted in

Page 1 of 20
the hospital for 191 days. The appellant has also

suffered severe impairment of cognitive power with

hemiparesis and total aphasiaand the prognosis for him

is 69%permanent disability.

3. The claim filed by the pillion riding appellant was

analogously considered with other claimantsfrom the

same accident,by the Motor Accident Claims Tribunal,

Thrissur (hereinafter referred to as, ‘the Tribunal’

for short).The Presiding Officer noticed that the

severely impaired pillion rider needed support of two

persons,holding him from either side and because of his

diminished cognitive facilities, the claimant appeared

to be oblivious to his surroundings before the

Tribunal. He could only partially close his mouth and

consequently saliva dribbled from his mouth. The

Tribunal judge noted that the claimant was 21 years old

and was earning around Rs.4,500/- per month from

jewellery work when he suffered the accident.

Considering these factors and applying the multiplier

Page 2 of 20
of 17, the payable compensation for the pillion

riderwas determined as Rs.5,74,320/- by the Tribunal.

4. Dissatisfied with the awarded sum, the claimant

moved the High Court of Kerala for higher compensation.

With court’s permission, the claimant produced three

discharge summaries, 40 medical bills (totalling

Rs.68,196/-) and 3 medical reports issued by the

hospital where the partially disabled claimant received

further treatment.Those were consideredtogether with

the fact that Rs. 4,500/- p.m. was the earning of the

claimant as a jewellery worker for which, 40% as future

prospect needed to be added.The additional medical

expenses incurred for furthertreatment after the

initial 191 days of hospitalization was taken into

account and,towards future treatment,Rs.1,00,000/- was

added. The nature of permanent disability of 69% was

then factored in under the relevant head and the High

Court quantified a higher sum ofRs.9,38,952/- (instead

of Rs.2,81,520/-) as compensation.Thusadditional

Page 3 of 20
compensation for permanent disability to the tune of

Rs.8,57,432/- was quantified by the High Court, beyond

the Rs.5,74,320/- determined by the Tribunal for the

pillion rider.

5. The chart below would indicate the compensation

quantified by the Tribunal and the High Court, under

different heads:

Head Tribunal High Court
Loss of earning 12,000/- 12,000/-
Expense for transportation 10,000/- 10,000/-
Extra-nourishment 10,000/- 10,000/-
Damage to clothing 500/- 500/-
Expenses for treatment 1,40,300/- 1,40,300/-
Expense for bystander 50,000/- 50,000/-
Compensation for pain and 50,000/- 1,00,000/-
Compensation for permanent 2,81,500/- 9,38,952/-
Loss for loss of amenities 20,000/- 70,000/-
Future medical expenses NIL 1,00,000/-
Total 5,74,320/- 14,31,752/-

6. The learned counsel Mr. A. Karthik for the

appellant underscores that the claimant has suffered

69% permanent disability and is unable to perform

everyday activities and he requires constant support

even for the confined life that he is leading.

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Accordingly earnest plea is made for adding expenses

for service of bystander/attendant for the severely

impaired claimant.

6.1 Since additional recurring medical exigencies are

necessitated and expenses are incurred for

regularmedical treatment even after the accident, based

upon the bills and hospital documents produced before

the High Court, the appellant’s counsel argues for

substantial enhancement of the sum awarded under the

head of future medical expenses.

6.2 Becausethe appellant’searning capacity is reduced

to zero, (notwithstanding his 69% permanent

disability), the logic of restricting the compensation

to 69% under the head of permanent disabilityis

questioned and Mr. Karthik, the learned counsel submits

that the correct figure should be reached by treating

it as 100% loss of future earnings.

Page 5 of 20
6.3 Considering the fact that the injured appellant was

hospitalized for 191 days and was off work, the lower

quantification of his six months loss of earning at

Rs.12,000/-, when income is accepted as Rs. 4500/-, is

questioned by the appellant’s counsel and he argues

that the loss of earning should be quantified at

Rs.27,000/- (instead of Rs.12,000/-,) under the

relevant head.

7. On the other hand, Mr. JPN Shahi, the learned

counsel appearing for the Insurance Company submits

that when 69% percent permanent disability is suffered,

the sum quantified by the High Court at 69% level,

requires no enhancement.

7.1 It is further pointed out by the learned counsel

that the High Court has already awarded Rs.1,00,000/-

towards future medical expenses and the appellant is

disentitled to claim any further sum on the said count.

Page 6 of 20
7.2 Insofar as the claim for expenses for a

bystander/attendant, the learned counsel submits that

no material is produced by the claimant on the

actualexpenses incurred for service of attendant and

accordingly it is argued that no further claim is

merited under this head.

8. As earlier noted, the appellant has suffered

69%permanent disability and without assistance, cannot

perform everyday functions. The claimant with

seriously impaired cognitive and physical capabilities

would surely need full time assistance even for the

confined life that he is leading. In such

circumstances, the disabled claimant cannot be expected

to rely only upon gratuitous services of his well-

wishers and family members. Importantly, thepresiding

judge in the Tribunal himself noticed that the

claimant would require the assistance of a

bystander/attendant for all his movements.

Consequently, bearing in mind the need for assisted

Page 7 of 20
living and what was said in Kajal vs. Jagdish Chand and

Others1, it is found necessary to addthe expenses for

service of an attendant for the claimant. Since no

material is produced to quantify the expenses for the

attendant,making a conservativeestimate, Rs.5,000/- per

month appears to be thebareminimum. It is therefore

deemed appropriate to quantify the annual expenses at

Rs.60,000/- and applying the multiplier of 18, the

additional compensation payable under the bystander

head is quantified at Rs.10,80,000/-.

9. The appellant has produced adequate medical

documents before the High Court to show the recurring

needs for testing, treatment and further

hospitalisation for which, considerable expenses were

incurred even after the initial 191 days of

hospitalization. As a person suffering severe cognitive

impairment and 69% disability, recurring medical

treatment is inevitable and bearing in mind

theadditional expenses already incurred, we deem it

1(2020) 4 SCC 413

Page 8 of 20
appropriate to enhance the future medical expenses to

Rs.3,00,000/- (from Rs.1,00,000/-), since the sum

quantified by the High Court appears to be on the lower


10.While the permanent disability as certified by the

doctors stands at 69%,the same by no means, adequately

reflects the travails the impaired claimant will have

to face all his life. The 21 year old’s youthful dreams

and future hopes were snuffedout by the serious

accident. The young man’s impaired condition has

certainly impacted his family members. Their resources

and strength are bound to be stressed by the need to

provide full time care to the claimant. For the

appellant to constantly rely on them for stimulation

and support is destined to cause emotional, physical

and financial fatigue for all stakeholders.

11. The Motor Vehicles Act is in the nature of social

welfare legislation and its provisions make it clear

that the compensation should be justlydetermined.

Page 9 of 20
Justice A.P. Misra in Helen C. Rebello and Others

v. Maharashtra SRTC and Anr.2, held the following on the

contours of ‘just’ compensation,

“The word “just”, as its nomenclature, denotes
equitability, fairness and reasonableness having a
large peripheral field. The largeness is, of
course, not arbitrary; it is restricted by the
conscience which is fair, reasonable and
equitable, if it exceeds; it is termed as unfair,
unreasonable, unequitable, not just.”

A person therefore is not only to be compensated

for the injury suffered due to the accident but also

for the loss suffered on account of the injury and his

inability to lead the life he led, prior to the life-

altering event. Justice D.Y. Chandrachud speaking for a

three judges’ bench in Jagdish Vs. Mohan and others3

makes the following relevant observation on the

intrinsic value of human life and dignity that is

attempted to be recognised, through such compensatory


“…the measure of compensation must reflect a
genuine attempt of the law to restore the dignity

2(1999) 1 SCC 90
3(2018) 4 SCC 571

Page 10 of 20
of the being. Our yardsticks of compensation
should not be so abysmal as to lead one to
question whether our law values human life. If it
does, as it must, it must provide a realistic
recompense for the pain of loss and the trauma of
suffering. Awards of compensation are not law’s
doles. In a discourse of rights, they constitute
entitlements under law.”

12. The Courts should strive to provide a realistic

recompense having regard to the realities of life, both

in terms of assessment of the extent of disabilities

and its impact including the income generating capacity

of the claimant. In cases of similar nature, wherein

the claimant is suffering severe cognitive dysfunction

and restricted mobility, the Courts should be mindful

of the fact that even though the physical disability is

assessed at 69%, the functional disability is 100% in

so far as claimant’s loss of earning capacity is


13. The extent of economic loss arising from a

disability may not be measured in proportions to the

extent of permanent disability. This aspect was noticed

Page 11 of 20
in Raj Kumar Vs. Ajay Kumar and Anr.4, where Justice

R.V. Raveendran made the following apt observations:

“10. Where the claimant suffers a permanent
disability as a result of injuries, the assessment
of compensation under the head of loss of future
earnings would depend upon the effect and impact
of such permanent disability on his earning
capacity. The Tribunal should not mechanically
apply the percentage of permanent disability as
the percentage of economic loss or loss of earning
capacity. In most of the cases, the percentage of
economic loss, that is, the percentage of loss of
earning capacity, arising from a permanent
disability will be different from the percentage
of permanent disability. Some Tribunals wrongly
assume that in all cases, a particular extent
(percentage) of permanent disability would result
in a corresponding loss of earning capacity, and
consequently, if the evidence produced shows 45%
as the permanent disability, will hold that there
is 45% loss of future earning capacity. In most of
the cases, equating the extent (percentage) of
loss of earning capacity to the extent
(percentage) of permanent disability will result
in award of either too low or too high a

11. What requires to be assessed by the Tribunal
is the effect of the permanent disability on the
earning capacity of the injured; and after
assessing the loss of earning capacity in terms of
a percentage of the income, it has to be
quantified in terms of money, to arrive at the
future loss of earnings (by applying the standard
multiplier method used to determine loss of
dependency). We may however note that in some
cases, on appreciation of evidence and assessment,
the Tribunal may find that the percentage of loss

4(2011)1 SCC 343

Page 12 of 20
of earning capacity as a result of the permanent
disability, is approximately the same as the
percentage of permanent disability in which case,
of course, the Tribunal will adopt the said
percentage for determination of compensation.”

14. The test for determining the effect of permanent

disability on future earning capacity involves the

following 3 steps as was laid down in Raj Kumar5 and

reiterated by Justice Indu Malhotra in Chanappa Nagappa

Muchalagoda vs.Divisional Manager, New India Insurance

Company Limited6.

“13. Ascertainment of the effect of the
permanent disability on the actual earning
capacity involves three steps. The Tribunal has to
first ascertain what activities the claimant could
carry on in spite of the permanent disability and
what he could not do as a result of the permanent
disability (this is also relevant for awarding
compensation under the head of loss of amenities
of life). The second step is to ascertain his
avocation, profession and nature of work before
the accident, as also his age. The third step is
to find out whether (i) the claimant is totally
disabled from earning any kind of livelihood, or
(ii) whether in spite of the permanent disability,
the claimant could still effectively carry on the
activities and functions, which he was earlier
carrying on, or (iii) whether he was prevented or
restricted from discharging his previous
activities and functions, but could carry on some
other or lesser scale of activities and functions

6(2020)1 SCC 796

Page 13 of 20
so that he continues to earn or can continue to
earn his livelihood.”

15. The above yardstick to be adopted in such

exigencies was reaffirmed by Justice S. Ravindra Bhat

in Pappu Deo Yadav vs. Naresh Kumar and others7. The

following was set out by the three Judges’ Bench:

“13. The factual narrative discloses that the
appellant, a 20-year-old data entry operator (who
had studied up to 12th standard) incurred permanent
disability, i.e. loss of his right hand (which was
amputated). The disability was assessed to be 89%.
However, the tribunal and the High Court re-
assessed the disability to be only 45%, on the
assumption that the assessment for compensation
was to be on a different basis, as the injury
entailed loss of only one arm. This approach, in
the opinion of this court, is completely
mechanical and entirely ignores realities. Whilst
it is true that assessment of injury of one limb
or to one part may not entail permanent injury to
the whole body, the inquiry which the court has to
conduct is the resultant loss which the injury
entails to the earning or income
generating capacity of the claimant. Thus, loss of
one leg to someone carrying on a vocation such as
driving or something that entails walking or
constant mobility, results in severe income
generating impairment or its extinguishment
altogether. Likewise, for one involved in a job
like a carpenter or hairdresser, or machinist, and
an experienced one at that, loss of an arm, (more
so a functional arm) leads to near extinction of
income generation. If the age of the victim is
beyond 40, the scope of rehabilitation too
diminishes. These individual factors are of

7(2020) SCC Online 752

Page 14 of 20
crucial importance which are to be borne in mind
while determining the extent of permanent
disablement, for the purpose of assessment of loss
of earning capacity.”

“20. Courts should not adopt a stereotypical or
myopic approach, but instead, view the matter
taking into account the realities of life, both in
the assessment of the extent of disabilities, and
compensation under various heads. In the present
case, the loss of an arm, in the opinion of the
court, resulted in severe income earning impairment
upon the appellant. As a typist/data entry
operator, full functioning of his hands was
essential to his livelihood. The extent of his
permanent disablement was assessed at 89%; however,
the High Court halved it to 45% on an entirely
wrong application of some ‘proportionate’
principle, which was illogical and is unsupportable
in law. What is to be seen, as emphasized by
decision after decision, is the impact of the
injury upon the income generating capacity of the
victim. The loss of a limb (a leg or arm) and its
severity on that account is to be judged in
relation to the profession, vocation or business of
the victim; there cannot be a blind arithmetic
formula for ready application. On an overview of
the principles outlined in the previous decisions,
it is apparent that the income generating capacity
of the appellant was undoubtedly severely affected.
Maybe, it is not to the extent of 89%, given that
he still has the use of one arm, is young and as
yet, hopefully training (and rehabilitating)
himself adequately for some other calling.
Nevertheless, the assessment of disability cannot
be 45%; it is assessed at 65% in the circumstances
of this case.”

16. As noted earlier, the impact on the earning

capacity for the claimant by virtue of his 69%

Page 15 of 20
disability must notbe measured as a proportionate loss

of his earning capacity. The earning life for

theappellant is over and as such his incomeloss has to

be quantified as 100%. There is no other way to assess

the earning loss since the appellant is incapacitated

for life and is confined to home. In such

circumstances, his loss of earning capacity must be

fixedat 100%.As his monthly incomewas Rs.4,500/-,

adding 40% future prospect thereto,the monthly loss of

earning is quantified as Rs.6,300/-. We therefore deem

it appropriate to quantify Rs.13,60,800/- (Rs.6,300 x

12 x 18) as compensation for 100% loss of earning for

the claimant. Accordingly, under this head, the amount

awarded by the High Court is enhanced proportionately.

17. Thelesser amount for 6 months earning loss during

hospitalization, must also be corrected. The claimant

was awarded Rs.12,000/- for his hospitalization in the

aftermath of the accident. But the lower figure does

not correctly correspond to six monthsloss, when the

Page 16 of 20
income was Rs. 4500/- p.m. Accordingly, the amount

under this head is corrected as Rs.27,000/- (Rs.4,500 x


18. Following the above conclusion, additional

compensation is found merited for the appellant and the

same is ordered. The payableamount under the four

specific heads is indicated as under:

S No Head Amount claimed
1. Expense for bystander Rs.10,80,000/-
2. Future Medical Expenses Rs.3,00,000/-
3. Compensation for permanent Rs.13,60,800/-
disability and loss of earning

4. Loss of earning Rs. 27,000/-
5. Total Rs.27,67,800/-

The above quantified sum should be paid by the

first respondent, within six weeks from today. Any

amount paid earlier under these heads, may be adjusted

during payment to the appellant. It is ordered


19. Before parting, it needs emphasizing that in cases

such as this, the Tribunal and the Courts must be

conscious of the fact that the permanent disability

Page 17 of 20
suffered by the individual not only impairs his

cognitive abilities and his physical facilities but

there are multiple other non-quantifiable implications

for the victim. The very fact that a healthy person

turns into an invalid, being deprived of normal

companionship, and incapable of leading a productive

life, makes one suffer the loss of self-dignity. Such a

Claimant must not be viewed as a modern day Oliver

Twist, having to make entreaties as the boy in the

orphanage in Charles Dickens’s classic, “Please Sir, I

want some more”. The efforts must be to substantially

ameliorate the misery of the claimant and recognize his

actual needs by accounting for the ground realities.

The measures should however be in correct proportion.

As is aptly said by Justice R.V Raveendran, while

speaking for the Division Bench in Sarla Verma and

Others Vs. Delhi Transport Corporation and Another8,

just compensation is adequate compensation and the

Award must be just that- no less and no more. The plea

8 (2009)6 SCC 121

Page 18 of 20
of the victim suffering from a cruel twist of fate,

when asking for some more, is not extravagant but is

for seeking appropriate recompense to negotiate with

the unforeseeable and the fortuitous twists is his

impaired life. Therefore, while the money awarded by

Courts can hardly redress the actual sufferings of the

injured victim (who is deprived of the normal amenities

of life and suffers the unease of being a burden on

others), the courts can make a genuine attempt to help

restore the self-dignity of such claimant, by awarding

‘just compensation’.

20. With the above observation and enhancement of

compensation, the claimant’s appeal stands allowed. The

impugned judgment of the High Court stands modified to

the extent indicated above. The parties to bear their

respective cost.



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OCTOBER 27, 2021

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