Claimant Requiring Lifelong Attendant Can Be Treated As 100% Functionally Disabled Under Motor Vehicles Act: Supreme Court
Although the Medical Board assessed the claimant’s medical disability at 75.5%, the Court held that his complete dependence on others and total loss of working capacity required his functional disability to be assessed at 100%.
Justice S.V.N. Bhatti, Justice N.V. Anjaria, Supreme Court
The Supreme Court has held that, while determining compensation under the Motor Vehicles Act, 1988, an accident victim who remains dependent on another person and requires an attendant throughout life can be treated as suffering from 100% functional disability when the injuries completely destroy his capacity to work.
Applying this principle, the Court enhanced the compensation payable to a 43-year-old accident victim from ₹36.22 lakh to ₹77.84 lakh. It assessed his loss of earning capacity on the basis of 100% functional disability, despite his medically certified disability being 75.5%.
The Court was hearing appeals seeking enhancement of compensation awarded by the Kerala High Court in two motor-accident claims arising from the same collision. The first appellant, represented by his wife after becoming totally disabled, challenged the High Court’s reliance upon his medical-disability percentage without considering the functional effect of his injuries.
A Bench of Justice S.V.N. Bhatti and Justice N.V. Anjaria observed: “Therefore, even though the Medical Board certified the medical disability to be 75.5%, the functional effect can be said to be debilitating for the appellant to the extent of 100%. One who remains dependent on another and requires an attendant throughout his life can be said to be suffering from 100% functional disability. The appellant would not be able to do his own work, much less engage in earning activity for himself and his family, leading to total loss of working capacity.”
Referring to Shankar Dutt v. United India Insurance Co. Ltd. and Others (2026), the Bench added: “This Court elaborated the concept of permanent disability, highlighting the components thereof, the prime of which is loss of earning capacity. The claimant, who becomes partially or completely disabled and lose forever the capacity to earn, is a permanently disabled person, and the amount of compensation on the said count has to be determined in such context.”
Advocate Aarthi Rajan appeared for the appellants, while Advocate Shubham Janghu appeared for the respondent insurer.
Background
The two appellants suffered serious injuries in an October 2016 collision near the Paliyekkara toll plaza. Sunil Kumar, the first appellant, was travelling as a pillion rider, while the second appellant was driving the scooter.
Sunil Kumar was 43 at the time of the accident and claimed that he earned ₹30,000 per month from trading in bakery items and agricultural activities. The Motor Accident Claims Tribunal fixed his income at ₹9,000 per month and awarded ₹19.91 lakh.
The Kerala High Court increased his monthly income to ₹15,000 and enhanced the compensation to ₹36.22 lakh. However, it retained his disability at 75.5%, corresponding to the Medical Board’s assessment.
Court’s Observations
Functional Effect Of Injuries Must Be Assessed
The Court observed that permanent disability could not be realistically assessed without considering the nature of the injuries and their effect upon the claimant’s daily life and earning capacity.
The Bench noted that the appellant had sustained severe head and other injuries, required an attendant throughout his life and would suffer from a higher grade of psychiatric disability.
The Court stated: “The extent of permanent disability cannot be realistically assessed without considering the nature of the injuries and the effect thereof on the life and state of living of the appellant. The injuries which he suffered, included severe head injuries, open diffuse axonal injury, midbrain contusion with Weber’s syndrome and left knee penetrating injury. The functional effect of those injuries has to be estimated. They have grave consequences on the earning capacity of the appellant.”
Medical And Functional Disability Are Distinct
Referring to Shankar Dutt (2026), the Court drew a distinction between the percentage of physical impairment medically certified and the disability experienced by the claimant in daily life or employment.
The Bench quoted the precedent: “A conceptual distinction has to be drawn between the medically certified disability resulting out of physical injury or impairment on one hand, and the long-term repercussions on the injured, on his or her life and activities on the other hand. The functional disability is one which is suffered and felt by the injured in his day-to-day life or in his avocation, occupation, business or profession.”
The Court observed that functional incapacity may be greater than the physical impairment assessed by doctors. Its calculation depends upon the claimant’s age, occupation, nature of work and the effect of the injuries upon earning capacity.
Referring to Jithendran v. New India Assurance Co. Ltd. and Another (2022), the Bench emphasised that courts must adopt a realistic approach when assessing disability and its effect upon the claimant’s ability to generate income.
The Court quoted: “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% insofar as the claimant's loss of earning capacity is concerned.”
Loss Of Earning Capacity Recalculated
The Court assessed the first appellant’s functional disability at 100% and calculated ₹31.50 lakh towards permanent disability and loss of earning capacity. It applied a monthly income of ₹15,000, 25% future prospects and a multiplier of 14.
The Bench also held that the ₹1 lakh awarded for future attendant expenses was inadequate because the claimant would require assistance throughout his life.
Referring to Kajal v. Jagdish Chand and Others (2020) and Gobald Motor Service Ltd. v. R.M.K. Veluswami (1962), the Court applied the multiplier method and awarded ₹25.20 lakh towards attendant expenses.
Compensation In Connected Appeal
The Court separately assessed the second appellant’s functional disability at 80%, although the Medical Board had certified 62% physical disability. It enhanced his compensation to ₹69.60 lakh, including ₹25.40 lakh for loss of earning capacity and ₹22.68 lakh for attendant expenses.
Conclusion
The Supreme Court allowed both appeals and held the first appellant entitled to ₹77,84,394, representing an additional ₹41,61,750 over the amount awarded by the High Court.
It awarded the second appellant ₹69,60,880, resulting in additional compensation of ₹41,90,216. Both additional amounts would carry interest at 6.5% per annum from the dates of the respective claim petitions until realisation.
The Court directed the insurer to deposit the additional compensation with interest before the Tribunal within six weeks. The Tribunal was directed to transfer the amounts directly into the respective claimants’ bank accounts after completing the identification procedure.
Cause Title: Sunil Kumar (Totally Disabled, Represented By Wife) v. IFFCO Tokio General Insurance Company Limited (Neutral Citation: 2026 INSC 1145)
Appearances
Appellants: Advocates Aarthi Rajan, Smrithi Suresh, Abhilasha Sherawat, Manasi Aggarwal, Sugam Agrawal and Togin M. Babichen; Advocate-on-Record A. Karthik
Respondent: Advocate Shubham Janghu; Advocate-on-Record Gopal Singh