[Cites 3, Cited by 0]
Delhi High Court
M/S National Insurance Co Ltd vs Anil Kumar & Ors on 26 February, 2026
$~3
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of decision: 26th February 2026
+ MAC.APP. 493/2014
M/S NATIONAL INSURANCE CO LTD .....Appellant
Through: Mr. Pankaj Seth & Mr. Yurvaraj
Sharma, Advs.
versus
ANIL KUMAR & ORS .....Respondent
Through: Mr. Debashis Mukherjee, Mr. Parma
Nand and Mr. Anand Shankar,
Advocates for Respondent No. 1
CORAM:
HON'BLE MR. JUSTICE ANISH DAYAL
JUDGMENT
ANISH DAYAL, J (ORAL)
1. This appeal has been filed challenging award dated 28 th February
2014 passed by MACT, Saket Courts in MACT No.714/2011, whereby
compensation of Rs.21,52,901/- was awarded to injured-claimant, Mr. Anil
Kumar, who had suffered injuries in an accident on 20 th March 2011 when
an Indigo Car bearing No.DL-3C-BB-2867 (offending vehicle) being driven
by respondent no.2, hit motorcycle of injured. The offending vehicle was
insured with the appellant.
2. As per the disability certificate, claimant suffered 90% permanent
disability with respect to his left lower limb.
3. Mr. Pankaj Seth, counsel for Insurance Company, challenges the
assessment of functional disability at 100%, contending that there was
disability only with respect to left lower limb. He contends that even though
claimant had claimed to be a TSR driver, there are other vocations in which
he could have engaged himself. Therefore, 100% functional disability,
amounting to complete loss of earning capacity, cannot be imputed in a case
of this nature. In this regard, he adverts to paragraph 15 and 19 of the
MACT award, whereby the Tribunal has considered the principles laid down
by the Supreme Court in Raj Kumar v. Ajay Kumar (2011) 1 SCC 343;
however, according to Mr. Seth, the said principles have not been applied in
the correct manner to the facts of the present case.
4. To this extent, this Court is inclined to agree with submissions of Mr.
Seth, as 100% loss of earning capacity can be imputed only in cases where
person is completely disabled or completely paralysed and is unable to earn
anything at all. The present case is not a case of amputation, rather it is a
case of disability caused due to fracture involving a femur, which has been
operated with external fixtures/plating.
5. The Supreme Court in the case Raj Kumar v. Ajay Kumar (2011) 1
SCC 343, held that the Tribunal must assess not merely the extent of
permanent disability but its actual impact on the claimant's earning capacity,
which may differ from the medical percentage of disability. This requires
evaluating the claimant's pre-accident vocation, the functions affected, and
whether livelihood can still be earned despite the disability. The Court
emphasised that disability and loss of earning capacity are distinct concepts,
except in cases where evidence shows they coincide. Relevant paragraphs
are extracted as under:
"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 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.
12. Therefore, the Tribunal has to first decide whether there is
any permanent disability and, if so, the extent of such
permanent disability. This means that the Tribunal should
consider and decide with reference to the evidence:
(i) whether the disablement is permanent or temporary;
(ii) if the disablement is permanent, whether it is permanent
total disablement or permanent partial disablement;
(iii) if the disablement percentage is expressed with reference
to any specific limb, then the effect of such disablement of the
limb on the functioning of the entire body, that is, the
permanent disability suffered by the person.
If the Tribunal concludes that there is no permanent disability
then there is no question of proceeding further and
determining the loss of future earning capacity. But if the
Tribunal concludes that there is permanent disability then it
will proceed to ascertain its extent. After the Tribunal
ascertains the actual extent of permanent disability of the
claimant based on the medical evidence, it has to determine
whether such permanent disability has affected or will affect
his earning capacity.
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 so that he continues to
earn or can continue to earn his livelihood."
(emphasis added)
6. In Raj Kumar v. Ajay Kumar (supra), the Court summarised the
principles, which are extracted as under:
"19. We may now summarise the principles discussed above:
(i) All injuries (or permanent disabilities arising from
injuries), do not result in loss of earning capacity.
(ii) The percentage of permanent disability with reference
to the whole body of a person, cannot be assumed to be the
percentage of loss of earning capacity. To put it differently,
the percentage of loss of earning capacity is not the same
as the percentage of permanent disability (except in a few
cases, where the Tribunal on the basis of evidence,
concludes that the percentage of loss of earning capacity is
the same as the percentage of permanent disability).
(iii) The doctor who treated an injured claimant or who
examined him subsequently to assess the extent of his
permanent disability can give evidence only in regard to the
extent of permanent disability. The loss of earning capacity
is something that will have to be assessed by the Tribunal
with reference to the evidence in entirety.
(iv) The same permanent disability may result in different
percentages of loss of earning capacity in different persons,
depending upon the nature of profession, occupation or job,
age, education and other factors."
(emphasis added)
7. In the fact and circumstances of the present case and taking into
account the principles laid down in Raj Kumar (supra), the Court is of the
opinion that the functional disability ought to be considered as 75%.
8. Aside from this, the Court has noted that future prospects have not
been awarded in terms of principles of National Insurance Company Ltd.
vs. Pranay Sethi & Ors. (2017) 16 SCC 680. Since benchmark income
adopted was the minimum wages applicable to skilled labour, i.e., Rs.
7,410/- per month and was 45 years of age, future prospects at 30% ought
to be awarded.
9. Further, since the claimant had just turned 45 years on the date
accident, it would be appropriate that multiplier of 14 is adopted, as per
tabulation in Smt. Sarla Verma & Ors v. Delhi Transport Corporation &
Anr. (2009) 5 SCC 121.
10. Accordingly, the revised computation is as under:
Sr. Heads Awarded by the Awarded by
No. Tribunal this Court
1 Compensation for medical expenses Rs. 5,46,941/- Rs. 5,46,941/-
2 Compensation for pain & suffering Rs. 1,00,000/- Rs. 1,00,000/-
3 Compensation for special diet and Rs. 50,000/- Rs. 50,000/-
conveyance
4 Compensation for attendant charges Rs. 1,50,000/- Rs. 1,50,000/-
5 Income of Injured (D) (less Income Tax) Rs. 7,410/- Rs. 7,410/-
6 Add Future Prospects (E) - 30%
8 Functional Disability (G) 100% 75%
9 Loss of earning capacity including Rs. 11,55,960/- Rs. 12,13,758/-
future due to disability [(Dx12) + E] x
F= H)
10 Compensation for loss of amenities and Rs. 1,00,000/- Rs. 1,00,000/-
enjoyment of life
11 Compensation for disfigurement Rs. 50,000/- Rs. 50,000/-
12 Total Rs. 21,52,901/- Rs. 22,10,699/-
13 Interest awarded 9% per annum 9% per annum
Enhanced amount Rs. 57,798/-
11. Vide order dated 26th May 2014, this Court directed the Insurance
Company to deposit the entire awarded amount with interest with the
Registrar General of this Court, subject to which stay was granted. Further,
the Registrar General of this Court was directed to release 60% of the
awarded amount in favour of the respondent no. 1/claimant as per the terms
and conditions fixed by the Tribunal. Vide order dated 23rd February 2023,
this Court directed release of 20% of amount lying deposited to respondent
no.1/claimant upon furnishing adequate security of the like amount to the
satisfaction of the Registrar General of this Court. The same was modified
on 28th August 2023, and the Court directed release of 20% of the total
amount, i.e. principal + interest, which would come to Rs.3,90,493.32/-
12. Accordingly, the enhanced amount along with interest thereupon be
deposited by the Insurance company within a period of 4 weeks and be
released to the respondent no.1/claimant within a period of 2 weeks
thereafter.
13. Accordingly, appeal stands disposed of.
14. Pending applications, if any, are rendered infructuous.
15. Statutory deposit (if any) shall be refunded to appellant.
16. Judgement be uploaded on the website of this Court.
ANISH DAYAL, J
FEBRUARY 26, 2026/sm/bp
