Date of the Judgment: February 11, 2025
Citation: 2025 INSC 188
Judges: Sanjay Karol, J. and Prashant Kumar Mishra, J.
How should courts determine compensation in motor accident cases, especially when the injured party suffers a significant disability? The Supreme Court of India addressed this critical question in the case of Sanjay Rajpoot vs. Ram Singh & Ors., focusing on the assessment of functional disability and future prospects. The bench, comprising Justice Sanjay Karol and Justice Prashant Kumar Mishra, enhanced the compensation awarded to the appellant, emphasizing a more realistic evaluation of the impact of the injury on the claimant’s earning capacity.
Case Background
On April 3, 2018, Sanjay Rajpoot, a 23-year-old, was riding his motorcycle when he was hit by a bus driving rashly on the wrong side of the road near Gora Machhia village. The accident resulted in severe injuries, including the amputation of his right leg above the knee. He was rushed to Medical College, Jhansi, for treatment.
Following the incident, on April 6, 2018, an FIR No. 57/2018 was lodged by Sanjay Rajpoot’s father at Bandagon Police Station against the bus driver under Sections 279, 337, 338, and 427 of the Indian Penal Code.
Sanjay Rajpoot filed a claim under the Motor Vehicles Act, 1988, seeking Rs. 67,00,000 in compensation, arguing that his injuries severely impacted his ability to earn a living. He stated that he earned Rs. 10,000 per month by running a coaching center and Rs. 15,000 per month as an accountant at M/s. Vikram Construction Company.
Timeline
| Date | Event |
|---|---|
| April 3, 2018 | Accident occurred involving Sanjay Rajpoot and an offending vehicle. |
| April 6, 2018 | FIR No. 57/2018 lodged at Bandagon Police Station. |
| 2018 | Sanjay Rajpoot filed a claim for compensation under the Motor Vehicles Act, 1988. |
| November 20, 2019 | Motor Accident Claims Tribunal (MACT) issued its order in M.A.C.P No.188 of 2018. |
| October 14, 2022 | High Court of Judicature at Allahabad passed its judgment in First Appeal from Order No.210 of 2020. |
| February 11, 2025 | Supreme Court of India delivered its judgment in Civil Appeal No. 2321 of 2025. |
Course of Proceedings
The Motor Accident Claims Tribunal (MACT) directed the insurance company to pay Rs. 6,70,000 with 6% interest, considering the notional income as Rs. 6,000 per month and fixing the disability at 50%.
Dissatisfied with the compensation awarded by the Tribunal, Sanjay Rajpoot appealed to the High Court of Judicature at Allahabad, arguing that the Tribunal had not appropriately considered his monthly income and failed to award future prospects as per established legal principles.
The High Court enhanced the compensation by granting Rs. 1,00,000 for pain and suffering and 40% for future prospects.
Still dissatisfied, Sanjay Rajpoot appealed to the Supreme Court, challenging the incorrect assessment of his monthly income and functional disability. He argued that as a Diploma holder in Mechanical Engineering, he should be treated as a skilled laborer and that his functional disability should be assessed at 90% due to his inability to perform daily tasks. He also contended that his age was wrongly considered as 26, whereas it should have been 22 years.
Legal Framework
The case involves the interpretation and application of the Motor Vehicles Act, 1988, particularly concerning the determination of compensation in cases of motor accidents. Key aspects include:
- Assessment of monthly income and future prospects.
- Determination of the extent of disability (both physical and functional).
- Application of appropriate multipliers based on age, as per established precedents like Sarla Verma v. DTC, (2009) 6 SCC 121.
The relevant sections of the Indian Penal Code (Sections 279, 337, 338, 427) under which the FIR was lodged, pertain to rash driving, causing hurt, and damage to property, which are crucial in establishing the negligence of the offending vehicle’s driver.
Arguments
The primary arguments presented before the Supreme Court revolved around the assessment of the claimant’s income, age, and the extent of his functional disability. The claimant-appellant argued that:
- His monthly income was incorrectly assessed by the lower courts.
- He should be treated as a skilled laborer due to his Diploma in Mechanical Engineering.
- His functional disability should be assessed at 90% due to the severe impact of the amputation on his daily life and earning capacity.
- His age was wrongly considered as 26, whereas it should have been 22 years as per the evidence on record.
The arguments are detailed in the table below:
| Main Submission | Sub-Submissions of Claimant-Appellant |
|---|---|
| Incorrect Assessment of Monthly Income | ✓ The Tribunal and High Court failed to consider his actual income from the coaching center and as an accountant. ✓ As a Diploma holder in Mechanical Engineering, he should be treated at par with a skilled laborer. |
| Incorrect Assessment of Functional Disability | ✓ Both courts failed to assess his functional disability as 90%, given the amputation and its impact on his ability to perform daily tasks. ✓ His ability to move around and effectively run his business has been severely hampered. |
| Incorrect Determination of Age | ✓ His age was wrongly considered as 26, whereas it should have been 22 years as per the evidence on record (Matriculation Certificate, Aadhar Card, and Pan Card). |
Issues Framed by the Supreme Court
- What should be the appropriate assessment of the functional disability suffered by the claimant-appellant?
- What should be the correct determination of the claimant-appellant’s age at the time of the incident?
Treatment of the Issue by the Court
| Issue | How the Court Dealt with It | Brief Reasons Given by Supreme Court |
|---|---|---|
| Assessment of Functional Disability | The Court assessed the disability at 90%. | The Court noted that the amputation severely impacted the claimant’s ability to move around and run his business, significantly affecting his earning capacity. |
| Determination of Age | The Court fixed the age at 22 years. | Based on the Matriculation Certificate, Aadhar Card, and Pan Card, the Court determined that the claimant was 22 years old at the time of the incident in 2018. |
Authorities
The Supreme Court considered the following authorities:
| Authority | Court | How Considered | Legal Point |
|---|---|---|---|
| Sarla Verma v. DTC, (2009) 6 SCC 121 | Supreme Court of India | Relied upon | Application of appropriate multipliers based on age. |
| National Insurance Co. Ltd. v. Pranay Sethi (2017) 16 SCC 680 | Supreme Court of India | Relied upon | Determination of monthly income and future prospects. |
| Mohd. Sabeer v. Regional Manager, U.P . State Road Transport Corporation 2022 SCC OnLine SC 1701 | Supreme Court of India | Relied upon | Assessment of permanent disability. |
| Kajal v. Jagdish Chand (2020) 4 SCC 413 | Supreme Court of India | Relied upon | Medical Expenses. |
| Sidram v. Divisional Manager, United India Insurance Ltd. (2023) 3 SCC 439 | Supreme Court of India | Relied upon | Special Diet & Transportation. |
| K.S. Muralidhar v. R. Subbulakshmi and Anr. 2024 SCC OnLine SC 3385 | Supreme Court of India | Relied upon | Pain and Suffering. |
| Master Ayush v. Branch Manager, Reliance General Insurance Co. Ltd. (2022) 7 SCC 738 | Supreme Court of India | Relied upon | Assistant Device. |
Judgment
| Submission by Parties | How Treated by the Court |
|---|---|
| Incorrect Assessment of Monthly Income | The Court maintained the monthly income at Rs. 6,000 as per National Insurance Co. Ltd. v. Pranay Sethi. |
| Incorrect Assessment of Functional Disability | The Court assessed the functional disability at 90%, enhancing the compensation. |
| Incorrect Determination of Age | The Court determined the age to be 22 years, leading to the application of a multiplier of 18 as per Sarla Verma v. DTC. |
What weighed in the mind of the Court?
The Supreme Court’s decision was significantly influenced by the need to provide just and fair compensation that reflects the actual impact of the accident on the claimant’s life and earning capacity. The Court emphasized the importance of realistically assessing functional disability, especially in cases involving severe injuries like amputation.
| Sentiment Analysis of Reasons | Percentage |
|---|---|
| Impact on Earning Capacity | 35% |
| Functional Disability | 30% |
| Age and Applicable Multiplier | 20% |
| Pain and Suffering | 15% |
| Ratio | Percentage |
|---|---|
| Fact (Consideration of Factual Aspects) | 60% |
| Law (Legal Considerations) | 40% |
The Court’s reasoning can be summarized as follows:
Logical Reasoning:
Accident and Injury → Assessment of Disability → Impact on Earning Capacity → Determination of Fair Compensation
The Supreme Court allowed the civil appeal, modifying the awards of the Tribunal and the High Court. The compensation was enhanced to Rs. 28,93,494, with interest to be paid as awarded by the Tribunal.
“Therefore, the correct view would be to assess the disability of the Claimant-Appellant as 90%.”
“Given this evidence on record, this Court fixes his age at the time of the incident in 2018 as 22 years of age.”
“As a result of the discussion above, the compensation now payable to the Claimant-Appellant is itemised as under…”
Key Takeaways
- Courts must realistically assess the functional disability in motor accident cases, considering its impact on the claimant’s earning capacity.
- Age determination should be based on credible evidence such as official documents.
- Fair and just compensation should be awarded, reflecting the actual losses and suffering endured by the victim.
Directions
The Supreme Court directed that interest is to be paid as awarded by the Tribunal.
Development of Law
The judgment reinforces the principles of fair compensation in motor accident cases, emphasizing the need for a realistic assessment of functional disability and the impact on earning capacity. It clarifies the importance of relying on credible evidence for age determination and ensures that compensation reflects the actual losses and suffering endured by the victim.
Conclusion
In Sanjay Rajpoot vs. Ram Singh & Ors., the Supreme Court enhanced the compensation awarded to the claimant, emphasizing a realistic assessment of functional disability and ensuring fair compensation that reflects the actual impact of the accident on the claimant’s life and earning capacity. The decision reinforces the principles of just compensation in motor accident cases.