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2026 Supreme(All) 168

HIGH COURT OF JUDICATURE AT ALLAHABAD
Sandeep Jain, J.
Sangam Lal – Appellant
Versus
The New India Assurance Co. Ltd. And Anr. - Respondents
First Appeal From Order No. 892 of 2015, First Appeal From Order No. 697 of 2015
Decided On : 08-01-2026

Advocates Appeared:
For the Appellant : Amit Kumar Sinha, Deepali Srivastava Sinha
For the Respondent: Anubhav Sinha

Compensation calculations for permanent disability must accurately reflect functional loss and future earning capacity, avoiding mechanical application of disability percentages and ensuring just compensation based on age-related multipliers.

Headnote:(A) Motor Vehicles Act, 1988 - Section 173 - First Appeal challenging the impugned order of the Motor Accident Claims Tribunal regarding compensation for injuries sustained in a motor accident - Compensatory award modified to Rs.16,59,510/- with interest at 7% per annum. (Paras 24, 26)

(B) Compensation assessment principles - Tribunal must assess loss of earnings reflecting the claimant's functional disability rather than a mechanical application of disability percentages; established by precedent. (Paras 8-10)

(C) Calculation of compensation must consider future prospects and correct multipliers based on age; misapplication of these factors requires correction to achieve equitable compensation. (Paras 20-21)

Facts of the case:
The claimant suffered severe injuries from a motor accident on 29.03.2009, leading to the amputation of his right leg and toes, initially assessed with 80% disability, disputed by both parties.

Findings of Court:
The court found the initial compensation inadequate and corrected the total compensation to Rs.16,59,510/-, affirming the need for proper functional disability assessment and multipliers based on age.

Issues: The main issues revolved around the assessment of the claimant's functional disability, adequacy of compensation awarded, and proper application of legal principles concerning future prospects.

Ratio Decidendi: The court established that compensatory assessments must prioritize functional disability and future earning capacity, correcting the tribunal's deficits in these evaluations.

Result: FAFO No.697 of 2015 dismissed; FAFO No.892 of 2015 allowed, award modified accordingly.

Table of Content
1. factual introduction of appeals. (Para 1 , 2 , 3 , 4)
2. arguments regarding disability assessment. (Para 5 , 6)
3. court's review of the evidence. (Para 7 , 8)
4. assessment of functional disability. (Para 9 , 10 , 11 , 12)
5. compensation principles for permanent disability. (Para 13 , 14 , 15 , 16 , 17 , 18)
6. specific compensation calculations. (Para 20 , 21 , 22)
7. final decision and orders. (Para 23 , 24 , 25 , 26 , 27 , 28 , 29)

JUDGMENT :

SANDEEP JAIN, J.

1. FAFO No. 697 of 2015 under Section 173 of the Motor Vehicles Act, 1988 has been preferred by the insurer of the offending Truck No.MH-04- DK-4585 against the impugned judgment and award dated 15.01.2015 passed by the Motor Accident Claims Tribunal/Additional District Judge, court no.1, Allahabad, in MACP No. 521 of 2011, Sangam Lal Vs. Jitendra Pal Singh & another, whereby, for the injuries sustained in a motor accident which occurred on 29.03.2009, the claimant has been awarded a compensation of Rs.5,03,310/-, alongwith interest at the rate of 7% per annum, which has been ordered to be indemnified by the insurer of the offending Truck No.MH-04-DK-4585.

2. FAFO No.892 of 2015 under Section 173 of the Motor Vehicles Act, 1988 has been preferred by the claimant for enhancement of compensation against the impugned judgment and award dated 15.01.2015 passed by the Motor Accident Claims Tribunal/Additional District Judge, court no.1, Allahabad, in MACP No. 521 of 2011, Sangam Lal Vs. Jitendra Pal Singh & another, whereby, for the injuries sustained in a motor accident which occurred on 29.03.2009, the claimant has been awarded a compensation of Rs.5,03,310/-, alongwith interest at the rate of 7% per annum, which has been ordered to be indemnified by the insurer of the offending Truck No.MH-04-DK-4585.

3. FAFO No.892 of 2015 is admitted.

4. Since, both the appeals arise from the same judgment and award as such, they are being heard and decided by the common judgment.

5. Learned counsel for the appellant-insurance company in FAFO No.697 of 2015 submitted that the claimant allegedly suffered only 60% permanent disability due to the injuries sustained in the accident but it was considered to be 80% by the tribunal only on the basis of certificate issued by the Physiotherapist, which was not at all admissible in evidence. It is further submitted that the claimant was a minor who was not earning, but still the tribunal has assessed compensation by taking his monthly income at Rs.3,000/- which is erroneous. With these submission, it was prayed that the appeal be allowed and the compensation paid to the claimant be reduced.

6. Per contra, learned counsel for the claimant-respondent submitted that due to the injuries suffered in the accident, the right leg of the claimant was amputated from the knee and his two little toes of left foot were also amputated due to which he suffered 100% functional disability but the tribunal has only assessed the disability of the claimant at only 80% which requires enhancement. She further submitted that due to the amputation, the claimant was unable to do any manual labour, as such, it was a fit case where the tribunal should have awarded compensation by taking functional disability of the claimant at 100%. She further submitted that the claimant was also entitled to compensation for future prospects at the rate of 50% in accordance with Rule 220-A of the UP Motor Vehicle Rules,1998, but the tribunal has not awarded any compensation towards it. It was further submitted that since the deceased was about 16 years old, a multiplier of 18 was to be applied for assessing compensation, but the tribunal has applied a multiplier of 16, which requires enhancement. It was further submitted that the tribunal has awarded inadequate amount of compensation towards non pecuniary heads which require substantial enhancement keeping in view of the various precedents of the Apex Court. With these submissions, it was prayed that the appeal preferred by t

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