Disability Cannot Be Viewed in Isolation from Vocation: Punjab & Haryana High Court Enhances Compensation by Assessing Functional Disability at 50%

“65% Medical Disability Does Not Always Mean 65% Loss of Earning Capacity — For a Patwari, Functional Impact Must Be Judged Through the Lens of His Duties”: Justice Deepak Gupta

Punjab and Haryana High Court delivered a significant judgment concerning compensation assessment for permanent disability in motor accident claims. Justice Deepak Gupta, sitting in appellate jurisdiction, enhanced the compensation awarded to the injured claimant by ₹1,45,400, holding that “functional disability must be assessed in light of the claimant's profession and its impact on earning capacity.”

The Court also rejected cross-objections filed by the driver of the offending vehicle, who sought to deny liability, observing that he had already been convicted in criminal proceedings arising from the same accident — a fact which remained undisputed during the hearing.

“65% Physical Disability May Result in Only 50% Functional Disability Depending on Employment Nature”: Court Applies Vocational Test to Compensation Calculation

The case arose from a road accident on 14.03.1995, in which the appellant, Ranjit Singh, then working as a Patwari, sustained left-sided hemiparesis and knee stiffness, ultimately resulting in 65% permanent disability. The Motor Accident Claims Tribunal (MACT) had awarded ₹3,50,000 in total compensation, including ₹1,30,000 for permanent disability. Dissatisfied, the appellant approached the High Court seeking enhancement, while the driver filed cross-objections denying negligence.

Rejecting the MACT’s mechanical approach, the High Court took a more nuanced view, holding:

“Having regard to the nature of his job, it cannot be assumed that his functional disability was reduced to the extent of 65%. However, still the said functional disability can be taken to be at-least 50%.”

Justice Gupta then applied the standard multiplier method under Section 166 of the Motor Vehicles Act. Considering the appellant’s monthly income of ₹2700, the annual loss of earning capacity due to 50% disability was calculated at ₹16,200. Applying a multiplier of 17 (based on his age of 30 years), the correct compensation under this head was arrived at as ₹2,75,400.

Since ₹1,30,000 had already been awarded by the Tribunal, the enhancement came to ₹1,45,400, which the Court allowed, along with interest at 7.5% per annum from the date of the claim petition till realization.

“Negligence Established in Criminal Conviction — Cross-Objections of Driver Dismissed as Baseless”

The driver of the offending vehicle, Respondent No. 2, had filed cross-objections claiming there was no negligence on his part. However, the Court flatly rejected this plea, observing:

“Respondent No.2 has been convicted by the criminal Court on account of his rash and negligent driving. The said fact has not been refuted by counsel for the respondents.”

Consequently, the Court affirmed the Tribunal’s finding on negligence, noting that no new evidence or argument had been brought forward to disturb the finding.

“Compensation Should Reflect Real Loss, Not Just Medical Diagnosis”: Functional Approach Reaffirmed in Motor Accident Claims

The ruling reinforces a critical legal distinction between “medical disability” and “functional disability”, which has evolved through judicial precedents. The Court reiterated that earning capacity is not diminished in the same proportion as physical impairment, especially when the claimant is employed in non-manual or desk-based professions.

“Disability compensation should not be determined solely by medical percentage. It must be linked to how that disability affects the claimant's work, life, and livelihood,” the Court noted.

This approach is consistent with judgments of the Supreme Court in cases like Raj Kumar v. Ajay Kumar [(2011) 1 SCC 343], where the apex court emphasized that “functional disability” is the relevant measure in awarding compensation.

The Court concluded the matter by modifying the MACT award and issuing the following directions:

“The present appeal is accepted by modifying the award of the Tribunal and by allowing enhanced compensation of ₹1,45,400/- to the appellant-claimant… along with interest @ 7.5% per annum to be calculated from the date of filing of the claim petition till actual realization.”

The cross-objections filed by the driver were dismissed in toto.

Date of Decision: 24 September 2025