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REPORTABLE  

 IN THE SUPREME COURT OF INDIA  CIVIL APPELLATE JURISDICTION  

 CIVIL APPEAL NO. 9306 OF 2019  

(Arising out of SLP (Civil) No. 31909 of 2017)    

Sri Chanappa Nagappa Muchalagoda         …Appellant  

 versus  

 Divisional Manager, New India Insurance        Company Limited             …Respondent    

J U D G M E N T  

INDU MALHOTRA, J.  

 Leave granted.  

1. The present Civil Appeal has been filed by the Appellant –  

Claimant for enhancement of the compensation awarded to  

him by the Karnataka High Court (Dharwad Bench) under the  

Workmen’s Compensation Act, 1923.  

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2. The Appellant – a driver of heavy vehicles, was employed by  

one Sekar Santharam. On 13.05.2006, while he was driving a  

truck bearing No. MH-08H-0390 loaded with sand from  

Islampura towards Ratnagiri, he lost control of the truck due  

to an axle cut, and dashed against a rock on the side of the  

road.  

As a consequence, the truck turtled thrice, and the  

Appellant suffered grievous injuries all over his body. The  

truck was insured with the Respondent – Insurance Company.  

3. The Appellant suffered from serious injuries in his right leg by  

an Anterior Cruciate Ligament and a Collateral Ligament Tear.  

Plastic surgery was performed on his right leg. This led to his  

right leg getting permanently injured, which resulted in  

complete disability to continue his vocation as a driver of a  

heavy motor vehicle.  

The Appellant underwent hospitalization for a total  

period of 65 days, first in Government Hospital, Ratnagiri  

between 13.05.2006 and 01.06.2006 and thereafter, in KIMS  

Hospital, Hubli between 17.06.2006 and 26.08.2006.

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4. The Appellant filed a Claim under the Workmen’s  

Compensation Act, 1923 (“the Act”) before the Labour Officer  

and Commissioner for Workmen’s Compensation, Sub-

Division 2 – Belgaum (“Commissioner”) against the Truck  

Owner and the Insurance Company, praying that an amount  

of Rs. 5,00,000/- be awarded to him as compensation.  

5. The Truck Owner filed his Written Statement, wherein he  

admitted the factum of the accident and the injuries suffered  

by the Appellant. He submitted that he was paying Rs. 4,000/-   

p.m. and Rs. 30 batta per day to the Appellant.  

6. Dr. S.D. Patil – a Knee Specialist from Belagavi who had  

examined the Appellant, deposed that the Appellant can  

neither stand for a long period of time, nor can he fold his legs.  

He was required to use a walking stick, and could not lift heavy  

objects. Dr. Patil opined that the Appellant suffered 37%  

disability in his whole body, and could not perform the work  

of a truck driver any longer.

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7. The Commissioner assessed the Appellant’s income at Rs.  

3,000/- p.m., and held that he had lost 50% of his earning  

capacity. Since the Appellant was 33 years old at the time of  

the accident, 201.66 was taken as the relevant factor as per  

Schedule IV to the Act. Accordingly, the compensation was  

computed at Rs. 1,81,494/-. The Respondent – Insurance  

Company was held liable to pay the amount awarded.  

8. The Appellant filed MFA No. 1569/2008 before the Karnataka  

High Court (Dharwad Bench) for enhancement of the  

compensation awarded by the Commissioner.  

The High Court accepted the income of the Appellant at  

Rs. 4,000/- p.m. as per the statement made by the employer.  

Insofar as the functional disability of the Appellant was  

concerned, the Court held the assessment by the  

Commissioner at 50% was on the lower side, and increased it  

to 60%, since the Appellant could no longer earn his livelihood  

as a driver, and could not even stand for a long time.

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The compensation was accordingly enhanced to Rs.  

2,90,390/- with Interest @12% p.a. payable from one month  

after the date of the accident.   

9. Aggrieved, the Appellant has filed the present Civil Appeal  

before this Court for enhancement of the compensation  

awarded by the High Court.  

We have heard the learned Counsel appearing for the  

parties, and perused the pleadings on record.  

It is the admitted position that the Appellant can no  

longer pursue his vocation as a driver of heavy vehicles. The  

medical evidence on record has corroborated his inability to  

stand for a long period of time, or even fold his legs. As a  

consequence, the Appellant has got permanently incapacitated  

to pursue his vocation as a driver.   

This Court in Raj Kumar v. Ajay Kumar and Ors.,1 held  

that:  

“10. 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  

 1 (2011) 1 SCC 343.

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do as a result of the permanent ability (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.    For example, if the left hand of a claimant is  amputated, the permanent physical or functional  disablement may be assessed around 60%. If the  claimant was a driver or a carpenter, the  actual loss of earning capacity may virtually  be hundred percent, if he is neither able to  

drive or do carpentry. On the other hand, if the  claimant was a clerk in government service, the  loss of his left hand may not result in loss of  employment and he may still be continued as a  clerk as he could perform his clerical functions;  and in that event the loss of earning capacity will  not be 100% as in the case of a driver or carpenter,  nor 60% which is the actual physical disability,  but far less. In fact, there may not be any need to  award any compensation under the head of 'loss  of future earnings', if the claimant continues in  government service, though he may be awarded  compensation under the head of loss of amenities  as a consequence of losing his hand. Sometimes  the injured claimant may be continued in service,  but may not found suitable for discharging the  duties attached to the post or job which he was  earlier holding, on account of his disability, and  may therefore be shifted to some other suitable  but lesser post with lesser emoluments, in which  case there should be a limited award under the  head of loss of future earning capacity, taking  note of the reduced earning capacity. It may be

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noted that when compensation is awarded by  treating the loss of future earning capacity as  100% (or even anything more than 50%), the need  to award compensation separately under the  head of loss of amenities or loss of expectation of  life may disappear and as a result, only a token  or nominal amount may have to be awarded  under the head of loss of amenities or loss of  expectation of life, as otherwise there may be a  duplication in the award of compensation. Be that  as it may.”  

(emphasis supplied)  

10. In K. Janardhan v. United India Insurance Co. Ltd.,2 this Court  

examined the loss of earning capacity in the case of a tanker  

driver who had met with an accident, and lost one of his legs  

due to amputation. The Commissioner for Workmen’s  

Compensation assessed the functional disability of the tanker  

driver as 100% and awarded compensation on that basis. The  

High Court however, referred to Schedule I to the Workmen’s  

Compensation Act, 1923, and held that loss of a leg on  

amputation resulted in only 60% loss of earning capacity. This  

Court set aside the judgment of the High Court, and held that  

since the workman could no longer earn his living as a tanker  

driver due to loss of one leg, the functional disability had to be  

assessed as 100%.  

 2 (2008) 8 SCC 518.

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In S. Suresh v. Oriental Insurance Co. Ltd. & Anr.,3 this  

Court held that :  

“8. … We are of the opinion that on account of  amputation of his right leg below knee, he is  rendered unfit for the work of a driver, which he  was performing at the time of the accident  resulting in the said disablement. Therefore, he  has lost 100% of his earning capacity as a lorry  driver, more so, when he is disqualified from even  getting a driving license under the Motor Vehicles  Act.”  

(emphasis supplied)  

The aforesaid judgments are instructive for assessing the  

compensation payable to the Appellant in the present case. As  

a consequence of the accident, the Appellant has been  

incapacitated for life, since he can walk only with the help of a  

walking stick. He has lost the ability to work as a driver, as he  

would be disqualified from even getting a driving license. The  

prospect of securing any other manual labour job is not  

possible, since he would require the assistance of a person to  

ensure his mobility and manage his discomfort. As a  

consequence, the functional disability suffered by the  

Appellant must be assessed as 100%.  

 3 (2010) 13 SCC 777.

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11. We affirm the judgment of the High Court on assessing the  

income of the Appellant at Rs. 4,000/- p.m. as per the evidence  

of his employer. The “functional disability” of the Appellant is  

assessed as 100%, and the relevant factor would be 201.66 as  

per Schedule IV to the Act. Consequently, the compensation  

payable to the Appellant would work out to Rs. 4,83,984/-  

under Section 4 of the Act.  

12. We find that the Appellant has not been awarded any amount  

towards reimbursement of the medical expenses incurred by  

him, either by the Commissioner, or by the High Court. The  

Appellant underwent hospitalization for a period of 65 days’  

for medical treatment and surgical operations.   

We deem it just and appropriate to award a lump sum  

amount of Rs. 1,00,000/- towards hospitalization and medical  

expenses incurred by the Appellant.  

13. The Respondent – Insurance Company is directed to pay the  

enhanced amount of compensation to the Appellant along-

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with Interest @6% p.a. to be calculated one month from the  

date of the accident till the date of payment within 4 weeks.  

The Civil Appeal stands allowed in the aforesaid terms. All  

pending Applications, if any, are accordingly disposed of.  

Ordered accordingly.  

 .....................................J.  

(UDAY UMESH LALIT)          

.…...............………………J.  (INDU MALHOTRA)  

New Delhi,  December 10, 2019