Appellate court interfering with Motor Accidents Claims Tribunal findings on assessment of disability and loss of earning capacity must undertake a thorough reappreciation of evidence
In a recent judgment, Hon’ble Supreme Court while enhancing compensation for functional disability held that when an appellate court interferes with findings of fact duly recorded by the Motor Accidents Claims Tribunal (MACT), particularly on issues such as assessment of disability and loss of earning capacity, it must undertake a thorough reappreciation of the evidence and to assign cogent, clear and convincing reasons for departing from the conclusions arrived at by the MACT
ABCAUS Case Law Citation:
5072 (2026) (03) abcaus.in SC
Important Case Laws relied upon by Parties
Raj Kumar v. Ajay Kumar (2011) 1 SCC 343
In The instant case the appellant/claimant had challenged the order of the Hon’ble High Court whereby the Court had reduced the compensation awarded by Motor Accidents Claims Tribunal.
The MACT had accepted the disability certificate issued by the Medical Board, and determined the impact of such disability on appellant claimant’s earning capacity. Applying the multiplier method and taking into consideration appellant-claimant’s age, monthly income inclusive of future prospects, MACT applying the disability percentage as per medical certificate, computed the loss of future earning capacity.
The High Court, observed that the percentage of the physical disability assessed by the Medical Board could not be mechanically adopted for the purpose of determining loss of earning capacity.
The High Court adjudged the functional disability suffered by the appellant-claimant by applying a much lower percentage and reduced the compensation on account of future loss earning power.
The Hon’ble Supreme Court observed that the assessment of functional disability must be grounded in a realistic appraisal of the impact of the injury on the claimant’s capacity to earn. The inquiry is not confined to the numerical percentage of physical impairment certified by the Medical Board, but extends to evaluating whether the claimant, in light of his educational background, skill set and nature of employment, is capable of meaningfully pursue his vocation.
The Hon’ble Supreme Court observed that the disability certificate issued by the Medical Board clearly recorded that the claimant had suffered a head injury treated conservatively, facial injury, and left femur fracture treated by surgical intervention. These injuries progressively resulted in partial blindness, cognitive impairment and partial loss of range of motion and stability of the left knee. The neuropsychological assessment further evidences severe impairment in verbal and visual memory, impairment of frontal lobe functions and an IQ score of 65, placing the appellant-claimant in the category of Mild Intellectual Disability.
The Hon’ble Supreme Court further observed that the evidence did not indicate a mere diminution in efficiency, rather, it demonstrated a profound erosion of the faculties essential for gainful employment in his chosen field. These impairments strike at the core competencies indispensable for the effective discharge of managerial responsibilities and substantially undermine the appellant-claimant’s ability to perform the essential functions inherent in such a position.
The Hon’ble Supreme Court opined that without doubt, having suffered such grave medical and neurological impairments, the appellant-claimant would neither be considered suitable for the managerial post nor would he be capable of effectively discharging the onerous responsibilities attached to the said post, particularly in light of his present condition, which is likely to deteriorate progressively over time.
Following the settled principle that functional disability must reflect the actual loss of earning capacity, the Hon’ble Supreme Court held that the disability in the present case, for the purpose of computation of compensation, deserved to be reckoned at 100%.
Lastly, the Hon’ble Supreme Court reiterated that when an appellate court interferes with findings of fact duly recorded by the Motor Accidents Claims Tribunal, particularly on issues such as assessment of disability and loss of earning capacity, it is incumbent upon it to undertake a thorough reappreciation of the evidence and to assign cogent, clear and convincing reasons for departing from the conclusions arrived at by the Motor Accidents Claims Tribunal.
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