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Pappu Deo Yadav v. Naresh Kumar and Ors.

Civil Appeal · 2020 INSC 553Decided 17 Sept 2020
Civil Appeal No. 2567 of 2020
Justice L. Nageswara Rao · Justice Krishna Murari · Justice S. Ravindra Bhat

Background

The appellant, a young data-entry operator/typist earning about Rs. 12,000 a month, was injured in 2012 when a bus he was travelling in as a paying passenger was struck by another bus driven rashly from the wrong side. He suffered a severe arm injury that required amputation, leaving him with an assessed 89% permanent disability in that limb. The Motor Accident Claims Tribunal awarded him compensation based on a 45% disability and a lower assumed income, and the Delhi High Court further reduced the compensation by removing an enhancement for "future prospects." The appellant challenged this reduction before the Supreme Court.

Decision Breakdown

The Supreme Court held that the High Court's halving of his disability to 45% using a crude "proportionate" arithmetic formula was illogical, since what matters is the real-world impact of the injury on the specific person's ability to earn a living: here, losing an arm effectively ended his career as a typist. The Court raised the assessed functional disability to 65%, also increased his assumed monthly income from Rs. 8,000 to a more realistic Rs. 10,000 (noting informal-sector workers below the income-tax threshold aren't expected to have filed returns), and added a 40% enhancement for future prospects. Applying the correct multiplier, the Court recalculated his compensation for loss of earning capacity upward to Rs. 19,65,600, while leaving the High Court's other compensation heads (medical expenses, pain and suffering, etc.) undisturbed. The appeal was partly allowed and the judgment modified accordingly, with no order on costs.

Lesson Learnt

In personal injury and accident compensation cases, disability percentages must be judged against the specific victim's occupation and real loss of earning capacity, not reduced through a rigid, context-blind mathematical formula, and informal-sector workers' claimed income cannot be arbitrarily discounted just because they lack formal tax filings.

Official source (sci.gov.in)View Judgment (PDF)

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