The Karnataka High Court has substantially enhanced the compensation payable to a woman who suffered severe and permanent neurological injuries in a road accident, holding that the Motor Accident Claims Tribunal (MACT) did not adequately assess the impact of her injuries on her future earning capacity and daily life. The Division Bench increased the compensation from ₹11.12 lakh to ₹55.13 lakh after concluding that the claimant had effectively lost her ability to earn a livelihood and would require lifelong care.
Background of the Case
The appeal challenged the judgment and award dated June 17, 2020, passed by the Senior Civil Judge and Additional MACT, Kundapura, in MVC No. 794 of 2016.
Chethana, who was 25 years old at the time of the accident, was travelling as a pillion rider on a motorcycle driven by her husband on January 27, 2016. When the motorcycle reached near Thekkatte Village on NH-66, the rider lost control of the vehicle, causing both of them to fall. The Tribunal had already found that the accident occurred due to the rash and negligent riding of the motorcycle by the rider, and that finding was not disturbed by the High Court.
Chethana sustained grievous injuries, including a severe head injury, fractures and neurological damage. She underwent emergency brain surgery and was admitted to hospital five times following the accident. Medical records also showed that she continued to require regular follow-up treatment. In her claim petition, she stated that she worked as a Post Office Incharge, undertook tailoring work and also managed household responsibilities, earning around ₹15,000 per month before the accident. She claimed that because of the injuries she was permanently disabled and could no longer work or even manage her daily activities independently.
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The Tribunal awarded her ₹11,12,187 with interest at 6% per annum. Dissatisfied with the amount, she approached the High Court seeking enhancement.
Court's Observations
The Division Bench comprising Justice Jayant Banerji and Justice Tara Vitasta Ganju closely examined the medical evidence and the testimony of the treating neurosurgeon.
The doctor certified that Chethana had suffered severe cognitive impairment, poor working memory, difficulty in identifying numbers, colours and shapes, post-traumatic seizures and permanent neurological disability. Her permanent disability was assessed at 82.25% to the whole body, and the doctor stated that she would require constant supervision, regular medication administered by another person and assistance in carrying out routine activities throughout her life.
The High Court noted that although the Tribunal had accepted the medical evidence, it treated her functional disability as only 40% while calculating compensation.
Relying on the Supreme Court's decision in Raj Kumar v. Ajay Kumar (2011) 1 SCC 343, the Bench reiterated that the percentage of medical disability cannot automatically be equated with the loss of earning capacity. The Court observed that what must be assessed is the actual impact of the disability on the claimant's profession, livelihood and future earning ability.
After examining the evidence as a whole, the Court concluded that although the medical disability was assessed at 82.25%, the injuries had rendered the claimant incapable of returning to her previous occupation or earning a livelihood in any meaningful manner.
The Bench observed,
“Given the extensive evidence placed on record by the appellant/claimant and the type of injuries sustained, it is quite clear that the appellant/claimant would be unable to return back to her avocation throughout her life.”
The Court also found that she would remain dependent on others for her day-to-day activities and would require an attendant for the rest of her life.
Reassessment of Compensation
Holding that the claimant had suffered 100% loss of earning capacity, the High Court recalculated the compensation under the head of future loss of income. Since the accident occurred in 2016, the Court adopted a notional monthly income of ₹9,500, added 40% towards future prospects and applied the multiplier of 18. On that basis, it awarded ₹28,72,800 towards future loss of income.
The Bench also found that the Tribunal had awarded only ₹1 lakh towards future medical expenses and caretaker costs despite clear medical evidence that Chethana would require lifelong supervision. Observing that she would need an attendant for approximately 50 years, the Court enhanced the amount awarded towards caretaker expenses to ₹20 lakh.
The compensation under the head of pain and suffering was increased to ₹4 lakh. Medical expenses of ₹1,52,387, conveyance, diet and attendant charges of ₹50,000, and ₹38,000 towards loss of income during the laid-up period were also awarded. Consequently, the total compensation payable to the claimant was reassessed at ₹55,13,187.
Interest on Compensation
The High Court also reconsidered the rate of interest awarded by the Tribunal. While referring to recent judicial precedents where 9% interest had been upheld in cases involving death or permanent disability, the Bench held that interest at 8% per annum would be appropriate in the present case considering the facts and circumstances.
The Court, however, clarified that no interest would be payable on the amount awarded towards caretaker expenses, while interest at 8% per annum would apply to the remaining compensation from the date of the claim petition until realization.
Decision
Allowing the appeal in part, the Karnataka High Court modified the Tribunal's award and enhanced the claimant's compensation by ₹44,01,000, increasing the total compensation from ₹11,12,187 to ₹55,13,187. The Court directed the National Insurance Company to deposit the enhanced compensation along with the applicable interest within eight weeks. It further ordered that the enhanced amount be released to the claimant upon filing an appropriate application before the Tribunal, while leaving the remaining portions of the Tribunal's award undisturbed.
Case Details:
Case Title: Chethana v. Pradeep Achar & Ors.
Case Number: Miscellaneous First Appeal No. 1405 of 2021 (MV-I)
Judge: Justice Jayant Banerji and Justice Tara Vitasta Ganju
Decision Date: 1 July 2026
