The Supreme Court has asked the Tamil Nadu State Transport Corporation to pay compensation in a case of a motor accident. The Apex Court held that the High Court, without any appeal by the Insurance Company, reduced the disability to 40%, which was improper.

The Apex Court was considering an appeal filed by the claimant who suffered a disability in a motor accident, seeking enhancement of the award amounts.

The Division Bench of Justice Ahsanuddin Amanullah and Justice K. Vinod Chandran held, “The appellant had produced a certificate, Exhibit P14 wherein the disability was assessed at 60% by the Doctor who was examined as PW-2. It is also stated in cross examination that only skin grafting was done on the appellant. It was hence, the disability was fixed at 50% by the Tribunal. The High Court without any appeal by the Insurance Company reduced the disability to 40%, which was improper. Disability as assessed by the Tribunal hence has to be maintained.”

AOR M. Yogesh Kanna represented the Appellant, while AAG Balaji Subramaniam represented the Respondent.

Factual Background

The case as set up by the appellant was that he was employed as a salesman and was earning an amount of Rs 8,000 per month. However, the Tribunal only took an amount of Rs 3,300 as his monthly income, adopted from the Schedule applicable to Section 163A of the Motor Vehicle Act, 1988, and it was left untouched by the High Court.

Arguments

It was argued by the appellant that at least the minimum wages applicable on the date of the accident ought to have been taken. It was also argued that the reduction of the disability quotient to 40%, as assessed by the medical expert, was without any valid cause.

Reasoning

The Bench took note of the fact that the application was filed under Section 163A of the MV Act. However, the compensation claimed was Rs 7,40,000, and the averments indicated that the contention was that the accident occurred because of the rash and negligent manner in which the bus of the Corporation was being driven. “Hence, we are of the opinion that though Section 163A of the MV Act was mentioned in the application, the claim is one under Section 166 of the MV Act”, it stated.

On the aspect of income, the Bench noticed that though the appellant had claimed that he was a vendor of electronic equipment, there was nothing produced to show the employment, nor the income claimed of Rs 8,000. Reference was made to the judgment in Ramachandrappa v. Royal Sundaram Alliance Insurance Co. Ltd. (2011), where the Court had computed the income of a Coolie at Rs 4,500 per month in the year 2004.

The Bench thus stated, “We are of the opinion that the income of the appellant, hence can be safely computed at Rs.5,000/- (Rupees five thousand) per month and the appellant being of the age of 27 years, the multiplier applicable would be 17. There should be future prospects of an addition of 40%, the claimant being selfemployed. The loss of compensation has to be reduced, in accordance with the disability assessed.” As per the Bench, the High Court, without any appeal by the Insurance Company, reduced the disability to 40%, which was improper.

Modifying the total award amount, the Bench assessed the loss of income at Rs 7,14,000. “The compensation as above would be for the loss of income. The amounts awarded under the conventional heads by the Tribunal and affirmed by the High Court would stand as it is”, it clarified. The Bench thus ordered the respondent to pay the said amounts within three months with interest at the rate of 7.5% as awarded by the High Court.

Cause Title: S. Shakul Hameed v.Tamil Nadu State Transport Corporation Limited (Neutral Citation: 2026 INSC 29)

Appearance

Appellant: AOR M. Yogesh Kanna, Advocates Meha Ashok Aggarwal, Aman Sinha

Respondent: AAG Balaji Subramaniam, AOR G. Indira, Advocates P. Gandepan, Akash Kundu, Anurag Kashyap, Anjali Singh, Raniba Pangnila

Click here to read/download Judgment



Justice Ahsanuddin AmaahJustice K. Vinod Chandran

Tulip Kanth

Assistant Editor

Tulip Kanth is an Assistant Editor at Verdictum having over 5 years of experience in the field of legal journalism and editing. She extensively covers judgments of the Supreme Court, High Courts as well as Tribunals. She has previously worked with a legal publishing website where she oversaw the work of other editors and has also created updates on notifications of different Government Ministries. She holds an English Honours Degree from SGTB Khalsa College, Delhi University and has completed her LLB course with specialisation in Corporate Law from Amity University.