Jammu & Kashmir High Court
United India Insurance Co. Ltd vs Ghulam Ali And Ors on 17 July, 2026
Author: Rajnesh Oswal
Bench: Rajnesh Oswal
2026:JKLHC-JMU:2139
HIGH COURT OF JAMMU &KASHMIR AND LADAKH
AT JAMMU
...
Mac App No. 175/2024
Reserved on: 10.07.2026
Pronounced on: 17.07.2026
Uploaded on: 17.07.2026
Whether the operative part or full
Judgment is pronounced: Full
United India Insurance Co. ltd.
.......Petitioner(s)
Through: Ms. Damini Singh Chauhan, Adv.
Versus
Ghulam Ali and ors.
.....Respondent(s)
Through: Mr. Irfaan Khan, Advocate
CORAM:HON'BLE MR JUSTICE RAJNESH OSWAL, JUDGE
JUDGMENT
1. The instant appeal is directed against the award/judgment dated
02.07.2024 passed by the learned Presiding Officer, Motor Accidents
Claims Tribunal (Additional District Judge, Anti-Corruption), Jammu
(hereinafter referred to as “the Tribunal”) in a claim petition titled
“Ghulam Ali v. United India Insurance Company Limited and Others“,
bearing File No. MACT (Civil)/31/2022. By the impugned award, the
learned Tribunal allowed the claim petition filed by respondent No. 1
and awarded compensation of ₹29,44,482/- (after deducting the interim
compensation, if any, already paid), along with simple interest at the rate
of 7.5% per annum from the date of filing of the claim petition till its
realization. The appellant-Insurance Company has further been directed
to satisfy the said award.
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2. The appellant/Insurance Company has raised the following issues for
consideration of this Court:
i. Whether learned Presiding Officer, Motor Accidents Claims
Tribunal, Jammu, was justified in calculating the compensation in
favour of the claimant/respondent No. 1 while taking “Permanent
Disability” as 85% of whole body instead of 85% of “Right Lower
Limb” as assessed by Medical Certificate and when considered in
context of the whole body, disability suffered by the
Claimant/Respondent No. 1 was required to be taken as less than
40 percent?
ii. Whether learned Presiding Officer, Motor Accidents Claims
Tribunal, Jammu, was justified in equating “Permanent Disability”
of the limb to be the “Functional Disability” and could it be
assumed to result in a corresponding extent of “Loss of Earning
Capacity”, as the disability has not prevented him from carrying
on his activities normally though it might impede in his smooth
functioning?
iii. Whether the learned Presiding Officer, Motor Accidents Claims
Tribunal, Jammu, while awarding compensation resulting from the
vehicular accident can allow interest under the Heads “For future
Income” in injury case resulting from the vehicular accident?
iv. Whether the Learned Presiding Officer, Motor Accidents Claims
Tribunal, Jammu, while awarding compensation resulting from the
vehicular accident can allow interest at the rate of 7.5% per annum
especially when with the change in economy the banks have
lowered the rates of interests on fixed deposits?
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v. Whether the compensation awarded is just, reasonable and based
on reliable evidence?
3. Before considering the issues raised by the appellant, it is deemed
appropriate to take note of the facts necessary for the adjudication of the
aforesaid issues.
4. Respondent No. 1, aged about 63 years, filed the claim petition seeking
compensation for the injuries sustained by him in a vehicular accident
that occurred on 19.10.2021 within the jurisdiction of Police Station,
Nagrota. In the said accident, respondent No. 1 suffered permanent
disability, which was assessed at 85% by Dr. Mohd. Rafiq, Orthopaedic
Surgeon. As per the disability certificate, respondent No. 1 suffered an
above-knee amputation of the right lower limb with a short stump,
stiffness and equinus deformity of the left foot, and flexion deformity of
the left great toe. The disability certificate, exhibited as EXTP-MR,
further records that the injuries suffered by respondent No. 1 have
resulted in total disablement.
5. The claim petition was contested by the appellant-Insurance Company
as well as respondent Nos. 2 and 3. In support of his claim, respondent
No. 1 examined himself, Dr. Mohd. Rafiq, Orthopaedic Surgeon, and
PW Mohd. Faizan. On the other hand, the appellant-Insurance Company
did not lead any evidence in rebuttal.
6. The learned Tribunal, after taking note of the permanent disability of
85% suffered by respondent No. 1, allowed the claim petition and
awarded compensation to the tune of ₹29,44,482/- under the following
heads:
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1. Loss of future income to the petitioner= ₹ 26,59462/-
2. Medical Expenses = ₹ 57,000/-
3. Special Diet = ₹ 10,000/-
4. Transportation Charges = ₹. 18000/-
5. Attendant Charges = ₹ 1,80,000/-
6. Pain and Suffering = ₹ 20,000/-
Total = ₹ 29,44,482/-
7. Learned counsel for the appellant submitted that the compensation
awarded by the learned Tribunal is excessive and contrary to the settled
principles governing the assessment of compensation under the Motor
Vehicles Act. She further contended that the Tribunal failed to properly
assess the functional disability and its impact on the earning capacity of
respondent No. 1 while determining the compensation. In support of her
submissions, learned counsel placed reliance upon the judgment of the
Hon’ble Supreme Court in “Raj Kumar v. Ajay Kumar and another“,
(2011) ACJ 1, as well as the judgment of this Court in “United India
Insurance Co. Ltd. v. Madan Lal and others“, 2014(1) JKJ (HC).
8. Per contra, learned counsel for respondent No. 1 submitted that the
award passed by the learned Tribunal is just, fair, and in accordance with
law, warranting no interference by this Court. He further urged that the
compensation awarded is in accordance with the nature of the injuries,
the permanent disability suffered by respondent No. 1 and loss of income
suffered by him. In support of his submissions, learned counsel placed
reliance upon the judgments of the Hon’ble Supreme Court in “R. Halle
v. Reliance General Insurance Company Ltd“., 2026 LiveLaw (SC)
261; “Sarnam Singh v. Shriram General Insurance Co. Ltd. and
others“, 2023 LiveLaw (SC) 498; “M. Paramesh v. VRL Logistics
5 Mac App No. 175/20242026:JKLHC-JMU:2139
Ltd. and another”, 2026 INSC 655; and “Shankar Dutt v. United
India Insurance Co. Ltd. and others“, 2026 Supreme (SC) 726.
9. Since Issue Nos. 1 and 2 are interrelated, they are taken up for
consideration together. The said issues are reproduced hereunder:
Issue Nos. (i) & (ii)
i. Whether learned Presiding Officer, Motor Accidents Claims
Tribunal, Jammu, was justified in calculating the compensation
in favour of the claimant/respondent No. 1 while taking
“permanent Disability” as 85% of whole body instead of 85%
of “Right Lower Limb” as assessed by Medical Certificate and
when considered in context of the whole body, disability
suffered by the Claimant/Respondent No. 1 was required to be
taken as less than 40 percent?
ii. Whether learned Presiding Officer, Motor Accidents Claims
Tribunal, Jammu, was justified in equating “Permanent
Disability” of the limb to be the “Functional Disability” and
could it be assumed to result in a corresponding extent of
“Loss of Earning Capacity”, as the disability has not prevented
him from carrying on his activities normally though it might
impede in his smooth functioning?
10. Learned counsel for the appellant contended that respondent No. 1 had
suffered 85% permanent disability only in relation to the right lower
limb, and that disability, when assessed with reference to the whole
body, the extent of disability ought to have been taken as less than 40%.
It was further argued that the learned Tribunal was not justified in
equating the permanent physical disability of the affected limb with the
functional disability, as the injuries sustained by respondent No. 1 had
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not rendered him incapable of carrying on his day-to-day activities,
though the injuries may cause him some difficulty.
11. A perusal of the statement of respondent No. 1 reveals that he
categorically deposed that, prior to the accident, he was running a
Karyana shop in the Main Market, Gool, District Ramban, and was
earning approximately ₹50,000/- per month. He further stated that he
was a GST-registered dealer and had to close his shop on account of the
permanent disability suffered by him in the accident. He deposed that he
is now completely dependent on others for his daily needs and has
engaged two permanent attendants to look after him, as he is unable even
to fetch a glass of water or attend to the call of nature without assistance.
During his cross-examination, he remained consistent and reiterated that
he had closed his shop after the accident. Thus, it is evident that the
business of the respondent No.1 is closed after the accident.
12. Hon’ble the Supreme Court of India, in “Sarnam Singh vs. Shriram
General Insurance Co. ltd. and ors”. 2023 LiveLaw (SC) 498, has
observed as under:
“9.As to how compensation, in case where permanent disability
of an injured affects his functional disability, is to be assessed
has been considered by this Court, repeatedly. Reference can be
made to the judgment of this Court in Mohan Soni vs. Ram
Avtar Tomar And Others. In the aforesaid case the injured was
working as a cart puller. As a result of the accident, his left leg
was amputated. His permanent disability was assessed at 60%.
The Tribunal assessed the compensation taking the loss of
earning at 50% on the theory that he can still do some other
work while sitting. The High Court did not disturb the
finding regarding loss of income on account of disability.
This Court found that the Tribunal was in error in taking
the loss of earning at 50% as the injured was 55 years of age
and it may be difficult for him to find a job at that stage. In
fact, any physical disability resulting from an accident has to
be judged with reference to the nature of the work being
performed by the person who suffered disability. The same
injury suffered by two different persons may affect them in
7 Mac App No. 175/20242026:JKLHC-JMU:2139
different ways. Loss of leg by a farmer or a rickshaw puller
may be end of the road as far as his earning capacity is
concerned. Whereas, in case of the persons engaged in some
kind of desk work in office, loss of leg may have lesser effect.
This Court enhanced the loss of earning capacity from 50%
to 90%.
10. Applying the same principle to the case in hand, we find
that the appellant herein was working as a gunman with
Bharat Hotel Limited. On account of amputation of his right
leg above the knee, he was terminated from service w.e.f.
31.05.2015. It is not a matter of dispute that a person with
his right leg amputated cannot perform the duty of a
gunman. This is his functional disability. He was 50 years &
5 months old at the time of accident. Considering the
aforesaid facts, in our view, the Tribunal was right in
assessing the loss of earning capacity of the appellant at
100% and assessing the compensation accordingly. The High
Court was in error in reducing the loss of earning capacity
to 80%, relying upon the judgment of High Court, despite
there being a judgment of this Court available on the issue.”
13. In “R. Halle vs. Reliance General Insurance Company ltd.”, 2026
Live Law (SC) 261, the Hon’ble Supreme Court held as under:
“21. However, the High Court, while observing that physical
disability cannot be mechanically equated with functional
disability, reduced the functional disability suffered by the
appellant-claimant from 63% to 30% without adverting in
detail to the medical evidence on record, particularly the
findings of the Medical Board and the neuropsychological
report evidencing cognitive deficits suffered by the
appellant-claimant as a consequence of the injuries suffered
in the accident. No independent contra material was placed
on record by the respondent- insurer to displace the
evidentiary value of the disability certificate. In our
considered view, such reduction of the functional disability,
in the absence of convincing evidence impeaching the
credibility of the medical certificates placed on record by the
appellant-claimant and without assigning cogent reasons,
was not at all justified. For ready reference, the relevant extract
from the impugned judgment is reproduced herein below: –
“10. According to the claimant he was earning a sum of
Rs.29,108/- per month by working as a Manager in a private
concern, which has been proved through Exs.21 to 25. Thus,
the Tribunal has arrived the amount under the head of loss of
earning power, by multiplying the disability as 63%. It
appears to be on the higher side. Though the Medical Board
has assessed the physical disability of the claimant as
63%, after going through the records, we have come to
the conclusion that the functional disability suffered by
the claimant would be 30%. After adding 40% towards
future prospectus, the total income of the claimant is arrived
at Rs.40,751/-, rounded off to Rs.40,000/-. Thereby, the
8 Mac App No. 175/20242026:JKLHC-JMU:2139
claimant is entitled for an amount of Rs.24,48,000/-
(Rs.40,000/- x 12 x 30% x 17); Rs.1,00,000/- for Loss of
amenities; Rs.2,00,000/- under Pain and sufferings; since the
claimant was unmarried at the time of accident and sustained
grievous injuries in the accident, an amount of Rs.2,00,000/-
is granted towards loss of marital prospectus; The amounts
awarded under the heads of Medical expenses, Transportation
to hospital, Extra nourishment and Damage to clothing and
articles are confirmed.”
22. A careful reading of the aforesaid extract indicates that
the High Court merely adverted to the general principles
governing assessment of disability and, without undertaking
any independent analysis of the evidence on record, abruptly
concluded that the functional disability suffered by the
appellant- claimant would be 30%. There is no discussion as
to why the medical findings, the disability certificate issued
by the competent Medical Board, or the neuropsychological
report were doubtful or insufficient to sustain the conclusion
reached by the MACT. Equally, while reducing the quantum
of compensation, no specific or cogent reasons have been
assigned for curtailing the amounts awarded under the heads
of “Loss of Amenities” and “Pain and Suffering,” which were
based on the nature and gravity of the injuries sustained by
the appellant- claimant. In our considered opinion, such
conclusions, abruptly arrived at without proper re-
appreciation of the evidence and without recording adequate
reasons, are in the nature of presumptions and assumptions
and cannot be sustained in the eyes of law.
23. Ordinarily, where a Court exercising appellate jurisdiction
reverses or modifies a finding of fact recorded by the Court of
first instance without a proper re-appreciation of the evidence or
without assigning cogent reasons, this Court would be justified
in setting aside the impugned judgment and remitting the matter
for fresh consideration on merits and in accordance with law. In
the present case, the assessment of functional disability, which
had a direct bearing on the determination of just compensation,
necessarily required a careful scrutiny of the medical evidence
and its impact on the avocation of the injured. The failure to
undertake such an exercise would, in the normal course, warrant
a remand.
24. However, we cannot be oblivious of the fact that the
accident occurred in the year 2016 and that the appellant-
claimant has been engaged in litigation for nearly a decade, first
before the MACT, thereafter before the High Court and now
before this Court. A remand at this stage would only prolong the
proceedings and compound the agony alreadysuffered by the
appellant-claimant. In these circumstances, in order to do
complete justice between the parties, we deem it appropriate to
examine the issue on merits and determine the issue of
functional disability on the basis of the material available on
record.
25. In order to determine the functional disability suffered by the
appellant-claimant, it is necessary to advert to the findings
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recorded by the Medical Board with respect to the permanent
physical disability, as well as the neuropsychological assessment
report placed on record. Both these documents remained
uncontroverted and hence, they provide credible expert evidence
so as to assess the extent and nature of disability. The true nature
and extent of the injuries, and their impact on the cognitive and
functional abilities of the appellant-claimant, can be properly
appreciated only upon a careful consideration of these materials.
For ready reference, the relevant extracts from the said
documents are reproduced herein below: –
“Neuropsychological Assessment Report: Interpretation &
Conclusion
• Memory Scale shows that his verbal and Visual memory is
impaired severely.
•On tests for frontal lobe functioning-impairment.
• On the test for parietal lobe functioning, normal
performance shows that the lobe function is intact.
The IQ range of 65,fall into the category of Mild Intellectual
Disability. Report of the Medical Board.
Case of Head injury treated conservatively, facial injury x left
femur fracture treated by surgical intervention. Above injury
has resulted in partial blindness, cognitive impairment and
partial lom of Rom and stability of left knee.
His disability due to above injuries sixty three percent
(63%).”
[Emphasis supplied]
26. Having bestowed our anxious consideration to the material
placed on record, we find that the disability certificate issued by
the Medical Board clearly records that the appellant-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. These findings, read conjointly,
demonstrate that the injuries suffered by the appellant-claimant
were not merely orthopedic in nature, but had significant
neurological sequelae directly impacting his functional and
cognitive abilities.
27. This Court, in Raj Kumar v. Ajay Kumar9, has
authoritatively laid down the principles governing assessment of
permanent and functional disability for the purpose of awarding
compensation. It has been held that the percentage of
permanent disability assessed by a medical expert cannot be
mechanically equated with the percentage of loss of earning
capacity. What is required to be determined is the actual
impact of such disability on the earning capacity of the
injured, having regard to his avocation, age and the nature
of work performed. The Tribunal is required to undertake a
structured analysis to ascertain the activities the claimant
can or cannot perform post-injury, the nature of his
profession prior to the accident, and whether the disability
has resulted in total incapacity or merely restricted or
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reduced earning capacity. For ready reference, the relevant
extracts from the said judgment are reproduced hereinbelow: –
“9. The percentage of permanent disability is expressed by the
doctors with reference to the whole body, or more often than
not, with reference to a particular limb. When a disability
certificate states that the injured has suffered permanent
disability to an extent of 45% of the left lower limb, it is
not the same as 45% permanent disability with reference
to the whole body. The extent of disability of a limb (or
part of the body) expressed in terms of a percentage of the
total functions of that limb, obviously cannot be assumed
to be the extent of disability of the whole body. If there is
60% permanent disability of the right hand and 80%
permanent disability of left leg, it does not mean that the
extent of permanent disability with reference to the whole
body is 140% (that is 80% plus 60%). If different parts of
the body have suffered different percentages of
disabilities, the sum total thereof expressed in terms of the
permanent disability with reference to the whole body
cannot obviously exceed 100%.
“10. Where the claimant suffers a permanent disability as
a result of injuries, the assessment of compensation under
the head of loss of future earnings would depend upon the
effect and impact of such permanent disability on his
earning capacity. The Tribunal should not mechanically
apply the percentage of permanent disability as the
percentage of economic loss or loss of earning capacity. In
most of the cases, the percentage of economic loss, that is,
the percentage of loss of earning capacity, arising from a
permanent disability will be different from the percentage
of permanent disability. Some Tribunals wrongly assume
that in all cases, a particular extent (percentage) of
permanent disability would result in a corresponding loss
of earning capacity, and consequently, if the evidence
produced show 45% as the permanent disability, will hold
that there is 45% loss of future earning capacity. In most
of the cases, equating the extent (percentage) of loss of
earning capacity to the extent (percentage) of permanent
disability will result in award of either too low or too high
a compensation.
11. What requires to be assessed by the Tribunal is the
effect of the permanent disability on the earning capacity
of the injured; and after assessing the loss of earning
capacity in terms of a percentage of the income, it has to
be quantified in terms of money, to arrive at the future
loss of earnings (by applying the standard multiplier
method used to determine loss of dependency). We may
however note that in some cases, on appreciation of evidence
and assessment, the Tribunal may find that the percentage of
loss of earning capacity as a result of the permanent
disability, is approximately the same as the percentage of
permanent disability in which case, of course, the Tribunal
will adopt the said percentage for determination of
compensation. (See for example, the decisions of this Court
in Arvind Kumar Mishra v. New India Assurance Co.
Ltd. [(2010) 10 SCC 254 : (2010) 3 SCC (Cri) 1258: (2010)
10 Scale 298] and Yadava Kumar v. National Insurance Co.
Ltd. [(2010) 10 SCC 341 : (2010) 3 SCC (Cri) 1285 : (2010)
8 Scale 567]) [……]
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13. 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
do as a result of the permanent disability (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.”
[Emphasis supplied]
28. In view of the principles laid down by this Court in Raj
Kumar (supra), as consistently affirmed thereafter, 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 avocation.”
14. Further, in “M Paramesh vs. VRL Logistics ltd. and another, 2026
INSC 655, the Hon’ble Supreme Court has held as under:
“By virtue of the aforesaid amputation, the appellant has
effectively lost his capacity to continue the work of a mason,
which was admittedly the sole avocation being pursued by him
for earning his livelihood. It is not even the case of the
respondents that the appellant was engaged in any other
sedentary occupation or that despite the amputation suffered by
him, his earning capacity remained unaffected.”
15. The ratio laid down in the aforesaid judgments is that the assessment of
functional disability must be determined on the basis of the impact of
the injuries on the claimant’s earning capacity and is not confined to the
numerical percentage of permanent physical disability certified by the
Medical Board. Applying the ratio laid down in the aforesaid
judgments to the facts of the present case, this Court finds no infirmity
in the compensation awarded by the learned Tribunal towards loss of
future income of respondent No.1. The learned Tribunal has assessed
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the compensation by taking the functional disability of respondent No.
1 at 85% of his annual income of Rs. 4,46,972/- as per ITR for the year
2019-2020, notwithstanding the statement made by the respondent No.1
that after accident, he has closed the shop and there is no evidence in
rebuttal. The determination of annual income by the learned Tribunal
has not at all been disputed by the appellant. Furthermore, the Tribunal
has applied the multiplier of 7 in accordance with the principles laid
down by the Hon’ble Supreme Court in Sarla Verma v. Delhi
Transport Corporation, (2009) 6 SCC 121. Accordingly, Issue Nos. 1
and 2 are answered against the appellant.
Issue No. (iii)
Whether the learned Presiding Officer, Motor Accidents Claims
Tribunal, Jammu, while awarding compensation resulting from the
vehicular accident can allow interest under the Heads “For future
Income” in injury case resulting from the vehicular accident?
16. The Hon’ble Supreme Court, in Shankar Dutt v. United India
Insurance Co. Ltd. and others; 2026 SCC OnLine SC 1193, awarded
the interest on the future earnings also, besides compensation under
other heads. In The Oriental Insurance Co. Ltd. v. Niru @ Niharika
& Ors., 2025 INSC 822, the Hon’ble Apex Court has held as under:
“9. A very relevant issue agitated by the Insurance Company
is the illegality in awarding interest for future prospects,
which in any event is an amount received in advance,
normally inuring to the benefit of the claimants only in
future. This is the only contention taken in the connected appeal
bearing SLP(C) No. 22136 of 2024. We find absolutely no
reason to accept this argument. In SLP(C) No. 11340 of 2020,
the multiplier applied looking at the life span of the deceased
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and the claimants is 13. Before the Tribunal itself, the case was
pending for 12 years and the only amount received by the
claimants was Rs. 50,000/-. Hence though amounts are awarded
for future prospects taking the multiplier of 13; in effect, the
money is received only after the period for which the multiplier
is adopted. Similar is the case in SLP(C) No. 22136 of 2024
where the accident occurred in 2018, the multiplier applied is 17
and we are seven years from the date of accident.
10. We cannot but observe that there was nothing stopping
the Insurance Company from settling the claim on a
computation, on receipt of intimation of the accident,
especially since the determination of compensation for loss
of dependency, on death being occasioned in a motor vehicle
accident, can be determined as evident from the judicial
precedents; at least provisionally.
11. In fact, it is due to the repudiation of or refusal to
consider the claim that the claimants are driven to the
Tribunal. When the matter is pending before the Tribunal
or in appeal before the higher forums, the claimants are
deprived of the compensation for future prospects. If they
are paid in time, it could be utilized by the claimants and on
failure, the loss of dependency would force the claimants to
source their livelihood from elsewhere. This is sought to be
compensated at least minimally by award of interest, which
oftener them ever is nominal also since only simple interest
is awarded. If the amounts were disbursed to the claimants
on a rough calculation, on intimation of the accident to the
Insurance Company, subject to the award of the Tribunal,
necessarily there would not have been any interest liability
atleast to the extent of the disbursement made. Hence, we
reject the contention and direct that the entire award
amounts would be paid with interest at the rate of 9% from
the date of filing of the claim till the date of disbursement,
deducting only Rs. 50,000/- granted as interim
compensation, in SLP(C) No. 11340 of 2020 and 6% in SLP(C)
No. 22136 of 2024 as awarded by the High Court; deduction to
be made for the amounts already paid.”
17. In the present case, accident took place in the year 2021, and multiplier
of 7 has been employed by the learned Tribunal for determining the
compensation. The case has remained pending before the court for 4
years. In view of the aforesaid, the award of interest on the future
14 Mac App No. 175/2024
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earnings does not call for any interference. Accordingly, Issue No. 3 is
answered against the appellant.
Issue No. (iv)
Whether the Learned Presiding Officer, Motor Accidents Claims
Tribunal, Jammu, while awarding compensation resulting from the
vehicular accident can allow interest at the rate of 7.5% per annum
especially when with the change in economy the banks have
lowered the rates of interests on fixed deposits?
18. The Hon’ble Supreme Court, in The Oriental Insurance Co. Ltd. v.
Niru @ Niharika & Ors (supra), has observed as under:
“Further contention taken is the higher rate of interest of 9%, in
challenge of which several precedents were placed before us.
From the decisions perused what emanates is that in the 1980’s,
Courts were awarding 12% interest which stood reduced to 9%
in the 1990’s. With the advent of the 21st century and the
economic recession world over, the interest rates fell
considerably. But even now the rates offered by National Banks
for long term deposits are 7% or more. Considering the over-all
circumstances especially the long delay caused, we are of the
opinion that 9% interest rate granted by the Tribunal is perfectly
in order especially noticing the accident having occurred in the
year 1995.”
19. In the present case, the learned Tribunal has awarded interest at the rate
of 7.5% per annum only. Therefore, this Court finds no infirmity or legal
error in the award of interest at the rate of 7.5% per annum by the
learned Tribunal. Accordingly, this issue is answered against the
appellant-Insurance Company.
Issue No. (v)
Whether the compensation awarded is just, reasonable and based
on reliable evidence?
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20. As already discussed hereinabove, the compensation awarded by the
learned Tribunal is based on a proper appreciation of the evidence on
record and the settled principles governing the assessment of
compensation under the Motor Vehicles Act. The amount awarded
cannot be said to be either inadequate, excessive, arbitrary, or otherwise
unjust or unreasonable so as to warrant interference by this Court.
Accordingly, no case is made out for modification or enhancement of the
compensation awarded by the learned Tribunal. Hence, this issue is
answered accordingly.
21. In view of the foregoing discussions and the findings recorded
hereinabove, this Court is of the considered view that the present appeal
is misconceived and devoid of any merit. The compensation awarded by
the learned Tribunal has been found to be just and reasonable, and the
findings recorded therein are based upon proper appreciation of the
material available on record. Accordingly, no ground is made out for any
modification or interference with the impugned award. Accordingly, the
present appeal is dismissed. The amount deposited with the Registry of
this Court shall be released in favour of respondent No. 1 in accordance
with the directions contained in the award passed by the learned
Tribunal, subject to payment of the requisite court fee, if any.
(Rajnesh Oswal)
Judge
Jammu
17.07.2026
Karam Chand
Whether approved for reporting: Yes/No
