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.

2 Mac App No. 175/2024

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?

3 Mac App No. 175/2024

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:

4 Mac App No. 175/2024

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. 175/2024

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

6 Mac App No. 175/2024

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. 175/2024

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. 175/2024

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

9 Mac App No. 175/2024

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 Kum ar9, 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

10 Mac App No. 175/2024

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]) [……]

11 Mac App No. 175/2024

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

12 Mac App No. 175/2024

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

13 Mac App No. 175/2024

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

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?

15 Mac App No. 175/2024

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