PALRAJ versus THE DIVISIONAL CONTROLLER, NEKRTC

Citation: [2010] 11 S.C.R. 89 · Decided: 07-09-2010 · Supreme Court of India · Bench: ALTAMAS KABIR · Disposal: Disposed off

Judgment (excerpt)

[2010] 11 S.C.R. 89 
PALRAJ 
V. 
THE DIVISIONAL CONTROLLER, NEKRTC 
(Civil Appeal No. 7430 of 2010) 
SEPTEMBER 07, 2010 
[ALTAMAS KABIR AND A.K. PATNAIK, JJ.] 
Workmen's Compensation Act, 1923: 
s.4 and Schedule I, Part II -
Compensation due to 
disability during employment -
State Road Transport 
Corporation bus met with accident - Appellant, the bus driver, 
lost use of his legs and became disabled from driving any 
bus - He claimed compensation - Held: For determining 
compensation, functional disability resulting in loss of earning 
capacity is the criteria - Although the driver became totally 
disabled from driving any vehicle, he remained in a position 
to earn a living other than by functioning as a driver -
The 
loss of earning capacity has to be computed keeping in mind 
the alternate employment given to the appellant as a Peon 
on the same salary as he was enjoying while performing the 
duty of a bus driver - On facts, the percentage of functional 
disablement in respect of the appellant fixed at 35%, having 
regard to his restricted mobility after the accident and a/so 
because of his loss of future earnings and promotion -
Appellant directed to be provided with compensation on the 
basis of 35% functional disability. 
s. 4A(3) - Interest under the Act - Payment of - Held: 
Such interest cannot be claimed from the date of the filing of 
A 
B 
c 
D 
E 
F 
the application, but only after a default is committed in respect 
G 
of the payment of compensation within 30 days from the date 
on which the payment becomes due. 
A State Road Transport Corporation bus met with an 
89 
H 
90 
SUPREME COURT REPORTS 
[2010] 11 S.C.R. 
A accident, due to which the driver of the bus, i.e. the 
appellant, lost the use of his legs and consequently 
became disabled from driving any bus. Subsequently, the 
respondent-Corporation provided alternative employment 
to the appellant as a Peon, on the same salary as he was 
B drawing while performing the duty of a bus driver. 
The Commissioner, Workmen's Compensation 
quantified the functional disability of the appellant at 85% 
and on that basis awarded compensation alongwith 
C interest @ 12% p.a .. 
Aggrieved, the respondent-Corporation filed an 
appeal whereupon the High Court held that the 
percentage of disability taken by the Commissioner was 
against the weight of the medical evidence adduced in the 
D case, and ought to have been taken at 20% instead of 
85%, and, accordingly, reduced the compensation 
amount with interest@ 12% p.a. from 30 days after the 
date of the passing of the award. 
E 
Disposing of the appeal, the Court 
HELD:1.1. While computing compensation for 
disabilities being suffered by a workman in the case of 
his employment, it is the functional disability resulting in 
loss of earning capacity which is the criteria which is 
F followed in assessing compensation. The Workmen's 
Compensation Act, 1923 has its own formula in 
computing compensation on account of injuries su~ered 
during employment which is reproduced in Schedule I to 
the said Act. In Part II of the said Schedule, the loss of 
G earning capacity in terms of percentage has been directly 
related to the loss of any of the limbs and parts thereof, 
both of the upper limbs as also the lower limbs. [Para 9] 
[96-G-H; 97-A-B] 
H 
1.2. In the instant case, though the appellant has lost 
PALRAJ v. DIVISIONAL CONTROLLER, NEKRTC 
91 
his capacity to function as a driver, but with the help of 
A 
external aids, his mobility has, to some extent, been 
restored and he is able to perform work which is suitable 
to his physical condition after the accident. In the 
appellant's case, by virtue of the injuries suffered by him, 
his disablement as far as driving a vehicle is concerned 
B 
is 100%, but that is not the measure of loss of his earning 
capacity. The Commissioner, Workmen's Compensation, 
seems to have confused the issue by combining both 
functional disability and permanent disability in arriving 
at the figure of 85% by way of loss of earning capacity c 
and has, therefore, arrived at a sum of Rs.1, 75,970/-
towards compensation. The High Court, on the other 
hand, realizing the mistake committed by the 
Commissioner, assessed the loss of earning capacity as 
20% instead of 85% and reduced the compensation 
0 
payable from Rs.1, 75,970/- to Rs.41,404.80p .. [Para 11) 
[97-D-F] 
2.1. Section 4(1 )(c) of the Workmen's Compensation 
Act, 1923 indicates that where a workman suffers injury 
which is 

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