In past, several analytical models has been developed to establish the occurrence of various induction motor faults. Some of the primarily occurring faults in induction motor being; bearing and stator winding faults and to a smaller extent the other types such as rotor and eccentricity. Though there has been a lot of research work done in detection and diagnosis, still the recognition of eccentricity fault in induction motors, specifically deciding the precise degree of eccentricity is a challenging task for the researchers. In this paper, a novel model-based approach has been developed for the detection of exact type and degree of eccentricity fault present in the motor. Simulation of induction motor for both healthy and eccentricity fault has been carried out using the Modified Winding Function (MWF) approach. A procedure has been developed for estimating the eccentricity fault from simulation model. Also, a metaheuristic nature inspired algorithm, viz. Firefly Algorithm (FA) has been used for the optimization of results obtained from simulation model. The results obtained from experimental investigations are close to that obtained from simulations, confirming the applicability of used model and simulation approach to find the exact degree of eccentricity defect.