This case is critically analyzed by Akshat Mehta, a student of Institute of Law, Nirma University, Ahmedabad. In this case, he analyzed how the need for ‘Absolute Liability’ emerged despite having the 18th century doctrine of ‘Strict Liability’.

INTRODUCTION

This case serves the basic foundation for the emergence of ‘Absolute Liability Rule’ in India after the Bhopal Gas tragedy and oleum Gas leak incident.

EQUIVALENT CITATION

 1987 AIR 1086, 1987 SCR (1) 819

BENCH

Justice P.N. Bhagwati 

DECIDED ON

20 December 1986

COURT

Supreme Court of India

RELEVANT LAWS

Rule of Absolute liability under the law of Torts, Article 21 and 32 of the Constitution of India

FACTS

On December 2, 1984, the deadly ‘Methyl Isocyanate gas’ leaked from the plant of UCC, Bhopal which killed almost 4,000 people immediately within 2 hours of the leak of the gas. Most people died were the people of the slum area residing near the geography of the plant. Till the morning the death toll reached up to 8,000 because lethal gas spread throughout the city. Around 20,000 people died in the next 20 days and more than 80,000 people suffered permanent disability. The most horrible part of the incident was that UCC was found shifting the whole liability to Union Carbide India Limited. The case was initiated by the name union Carbaid Corporation V. Union of India (1984) in the Apex Court. 

While the matter was pending before the Supreme Court similar incident occurred after the one year in the factory of Shriram Fertilizers & Chemicals and Other v. Union of India on 4th and 6th December 1985. A leakage of hazardous Oleum Gas occurred in the factory plant of Shriram Food and Fertilizers Industries a subsidiary of Delhi Cloth Mills Ltd. in which one advocate along with several other people was dead and some others are badly injured. Several applications were filed by Delhi Legal Aid and Advice board and Delhi Bar Association regarding the allocation of compensation to the deceased advocate and others who were badly injured and died. Also several times the question was raised in the parliament in 1985 proceedings regarding the use of hazardous substances which had taken away the lives of numerous people in both the incidents. The then leading legal practitioner M.C. Mehta filed a PIL under Article 32 of the Constitution for the violation of rights under Article 21 of the Constitution. 

ISSUES BEFORE THE COURT

Following issues were raised before the Apex Court:

1. Whether the Plant could be allowed to continue or not, if yes what are the preventive measures taken by the government to ensure that the operation of the plant doesn’t cause any risk or hazard to the community?

2. Whether Shriram Food and Fertilizers were engaged in production and making of hazardous substances and chemicals at the cost of human life and environment and could be made ‘Absolutely liable’ for their actions and the rule of ‘Rylands v. Fletcher’ could be applied in this case? 

3. Whether Shriram food and fertilizers could be considered under the ambit of Article 12 as a state?

4. Whether the factory management is liable to compensate the victims and application for compensation under Article 21 could be sustained?

RATIO OF THE CASE

The court was in the opinion that this case should be read in reference to ‘Bandhua Mukti Morcha v. Union of India’s case and held that powers in Article 32 of the Constitution are not only to be exercised when Fundamental Rights are threatened to be violated but also could be used for remedial purposes when the Rights are violated. The court also observed that the Court has the power to grant remedial relief in the cases where ‘paramount collective interest’ is located or the public at a large has an impact.

In regards to the ‘Strict Liability’ principle emerged in the case of Rylands v. Fletcher (1868), the court came out of a critical difference between the concept of ‘Strict Liability and Absolute Liability’, which is:

Strict Liability rule says:

⮚ There must be a dangerous thing which has been brought on to the land of the defendants. 

⮚ Such a dangerous thing must be used for a non-natural purpose.  

⮚ Such dangerous thing must escape away from the control of the defendants.

There are five exceptions to strict liability through which it could be avoided:

⮚  If the plaintiff was himself at fault.

⮚  Plaintiff’s consent to suffer harm.

⮚  Act of a stranger (3rd party).

⮚  Act of God, and

⮚  Statutory Authority.

But, the Court had noticed that ‘Strict Liability’ the rule was an 18th-century old law when science and technology have not developed to an extent as it is today. There is a serious need to develop new laws that could cater to the needs of current situation of industrialized society. Thus, the rule of ‘Absolute Liability’ emerged, which says: 

⮚ There must be a dangerous thing that has been brought on to the land of the defendants. 

⮚ Such a dangerous thing must be used for a non-natural purpose.  

⮚ Such dangerous thing must escape away from the control of the defendants.

⮚ Such dangerous thing must be brought in to the land of defendants for the Profit Motive

The Court noticed that these four conditions are needed to be satisfied in order to establish ‘Absolute Liability’. There is no exception to the rule of Absolute Liability as the term itself suggests that it makes a person absolutely liable for his wrong deeds or negligence.

On the issue of compensation, the Court held that compensation must be awarded after taking into account the magnitude and capacity of the industry so that deterrent effect could be positively created. The larger the scale of operation of the industry the more the amount is it liable to pay for compensation. 

DECISION OF THE COURT

1. The Shriram Food and Fertilizers are supposed to deposit Rs. 20 Lakhs in the Court for payment of Compensation to deceased and injured. Also, it was directed to keep Rs. 15 Lakhs as a security deposit in the bank that could be encashed by the registrar of the Supreme Court in the event of any sought of leakage.

2. Management and Directors of the company are supposed to give a written undertaking guaranteeing payment of compensation to the victims in case of any future tragedy.

3. The Shriram Food and Fertilizers should comply with the recommendations of the expert committee and Rs. 30000 must be paid by them for the traveling and convenience expenses of the committee members.

4. A green belt should be created within the width of 1.5 K.M. of the industrial plant set up. 

5. The Court directed Shriram Food and Fertilizers to pay Rs. 10000 to M.C. Mehta for costs occurred by him and appreciated his efforts.

6. The Court also directed the central government to setup an ‘Environmental Court’ consisting a judge and other experts and in consonance with this Government passed the National Environment Tribunal Act, 1995 to deal with the cases of Environmental Pollution.

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