A.I.R. 1989 SC 248
UNION CARBIDE CORPORATION (UCC)
VS.
UNION OF INDIA & OTHERS
(DT. 04.05.1989)
STATUTES REFFERED:
- THE CONSTITUTION OF INDIA, 1949
- THE BHOPAL GAS LEAK DISASTER (PROCESSING OF CLAIMS) ACT, 1985
CASES REFFERED:
- Charan Lal Sahu v. Union of India, (1990)
- M.C Mehta v. Union of India, (1987)
- Municipal Council, Ratlam v. Vardichand & Ors., (1981)
- Durga Shankar Mehta v. Thakur Raghuraj Singh & Others, (1955)
- Harbans Singh v. U.P. State, (1982)
- Isaacs v. Robertson, (1984)
- Prem Chand Garg v. Excise Commissioner, U.P., Allahabad, (1963)
- A.R. Antulay v. R.S. Nayak and Anr., (1988)
- State of Punjab v. Union of India, (1986)
- M.N. Sankarayarayanan Nair v. P.V. Balakrishnan & Ors. (1972)
- Sankar Rangayya v. Sankar Ramayya, (1916)
- Biswabahan v. Gopen Chandra,(1967)
- A.R. Antulay v. R.S. Nayak & Anr., (1984) Sheonandan Paswan v. State of Bihar& On., (1987)
FACTS:
- In the year 1934 American industrial giant Union Carbide with the Union of India incorporated Union Carbide India Limited (hereinafter UCIL) in India for the manufacture of batteries, chemicals, pesticides and other industrial products.
- The Union Carbide was the majority stakeholder (51%) in the company. In 1970, a new pesticide plant was set up by UCIL in a densely populated area of Bhopal (Madhya Pradesh).
- Despite repetitive complaints regarding the safety measures of the pesticide plant by the agronomic engineer of the plant, UCIL ignoring all these complaints kept on producing dangerous & hazardous chemicals in the plant. Unfortunately, on the intervening night of 02-03 December 1984, the Methyl Iso-cynate (MIC) gas (approx. 40 tons) used as a raw material in the production upon mixing with water and creating an exothermic reaction leaked into the atmosphere and unleashed a havoc on the residents of entire Bhopal City and adjoining areas. Due to high wind pressure, the MIC gas traveled as far as the peripheries of Bhopal. Due to the outbreak of this ghost of 1984 in Bhopal as many as 2600 people immediately died and the death toll rose to a huge 8000 within a fortnight, while tens of thousands were displaced, injured and affected. The later estimates indicate that the death toll rose to an enormous 20000 while more than 600000 were left injured.
- This catastrophe not only left the live human beings, flora and fauna victimized it also injured the babies in the womb. The residents of Bhopal are suffering even today due to this ghastly catastrophe that happened due to the negligence of a multinational company.
- Union of India immediately to provide speedy justice to the victims enacted Bhopal Gas Leak Disaster (Processing of Claims) Act, 1985 (the Bhopal Act) making the Union of India representative of the victims by the virtue of Doctrine of Parens patriae.
- However, the validity of this act was challenged in Supreme Court in Union Carbide Corporation v. Union of Indiaon the ground that since the Union of India was also owner of minority shareholders, they are also responsible for the disaster. However, the court by applying CharanlalSahu v. Union of India ruled in favor of the union of India and held that the state is obligated to protect the interests of its citizens across the globe. The court further held that our Constitution makes it imperative for the state to secure to all its citizens the rights guaranteed by the Constitution and where the citizens are not in a position to assert and secure their rights, the state must come into picture and protect and fight for the rights of the citizens.
ISSUES:
- Whether such compensation is adequate or not the majority bench held that the said compensation is adequate, reasonable and fair and in case any deficiency arises in money for rehabilitation, such money shall be tendered by the Union & State government.
- Whether they are complying with all the safety measures prescribed by the appropriate laws.
- Whether the citizens of the country are assured the protection of a legal system which could be said to be adequate in a comprehensive sense in such contexts arise.
CONTENTION OF THE PARTIES:
PETITIONER:
- The drop of criminal proceeding against Union Carbide was illegal and the amount of Compensation was inappropriate to the injury the disaster caused.
- The petitioners in this case argued that the majority opinion directed that the quashing of criminal proceedings against Union Carbide was not justified and held that the criminal proceedings must be initiated.
- The learned Attorney General submitted that even the most bona fide, sincere and devoted efforts at settlement were likely to come in for motivated criticism.
RESPONDENT:
- Shri Nariman stated that his client would stand by its earlier offer of Three Hundred and Fifty Million US dollars and also submitted that his client had also offered to add appropriate interest, at the rates prevailing in the U.S.A., to the sum of 350 million US dollars which raised the figure to 426 million US dollars.
- In regard to this offer of 426 million US dollars the learned Attorney-General submitted that he could not accept this offer.
- He submitted that any sum less than 500 million US dollars would not be reasonable.
JUDGMENTS:
- The Supreme Court ordered Union Carbide to pay US $470 million against all the destruction that the leak of MIC gas from the industrial premise.
- In the reasoned order Justice Pathak said that it was the duty of the court to secure immediate relief to the victims of the MIC leak and while doing that the court did not entered into any virgin territory.
- Pathak j. applying the polluters pay principle decided the quantum of compensation to be US $470 Million. The court considered that the counter offers ranged between US $ 426 Million and US $ 500Million. Therefore, US $ 470 Million was calculated as the mean of the counter ranges.
- However, this settlement of US $ 470 Million was way less to the promised amount by the government and also various jurists considered it to be an inappropriate compensation. After analyzing the ratio, it seems that an amount less than INR 50,000 was delivered to each victim.
COMMENTS:
- The MIC leak disaster brought out the incompetence in Indian laws as well as the institutions that claim themselves to be the protector of rights vested in the citizens of the nation.
- However, the Union of India shockingly decided to litigate the case in foreign courts instead of fighting it in Indian courts. The Union of India to support its stance of choosing American courts contended the following:
- Indian legal system is not appropriate to entertain such big a matter including the flaws of substantial backlogs in the cases.
- Both Indian Lawyers and Indian law is not well versed with the laws of Torts therefore, due to gap in law it is probable that justice might not be delivered.
- The role of the India government in the Bhopal disaster was that of an actor in many parts.
- The government was keen that transnational corporations such as carbide set up shops in India, in the hope of creating jobs and drawing new technology and industry into this rapidly developing country.
CONCLUSION:
- From Parliament’s decision to fight the case in U.S. to the ambiguous and inappropriate decision of SC, it was reflected that all the rights and freedom that a citizen is guaranteed is only on papers.
- All the appeals against Union carbide were clubbed into one single petition before Keenan’s court. The Keenan’s Court at once dismissed the case on the grounds of forum non conviniens.
- The Government was also responsible for overseeing the construction and management of the carbide plant ensuring that applicable health and safety standards were met.
- Then with the passage of the Bhopal Act, the government named itself as the sole plaintiff in all litigation, which created an enormous conflict of interests. And while the issues of liability, an adequate amount of compensation, and strategies to resolve the Bhopal controversy are of great significance and ought to concern us, the issues often ignored relate to the Bhopal victims for whom the bell continues to toll.