Liability vis-a-vis Various Industrial/Mass Disasters

In an earlier post here, we discussed the legislative framework for nuclear damage in India. This post shall further enlist the provisions in case of gas disasters, fire explosions etc.

 The Supreme Court and the High Court are entitled to render compensatory justice by awarding reasonable monetary compensation under Article 32 or 226 of the Constitution of India, for the injury mental, physical, fiscal suffered by the individual for the violation of fundamental rights guaranteed under the Constitution. It is not necessary that the victim should approach the Civil Court by invoking a common law remedy for claiming damages for violation of the fundamental rights. The option is left to the victim to claim the damages by invoking either the constitutional remedy or civil remedy. Since the constitutional remedy is a public law remedy, the actual victim need not approach the Court. The relief can also be awarded either by the exercise of suo motu power or in a public interest litigation case.

Following are some of the violation of the rights of masses and how they are regulated under Indian legal system –

(a) General Legislations –

The Fatal Accidents Act, 1855 and Public Liability Insurance Act, 1991 are two important legislations providing for relief in case of accidents-

1. The Fatal Accidents Act, 1855 

Section 1A provides for Suit for compensation. It provides that whenever the death of a person shall be caused by wrongful act, neglect or default, and the act, neglect or default is such as would (if death had not ensued) have entitled the party injured to maintain an action and recover damages in respect thereof, the party who would have been liable if death had not ensued, shall be liable to an action or suit for damages, notwithstanding the death of the person injured and although the death shall have been caused under such circumstances as amount in law to felony or other crime.

Every such action or suit –

  • shall be for the benefit of the wife, husband, parent, and child, if any, of the person whose death shall have been so caused, and
  • shall be brought by and in the name of the executor, administrator or representative of the person deceased; and
  • in every such action, the court may give such damages as it may think proportioned to the loss resulting from such death to the parties respectively, for whom and for whose benefit such action shall be brought, and
  • the amount so recovered, after deducting all costs and expenses, including the costs not recovered from the defendant, shall be divided amongst the before-mentioned parties, or any of them, in such shares as the court by its judgment or decree shall direct.

2. Public Liability Insurance Act, 1991

Public Liability Insurance Act, 1991 provides for public liability- insurance for the purpose of providing immediate relief to the persons affected by accident occurring while handling any hazardous substance.

Liability of Owner under Section 3 – 

Section 3 provides that where death or injury to any person (other than a workman) or damage to any property has resulted from an accident, the owner shall be liable to give such relief as is specified in Schedule for such death, injury or damage.

Duty of owner handling any hazardous substance to take insurance policy –

Section 4 provides that every owner shall take out before he starts handling any hazardous substance, one or more insurance policies providing for contracts of insurance thereby he is insured against liability to give relief under section 3 (1).

provides for public liability- insurance for the purpose of providing immediate relief to the persons affected by accident occurring while handling any hazardous substance.

3. Right to Legal Aid of Victims of Mass Disasters

Section 12(e), Legal Services Authorities Act, 1987 provides that a person under circumstances of undeserved want such as being a victim of a mass disaster, ethnic violence, caste atrocity, flood, drought, earthquake or industrial disaster shall be entitled to legal services under the Act.

4. Concept of Aggravated Damages

In actions in tort, where damages are at large i.e. not limited to the pecuniary loss that can be specifically proved, the Court may also take into account the defendant’s motives, conduct and manner of committing the tort, and where these have aggravated the plaintiff’s damage e.g. by injuring his proper feelings of dignity, safety and pride – aggravated damages may be awarded.

Aggravated damages are designed to compensate the plaintiff for his wounded feelings, they must be distinguished from exemplary damages which are punitive in nature and which (under English Law) may be awarded in a limited category of cases.

(b) Disasters and Relevant Legislations

This part discusses the specific mass disasters and the legal remedies available. It also covers examples of such disasters occured in India –

  1. Gas Leaks Incidents

Examples of Gas leaks in India

  • On the night of December 2, 1984, an accident at the Union Carbide pesticide plant in Bhopal took place. A number of poisonous gases, mainly around 30 tons of a highly toxic gas- methyl isocyanate was released. Over 500,000 people were exposed.
  • Escape of oleum gas from one of the units of Shriram Foods and Fertiliser Industries in Delhi on 4th and 6th December, 1985.
  • Ammonia leak in  Shivrajpur, Kanpur; Gas leak at Bhilai Steel Plant run by SAIL; an explosion at a GAIL gas pipeline near Nagaram village, Andhra Pradesh; chlorine gas leaked from a cylinder in Por village, Vadodara district; HPCL gas pipeline leaked in Ankapura village.
  • Explosion in the Unchahar plant of National Thermal Power Corporation, Rae Bareli on 01.11.2017 resulted in around 30 deaths and 100 injuries.

Relevant Legislations –

  • Bhopal Gas Leak Disaster (Processing of Claims) Act, 1985 was enacted to confer certain powers on the Central Government to secure that claims arising out of, or connected with, the Bhopal gas leak disaster are dealt with speedily, effectively, equitably and to the best advantage of the claimants.

Section 3 conferred the Central Government with the exclusive right to –represent, and act in place of (whether within or outside India) every person who has made, or is entitled to make, a claim for all purposes connected with such claim in the same manner and to the same effect as such person.

Section 9  empowered the Central Government for carrying into effect the purposes of this Act, to frame by notification in the Official Gazette a Scheme as soon as may be after the commencement of this Act.

It provides the mechanism for a claim of compensation in case of the damage. It also establishes Claims Commissioner and the Nuclear Damage Claims Commission.

Proceedings before the Apex Court vis-a-vis Bhopal tragedy

In 1989, the Indian Supreme Court approved a settlement of the civil claims against Union Carbide for $470 million. In July of 2004, the Indian Supreme Court directed that the balance of the settlement fund be disbursed among all of the Bhopal claimants. In 2010, the victims and the government filed a “curative petition” with the Supreme Court of India asking to re-open the settlement.

On 24 May 2016, a US court ruled that a lawsuit against Union Carbide filed by local communities may not proceed despite strong evidence the company’s chemical plant continues to cause water pollution in Bhopal, India.  In July 2016, the victims asked the court to reconsider its 24 May decision.  In August 2016, the US court of appeals rejected their appeal for a rehearing, allowing stand the lower court decision ruling that UCC was not liable to stand.

Charan Lal Sahu Etc. Etc v. Union Of India And Ors,   AIR 1990 SC 1480 –

The constitutional validity of Bhopal Ga Leak Disaster (Processing of Claims) Act, 1985 was challenged. The grounds of the challenge were –

  • The impugned Act is violative of the Principles of Natural Justice mainly on the ground that Union of India, being a joint tortfeasor, in that it has permitted the establishment of such factories without necessary safeguards, has no locus standi to compromise on behalf of the victims;
  • that the victims and their legal heirs were not given the opportunity of being heard, before the Act was passed;
  • that in the guise of giving aid, the State could not destroy the rights inherent in its citizens;
  • nor could it demand the citizens to surrender their rights to the State;
  • that vesting of the rights in Central Government was bad and unreasonable because there was a conflict of interest between the Central Government and the victims as the Central Government owned 22% share in UCIL, and that would make the Central Government a Judge in its own cause.

The Hon’ble Apex Court held that the Act is constitutionally valid. It proceeds on the hypothesis that until the claims of the victims are realized or obtained from the delinquents, namely, UCC and UCIL by settlement or by adjudication and until the proceedings in respect thereof continue, the Central Government must pay interim compensation or maintenance for the victims. There is no prohibition or inhibition, for Indian State taking over the claims of the victims or for the State acting for the victims as the Act has sought to provide. The Act in question has been passed in recognition of the right of the sovereign to act as parens patriae. The Government of India in order to effectively safeguard the rights of the victims in the matter of the conduct of the case was entitled to act as parens patriae, which position was reinforced by the statutory provisions, namely the Act.

In view of the enormity of the disaster the victims of the Bhopal gas leak disaster, as they were placed against the multi-national and a big Indian Corporation and in view of the presence of foreign contingency lawyers to whom the victims were exposed, the claimants and victims can legitimately be described as a class by themselves different and distinct, sufficiently separate and identifiable to be entitled to special treatment for effective, speedy, equitable and best advantageous settlement of their claims. The disaster being unique in its character and in the recorded history of industrial disaster, situated as the victims were against a mighty multinational with the presence of foreign contingency lawyers looming on the scene, there were sufficient grounds for such differentiation and different treatment.

It further observed that in view of the magnitude of the misery involved and the problems in this case, the setting aside of the settlement on this ground in view of the facts and the circumstances of this case keeping the settlement in abeyance and giving notice to the victims for a post-decisional hearing would not be in the ultimate interest of justice.

Decision of the Apex Court in Oleum gas leak-

The Hon’ble Apex Court on 20 December,1986 directed the Delhi Legal Aid and Advice Board to take up the cases of all those who claim to have suffered on account of oleum gas and to file actions on their behalf in the appropriate Court for claiming compensation. The Court observed -an enterprise which is engaged in a hazardous or inherently dangerous industry which poses a potential threat to the health and safety of the persons working in the factory and residing in the surrounding areas owes an absolute non-delegable duty to the community to ensure that if any harm results to anyone, the enterprise must be held to be under an obligation to provide that the hazardous or inherently dangerous activity must be conducted with the highest standards of safety and if any harm results on account of such activity the enterprise must be absolutely liable to compensate for such harm irrespective of the fact that the enterprise had taken all reasonable care and that the harm occurred without any negligence on its part.

2. Fire explosions

Examples of Fire Explosions

  • Two explosions shook the Victoria Dock of Mumbai (then Bombay) in April 1944, when a freighter carrying a cargo of gold, ammunition and other items caught fire. It resulted in around 800 deaths.
  • Fire accident on 23rd December, 1995 at Mandi Dabwali, a town in Sirsa district, Haryana. Around 400 people died in the fire, and at least 160 were injured.
  • Fire at Uphaar Cinema Theatre in Green Park, South Delhi on 13.6.1997. It resulted in the death of 59 patrons and injury to 103 patrons.
  • The fire at the Indian Oil terminal in Jaipur in 2009 killed 11 workers and caused a $60 million loss.
  • The massive fire at the state-run Hindustan Petroleum refinery-cum-petrochemical complex in Visakhapatnam in August 2013,  left nine workers dead and 34 injured.

Proceedings before the Supreme Court vis-a-vis  Uphaar Cinema Tragedy –

13-10-2011 (M.C.D. v. Association of Victims of Uphaar Tragedy & others)

  • The licensee (appellant in CA No.6748 of 2004) and Delhi Vidyut Board are held jointly and severally liable to compensate the victims of the Uphaar fire tragedy. Though their liability is joint and several, as between them, the liability shall be 85% on the part the licensee and 15% on the part of DVB. (Para 46)
  • Compensation for the death of persons- Award of Rs.10 lakhs in the case of persons aged above 20 years and Rs.7.5 lakhs in regard to those who were 20 years or below as on the date of the incident, would be appropriate. The award of Rs.1 lakh each in the case of injured. The amount awarded as compensation will carry interest at the rate of 9% per annum from the date of writ petition as ordered by the High Court, reserve liberty to the victims or the LRs. of the victims as the case may be to seek higher remedy wherever they are not satisfied with the compensation.
  • Suggestions to the government were made for consideration and implementation. (Para 45)

22-09-2015 (Sushil Ansal v. State through CBI)

  • Sentence awarded by the High Court needs to be enhanced to the maximum period of two years under Section 304-A but in lieu of additional period of sentence of one year, the substantial amount of fine needs to be imposed. We are further of the view that in case the said amount of fine is paid, the sentence should be reduced to the period already undergone, as indicated by Misra, J. in the case of Sushil Ansal (A1). On the principle of parity, the case of Gopal Ansal (A2) will stand on the same footing as that of Sushil Ansal (A1).
  • To meet the ends of justice would meet if the appellants are directed to pay fine so that the amount of fine can be used either for the purpose of setting up a Trauma Centre in NCT of Delhi or for upgrading Trauma Centres of Hospitals managed in NCT of Delhi by the Government of Delhi.
  • We, therefore, direct that a fine of Rs.30 crore on each appellant should be imposed and if the said fine is paid within a period of three months, the sentence of the appellants be reduced to the sentence already undergone.

9-02-2017 (Appeals against  Orders of the Supreme Court dated 19.08.2015 and 22.09.2015) 

The Apex Court did not find any merit in the Review Petitions and the same were dismissed.

3. Riots involving damages to public property

General Rule of Liability

Where persons, whether jointly or otherwise, are part of a protest which turns violent, results in damage to private or public property, the persons who have caused the damage, or were part of the protest or who have organized will be deemed to be strictly liable for the damage so caused, which may be assessed by the ordinary courts or by any special procedure created to enforce the right.

Prevention of Damage to Public Property Act, 1984

Section 2(b) defines Public property as any property, whether immovable or movable (including any machinery) which is owned by, or in the possession of, or under the control of the Central Government; or any State Government; or any local, authority; or any corporation established by, or under, Central, Provincial or State Act; or any company as defined in Section 617 of the Companies, Act, 1956 (1 of 1956); or any institution, concern or undertaking which the Central Government may, notification in the Official Gazette, specify in this behalf.

The Act provides for punishment for committing Mischief causing damage to public property and Mischief causing damage to public property by fire or explosive substance.

In Re: Destruction Of Public & Private Properties vs State Of A.P. & Ors, decided on 16 April, 2009, The Apex Court was called upon to frame guidelines and venture to evolve new principles of liability to meet situations that have already arisen in the past and are likely to arise again in future, so that speedy remedies become available to persons affected by loss of life, injury and loss of properties, public or private, as a result of riots and civil commotions. The Hon’ble Court observed that the suggestions given by Nariman Committee ( to amend Prevention of Damage to Public Property Act, 1984) are extremely important and they constitute sufficient guidelines which need to be adopted. But leave it to the appropriate authorities to take effective steps for their implementation.

4. Miscellaneous 

Radiation Leak –


  • Leakage of radioactive substance from the Delhi University equipment auctioned to scrap dealers in Mayapuri in 2010. One person was killed and eight others were hospitalized.

Bomb Explosion –

Leesha v. Union of India and others, Karnataka High Court (2015) the petitioner sought the creation of a National Policy of Compensation and Rehabilitation for victims of bomb blasts in the country. She sought a policy where a special committee can recommend compensation to the victims so that they get relief for medical expenses, mobility cost and also job security.

Image from here.

Bhumika Sharma

She is currently a Research Scholar, (PhD) at Himachal Pradesh University, Shimla. She finds peace in research and writing on a variety of social issues. She believes in the power of education and awareness to deal with various problems.

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