Industrial disasters and the law: India

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Compensation to victims

Govt liable to pay Bhopal victims: SC

Says Centre Must Fork Out If Carbide Compensation To Victims Is Found Inadequate

Dhananjay Mahapatra | TNN

From the archives of The Times of India 2007, 2009

New Delhi: Who should be blamed for the paltry compensation paid to Bhopal gas leak victims? Who should make good the shortfall in compensation if the $470 million paid by Union Carbide Corporation (UCC) is found inadequate?

On both counts, the central government, and not Dow Chemicals, which has taken over UCC, will have to deliver. This is so if one goes by the October 3, 1991 judgment of the Supreme Court in the case Union Carbide Corporation (UCC) vs Union of India. The group of ministers (GoM) constituted by Prime Minister Manmohan Singh will find that it is the Centre which will have to settle any additional claims for compensation made by victims of the gas tragedy.

In 1991, a five-judge bench comprising then Chief Justice Ranganath Misra and Justices M N Venkatachaliah, K N Singh, A M Ahmadi and N D Ojha had dealt in detail with the adequacy of $470 million agreed under a settlement between the Union government and UCC in 1989 to meet the compensation to be given to nearly 2 lakh victims.

Under the settlement, $470 million paid by UCC was to be taken to have met the civil requirements and also that “all criminal proceedings related to and arising out of the disaster shall stand quashed wherever they may be pending”. When the victims and some NGOs sought review of the 1989 judgment of the SC accepting and recording the settlement, the apex court in 1991 agreed that the settlement could not wipe out the criminal liability of the accused.

However, it expressed satisfaction over the amount paid by UCC which in 1991 stood at Rs 1,200 crore. It had said, “Such a contingency may not arise given the size of the settlement-fund... It may be hazardous to belittle the advantages of the settlement in a matter of such complexity. Every effort should be made to protect the victims from the prospects of protracted, exhausting and uncertain litigation.”

However, when the victims and related associations repeated their fears about inadequacy of the settlementfund to meet the extraordinary situation, the bench had said if such a situation arose, then it would be the Centre’s duty to meet any shortfall in compensation.

“If it should arise, the reasonable way to protect the interests of victims is to hold that the Union of India, as a welfare state and in the circumstances in which the settlement was made, should not be found wanting in making good the deficiency, if any,” the SC had said.