Bhopal Disaster Case Analysis

Bhopal Gas Tragedy had a massive impact on how future laws were created in India.
The two
main purposes of those laws were holding the industries accountable for their actions and
compensating the victims for their injuries. The Bhopal gas leak Disaster Act, 1985, was created
to provide compensation to the victims of the incident. This incident was a shining example of
the government’s failure in providing justice to the victims, which was first seen in 1989 where
they settled for a mere $470 million. 1 Another failure was in late payment of compensation as in
2004, the Supreme Court ordered the RBI to compensate the remaining victims. 2 This mishap
happened due to poor management of the government in assessing the correct number of
victims.3
However, despite these failures, the government has also taken many steps towards providing
justice. The Environment (Protection) Act was enacted in 1986 and provides for measures to
protect the environment. The law holds any company executive that commits an offence under
this Act may be punished with imprisonment. Another major statute was the Public Liability
Insurance Act, which ‘punishes’ the companies by holding them financially accountable as it
provided an immediate ‘no-fault’ compensation scheme for the victims of industrial accidents.
This Act has already incorporated absolute liability in its provisions.
In 1987, the Supreme Court of India gave the landmark judgment of M.C. Mehta v Union of
India4 where they established the theory of absolute liability. As per this theory if a person is
involved in the operation of hazardous substances or an activity that is inherently dangerous then
such person has to take all the precautions a reasonable person needs to take to prevent an
occurrence of an accident because in case an accident happens, the said person would be
unconditionally liable for the damage caused. This theory was sort of an evolution of the
previously applicable strict liability which had numerous exceptions like the damage being
caused by an Act of God or a 3 rd party. The significance of removing these exceptions is that
companies will know that they will be liable for every accident that is caused due to their assets.
1
Union Carbide Corporation v Union of India, 1989 SCC (2) 540.
2
Betwa Sharma. “Bhopal Gas Tragedy: 'New' Victims.” Economic and Political Weekly, vol. 41, no. 17, 2006, pp. 1613–
1616.
3
Betwa Sharma. “Bhopal Gas Tragedy: 'New' Victims.” Economic and Political Weekly, vol. 41, no. 17, 2006, pp. 1613–
1616.
4
M.C. Mehta v. Union of India SC 1086 (1987).
The measure of compensation here is correlated to the magnitude of the liable entity. This acts as
a deterrent and pushes the companies to maintain high safety standards. If this theory was
applied in the Bhopal Gas Tragedy case,5 then Union Carbide would have been held liable for a
much higher amount as per this theory which requires the compensation to be proportional to the
damage caused.
Even though a lot of progress has been made, there are still flawed laws which need to be looked
at. The Environment (Protection) Act has not yet incorporated the principles of absolute liability,
polluter’s pay and the precautionary principle in its provision. Even though the courts have
applied these principles in their judgments,6 its high time environment laws incorporate them as
well as the Public Liability Insurance Act did. There have also been cases where precautionary
principle should have been applied but instead, the National Green Tribunal made the order in
favour of the industries and said that actions must not be based on suspicions, 7 which can be
argued to be against the precautionary principle.
5
Union Carbide Corporation v Union of India, 1989 SCC (2) 540.
6
Indian Council for Enviro-Legal Action v Union of India 1996 AIR 1446; Vellore Citizens Welfare Forum v
Union of India and others (1996) 5 SCC.
7
M/s. Sterlite Industries (India) Ltd. v. Tamil Nadu Pollution Control Board and Ors. Appeal No. 57 of 2013.

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Bhopal Gas Tragedy had a massive impact on how future laws were created in India.

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