Bhopal Gas Tragedy : Supreme Court Dismisses Centre's Curative Petition Seeking Additional Compensation From UCC

A Constitution Bench of the Supreme Court, on Tuesday, dismissed the curative petition filed by Central Government seeking to reopen the settlement with the Union Carbide Corporation (now Dow Chemicals) to claim additional compensation for victims of the Bhopal Gas Tragedy of 1984. It noted that settlement can be set aside only on the ground of fraud, but no ground of fraud has been pleaded by the Union of India. However, the Court directed that a sum of INR 50 crores lying with RBI ought to be utilized by the Union Government to satisfy pending claims, if any.A Bench comprising Justice S.K. Kaul, Justice Sanjiv Khanna, Justice A.S. Oka, Justice Vikram Nath and Justice J.K. Maheshwari, which had reserved judgment on January 12, 2023, said that the Union's curative petition has no basis in legal principles.The Court noted that the Union Government had itself failed to take out insurance policies as directed by the Apex Court -"The Union has filed the curative petition seeking to reopen the settlement. The responsibility was placed on the Union of India, being a welfare state, to make good the deficiency( in the compensation) and to take out the relevant insurance policy. Surprisingly, we are informed that no such insurance policy was taken out. This is gross negligence on the part of Union and in breach of the judgment of this Court. The Union cannot be negligent on this aspect and then seek a prayer from this Court to fix such responsibility on the UCC."It added - "We are unsatisfied with the Union of India for not furnishing any rationale for raking up this issue more than two decades after the incident". The Court held that the Union's plea for top up compensation has no basis in legal principle. "Either a settlement is valid, or it has to be set aside on the ground that it has been vitiated on the ground of fraud. No such fraud has been pleaded by the Union of India", the bench noted.The Court noted that the Union's case is based on the number of victims and injuries which were not envisaged at the time when the settlement was effected. However, there was bound to be environmental degradation and it was known that medical facilities will have to be extended to rehabilitate people. It is the allegation of UCC that Union and State did not promptly detoxify the site and this aggravated the problem. In any case, this cannot be ground to seek enhancement, the Court noted.Even if it is assumed that there are more claims than envisaged, an excess amount of funds remain available to satisfy such claims.The Court noted that the Union's stand is that the Commissioner has adjudicated all claims in accordance with the law. Further, it was admitted in the proceedings which culminated in 2004 that the the amounts were sufficient to meet the actual requirements. Thus the claimants was awarded more than reasonable compensation. This reinforces the position that the settlement amount was sufficient.In 1989, UCC agreed to pay a sum of US $ 470 million to the Union of India in settlement of all claims, rights, and liabilities relating to and arising out of the Bhopal Gas disaster. The terms of the settlement were set out in the orders of the Supreme Court passed on 14th and 15th February, 1989. In review petition filed by private parties, he settlement was approved by a Constitution Bench of the Court in 1991 in Union Carbide Corporation & Others v. Union of India & Others 2 (1991) 4 SCC 584.ArgumentsOver a span of three days, the Bench heard arguments put forth by the Attorney General for India, Mr. R. Venkataramani on behalf of the Union Government; Advocate, Ms. Karuna Nundy and Senior Advocate, Mr. Sanjay Parikh representing organisations and victims of the disaster. Their arguments were countered by Senior Advocate, Mr. Harish Salve who appeared for Dow Chemicals.At the very threshold, the Bench had raised questions regarding the scope of curative petitions and expressed concern that it appears that the Union Government is seeking to reopen or to add-on to a settlement that was reached long back, in 1989. The Attorney General defended the stand of the Government by indicating the inadequacy of the compensation amount and the requirement to amend the same in the light of the subsequent developments. The Judges were baffled that it took the Union Government 25 years to realise that the compensation fixed in 1989 was inadequate. Justice Kaul pointed out that when the settlement was negotiated in 1989 it was between the Corporation and the Government of India and not between unequals, so there could not have been any scope for oppression. It was further emphasised upon by the Judges at different points in time during the course of the hearing that, a part of the compensation, amounting to INR 50 crores 25 lakhs was still lying with the Reserve Bank of India. Mr. Salve apprised the Bench that the arguments of the Union Government in the curative petition has traveled beyond the scope of issue raised in the original suit. ...

Bhopal Gas Tragedy : Supreme Court Dismisses Centre's Curative Petition Seeking Additional Compensation From UCC

Sohini Chowdhury

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