The Supreme Court has called for a comprehensive affidavit from the Union of India and the CPCB (Central Pollution Control Board) on the "Environment Relief Fund" established under the Public Liability Insurance Act.

For context, the ERF was created to provide financial relief to victims of transport accidents involving hazardous materials. A person plying a vehicle on road is supposed to have a policy covering third-party risk, but those carrying hazardous materials must have an additional insurance in terms of the PLIA. Since its creation, over Rs.1000 crores are stated to have been received in the ERF.

A bench of CJI Surya Kant, Justice Joymalya Bagchi and Justice Vipul Pancholi called for the affidavit, while dealing with a public interest litigation initiated by Jabalpur-based social activist Gyan Prakash. At his request, the bench also agreed to appoint an Amicus Curiae in the matter.

Petitioner-Gyan Prakash, appearing in person, referred to Section 146(1) of the Motor Vehicles Act, which deals with necessity for insurance against third-party risks. Proviso to this provision reads thus:

"Provided that in the case of a vehicle carrying, or meant to carry, dangerous or hazardous goods, there shall also be a policy of insurance under the Public Liability Insurance Act, 1991 (6 of 1991)."

He submitted that on a daily basis, about 600 people get killed in India due to road accidents and majority of them do not have insurance. Under the Public Liability Insurance Act, the Ministry of Environment has been designated as the nodal agency. Pursuant to an order passed by the Madhya Pradesh High Court in his contempt petition, the "Environment Relief Fund" was constituted, whereunder Rs.1500 crores have been collected as insurance premium but nobody has been paid out of it.

When the CJI asked to who all are entitled to the funds, the petitioner replied, "those who are killed or injured due to these hazardous substances". He also cited the recent incident at Kaushambi, when an LPG tanker collided into a toll plaza and resulted in the death of 5 people.

Counsel for the Union, per contra, claimed that an order was passed by the National Green Tribunal after filing of the present petition, which covered everything. The MV Act as well was amended afterwards, he said. On a specific query by CJI Kant, it was further informed that about Rs.881 crores had accumulated in the ERF by 2020 and it was being managed by the CPCB. The number rose to about Rs.1000 crores by the end of 2021, the bench noted.

The petitioner also argued that the Ministry of Environment and CPCB were acting in an ignorant manner. Moreover, he pointed out that the CPCB charges Rs.10 crores per year as Fund Manager.

Hearing the submissions, the CJI told the Union to find out details about the Fund (such as, how much amount is lying therein and whether anything has been paid out of it). Since there was nothing on record to show how much amount, if any, had been disbursed, the Court said that the affidavits (by Union and CPCB) shall explain the scheme for utilization of the fund.

The court also recorded in its order appreciation for the petitioner's efforts. It said that he appeared to be a well known social activist who firmly believes in good governance. The Court further made part of its order details of the High Court order of 2006 (in the petitioner's case), pursuant to which the ERF was created. Before parting, the petitioner informed the Court that he has a second PIL pending qua pedestrians.

Case Title: GYAN PRAKASH v. UNION OF INDIA AND ORS. W.P.(C) No. 1093/2019