CPL FD
CPL FD
SUMMER SESSION
(JULY-NOVEMBER 2015)
Submitted To:
Submitted By:
Semester 1, Roll-751
Faculty (Law)
SUBMITTED ON
September 10, 2015
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Acknowledgment
I sincerely thank Prof. (Dr.) I.P. Massey and Mr. Anand Kumar Singh for allowing me to
work on an area of my interest. Their invaluable assistance and patience to stand us all in a
class of undisciplined learners is admirable. I am highly thankful to them for their infallible
help and support. I am highly indebted to the staff of the NLUJ library for their kind
consideration in the same regard. And last but not the least I would take the opportunity to
thank my parents, friends and well wishers without whose support and criticism this project
of mine would not have gathered enough momentum. This is as much theirs.
Gaurav Kumar Singh
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Contents
Introduction
Research Objectives and Questions
M.C. Mehta v Union of India
Bhopal Gas Tragedy Case
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Introduction
Laws must change with time in a progressive society. In this project we shall trace the history
of the principle of Absolute Liability focussing on the famous Sri Ram Food Case and later
deal with comparative analysis of the same with other principles and jurisdictions. The
project shall further deal as to why the Indian Supreme Court did not apply the principle of
strict liability and developed ingenious jurisprudence on the cases of liability.
The principle of absolute liability was laid down by the Supreme Court in the case of M.C.
Mehta v Union of India1, popularly known as oleum gas leak case. This case is one of the
most intriguing parts of the Indian compensatory jurisprudence ever developed. It
commenced an entire new chapter in Indias environmental law history, and brought about a
level of maturity in the Indian judiciary never seen before. The concept so developed can be
deemed as a stricter version of the liability laid down by the English Court in the case of
Rylands v Fletcher2. Blackburn, J. in the case stated:
That the person who for his own purposes brings on his lands and collects and keeps there
anything likely to do mischief if it escapes, must keep it in at his peril, and, if he does not do
so, is prima facie answerable for all the damage which is the natural consequence of its
escape. He can excuse himself by showing that the escape was owing to the plaintiff's default;
or perhaps that the escape was the consequence of vis major, or the act of God; and it seems
but reasonable and just that the neighbour, who has brought something on his own property
which was not naturally there, harmless to others so long as it is confined to his own property,
but which he knows to be mischievous if it gets on his neighbour's, should be obliged to
make good the damage which ensues if he does not succeed in confining it to his own
property."3
The House of Lords, however, added a rider to the above statement, viz., that the user by the
defendant should be a "non-natural" user to attract the rule. In other words, if the user by the
defendant is a natural user of the land, he would not be liable for damages. Thus, the twin
1 AIR 1987 SC 1086
2 (1868) LR 3 HL 330
3 Ibid
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tests - apart from the proof of damage to the plaintiff by the act/negligence of the defendants which must be satisfied to attract this rule are "foreseability" and "non-natural" user of the
land.
The principle of strict liability comes down with exceptions unlike in case of absolute
liability. Further, the pre-requirements essential for establishing a liability under the principle
of strict liability viz., the non-natural use of land, use of a dangerous thing, and the element of
escape provided substantial loopholes to the enterprises to escape liability under the Rylands
v. Fletcher4 rule and was mentioned by the Supreme Court while pondering upon the requisite
jurisprudential aspect.
Research Objectives and Questions
1. To trace the historical background and analyze the concept of Absolute Liability.
What is the concept of strict and absolute liability?
What is the legal difference between strict and absolute liability? Is there any
yes, how?
2. To trace Indian judicial framework establishing the principle of absolute liability.
Whether Supreme Court has played a pivotal role in establishing the principle
of absolute liability?
Whether Supreme Court has differed in its judgment in applying the principle
4 Ibid.
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4. To critically compare American and Indian approach for absolute liability principle.
Whether both legal systems have clearly demarcated the difference between
liability?
Whether absolute liability mandates exemplary damages in both legal
systems? If yes, is there any criticism over its economic impact?
5 Supra 1.
6 Supra 2.
7 Ibid.
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Legal Issues:
1. What is the scope and ambit of the jurisdiction of the Supreme Court under Article 32 since
the application for compensation are sought to be maintained under Article?
2. Whether Article 21 is available against Shriram which is owned by Delhi Cloth Mills
Limited, a public company limited by shares and which is engaged in industry vital to public
interest and with potential to affect the life and health of the people?
3. What is the measure of the liability of an enterprise which is engaged in a hazardous or
inherently dangerous industry, if by reason of an accident occurring in such industry, persons
die or is injured?
The first issue which is concerned with the scope and ambit of the jurisdiction of the Supreme
Court under Article 32, Bhagwati J., in Bandhua Mukti Morcha v Union of India8, held that
the scope and ambit of Article 32 of the Constitution of India does not only confer power on
this Court to issue a direction, order or writ for the enforcement of fundamental rights but it
also lays a constitutional obligation on this Court to protect the fundamental rights of the
people and for that purpose the court has all incidental and ancillary powers including the
power to make and adopt new remedies and fashion new strategies designed to enforce the
fundamental rights. The second question concerning with the availability of Article 21, the
Honourable Court said that they do not propose to decide any definite statement at this stage
as it needs detailed consideration. For the third issue, which was concerned with the
compensation, the court decided to direct Delhi Legal Aid and Advice Board to take up the
cases of all those who claim to have been suffered by the oleum gas and file actions on their
behalf in the appropriate court for claiming compensation against Shriram and the Delhi
Administration is directed to provide the necessary funds to the Delhi Legal Aid and Advice
Board for the purpose of filing and prosecuting such actions.
The court before deciding the third issue laid down the concept of absolute liability and
also pointed out that the duty owed by such an enterprise to the society is absolute and nondelegable and that the enterprise cannot escape liability by showing that it had taken all
reasonable care and there was no negligence on its part.
The court rejected incorporation of the rule of strict liability in this case and held that:
8 1984 AIR(SC) 802
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We do not feel inhibited by this rule, which was evolved in the context of a totally different
kind of economy. Law has to grow in order to satisfy the needs of the fast changing society
and keep abreast with the economic developments taking place in this country. As new
situations arise, the law has to be evolved in order to meet the challenge of such new
situations. Law cannot allow our judicial thinking to be constrained by reference to the law as
it prevails in England, or for that matter in any other foreign legal order. We, in India, cannot
hold our hands back and I venture to evolve a new principle of liability which English Courts
have not done. And further reasoned that:
The enterprise alone has the resource to discover and guard against hazards or danger
and to provide warning against potential hazards.
On the point of compensation the court in this case held that the larger and more prosperous
the enterprise, greater must be the amount of compensation payable by it for the harm caused
on account of an accident in the carrying on of the hazardous or inherently dangerous activity
by the enterprise.
Bhopal Gas Tragedy Case
Case 1: Union Carbide Corporation v. Union of India9
The peculiar problem regarding the claim of compensation was involved because of such a
large number of victims, most of those belonging to the lower economic strata. On behalf of
the victims, a large number of cases were filed in Bhopal, and also in USA against the UCC.
The Indian government filed an affidavit in the US court citing immaturity and inefficiency
of the Indian judiciary and said that it might take years to come to final conclusion for a case
of this magnitude.10
9 AIR 1990 SC 273
10 S.P.Sathe, Transgressing Borders and Enforcing Limits, 302 (7th Ed. 2010)
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The case in USA was rejected on the ground of forum non conveniens i.e. the suit can be
more conveniently tried in India as apart from many other factors, India was the place of
catastrophe, and the plant personnel, victims, witnesses, documentary and all related
witnesses were located there.
After the dismissal of the suit in USA, the UOI filed a suit in the District Court of Bhopal.
The lower court ordered UCC to pay an interim relief of Rs. 350 crore to the gas victims. On
a civil revision petition file by the UCC in the Madhya Pradesh High Court against the order
of the Bhopal District Court, the appellate court reduced the quantum of interim
compensation payable from Rs. 350 crore to Rs. 250 crore. At this time UCC was involved
in discussions with the government regarding a direct settlement which was stayed by the
court. It was here that the court applied the rule of absolute liability and ordered a
compensation package of Rs. 750 crore but the court shied away from awarding exemplary
damages and the decision was subject to criticism over this point.
Case 2: Charan Lal Sahu v. Union of India11
There was wide resentment over the Bhopal Gas Disaster (Processing of Claims) Act (1985)
passed by the Govt. of India, which entitled it to represent the victims of the Bhopal Gas
Tragedy en masse. According to section 3 of the Act, the Government of India was
empowered to represent, and act in place of every person who made a claim, or is entitled to
make, a claim arising out of, or connected with, the Bhopal gas leak disaster and as a result
all suits filed by the victims in America and India were superseded and consolidated in the
action filed by the Union of India.
According to the Act, all criminal proceedings were quashed against the UCC and under the
doctrine of Parens Patriae the Indian government was allowed to take up the action on behalf
of the victims. In this case, the petitioner challenged the validity of the Bhopal Gas Disaster
(Processing of Claims) Act (1985) in the Supreme Court.
The petitioner contended that
1. The Government was not entitled to represent the victims before the Court and hence
the settlement was illegal;
2. The settlement was also not valid because the views of the victims had not been taken
before deciding on the final terms of the settlement.
11 AIR 1990 SC 1480
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With regard to the above-mentioned issues, the Supreme Court said that the Government of
India had not violated any law and any right of the victims by representing them. It was said
that in the background of the preamble to the Constitution and the mandate of the Directive
Principles of State Policy, it was possible to authorize the Central Government to take over
the claims of the victims of the gas leak to fight against the multi-national corporation in
respect of the claims. This was based on the concept of the maxim salus populi suprema lex
regard for public welfare is the highest law.
Regarding the views of victims as to the terms of the settlement, the Supreme said that the
purpose of the 1985 Act and principles of natural justice lead to the interpretation of Section
4 of the Act, that in case of a proposed or contemplated settlement, notice should be given to
the victims or their legal dependants whose rights are to be affected to ascertain their views.
This, however, does not mean that the consent of all the victims is required for the settlement.
The Government of India, acting as the representative of the victims can place the views of
the victims before the Court; in such a manner as it consider necessary before a settlement is
entered into. Further, it was stated by the Court that the victims had the right to approach the
court at any stage if, it was felt by the victims that their rights were being deprived of in the
action against Union Carbide Corporation.
It is important to note in this regard that the Supreme Court held that the compensation
awarded to the victims was justified and set aside the orders quashing criminal prosecutions.
This stand taken by the Supreme Court was contrary to the stand expressed by the same Court
in the matter of MC Mehta v. Union of India 12 where it had been said that the damages
payable would be fixed in proportion to the economic capacity of the defendant corporation.
Indian Council for Enviro-Legal Action v. Union of India13
In this case chemical industries were discharging sludge which was a contaminant
consisting of H acid (manufacturing is banned in many countries) and Oleum substitutes in
village Bicchri in Udaipur resulting in massive environmental degradation and death is some
cases due to water contamination. A writ petition concerning the above stated matter was file
before the Supreme Court under Article 32 by way of social action litigation on behalf of the
12 Supra 1.
13 AIR 1996 SC 1446
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villagers affected by the pollution resulting in invasion on their right to life, enshrined in
Article 21 of the Constitution.
The Supreme Court directed the Central Government to recover the costs of the remedial
measures from the private companies. The factories, plants, machinery, and all other
immovable assets of the respondent companies were ordered to be attached and the amount
so determined and recovered was ordered to be utilized by the Ministry of Environment and
Forests, Government of India (M.E.F.) for carrying out all remedial measures to restore soil,
water sources and the environment in general of the affected area to its former condition.
On account of their continuous, persistent, and insolent violations of law, the respondent
industries were characterized by the SC as rogue industries, industries which had heaped
loads of untold miseries upon poor and unsuspecting villagers. In this case, the Supreme
Court also explicitly recognized the principle of polluter pays. There basically exist three
principles that have been identified while dealing with rogue industries.
So the principle of absolute liability was applied in the case in full flow and it was further
held that the principle of absolute liability is a part of ration of the Sri Ram Food & Fertilizer
case14 and is not a part of obiter; hence it is now cleared to be followed by the courts as
precedent.
Is the principle of Absolute liability applicable only for Environmental Wrongs?
Klaus Mittelbachert v East India Hotels Ltd.15
In this case a German co-pilot, who stayed in New Delhi in Hotel Oberoi Inter-Continental,
five-star hotel, was badly injured when he dived in the hotel swimming pool due to defective
design of the swimming pool and insufficient amount of water in it. The injuries resulted in
his paralysis and ultimate death after 13 years of the accident.
The court arrived at the finding that the design of the swimming pool was defective; the
conclusion which necessarily emerges is that the swimming pool of the defendant's hotel was
a trap. It was a `hazardous premises' in the sense in which the term is used in the law of torts.
The liability of the defendants for adverse consequences flowing from the use of the
14 Supra 1.
15 AIR 1997 Delhi 201
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swimming pool- a hazardous premise - would be absolute. It was held that a five-star hotel
charging high or fancy prices from its guests owes a high duty of care to its guests. A latent
defect in its structure or service attracts absolute liability. The high price tag hanging on its
service pack attracts and casts an obligation to pay exemplary damages, if an occasion may
arise for the purposes.
Thus we see that the application of the rule is not limited to environmental matters. It can also
be applied elsewhere when there is a danger to a persons health and safety and the defendant
is totally at fault.
Role of Article 12 and Absolute Liability
In Oleum Gas Leak case a lot of discussion in the judgment was on the fact that whether Sri
Ram Food Industries would come under the purview of Article 12 under the term local and
other authorities. It was further decided by the court that they would not submerge
themselves in this discussion and formulated the principle of absolute liability but if we
critically analyze the judgment then we see the pattern as to how at first the locus standi was
made loose and afterwards the principle of deep and pervasive control by the government
was factored in; an avid reading to the judgment suggests inclination of that bench to rule the
said industry under Article 12 in spite of arguments such as intention of legislature and
economic impact.
But in the Sri Ram Food case which has been made a settled law again via judicial journey
over the course of time the principle of absolute liability talks about non-delegable duty
and fixates liability ousting the concept of Article 12; hence we can come to the conclusion
that it is not necessary for the enterprise to be state for the purposes under article 12 for
fixating liability.
Rule of Absolute Liability in USA
In America the Rylands v. Fletcher16 rule was adopted as soon as the case was dealt with in
England. The first American state to apply the Rylands doctrine was Massachusetts.
However, it is interesting to note that the American Courts have always been prone to use the
terms strict liability and absolute liability rather interchangeably. The clear line of distinction
that was created by Bhagwati CJ while evolving the rule of absolute liability does not exist in
16 (1868) LR 3 HL 330
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the case of American jurisprudence. Both Massachusetts and Minnesota while dealing with
cases where the rule essentially to be applied was strict liability, have instead used the term
absolute liability in affixing liability on people where the escape of thing due to the nonnatural use of land caused damage.
Many states have accepted the strict liability rule as a doctrine applicable principally to cases
where there is escape and consequential damage caused by water. However, some states have
made categorical exceptions and explanations to the rule, perhaps because the imposition of
liability without the proof of fault is a very harsh remedy according to jurisprudential aspect.
Further, a careful analysis of the judgments would lead to the conclusion that courts have at
the same time paradoxically accepted and rejected Rylands.
However, some basic changes were made to the application of the rule over a period of time
to incorporate the changing economic conditions. The amendments were brought out in the
Restatement of Torts (First) and (Second)17. Accordingly, section 519 of the Restatement
(Second) states that:
1. One who carries on an abnormally dangerous activity is subject to liability for harm to
the person, land or chattels of another resulting from the activity, although he has
exercised the utmost care to prevent the harm.
2. This strict liability is limited to the kind of harm, the possibility of which makes the
activity abnormally dangerous.
Section 520 of the Restatement (Second) provides18:
In determining whether an activity is abnormally dangerous, the following factors are to be
considered:
1. Existence of a high degree of risk of some harm to the person, land or chattels of
2.
3.
4.
5.
others;
Likelihood that the harm that results from it will be great;
Inability to eliminate the risk by the exercise of reasonable care;
Extent to which the activity is not a matter of common usage;
Inappropriateness of the activity to the place where it is carried on; and
17 http://law.wustl.edu/journal/53/200_.pdf
18 ibid.
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Therefore, we see that although the name remains the same, the principle has been evolved
from the principle affixing liability in the case of escape of water from a reservoir to one that
is the cornerstone for environment protection laws, in India as well as in America. The
general underlying principles remain the same the principle of polluter pays, rogue
industries (Enviro legal; case) etc., principles that are so very essential in maintaining the
sanctity of the environment in post-modern industrialized era.
Conclusion
The rule of absolute liability has become a messiah for the society, in the sense that it is one
rule that the society can always bank on for keeping establishments producing hazardous and
inherently dangerous products at bay. The rule of absolute liability provides an effective
weapon to the Indian Courts to effectively combat environmental pollution. The humane
aspect of the application of the rule of course, stands out. The untold misery suffered by the
people of Delhi, Bhopal, and many other cities and towns around the country; as exemplified
in the cases discussed ; makes the existence of such a rule all the more important.
While the courts in America have not made any specific rule such as the one in India until
recently, they have evolved their own existing principle of strict/absolute liability to suit their
needs. While the nomenclature is still a bit dubious with the interchangeable use of the words
strict and absolute; the rule has been able; to a very large extent; to help society counter
environmental pollution.
One aspect we can conclude that the principle is having some nexus with the violation of
fundamental right to clean environment extended under Article 21 and exemplary penalty can
be levied against corporations and industries with the necessity of bringing them under the
purview of Article 12 as compared to earlier stance of the court to enforce violation of
fundamental rights only against public bodies which are included under the term local and
other authorities under the Indian Constitution. Therefore, for the application of principle of
absolute liability in cases of environmental harm the settled law is that it is the constitutional
and statutory provisions to protect a persons right to fresh air, clean water and pollution free
environment and the source of the right is the inalienable common law right of clean
environment. Article 21 of the Constitution of India guarantees protection of life and personal
liberty which includes right to fresh air.22
22 Vellore Citizens Welfare Forum v Union of India, AIR1996SC2715
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Arguments have been put forth in courts that in commonwealth nations the principle of
absolute liability has not been well founded and therefore rule of strict liability must be the
criteria in such cases and the courts have held that this argument is untenable in light of the
decision by the court in oleum gas leak case. There have been debates over the intensity of
punishment in cases of absolute liability i.e. exemplary damages may damage the economic
set up of the concerned enterprise which may lead to loss of employment. This was on the
mind of the judges when Sri Ram case was heard and they had directed the company to
absorb all the employees while relocation and when some of the employees could not be
absorbed they were retrenched. The court in its judgment pointed the fact that one cannot shut
down industries altogether just for the reason they are located in dense population areas as it
would hamper the economic growth of the nation and it is something the nation must strive
for.
Analysis of the implications of Supreme Courts innovations for environmental jurisprudence
reveals that the application of creative methods to resolve disputes and implement Court
orders is certainly a deviation from the usual adjudicatory function of the Court. While the
procedural innovations have widened the scope for justice through recognition of citizens
right to healthy environment, entertaining petitions on behalf of affected people and
inanimate objects and creative thinking of judges to arrive at a decision by making spot visit,
substantive innovations have redefined the role of Court in the decision-making process
through application of environmental principles and expanding the scope of environmental
jurisprudence in particular. However, in reminding other organs about their Constitutional
duties and enforcing fundamental right of citizens, the Supreme Court has at times, crossed
its boundaries and has interfered in the very basic affairs of environmental management and
such cases require constant vigil over the scenario otherwise it might disrupt the entire
framework of development.
The expansive interpretation of Article 21 and the liberal interpretation of Article 32 and 226
are the remarkable development in the human rights to clean and wholesome environment in
India. The Article 21 of the Indian Constitution has been used by judiciary to implement the
principles of sustainable development, protecting the right to clean air, water and
environment; right to livelihood etc. the analysis of the case laws shows that the judiciary has
widened the scope of article 21 and implemented an international norm in a domestic law.
Article 48 A and 51 A (g) have been interpreted to substantiate this development.
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In the light many hurdles which are inhibiting the natural growth of tort law in India, the
recent development in combining tort law with the constitutional right to personal life and
liberty and its remedy through compensation is a good step, maybe on the verge of over-reach
in case of exemplary damages in absolute liability.
Bibliography
Books:
S.P.Sathe, Transgressing Borders and Enforcing Limits, 302 (7th Ed. 2010)
RatanLal & DhirajLal, Law of Torts, (G. P. Singh, Nagpur: Wadhwa and Company
Law Publishers, 2002).
Cases:
Websites:
www.manupatra.com
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