TITLE- Responsibility of industries in an accident, compensation, scope and ambit of the jurisdiction of the Supreme Court of India under Article 32

CASE NAME- M. C. Mehta & Anr v. Union of India & Ors

CITATION- 1987 SC 1086

COURT- the Supreme Court of India

BENCH/JUDGES- Bhagwati, P.N. (Cj)

DECIDED ON-  20 December 1986

BRIEF FACTS AND PROCEDURAL HISTORY:

1. MC Mehta filed a writ petition under Art. 21 and 32 of the Constitution Of India. He asked for the closure of Shri Ram foods and fertilizers because they were involved in manufacturing dangerous material.

2. When the petition was in the court there was a huge disaster incident that happened from one of its units. There was a leak of oleum gas which affected a number of people and even an advocate died because of this.

3. After the Bhopal Gas accident this incident shook people from inside out. After this incident factories were closed and authorities issued orders for inspection.

4. This incident happened just a few months before when the environment protection act was enacted and came into force.

ISSUES

1. Whether dangerous factories were permitted in the areas where it can be harmful?

2. Is there any strict mechanism involved in such cases?

3. How to fix the compensation amount?

4. On what grounds liabilities must be imposed?

RATIO

●  In the present petition the court stated that in this case the principle of  absolute liability applies.

●  It is true that factories and industries are important for the development of society and contribution to the economy of the country but not at the stake of people's lives. It is the responsibility of such companies to take reasonable care and caution while working on such dangerous machinery.

●  Before 1987 these factories used to escape from the loophole of the law which was a strict liability principle but in this case the court stated that this is a clear case of absolute liability.

●  The court also gave the reference of the case of Rylands vs Fletcher where it was stated that strict liabilities also have certain exceptions.

●  The court further stated that where the absolute liability is proved the industry is liable to pay compensation as per the injury or damage caused.

HELD

The Supreme Court's final decision was to allow Shriram to reopen the mentioned factories. His two orders dated December 7, 1985 and of Inspector General and Factory Deputy Director dated December 24 were not overturned, but both orders were suspended. The court granted a provisional permit to operate the facility, with 10 conditions and fines to be adhered to. The court also noted that failure to comply with the terms could result in the rescission of the approval granted by the court. 

Conditions given by the court to be followed was:

1. Implement all the recommendations given by experts.

2. Supervise the safety measures from time to time.

3. Surprise visit by the assigned officer or authority for inspection.

4. The court directed the owners to submit the undertaking which should be stated that in case of any future accidents they will be held liable.

5. Installation of loud speakers to announce the emergency in the factory or industry.