Supreme Court of India
UNION OF INDIA & ORS.versusM/S. UNION CARBIDE CORPORATION & ORS
- Citation
- 2023 INSC 222
- Decided
- 14 March 2023
- Disposal
- Dismissed
- Bench
- SANJAY KISHAN KAUL
Holding
The curative petitions are not maintainable and the 1989 settlement cannot be reopened or increased; the petitions are dismissed.
Summary
The Supreme Court considered curative petitions filed by the Union of India seeking to increase the US$470 million settlement awarded in 1989 for the Bhopal gas disaster. The Union claimed errors in victim counts, inflation, and additional environmental and rehabilitation costs, arguing that the original settlement was insufficient. The Court examined the maintainability of the curative petitions under the limited criteria laid down in Rupa Ashok Hurra and noted that the Union had not pursued a review. It observed that the settlement was based on the urgent need for immediate relief, that surplus funds remained with the Reserve Bank of India, and that the settlement amount was in excess of actual requirements. The Court held that there is no legal basis to "top up" the settlement and that the curative jurisdiction cannot be used to reopen a final judgment. Consequently, the petitions were dismissed, leaving the parties to bear their own costs.
Issues considered
- The curative petitions filed by the Union of India are maintainable under the criteria for curative jurisdiction.
- Whether the 1989 settlement can be reopened or increased on the ground of alleged errors in victim numbers, inflation, and additional costs.
- Whether the Union can shift liability for any deficiency or insurance obligations to Union Carbide Corporation.
- Whether the Court can invoke Article 142 to modify the settlement amount.
Legislation cited
Subjects
Bhopal gas tragedysettlementcurative petitionfinality of judgmentcompensationBhopal Gas Leak Disaster (Processing of Claims) Act, 1985review jurisdictionnatural justiceArticle 142liabilityinsurance
Judgment
[2023] 2 S.C.R. 881 881
UNION OF INDIA & ORS. A
v.
M/S. UNION CARBIDE CORPORATION & ORS.
(Curative Pet (C) No. 345-347 of 2010)
MARCH 14, 2023 B
[SANJAY KISHAN KAUL, SANJIV KHANNA,
ABHAY S. OKA, VIKRAM NATH AND
J. K. MAHESHWARI, JJ.]
Bhopal Gas Tragedy Case – Curative petitions filed by the
C
Union of India seeking increase in the settlement amount – Held:
Present petitions were filed by the Union of India 19 years post the
settlement seeking to reopen the same – The very basis for the original
settlement was the need to provide immediate succour to the victims
through medical relief, rehabilitation measures etc. – Without a
settlement, immediate funds would not have been available for the D
victims – Finality was reached at an early stage by way of the
settlement – Endeavours to reopen the same proved unsuccessful –
Now the curative petitions have been filed by the Union of India
having not filed review petitions – Further, admittedly, the amount
of settlement was found to be in surplus of the actual requirement –
E
Thus, settlement amount was sufficient to compensate the claimants
– Rs.50 crore remains with the Reserve Bank of India lying
undisbursed – The exchange rate worked in the Union’s favour as
the exchange rate of the Dollar rate escalated – Some interest on
the settlement amount also came in – Furthermore, in the review
judgment, in case of a shortage, the responsibility was placed on F
the Union of India to make good the deficiency and to take out the
relevant insurance policies – However, no such insurance policy
was taken out – The Union cannot be negligent on this aspect and
then seek a prayer to fix such liability on UCC – Rs.50 crore lying
with the RBI to be utilised by the Union of India to satisfy pending
G
claims, if any, in accordance with the 1985 Act and the Scheme
framed thereunder – Union of India’s claim for ‘topping up’ the
settlement amount has no foundations in any known legal principle
– Curative petitions not entertained – Bhopal Gas Leak Disaster
(Processing of Claims) Act, 1985.
H
881
882 SUPREME COURT REPORTS [2023] 2 S.C.R.
A Curative petition – Held: A curative petition relates to a re-
examination of a final judgment of Supreme Court that has already
undergone such re-examination through the review jurisdiction –
Court’s inherent power ought not to be exercised as a matter of
course – Court should be circumspect in reconsidering an order
that had become final on dismissal of the review petition – However,
B
in the present case in view of the nature of the matter, the curative
petitions were examined despite the preliminary objection on
maintainability.
Union Carbide Corporation v. Union of India & Ors.
(1989) 3 SCC 38 : [1989] 3 SCR 128; Union Carbide
C Corporation & Others v. Union of India & Others (1991)
4 SCC 584 : [1991] 1 Suppl. SCR 251; Bhopal Gas
Peedith Mahila Udyog Sangathan & Anr. v. Union of
India & Ors. (2007) 9 SCC 707 : [2007] 6 SCR 24;
Rupa Ashok Hurra v. Ashok Hurra & Anr. (2002) 4
D SCC 388 : [2002] 2 SCR 1006; Union Carbide
Corporation Ltd. v. Union of India (2006) 13 SCC 321
– referred to.
Case Law Reference
[1989] 3 SCR 128 referred to Para 6
E
[1991] 1 Suppl. SCR 251 referred to Para 9
[2007] 6 SCR 24 referred to Para 13
[2002] 2 SCR 1006 referred to Para 23
CIVIL APPELLATE JURISDICTION: Curative Pet (C) No. 345-
F
347 of 2010 in R.P. No. 229 of 1989 & 623-624 of 1989 in C.A. No.3187-
3188 of 1988 and SLP (C) No. 13080 of 1988.
From the Judgment and Order dated 24.02.1989 in R.P. (C) No.
229 of 1989 and dated 15.02.1989 in R.P. (C) Nos. 623 and 624 of 1989
of the Supreme Court of India.
G
R. Venkataramani, AG, Ms. Madhvi Divan, A.S.G., Saurabh
Mishra, A.A.G., R. Balasubramiam, S. Wasim A Qadri, Harish N Salve,
Ravindra Shrivastav, Sidharth Luthra, Sanjiv Sen, Sanjay Parikh, Naveen
R. Nath, Sr. Advs., Gurmeet Singh Makker, Ms. Chinmayee Chandra,
Ms. Shradha Deshmukh, Mrs. Vijayalakshmi Venkataramani, Anandh
H
UNION OF INDIA & ORS. v. M/S. UNION CARBIDE 883
CORPORATION & ORS.
Venkataramani, Vinayak Mehrotra, Chitvan Singhal, Ms. Mansi Sood, A
Ms. Sonali Jain, Abhishek Kumar Pandey, Raman Yadav, Nakul
Chengappa K.K., Ms. Akriti A Manubarwala, Shreekant Neelappa Terdal,
Ms. Karuna Nundy, Ms. Aparna Bhat, Ms. Karishma Maria, Nischal
Anand, Rahul Narayan, Ms. Muskan Tibrewala, Amanpreet Singh, Ragini
Nagpal, Ishaan Karki, Sanchith Shiva Kumar, Mrs. Shiraz Contractor
B
Patodia, Ashish Singh, Ms. Divya Sharma, Ms. Juhi Chawla, Mayank
Singhal, Ms. Sanya Shukla, Ms. Devangna Singh, Ms. Gayatri Goswami,
Pankaj Singhal, Shakti Singh, Ayush Anand, Ieshan Sharma, Aditya
Ghadge, Mrs. Bina Gupta, Ms. Bharti Badesra, Ms. Anjali Singh, Gautam
Khaitan, A.T. Patra, Anuj Kapoor, Rahul Jain, Satwik Parik, Ms. Soumya
Tandan, Mrinal Gopal Elker, Ms. Mrinal Elker Mazumdar, Sunny C
Choudhary, Advs. for the appearing parties.
The following Order of the Court was passed:
ORDER
1. A horrendous tragedy occurred on the night of 2nd and 3rd D
December 1984, due to the escape of deadly chemical fumes from the
factory owned and operated by M/s Union Carbide India Limited
(hereinafter referred as ‘UCIL’) in Bhopal. This Court labelled the mass
disaster as “unparalleled in its magnitude and devastation and … a ghastly
monument to the dehumanizing influence of inherently dangerous
technologies”. Union of India has filed the present curative petitions E
seeking reconsideration of the settlement that was effected in the
aftermath of the tragedy.
Background and claims in the present petitions
2. In order to provide remuneration to victims, and to create an F
institutional framework for disbursal of remedies, the Bhopal Gas Leak
Disaster (Processing of Claims) Act, 1985 (hereinafter referred as ‘the
said Act’), was enacted by the Government of India on 20.02.1985.
This granted the Central Government an exclusive right to represent
and act in place of every person who was entitled to make a claim for
compensation. It also empowered the Central Government to institute G
suits or other proceedings and to enter into a compromise. Consequently,
the Bhopal Gas Leak Disaster (Registration and Processing of Claims)
Scheme, 1985, was framed in exercise of powers conferred under
Section 9 of the said Act. This Scheme dealt with the procedure for
H
884 SUPREME COURT REPORTS [2023] 2 S.C.R.
A filing and processing of claims made to the Welfare Commissioner as
per Section 6 of the said Act.
3. Thereafter, several actions for compensation were brought in
the United States District Court for the Southern District of New York
against Union Carbide Corporation (hereinafter referred as ‘UCC’).
B UCC was a New York based corporation which owned 50.9% stock in
UCIL at the time of the tragedy. UCC resisted the jurisdiction of the
New York Court on grounds of forum non conveniens, claiming that it
had subjected itself to the Courts of India. Judge Keenan allowed this
plea vide order dated 10.06.1986 and dismissed the consolidated action
on the basis of several factors, including the presence of witnesses and
C evidence in India. The order however recorded UCC’s statement that it
shall consent to submit to the jurisdiction of the Courts of India.
4. As a result of the same, a suit was filed by the Union of India
against UCC before the District Judge, Bhopal, seeking compensation
of approximately US $ 3.3 billion. Being apprehensive about funds being
D made available for compensation to victims, the Union sought interim
compensation from UCC. This prayer received a favourable
consideration from the District Judge, who passed an interim order on
17.12.1987 directing UCC to deposit a sum of Rs. 350 crores by way of
interim compensation. However, in a revision petition(s) filed by UCC,
E this amount was reduced to Rs. 250 crores by the Madhya Pradesh
High Court vide an order dated 04.04.1988.
5. Being aggrieved by this order, both contesting parties i.e. Union
of India and UCC, filed SLPs before this Court. In terms of orders
passed in those proceedings, the parties endeavoured to negotiate a
F settlement, possibly with a little nudge from the Court. The endeavour
was successful and 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 this Court passed on 14 th and 15th February,
1989. This Court observed that there had been careful consideration for
G several days to the facts and circumstances placed before the Court by
the parties; including the pleadings, data, material relating to proceedings
in the Courts of USA, the offers and counter offers between the parties
at different stages of various proceedings, the complex issues of law
and facts raised, as well as the enormity of human suffering occasioned
H by the Bhopal Gas disaster and the pressing urgency to provide immediate
UNION OF INDIA & ORS. v. M/S. UNION CARBIDE 885
CORPORATION & ORS.
and substantial relief to victims of the disaster. Thus, it was observed A
that a sum of US $ 470 million would be just, equitable, and reasonable.
This was to be paid on or before 31.03.1989 and all civil and criminal
proceedings were to be closed in the process.
6. A detailed order setting out the reasons that persuaded this
Court to make the order of settlement was passed thereafter on B
04.05.1989, reported as Union Carbide Corporation v. Union of India
& Ors.1 We would like to highlight a few aspects of the said order. This
Court noted that the basic consideration motivating the settlement was
the compelling need for urgent relief. It was considered necessary to
grant immediate remedy as it was a question of survival for the thousands
of persons rendered destitute by the ghastly disaster. Regarding the C
quantum of the settlement, this Court added a caveat in paragraph 14 of
the said order. It was observed that if any material was placed before
the Court for drawing a reasonable inference that UCC had earlier offered
to pay any sum higher than the out-right down payment of US $ 470
million; it would result in the Court initiating a suo motu action, requiring D
the parties to show why the settlement should not be set aside and the
parties relegated to their respective original positions. Discussion then
proceeded to the reasonableness of the settlement amount. It was opined
that the question of reasonableness need not necessarily be construed
on the basis of an accurate assessment by way of adjudication. Instead,
the quantum was a broad and general estimate. What was significant E
was whether such settlement would avoid delays, uncertainties, and
assure immediate payment. The Court considered it appropriate to
proceed on some prima facie undisputed figures of cases of death and
of substantially compensatable personal injuries. This Court referred to
the factual scenario emanating from the High Court order dated F
04.04.1988, where it was recorded that as per the Union of India, a total
number of 2660 persons died and between 30,000 to 40,000 sustained
serious injuries as a result of the disaster. The figures before the Supreme
Court at the time were stated to be about 3000 fatal cases, and the
number of grievous and serious personal injuries was about 30,000, as
verifiable from hospital records. In estimating the amount of compensation, G
this Court set out the following basis in paragraph 24, which reads as
under:
1
(1989) 3 SCC 38. H
886 SUPREME COURT REPORTS [2023] 2 S.C.R.
A “24. So far as personal injury cases are concerned, about
30,000 was estimated as cases of permanent total or partial
disability. Compensation ranging from Rs. 2 lakhs to
Rs. 50,000 per individual according as the disability is total
or partial and degrees of the latter was envisaged. This alone
would account for Rs. 250 crores. In another 20,000 cases
B
of temporary total or partial disability compensation ranging
from Rs. 1 lakh down to Rs. 25,000 depending on the nature
and extent of the injuries and extent and degree of the
temporary incapacitation accounting for a further allocation
of Rs. 100 crores, was envisaged. Again, there might be
C possibility of injuries of utmost severity in which case even
Rs. 4 lakhs per individual might have to be considered. Rs.
80 crores, additionally for about 2000 of such cases were
envisaged. A sum of Rs. 500 crores approximately was thought
of as allocable to the fatal cases and 42,000 cases of such
serious personal injuries leaving behind in their trail total or
D
partial incapacitation cither of permanent or temporary
character.”
7. Outlays were also made for specialised institutional medical
treatment (Rs. 25 crores) and provision for cases which were not of
permanent/temporary disabilities but of minor injuries, loss of personal
E belongings, loss of livestock etc. (Rs. 225 crores). The interest accruing
on the corpus of settlement was also taken into account, being 14% to
14 ½ %.
8. On the aspect of the aforesaid broad allocations, it was clearly
observed that even if a particular case was found to fall within such
F broad categories, the determination of actual compensation payable to
the claimant had to be done by the authorities under the said Act.
However, the Court concluded that if the total number of cases of death
or disability became so large so as to counter the ‘basic assumptions
underlying the settlement’, then it would not hesitate to exercise its
G powers of review.
9. The next round in the matter related to an endeavour by private
parties to open the settlement by filing a review, inter alia on the powers
of this Court to record a settlement. A Constitution Bench examined this
issue in the Union Carbide Corporation & Others v. Union of India
H
UNION OF INDIA & ORS. v. M/S. UNION CARBIDE 887
CORPORATION & ORS.
& Others. 2 The settlement was upheld with one caveat. The A
extinguishment of criminal liabilities by the settlement was held to not be
appropriate and thus, that aspect of the original order was reviewed. As
to the need to arrive at a settlement, Ranganath Mishra, J. (as he then
was) detailed the factors that had guided this Court. The Court had to be
cognizant of the fact that the Indian assets of UCC, through UCIL were
B
around Rs. 100 crores at the time. Thus, any decree in excess of that
amount would have to be executed in the courts of USA. If such decree
were determined on the basis of prevailing law in India, i.e. absolute
liability (different from the accepted basis in the USA, i.e. strict liability);
the decree would be open to challenge on the grounds of due process
and may not be executable. On this aspect, the principal judgment of the C
majority laid emphasis on balancing factors such as the need for expedient
relief, as recorded in the original judgment. In so far as the present
controversy before us is concerned, we would like to flag the Court’s
observations on the path to be followed if the compensation is found to
be inadequate. These are set out in paragraph 198 of Union Carbide
D
Corporation & Others v. Union of India & Others3, which reads as
under:
“198. After a careful thought, it appears to us that while it
may not be wise or proper to deprive the victims of the benefit
of the settlement, it is, however, necessary to ensure that in
the — perhaps unlikely — event of the settlement fund being E
found inadequate to meet the compensation determined in
respect of all the present claimants, those persons who may
have their claims determined after the fund is exhausted are
not left to fend themselves. But, such a contingency may not
arise having regard to the size of the settlement fund. If it F
should arise, the reasonable way to protect the interests of
the victims is to hold that the Union of India, as a welfare
State and in the circumstances in which the settlement was
made, should not be found wanting in making good the
deficiency, if any. We hold and declare accordingly.”
G
10. The aforesaid would show that the burden would fall on the
Union of India, as a welfare state, to protect the interest of the victims.
2
(1991) 4 SCC 584.
3
(supra). H
888 SUPREME COURT REPORTS [2023] 2 S.C.R.
A It is to be noted that Ahmadi J., dissented on this aspect of liability of the
Union. However, naturally, the majority view prevails.
11. Another aspect noted in the review was qua the members of
the population of Bhopal who were put at risk; and who though
asymptomatic at the time and not having filed for compensation, might
B become symptomatic in future. In addition, care had to be taken of unborn
children of mothers exposed to toxicity, where such children later develop
congenital defects. For such an eventuality, a medical group insurance
cover was envisaged. This is set out in paragraph 207 of Union Carbide
Corporation & Others v. Union of India & Others4, which reads as
under:
C
“207. We are of the view that such contingencies shall be
taken care of by obtaining an appropriate medical group
insurance cover from the General Insurance Corporation of
India or the Life Insurance Corporation of India for
compensation to this contingent class of possible prospective
D victims. There shall be no individual upper monetary limit for
the insurance liability. The period of insurance cover should
be a period of eight years in the future. The number of persons
to be covered by this Group Insurance scheme should be about
and not less than one lakh of persons. Having regard to the
E population of the seriously affected wards of Bhopal city at
the time of the disaster and having regard to the addition to
the population by the subsequent births extrapolated on the
basis of national average of birth rates over the past years
and the future period of surveillance, this figure broadly
accords with the percentage of (sic the) population of the
F affected wards bears to the number of persons found to be
affected by medical categorisation. This insurance cover will
virtually serve to render the settlement an open ended one so
far as the contingent class of future victims both existing and
after-born are concerned. The possible claimants fall into
G two categories: those who were in existence at the time of
exposure; and those who were yet unborn and whose
congenital defects are traceable to MIC toxicity inherited or
derived congenitally.”
4
H (supra)
UNION OF INDIA & ORS. v. M/S. UNION CARBIDE 889
CORPORATION & ORS.
12. There is no dispute that the compensation was deposited within A
time.
13. Subsequently, certain endeavours were made on behalf of
victims from time to time to open up the settlement. However, these
were opposed by the Union of India and were not successful. The most
recent such attempt was Bhopal Gas Peedith Mahila Udyog B
Sangathan & Anr. V. Union of India & Ors.5
14. We are confronted here with an application filed under this
Court’s curative jurisdiction by the Union of India 19 years post the
settlement (i.e. in 2010) seeking to reopen the same. It is noteworthy
that the Union chose not to file the review petitions which culminated in C
this Court’s order dated 02.05.1989. Naturally, the present petitions have
been strongly opposed by UCC, whereas groups stated to be representing
the victims have endeavoured to ride piggyback on the curative petitions.
15. The curative petitions are broadly predicated on account of
“wrong assumption of facts and data” which undergirded the quantum D
of the settlement. Thus, the plea is that this ‘incompleteness of facts’,
particularly with respect to the number of victims, has vitiated the
settlement itself. On this basis, the settlement amount needs to be re-
examined by this Court. Nevertheless, we may note that the Union of
India was quite conscious of the fact that if the settlement were to be
reopened, it would result in a revival of the suit, something which the E
Union has not even claimed. What the Union of India claims in essence
is to top up the settlement i.e. maintain the factum of the settlement but
to increase the amount as canvassed by Mr. R. Venkataramani, the
learned Attorney General.
16. The Union of India’s claims, as set out in the petitions, are F
based on three categories:
“Claim – I: Claim on account of incorrect and wrong
assumption of facts and data in the impugned judgments and
orders on following grounds:
G
(i) Error in computation of Death Cases – Court recorded the
estimated number of death cases was 3,000 whereas actual
figure of death is 5,295 cases.
5
(2007) 9 SCC 707. H
890 SUPREME COURT REPORTS [2023] 2 S.C.R.
A (ii) Error in computation of Temporary Injury Cases – Court
recorded the estimated number of temporary disability cases
was 20,000 whereas actual figure of temporary disability is
35,455 cases.
(iii) Error in computation of Minor Injury Cases – Court
B recorded that the estimated number of Minor Injury cases
was 50,000 whereas actual figure of Minor Injury is 5,27,894
cases.
(iv) Other Cases – In certain categories (viz. Permanent
disability, utmost severe injuries, loss of property and loss of
C livestock), the actual number assumed by the court has been
found to be on the higher side resulting in the extra provision
of compensation in those categories.”
17. The total amount claimed under this category was Rs. 675.96
crore at the time of filing the curative petitions. This Court vide order
D dated 11.10.2022 requested for the latest figures available as on the said
date. These details have been set out in tabular form below:
E
F
G
18. The last column of the chart shows the additional amount
required to be paid. While there is an increase in the amount required for
compensation for death and temporary disability, there is also a decrease
in the amounts required for cases of permanent disability and utmost
H
UNION OF INDIA & ORS. v. M/S. UNION CARBIDE 891
CORPORATION & ORS.
severe cases, as also for loss of property and loss of life. This may have A
been the result of some changes in the categorisation of cases on account
of the available material. The real increase is on account of minor injuries
where it is stated that the additional amount required is of Rs. 955.45
crores. Undoubtedly, a decision was taken by the Government of India
on 08.09.1992 to increase the amount of compensation to victims in
B
view of representations filed by various social action groups.
“Claim – II: Claim of Rs.1,743.15 cr. on account of actual
expenditure incurred by the State towards relief and
rehabilitation measures.”
19. The aforesaid claim was further updated to Rs. 4,949.67 crores. C
“Claim – III: Claim of Rs.315.70 crore on account of
environment degradation.”
20. The updated amount under this category is Rs. 486.78 crores.
21. The Union of India has also claimed that since the revised D
amount is being claimed a number of years after the settlement; several
aspects, such as the devaluation of the rupee, interest rate, purchasing
power parity, and the inflation index ought to be taken into account.
These considerations were pleaded in alternative and are summarized in
the following table:
E
* Calculations based on Yearly LIBOR
F
$ Calculations by applying Consumer Price Index (CPI) for
industrial workers
&
Calculations based on 7% Compound Interest
UCC’s Submissions
G
22. The curative petitions were strongly opposed by Mr. Harish
Salve, learned senior counsel appearing for UCC.
23. The preliminary objection was on the very maintainability of a
curative petitions after two decades of the settlement. It was submitted
that this was in breach of the principles enshrined in Rupa Ashok Hurra
H
892 SUPREME COURT REPORTS [2023] 2 S.C.R.
A v. Ashok Hurra & Anr.6, wherein this Court had specified very limited
contours for its curative jurisdiction:
“51. Nevertheless, we think that a petitioner is entitled to relief
ex debito justitiae if he establishes (1) violation of principles
of natural justice in that he was not a party to the lis but the
B judgement adversely affected his interests or, if he was a party
to the lis, he was not served with notice of the proceedings
and the matter proceeded as if he had notice and (2) where in
the proceedings a learned Judge failed to disclose his
connection with the subject-matter or the parties giving scope
for an apprehension of bias and the judgment adversely
C affects the petitioner.”
24. It was submitted that the present curative petitions did not fall
under any of these parameters. Counsel for UCC also highlighted another
procedural deficiency on the basis of paragraph 52 of Rupa Ashok
Hurra,7 wherein the petitioner is required to specifically aver that the
D grounds mentioned in the curative petition had been taken in the review
petition and subsequently dismissed by circulation. Since Union of India
had not filed review petition(s), the curative petitions ought to be thrown
out at the threshold.
25. In response, the Learned Attorney General contended that it
E was this Court’s prerogative to chart a new course in terms of its curative
jurisdiction, and to not limit itself to the extant norms specified in Rupa
Ashok Hurra.8
On maintainability
F 26. On this preliminary point, we may note that a curative petition
relates to a re-examination of a final judgment of this Court, particularly
one that has already undergone such re-examination through the Court’s
review jurisdiction. Since this Court’s review jurisdiction itself is so
restrictive, we find it difficult to accept that this Court can devise a
curative jurisdiction that is expansive in character.
G
27. On the facts of this case, we have already noticed that when
review petitions were filed against the orders recording the settlement,
the Union of India sought to support the same. However, the Union
6
(2002) 4 SCC 388.
7
(supra).
8
H (supra).
UNION OF INDIA & ORS. v. M/S. UNION CARBIDE 893
CORPORATION & ORS.
subsequently opposed all other applications filed for reopening the A
settlement. We understand that such a strategy was adopted as the Union
of India’s endeavour is not to set aside the settlement but merely to ‘top
up’ the settlement amount.
28. We have great hesitation in allowing such a prayer and granting
such sui generis relief through the means of curative petitions. Although B
this Court in Rupa Ashok Hurra9 chose not to enumerate all the grounds
on which a curative petition could be entertained; the Court was clear in
observing that its inherent power ought not to be exercised as a matter
of course, and that it should be circumspect in reconsidering an order of
this Court that had become final on dismissal of the review petition.
Nevertheless, looking at the nature of the matter before us, it would be C
advisable to also examine the curative petition(s), apart from the aforesaid
preliminary objection.
On Merits
29. Turning to the objections on merits of the claims in the curative D
petitions, counsel for UCC emphasised that the US$ 470 million (Rs.
750 crore), required to be deposited were so deposited and, thus, if the
settlement is to be set aside, then the only consequence would be to
revive the suit. As a corollary, the Union of India would be required to
lead evidence to establish UCC’s liability, and UCC would be entitled to
have US$ 470 million remitted back to it by the Union of India with E
interest.
30. It was pointed out that an endeavour was made in the year
2007 by way of interlocutory applications to seek enhancement of the
settlement fund by private organisations. This prayer was rejected by
this Court in Bhopal Gas Peedith Mahila Udyog Sangathan10 on the F
ground that re-examination of the settlement could not be done as the
issue had already been decided. With regards to individual victims and
organisations, any grievances towards the amount of compensation had
to be taken up before the appropriate authorities constituted under the
said Act. It is noteworthy that the Union of India had opposed the plea G
of the private parties, and had taken a stand before this Court that claims
had been adjudicated and compensation had been paid in terms of the
scheme devised under the said Act.
9
(supra).
10
(supra). H
894 SUPREME COURT REPORTS [2023] 2 S.C.R.
A 31. The aforesaid was the latest endeavour prior to the filing of
the present curative petitions. However, even before this, certain private
organisations had filed interlocutory applications for disbursal of the
surplus amount left from the settlement fund. This Court in Union
Carbide Corporation Ltd. V. Union of India 11 observed that
approximately Rs. 1,503.01 crores from the settlement fund were available
B
as on that date, and thus ordered that this amount be distributed on pro
rata basis to those persons whose claims had been settled.
32. There appear to be two reasons for the growth of the fund –
(a) interest on it and (b) more importantly, an exchange rate fluctuation
in favour of the US Dollar. We may hasten to add that the learned
C Attorney General was correct in submitting that UCC could not have
taken benefit of a hypothetical fluctuation in the opposite direction, i.e. in
favour of the Rupee. Nevertheless, the fact remains that the settlement
fund, and the disbursement from the same underwent a significant
increase considering the lapse of time.
D 33. Next, learned counsel for UCC contended that the language
of this Court’s orders dated 14.02.1989 and 15.02.1989 left no doubt as
to the comprehensive nature of the settlement. UCC had agreed to the
settlement even without a finding as to its liability. UCC’s Indian holding,
i.e. UCIL had been wound up. The settlement was accepted only on the
E basis that it was an overall settlement, which ended its potential exposure
towards any legal proceedings. As a final stamp upon the settlement;
this Court’s order dated 15.02.1989 had imposed a duty on the Union of
India and the State of Madhya Pradesh to ensure that any suit, claim, or
civil complaint filed in the future against UCC would be defended by the
Union of India and would be disposed of in terms of the said order.
F
34. It was urged that the review judgment had confirmed the
‘basic assumptions underlying the settlement’ and the settlement itself
had been upheld, save the aspect of closure of criminal proceedings.
Moreover, the issues sought to be raised in the present curative petitions
were in fact raised in the review petitions filed by the private parties and
G were finally decided by the order of this Court dated 03.10.1991.
35. Thus, it was contended that the substance of Union of India’s
Claim-I, i.e. on account of error in computation of deaths, injuries etc.
had actually been addressed by this Court in its review judgment. This
11
H (2006) 13 SCC 321.
UNION OF INDIA & ORS. v. M/S. UNION CARBIDE 895
CORPORATION & ORS.
Court had dealt with the risk of asymptomatic individuals later becoming A
ill and had directed the Union of India to obtain insurance cover for eight
years and to provide free medical monitoring and treatment of victims.
In case of any deficit in the settlement fund, the responsibility was placed
on the Union of India as a welfare State to fulfil such deficiency. Mr.
Salve emphasised that it would be hazardous to belittle the advantages
B
of a settlement by questioning it on the anvil of adequacy or fairness,
considering the complexity of the matter and the need to protect victims
from the prospects of a protracted, exhausting, and uncertain litigation.
36. It was further contended that the settlement decree passed
by this Court was not an adjudication upon either UCC’s liability or the
quantum of compensation payable, as the suit never went to trial. A C
consensual settlement cannot be unilaterally enhanced without the consent
of both the parties. The Union of India has not brought forth any allegation
against the settlement or any ground to set it aside. The Union was fully
aware of the consequences of setting aside the settlement and thus,
restricted their petitions to a prayer for ‘topping up’ the settlement amount. D
37. It was also emphasised that there was no basic assumption
that could be considered to have gone wrong. In the table reproduced
above, it would appear that the only head in which there was any major
change was with respect to ‘minor injuries’. This however resulted from
the Union’s own categorisation of injuries suffered in the aftermath of E
the tragedy, and their decision to expand the coverage of relief to a
larger number of individuals. This was possible only because of the large
amount of funds available with the Union, as is evident from the fact
that this Court had in its order dated 19.05.2004 noted the availability of
more than Rs. 1,500 crores available with the RBI and consequently
awarded disbursal of the same on a pro rata basis. The Welfare F
Commissioner had recorded that after paying Rs.1,548.95 crores in the
first round, a further Rs.1,509.14 crores had been disbursed on pro rata
basis. Thus, a total of over Rs.3,000 crore had been paid to the victims.
38. In fact, it is admitted before us by the learned Attorney General
that a sum of Rs. 50 crore was still lying with the Reserve Bank of India G
to take care of victims.
39. We may note that the intervenors, who are organisations
representing victims, have also raised a similar line of arguments and
their prayer is also to enhance the settlement amount. Mr. Sanjay Parekh,
H
896 SUPREME COURT REPORTS [2023] 2 S.C.R.
A learned senior counsel, while seeking enhancement appeared to mirror
the arguments of the learned Attorney General. In addition, he prayed
for digitisation of medical records for the benefit of victims who had
been attended to in the hospitals so as to enable a fair assessment of
their injuries. This aspect is however stated to be pending before the
Madhya Pradesh High Court.
B
Analysis
40. We have bestowed our anxious consideration to the arguments
put forth by both sides. While we sympathize with the victims of the
awful tragedy, we are unable to disregard settled principles of law,
C particularly at the curative stage. Mere sympathy for the sufferers does
not enable us to devise a panacea; more so while looking into the nature
of dispute, and the multifarious occasions on which this Court has applied
its mind to the settlement.
41. The very basis for the original settlement was the need to
D provide immediate succour to the victims - through medical relief,
rehabilitation measures, setting up of facilities etc. This has been clearly
observed by this Court at every step; be it in the orders recording the
settlement, the order detailing reasons for the same, and the review
judgment. We thus do not appreciate the endeavour by Ms. Karuna
Nundy, counsel for the intervenors, in making out a case that there was
E a ‘midnight settlement’ whereby a fraud was played upon this Court and
the Union. The Court was clearly occupied with the aspect of a settlement
being entered into, and it was found, after a number of sittings and rounds
of hearings, that this was the most appropriate course of action.
42. On the aspect of adequacy, we must also take note of the
F factual scenario which emerges as per the figures of the Union itself.
Except for cases of minor injuries, the settlement amount was actually
in excess as is apparent from the table reproduced above. As far as the
issue of minor injuries is concerned, it appears from the Union’s own
affidavit in IA Nos. 48-49/2004 in Civil Appeal No. 3187-88 of 1998 that
G in cases of injury, Rs. 50,000 to Rs. 4 lakh (original and pro rata
compensation) and an additional Rs. 50,000 were paid in cases of mere
presence in the gas affected areas of Bhopal on the fateful night. It has
also been admitted in the said affidavit that the amount of compensation
for all categories was allocated on the higher side, and after disbursal of
the leftover amount on a pro rata basis, the overall rate of compensation
H
UNION OF INDIA & ORS. v. M/S. UNION CARBIDE 897
CORPORATION & ORS.
has in fact been doubled. Suffice for us to say that as per the learned A
Attorney General, a figure of Rs. 50 crore remains with the Reserve
Bank of India lying undisbursed.
43. We are conscious of the fact that the exchange rate worked
in the Union’s favour as the exchange rate of the Dollar rate escalated.
Some interest on the settlement amount also came in. This has allowed B
the Union to work out a more wholesome allotment for the claimants.
44. We are cognizant that no amount is truly adequate when such
incidents occur. Nevertheless, a monetary determination had to take
place, and the only compensatory mechanism known to common law is
that of a lump-sum settlement. This was deemed far more preferable to C
the alternative option, whereby the suit would be allowed to be tried
without a reasonable expectation of knowing when the trial would come
to an end. This determination would of course be subject to further appeals
and the process of execution, particularly as UCIL’s assets in India were
only about Rs. 100 crores. Without a settlement, immediate funds would
not have been available for the victims. All these factors weighed with D
this Court while arriving at the settlement.
45. It is the Union’s own stand that the Commissioner has
adjudicated all claims through procedure established by law where the
possibility of appeal was provided. Further, it has been admitted in the
proceedings culminating in this Court’s order dated 19.07.2004 that the E
amount of settlement was found to be in surplus of the actual requirement,
and thus the claimants had been “provided compensation that was
more than what was reasonably awardable to them under law”. This
reinforces the position that the settlement amount was sufficient to
compensate the claimants. F
46. The Union has filed the present curative petitions seeking to
reopen the settlement after opposing attempts by private parties to do
so. The scenario arising in case of a shortage was clearly outlined in the
review judgment, i.e. the responsibility was placed on the Union of India,
being a welfare State to make good the deficiency and to take out the G
relevant insurance policies. Surprisingly, we are informed that no such
insurance policy was taken out. This is gross negligence on part of the
Union of India and is a breach of the directions made in the review
judgment. The Union cannot be negligent on this aspect and then seek a
prayer from this Court to fix such liability on UCC.
H
898 SUPREME COURT REPORTS [2023] 2 S.C.R.
A 47. Union of India’s claim for a ‘top up’ has no foundations in any
known legal principle. Either a settlement is valid or it is to be set aside
in cases where it is vitiated by fraud. No such fraud has been pleaded by
the Union, and their only contention relates to a number of victims, injuries,
and costs that were not contemplated at the time the settlement was
effected. There is also specifically no pleading under the heading of
B
Claims 2 and 3 that can be said to be admissible, or one that could not be
envisaged at the stage of settlement. It was known that medical facilities
would have to be extended to rehabilitate people and there was bound to
be environmental degradation. In fact, it is the UCC’s allegation that the
Union and State Governments did not proactively detoxify or decomission
C the site, thereby aggravating the problem. In any case, this cannot be a
ground to seek annulment of the compromise, particularly as the settlement
had to be reached in an expedient manner. The learned Attorney General’s
response has been that a method for ‘topping up’ the settlement amount
be devised under Article 142 of the Constitution of India. We believe this
would not be an appropriate course of action or a method to impose a
D
greater liability on UCC than it initially agreed to bear.
48. We are equally dissatisfied with the Union being unable to
furnish any rationale for raking up this issue more than two decades
after the incident. Even assuming that the figures of affected persons
turned out to be larger than contemplated earlier, an excess amount of
E funds remained available to satisfy such claims. The Welfare
Commissioner has in fact held in its order dated 31.01.2009 that on
including the pro rata compensation, nearly six times the amount of
compensation has been disbursed to victims in comparison with Motor
Vehicle Accident claims. This order came in an application filed by
F organisations who sought enhancement of their claim amounts due to
fluctuation in the conversion value of the Dollar vis-à-vis the Rupee
prevailing at the time of the settlement in 1989. A sum of Rs.50 crore
lying with the RBI shall be utilised by the Union of India to satisfy pending
claims, if any, in accordance with the Bhopal Gas Leak Disaster
(Processing of Claims) Act, 1985 and the Scheme framed thereunder.
G
49. Providing closure to a lis is also a very important aspect. This
is more so in the context of the scenario faced by the Indian judiciary,
where delay is almost inevitable. This concern would be further amplified
in respect of a tort claim such as the present one - if evidence were to
be led for each claimant, this would open a pandora’s box in UCC’s
H
UNION OF INDIA & ORS. v. M/S. UNION CARBIDE 899
CORPORATION & ORS.
favour and would only be to the detriment of the beneficiaries. The A
money was needed in the immediate aftermath of the tragedy and not
after three decades.
50. Thus, finality was reached at an early stage by way of the
settlement. Endeavours to reopen the same proved unsuccessful. Now
the curative petitions have been filed by the Union of India having not B
filed review petitions. Private parties who are here before us seek to
ride on the coattails of the Union. This is not something we can
countenance.
Conclusion:
51. We are thus of the view that for all the aforesaid reasons the C
curative petitions cannot be entertained and we thus dismiss it leaving
the parties to bear their own costs.
Divya Pandey Petitions dismissed.
(Assisted by : Shevali Monga, LCRA) D
E
F
G
H
Search Indian case law
Ask in plain English, not just keywords. 25,000 AI words free, no card.
Try "Bhopal gas tragedy"Sign in to search