Part V

Corporate liability in Environment Protection

Relevant provisions relating to environmental protection laws

The Water (Prevention and Control of Pollution) Act, 1974

Discuss briefly the salient features of the law relating to water prevention?

Section 20(3). Without prejudice to the provisions of sub-section (2), a State Board may, with a view of preventing or controlling pollution of water, give directions requiring any person incharge of any establishment where any industry, operation or process, or treatment and disposal system is carried on, to furnish to it information regarding the construction, installation or operation of such establishment or of any disposal system or of any extension or addition thereto in such establishment and such other particulars as may be prescribed.

Discuss the liability in offences by companies?

(1) Where an offence under this Act has been committed by a company, every person who at the time the offence was committed was incharge of, and was responsible to the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly:

Provided that nothing contained in this sub-section shall render any such person liable to any punishment provided in this Act if he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission of such offence.

(2) Notwithstanding anything contained in sub-section (1), where an offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.

Explanation— for the purpose of this section,—

(a) "company means any body corporate, and includes a firm or other association of individuals; and

(b) "Director" in relation to a firm means a partner in the firm.

The Air (Prevention and Control of Pollution) Act, 1981

Discuss the liability in offences by companies with reference to Air Act, 1981?

(1) Where an offence under this Act has been committed by a company, every person who, at the time the offence was committed, was directly incharge of, and was responsible to the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly:

Provided that nothing contained in this sub-section shall render any such person liable to any punishment provided in this Act, if he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission of such offence.

(2) Notwithstanding anything contained in this sub-section (1), where an offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.

Explanation _ For the purpose of this section,—

(a) "company" means any body corporate, and includes a firm or other association of individuals; and

(b) "Director" in relation to a firm, means a partner in the firm.

The Environment (Protection) Act, 1986

Discuss the liability in offences by companies with reference to Environment Act?

(1) Where any offence under this Act has been committed by a company, every person who, at the time the offence was committed, was directly incharge of, and was responsible to, the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly:—

Provided that nothing contained in this sub-section shall render any such person liable to any punishment provided in this Act, if he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission of such offence.

(2) Notwithstanding anything contained in sub-section (1), where an offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to any neglect on the part of, any director manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.

Explanations- For the purpose of this section,—

(a) "company" means any body corporate and includes a firm or other association of individuals;

(b) "Director" in relation to a firm, means a partner in the firm.

the Indian Penal Code, 1860 (Relevant Provisions)

What is the criminal liability in Negligent Act. Likely to Spread Infection of Disease Dangerous to life?

Whoever unlawfully or negligently does any act which is, and which he knows or has reason to believe to be, likely to spread the infection of any disease dangerous to life, shall be punished with imprisonment of either description for a term which may extend to six months, or with fine, or with both.

Discuss the criminal liability fouling Water of Public Spring or Reservoir?

Whoever voluntarily corrupts or fouls the water of any public spring or reservoir, so as to render it less fit for the purpose for which it is ordinarily used, shall be punished with imprisonment of either description for a term which may extend to three months, or with fine which may extend to Rs. 500 or with both.

Discuss the criminal liability of punishment for Public Nuisance in Cases not otherwise provided for?

Whoever commits a public nuisance in any case, not otherwise punishable by this Code, shall be punished with fine which may extend to two hundred rupees.

Define mischief?

Whoever with intent to cause, or knowing that he is likely to cause, wrongful loss or damage to the public or to any person, causes the destruction of any property, or any such change in any property or in the situation thereof as destroys or diminishes its value or utility, or affects it injuriously, commits "mischief".

Explanation 1: It is not essential to the offence of mischief that the offender should intend to cause loss or damage to the owner of the property injured or destroyed. It is sufficient if he intends to cause, or knows that he is likely to cause, wrongful loss or damage to any person by injuring any property, whether it belongs to that person or not.

Explanation 2: Mischief may be committed by an act affecting property belonging to the person who commits the act, or to that person and others jointly.

What is the punishment under Section 426 for mischief?

Whoever commits mischief shall be punished with imprisonment of either description for a term which may extend to three months, or with fine, or with both.

Explain the criminal liability in Sec. 511. Punishment for Attempting to Commit Offences Punishable with Imprisonment for Life or other Imprisonment?

Whoever attempts to commit an offence punishable by this Code with imprisonment for life or imprisonment, or to cause such an offence to be committed, and in such attempt does any act towards the commission of the offence, shall, where no express provision is made by this Code for the punishment of such attempt, be punished with imprisonment of any description provided for the offence, for a term which may extend to one-half of the imprisonment for life or, as the case may be, one-half of the longest term of imprisonment provided for that offence, or with such fine as is provided for the offence, or with both.

Relevant Section under the Code of Criminal Procedure

B. Public nuisances

Briefly discuss Sec. 133. Conditional order for removal of nuisance?

(1) Whenever a District Magistrate or a Sub-Divisional Magistrate or any other Executive Magistrate specially empowered in this behalf by the State Government, on receiving the report of a police officer or other information and on taking such evidence (if any) as he thinks fit, considers—

(a) that any unlawful obstruction or nuisance should be removed from any public place or from any way, river or channel which is or may be lawfully used by the public; or

(b) that the conduct of any trade or occupation, or the keeping of any goods or merchandise, is injurious to the health or physical comfort of the community, and that in consequence such trade or occupation should be prohibited or regulated or such goods or merchandise should be removed or the keeping thereof regulated; or

(c) that the construction of any building, or, the disposal of any substance, as is likely to occasion conflagration or explosion, should be prevented or stopped; or

(d) that any building, tent or structure, or any tree is in such a condition that it is likely to fall and thereby cause injury to persons living or carrying on business in the neighbourhood or passing by and that in consequence the removal, repair or support of such building, tent or structure, or the removal or support of such tree, is necessary; or (e) that any tank, well or excavation adjacent to any such way or public place should be fenced in such manner as to prevent danger arising to the public; or

(f) that any dangerous animal should be destroyed, confined or otherwise disposed of, such Magistrate may make a conditional order requiring the person causing such obstruction or nuisance, or carrying on such trade or occupation, or keeping any such goods or merchandise, or owning, possessing or controlling such building, tent, structure, substance, tank, well or excavation, or owning or possessing such animal or tree, within a time to be fixed in the order.—

(i) to remove such obstruction or nuisance; or

(ii) to desist from carrying on, or to remove or regulate in such manner as may be directed, such trade or occupation, or to remove such goods or merchandise, or to regulate the keeping thereof in such manner as may be directed; or

(iii) to prevent or stop the construction of such building, or to alter the disposal of such substance; or

(iv) to remove, repair or support such building, tent or structure, or to remove or support such trees; or

(v) to fence such tank, well or excavation; or

(vi) to destroy, confine or dispose of such dangerous animal in the manner provided in the said order;

or, if he objects to do so, to appear before himself or some other Executive Magistrate subordinate to him at a time and place to be fixed by the order, and show cause, in the manner hereinafter provided, why the order should not be made absolute.

Explain Sec. 144. Power to issue order in urgent cases of nuisance or apprehended danger

(3) No order duly made by a Magistrate under this section shall be called in question in any Civil Court.

Explanation—A "public place" includes also property belonging to the State, camping grounds and grounds left unoccupied for sanitary or recreative purposes.

(1) In cases where, in the opinion of a District Magistrate, a Sub-Divisional Magistrate or any other Executive Magistrate specially empowered by the State Government in this behalf, there is sufficient ground for proceeding under this section and immediate prevention or speedy remedy is desirable, such Magistrate may, by a written order stating the material facts of the case and served in the manner provided by Section 134, direct any person to abstain from a certain act or to take certain order with respect to certain property in his possession or under his management, if such Magistrate considers that such direction is likely to prevent, or tends to prevent, obstruction, annoyance or injury to any person lawfully employed, or danger to human life, health or safety, or a disturbance of the public tranquillity, or a riot, or an affray.

(2) An order under this section may, in cases of emergency or in cases where the circumstances do not admit of the serving in due time of a notice upon the person against whom the order is directed, be passed ex parte.

(3) An order under this section may be directed to a particular individual, or to persons residing in a particular place or area, or to the public generally when frequenting or visiting a particular place or area.

(4) No order under this section shall remain in force for more than two months from the making thereof:

Provided that, if the State Government considers it necessary so to do for preventing danger to human life, health or safety or for preventing a riot or any affray, it may, by notification, direct that an order made by a Magistrate under this section shall remain in force for such further period not exceeding six months from the date on which the order made by the Magistrate would have, but for such order, expired, as it may specify in the said notification.

(5) Any Magistrate may, either on his own motion or on the application of any person aggrieved, rescind or alter any order made under this section, by himself or any Magistrate subordinate to him or by his predecessor-in-office.

(6) The State Government may, either on its own motion or on the application of any person aggrieved, rescind or alter any order made by it under the proviso to sub-section (4).

(7) Where an application under sub-section (5), or sub-section (6) is received, the Magistrate, or the State Government, as the case may be, shall afford to the applicant an early opportunity of appearing before him or it, either in person or by pleader and showing cause against the order, and if the Magistrate or the State Government, as the case may be, rejects the application wholly or in part, he or it shall record in writing the reasons for so doing.

the Factories Act, 1948

Define cleanliness under Factories Act, 1948?

(1) Every factory shall be kept clean and free from effluvia arising from any drain, privy or other nuisance, and in particular—

(a) accumulation of dirt and refuse shall be removed daily by sweeping or by any other effective method from the floors and benches of workrooms and from staircases and passages, and disposed of in a suitable manner;

(b) the floor of every workroom shall be cleaned at least once in every week by washing, using disinfectant, where necessary, or by some other effective method;

(c) where a floor is liable to become wet in the course of any manufacturing process to such extent as is capable of being drained, effective means of drainage shall be provided and maintained;

(d) all inside walls and partitions, all ceiling or tops of rooms and all walls, sides and tops of passages and staircases shall—

(i) where they are painted otherwise than with washable water paint or varnished, be repainted or revarnished atleast once in every period of five years;

(ia) where they are painted with washable water paint, be repainted with at least one coat of such paint at least once in every period of three years and washed at least once in every period of six months;

(ii) where they are painted or varnished or where they have smooth impervious surfaces, be cleaned at least once in every period of fourteen months by such method as may be prescribed;

(iii) In any other case, be kept whitewashed or colour washed, and the whitewashing or colour washing shall be carried out at least once in every once in every period of fourteen months;

(dd) all doors and window frames and other wooden or metallic framework and shutters shall be kept painted or varnished and the painting or varnishing shall be carried out at least once in every period of five years;

(e) The dates on which the processes required by Clause (d) are carried out shall be entered in the prescribed register.

(2) If, in view of the nature of the operations carried on in a factory or class or description of factories or any part of a factory or class or description of factories, it is not possible for the occupier to comply with all or any of the provisions of sub-section (1), the State Government may by order exempt such factory or class or description of factories or part from any of the provisions of that sub-section and specify alternative methods for keeping the factory in a clean state.

How the disposal of wastes and effluents should be carried out?

(1) Effective arrangements shall be made in every factory for the treatment of wastes and effluents due to the manufacturing process carried on therein, so as to render them innocuous, and for their disposal.

(2) The State Government may make rules prescribing the arrangements to be made under sub-section (1) or requiring that the arrangements made in accordance with sub-section (1) shall be approved by such authority as may be prescribed.

Explain Sec. 41B. Compulsory Disclosure of Information by the Occupier?

(1) The occupier of every factory, involving a hazardous process, shall disclose in the manner prescribed all information regarding dangers, including health hazards and the measures to overcome such hazards arising from the exposure to or handling of the materials or substances in the manufacture, transportation, storage and other processes, to the workers employed in the factory, the Chief Inspector, the local authority within whose jurisdiction the factory is situate and the general public in the vicinity.

(2) The occupier shall, at the time of registering the factory involving a hazardous profess, lay down a detailed policy with respect to the health and safety of the workers employed therein and intimate such policy to the Chief Inspector and the local authority and, thereafter, at such intervals as may be prescribed, inform the Chief Inspector and the local authority of any change made in the said policy.

(3) The information furnished under sub-section (1) shall include accurate information as to the quantity, specifications and other characteristics of wastes and the manner of their disposal.

(4) Every occupier shall, with the approval of the Chief Inspector, draw up an on-site emergency plan and detailed disaster control measures for his factory and make known to the workers employed therein and to the general public living in the vicinity of the factory the safety measures required to be taken in the event of an accident taking place.

(5) Every occupier of a factory shall, — (a) if such factory engaged in a hazardous process on the commencement of the Factories (Amendment) Act, 1987 (2 of 1987), within a period of thirty days of such commencement; and (b) if such factory proposes to engage in a hazardous process at any time after such commencement, within a period of thirty days before the commencement of such process, inform the Chief Inspector of the nature and details of the process in such from and in such manner as may be prescribed.

(6) Where any occupier of a factory contravenes to the provisions of sub-section (5), the licence issued under Section 6 to such factory shall, notwithstanding any penalty to which the occupier of factory shall be subjected to under the provisions of this Act, be liable for cancellation.

(7) The occupier of a factory involving a hazardous process shall, with the previous approval of the Chief Inspector lay down measures for the handling, usage, transportation and storage of hazardous substances inside the factory premises and the disposal of such substances outside the factory premises and publicise them in the manner prescribed among the workers and the general public living in the vicinity.

Discuss Sec. 96A. Penalty for contravention of the provisions of Sections 41B 41C and 41H?

(1) Whoever fails to comply with or contravenes to any of the provisions of Sections 41B, 41C or 41H or the rules made there under, shall, in respect of such failure or contravention, be punishable with imprisonment for a term which may extend to seven years and with fine which may extend to two lakh rupees, and in case the failure or contravention continues, with additional fine which may extend to five thousand rupees for every day during which such failure or contravention continues after the conviction for the first such failure or contravention. 

(2) If the failure or contravention referred to in sub-section (1) continues beyond a period of one year after the date of conviction, the offender shall be punishable with imprisonment for a term which may extend to ten years.

The Bhopal toxic gas leak tragedy

The Bhopal crisis was triggered by a technological accident: 45 tons (1,00,800 IB) of methyl isocyanate (MIC) gas escaped from two underground storage tanks at a Union Carbide pesticide plant. The accident occurred between 10 p.m. (2 December) and 1.30 a.m. (3 December) when the plant was on second shift and the surrounding population was asleep in slum "hutments" that are densely packed together in this part of Bhopal (fig.5.1).

Leaked gases were trapped under a nocturnal temperature inversion in a shallow bubble that blanketed the city within five miles of the plant. Next morning, over 2,000 people were dead and 3,00,000 were injured. Another 15,000 people died in subsequent months owing to injuries caused by the accident. At least 7,000 animals perished but damage to the natural environment remains largely unassessed (Prasad and Pandey 1985).

Emergency services were completely overwhelmed and confusion was rampant in the affected neighbourhoods. Police instructed people to run away from the area, but many of those who did so inhaled large amounts of toxic MIC and succumbed to its effects. Residents were unaware that the simple act of covering their faces with wet clothes and lying indoors on the floor provided effective protection against the gas. That night, and in the days that followed, nearly 4,00,000 people fled the city in a haphazard and uncontrolled evacuation. Two weeks later, during Government attempts to neutralize the plant's remaining MIC, another wave of mass flight involved 2,00,000 people. (Shrivastava 1992; Diamond 1985; Morehouse and Subramanian 1988).

Discuss in detail the struggle for compensation in Bhopal Gas Leak Tragedy?

To understand the causes of the larger crisis it is necessary to examine the antecedent conditions that set the stage for it, and the more proximate failures that directly caused the accident. Hazardous antecedent conditions and proximate failures occurred both inside Union Carbide and outside the company, in its social, economic, and political environment.

Union Carbide paid $ 470 million of compensation settlement in January 1989. This money remained in a court-administered account until 1992, while claims were sorted out. By early 1993 there were 6,30,000 claims of which only 3,50,000 had been substantiated on the basis of medical records. Hundreds of victims continued to die during the prolonged politico-legal and bureaucratic battles over compensation.

The compensation that victims sought in mid-1985 was modest and reasonable. They asked that compensation for dead victims be paid according to the standards of death compensation then prevailing in India: seriously injured victims were to be paid $ 100-150 per month, to meet their food and medical needs; victims with minor injuries were to be paid a one-time compensation for medical costs and economic hardships (Morehouse and Subramanian 1988). It was estimated that the total cost of all compensation would be between $600 million and $1.2 billion. The victims' quest for compensation took formal shape in a lawsuit filed by the Government of India against Union Carbide Corporation in New York, in March 1985. Table 5.2 summarizes the main legal events since the accident.

US-based cases were consolidated under Judge Keenan (Federal District Court of New York), and Union Carbide then asked that the case be moved to India, on the grounds that the United States was not a convenient venue for trial (Adler 1985). It was argued that the accident occurred in India and most of the evidence lay in India. Keenan sent the case to India under condition that "due process" of law would be followed there. The case went to the Bhopal District Court _ the lowest-level court that could hear such a case. For the next four years it wound its way through the maze of legal bureaucracy, via the State High Court, up to the Supreme Court of India. The Government of India did not want to expedite the case by appointing a special court. That might constitute lack of due process and thereby provide grounds for appeal by Union Carbide. 

Table 5.2 Chronology of legal events

Date

 Event

December 1984

 Multiple lawsuits filed against Union Carbide Corporation (UCC) in India to the USA.

March 1985

 Bhopal Gas Leak Disaster Ordinance enacted in India, Government of India sues Union Carbide in New York.

July 1985

 UCC asks court to dismiss the case on grounds of forum non-conveniens. November 1985 Court orders UCC to pay $5 million for interim relief.

May 1986,

 Judge Keenan sends case to be tried in India.

1987, 1988

 Out-of-court negotiations continue between UCC and Government of India.

The case moves form Bhopal District Court to the State High Court, to Supreme Court.

January 1989

 Supreme Court mediates a settlement for $470 Million. Victims' lawyers challenge the settlement.

October 1991

  Supreme Court upholds settlement amount, but cancels immunity for UCC, Opening up old suits.

January 1992

  Criminal cases reopened against UCC. Top UCC executive subpoenaed.

January 1993

  Compensation distribution initiated.

The two main legal disputes were over the amount of compensation and the exoneration of Union Carbide from future liabilities. But these disputes were complicated by lack of reliable information about causes and consequences. More importantly, the Government of India's Bhopal Gas Leak Disaster Ordinance—a law that appointed the Government as sole representative of the victims_ was challenged by victim activists. Victims were usually not consulted about legal matters or settlement possibilities in the bureaucratic and political maze that constituted "the Government". Victims had no meaningful representation. This in effect, dissolved the victims' identity as a constituency separate and differing from the Government. This unintentional disempowerment of victims seems to occur in other disasters, too, especially where victims are poor and cannot afford independent legal help (Reich. 1991).

The solution to costly and time- consuming litigation lay in reaching an out-of-court settlement. However, any settlement was fraught with many political dangers. A settlement with Union Carbide could backfire on the Government. It could be seen as capitulation to pressures from a multinational corporation and the United States. This meant that a viable settlement could be made only after the case reached the Supreme Court, beyond which level it could not be appealed, at least in India. It also required correct political timing, when the settlement could go through parliamentary approval with minimal political opposition. The national parliamentary elections of 1989 presented a good political opportunity to settle the case and win support from voters. Five years had passed since the accident. The legal case had reached the Supreme Court; victims were fed up with waiting. In any event, hundreds of victims had died and thousands had moved out of the gas_affected neighbourhoods. The level of organization among victims was at the lowest point and their ability to protest was minimal. In January 1989, the Supreme Court brokered a settlement of $470 million in compensation that gave Union Carbide immunity from future prosecution.

Victims and activists challenged the settlement in the Supreme Court. They argued that the settlement amount was inadequate and claimed that granting Union Carbide immunity from criminal prosecution was unconstitutional. In October 1991, the Supreme Court ruled on this challenge; it upheld the compensation amount and ordered the Government to distribute the compensation funds immediately. However, it also cancelled Union Carbide's immunity from further prosecution.

How you `explain the term victims remain victims' in reference to Bhopal Tragedy?

By 1991, seven years after the accident and two years after the settlement, victims were poised to receive compensation payments. But bureaucratic procedures delayed the initiation of payments until 1993. What had happened in the interim? The population of Bhopal had nearly doubled since the accident. Conflicts had politicised the definition of victims. The Government was in the process of setting-up 17 administrative courts for validating claims and distributing funds. It lacked good medico-legal documentation of damages to sort out valid claims. There were 13,000 death claims whereas government figures showed 4,000 deaths. Of the 6,30,000 claimants, 2,80,000 failed to appear before officials to validate their claims.

At the beginning of 1993, distribution of compensation money was started. Union Carbide's original $470 million had accumulated considerable interest and now totalled $7000 million. By March of that year 700 victims had received $2 million. This included relatives of the dead, who received $3,200 per fatality (more for multiple bereavements in the same family). Those who suffered serious injuries received $3,000 each: people with minor injuries were to receive much less (Hazarika 1993).

Bhopal has been in a chronic crisis since the accident. Only the parameters of the crisis have changed with time. At the time of the accident, medical and ecological damages were most salient: today the economic and social damages are more important. The city has also experienced a steady transformation of social and cultural attitudes towards the disaster. For people not affected by it, the disaster became a nuisance. It was a source of political conflicts and economic decline of the city. This segment of Bhopal viewed gas victims as a burden on the city's limited resources. They preferred to forget about the accident and get on with their lives.

The precarious and explosive situation in Bhopal was apparent during the Hindu-Muslim riots of December 1992 and early 1993. Bhopal was among the three worst-affected cities in India and incurred 150 deaths; 1,300 gas victims had their homes and compensation documents destroyed in fires.

 

© Universal law Publishing Co.