Bhopal Gas Tragedy Compensation: Judgement Pronouncement

Additional Compensation for Bhopal Gas Tragedy Victims

Judges: S.K. Kaul J, Sanjiv Khanna J, A.S. Oka J, Vikram Nath J, J.K. Maheshwari J

Today, the Justice Sanjay Kishan Kaul-led Constitution Bench unanimously dismissed the Union government’s plea to increase the compensation awarded to victims of the 1984 Bhopal Gas Tragedy.


In December 1984, a pesticide plant owned by the Union Carbide Corporation (UCC) in Bhopal, Madhya Pradesh, leaked 42 tonnes of a toxic chemical called methyl isocyanate. After the Federal District Court in New York dismissed the Union government’s case for reparations in February 1985, with directions to approach Indian Courts, Parliament enacted the Bhopal Gas Leak Disaster (Processing of Claims) Act in March 1985. The Act gave the Union the power to legally represent all the victims of the Bhopal gas tragedy. 

In February 1989, UCC and the Union finalised a settlement, facilitated and confirmed by the Supreme Court, for $470 million. The terms of the settlement also required the Union to pay any additional compensation if the amount was not sufficient to satisfy all claims. In October 1991, the Supreme Court refused to re-open the settlement in a review petition, holding that the lack of a ‘re-opener’ clause in the settlement did not make it invalid. 

In 2010, the Union filed a curative petition at the SC requesting an increase in the settlement amount, to be paid by Union Carbide. Curative petitions were introduced by the SC in 2002 as a last recourse for a litigant. The SC only grants relief in these cases when there has been a ‘gross miscarriage of justice’ arising from a past SC Order. 

The case came up for hearing before the Constitution Bench led by Justice S.K. Kaul on September 20th, 2022 and the Union expressed their desire to keep pursuing the case three weeks later, on October 11th.

Bench Decides There is no Legal Principle to Justify Settlement ‘Top-Up’

With all five Judges in agreement, Justice S.K. Kaul detailed why the Union had very little ground to stand on. He began with the compensation which had already been paid. By the Union’s own admission, there were no more pending claims for compensation. In fact, Justice Kaul pointed out that there was a significant surplus even after all of the claims were addressed. Enough to pay compensation to the victims twice over and still have ₹50 Crore remaining from the settlement amount today. The Bench ordered the Union to use this amount to satisfy any future claims for compensation. 

Then, the Bench found that the Union had not relied on any legal principles to justify the ‘top-up’ or increase in compensation. As far as the Bench was concerned, there were only two paths they could take. Either the settlement was either valid or Union Carbide committed fraud when negotiating the settlement, which would justify setting the settlement aside and re-opening the case. However, the Union chose not to make any allegations of fraud and only claimed that there were additional injuries and costs that were not contemplated when the settlement was negotiated.

The Bench then chastised the Union for their conduct leading up to the case. Before filing a petition to re-open the settlement themselves, the Union opposed attempts from private parties to do the same. 

Further, the Union was obligated to take out an insurance policy in case the settlement was insufficient (which is the Union’s claim in this case). However, in a ‘grossly negligent’ omission, the Union failed to do so. The Bench pointedly stated that the Union could not be negligent and then approach the Court claiming Union Carbide had a responsibility to pay further compensation. The Bench also drew attention to the Union’s failure to de-toxify the site of the tragedy which only aggravated the effects of the tragedy. 

The other petitioners were not spared the Bench’s ire. Justice Kaul stated that they sought to ‘ride of the coattails of the Union’. With this final comment, the Bench dismissed the curative petition.