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1991 Supreme(SC) 534

SUPREME COURT OF INDIA
RANGANATH MISRA, CJI., K.N. SINGH, M.N. VENKATACHALIAH, A.M. AHMADI, N.D. OJHA, JJ.
Union Carbide Corporation etc. etc., Appellants
Versus
Union of India, etc. etc., Respondents
Interim Appln. Nos. 1, 2, 3 of 1989; in Civil Appeal Nos. 3187, 3188 of 1988, D/-3-10-1991.
AND
In the matter of: Indian Red Cross Society Applicant / Intervener.
Advocates appeared :
Mr. Soli J. Sorabjee, Attorney General, Mr. P.P. Rao, Mr. Rajender Sachher, Mr. D.K. Kapur, Sr. Advocates, Mrs. Indu Goswamy, Mr. Raju Ramanchandran, Mr. Mukul Mudgal, Mr. S.R. Bhat, Mr. M.S. Ganesh, Mr. V.B. Mishra, Mr. A.M. Khanwilkar, Ms. Madhu Khatri, Mr. P. Parmeswaran, Ms. A. Subhashini, Mr. C.S. Vaidyanathan, Advocates with them, for the Appearing Parties.
BHOPAL GAS LEAK DISASTER—THE GRANTABILITY OF THE PRAYER OF THE INDIAN RED CROSS SOCIETY INTERIM AMOUNT OF 5 MILLION U.S. DOLLARS WAS NOT A DISTINCT AWARD STANDING INDEPENDENTLY, OUTSIDE THE FINAL ADJUDICATION - THE AGREEMENT BETWEEN AMERICAN RED CROSS, INDIAN RED CROSS SOCIETY CANNOT PREVAIL OVER THE ORDER OF THE SUPREME COURT TREATING UNUTILISED PART OF INTERIM RELIEF AS PART OF THE SETTLEMENT FUND, AUTHORIZING THE REGISTRAR OF THE SUPREME COURT TO REALIZE IT DOES NOT REQUIRE ANY MODIFICATION

Headnote:

Constitution of India,1950 - Seeks a modification - Portions of transcript - Applications arises in context of order June made by Presiding Judge of Southern District Court at New York (U.S.) directing utilization of million dollars for relief to victims of gas leak disaster through Indian Red Cross Society - In said order Judge Keenan referred to the willingness of the Union Carbide Corporation to pay million dollars to aid victims of gas plant disaster which occurred in December in Bhopal India and had desired and indicated that in administration of this fund which was intended to be at the disposal of Union of India should be subject to certain reporting-requirements as to the utilization of funds - Union of India did not agree to subject itself to those conditions - Referring to the alternative arrangements to administration of the interim relief necessitated by Union of India disinclination to take up relief operation on the terms stipulated by Court Judge - Held, It would appear that agreement between American Red Cross and the Indian Red Cross Society came to be discussed before the District Court, New York, during hearing on - Portions of the transcript of what transpired at the hearing furnished in affidavit indicate that far from approving the purported arrangement inter se between American Red Cross and the Indian Red Cross Society they show that terms of order June as to nature and character of the interim relief as an advance payment or credit to the defence were left undisturbed - Transcript of the hearing furnished in affidavit also reaffirms that if there is any recovery against Union Carbide it is a set off - Applications dismissed.

ORDER

By these applications the Indian Red Cross Society seeks a modification of certain directions issued by this Court on 15th February, 1989, in Civil Appeals Nos. 3187 and 3188 of 1988 pursuant to the settlement of the suit instituted by the Union of India against Union Carbide Corporation and the Union Carbide Corporation (India) Limited arising out of the Bhopal Gas leak disaster.

2. The prayer of the Indian Red Cross Society in these applications arises in the context of the order dated 7th June, 1985, made by John F. Keenan, Presiding Judge of the Southern District Court at New York (U.S.) directing the utilisation of 5 million dollars for relief to the victims of the gas leak disaster through Indian Red Cross Society. In the said order Judge Keenan referred to the willingness of the Union Carbide Corporation to pay 5 million dollars to aid the victims of the gas plant disaster which occurred in December, 1984 in Bhopal, India." and had desired and indicated that in the administration of this fund, which was intended to be at the disposal of the Union of India, should be subject to certain reporting-requirements as to the utilisation of the funds. Union of India did not agree to subject itself to those conditions. Referring to the alternative arrangements to the administration of the interim relief necessitated by Union of Indias disinclination to take up relief operation on the terms stipulated by the Court, Judge Keenan observed:

"Counsel for the Union of India has informed the Court that the Union of India considers these reporting requirements so onerous as to compel the Union of India to decline the five million dollars in interim relief offered. Accordingly, the Court directs that Liaison Counsel and Messers Bailey and Chesley of the Executive Committee contact the American Red Cross Society, to arrange for discussions with the Indian Red Cross Society, in order to formulate a plan for distribution of the five million dollars to the victims of the gas plant disaster."

3. The US District Court, therefore, proposed a scheme for the utilisation of the Interim Relief Fund through the agency of the American Red Cross Society. But what is of particular significance in the present context is as to how this interim relief fund was to be treated and accounted for at the end of the day when the litigation culminated in a final decision. That the payment was intended to be without prejudice to the contentions of the Union Carbide Corporation and that, further, the amount of interim relief would form part of the quantum that may finally be adjudicated was rendered explicit in the last paragraph of the said order dated 7th June, 1985 which stipulated:

"Neither the promulgation, implementation nor anything contained herein shall be asserted or used in any manner against the interests of Union Carbide Corporation. This provision of interim relief by Union Carbide Corporation shall be credited against the payment of any final judgment or settlement of the claims against Union Carbide Corporation arising out of the Bhopal gas leak of December, 1984."

After the proceedings in the US District Court terminated upon the Union Carbide Corporations plea of Forum Non-convenines being upheld, Union of India instituted suit No. 1113 of 1986 in the District Court at Bhopal. The claim in the suit came to be settled in this Court in the said Civil Appeal Nos. 3187, 3188 of 1988 by the orders dated 14th/ 15th February, 1989.

4. In terms of the said settlement the sum of 5 million US dollars was treated as part of the settlement fund. In the order of this Court dated 15th February, 1989 this sum of 5 million US dollars was specifically referred to in Cl. (a) of paragraph 2 and paragraph 5. The relevant portions of the order are excerpted below:

"(a) a sum of US 425 million (Four Hundred and Twentyfive millions) shall be paid on or before 23rd March, 1989, by Union Carbide Corporation to the Union of India, less US $ 5 million already paid by the Unio

















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