The case of shirram Food and Fertilizer is considered as one of the most important cases in environmental laws. Shriram food and Fertilizer opened its unit in population area of Delhi. A writ petition was filed against the opening as it might be hazardous for the health of people. But a three judges bench gave the judgment on 17th Fab, 1986 in favour of unit.

The Bench of three Judges permitted Shriram Foods and Fertiliser Industries (hereinafter referred to as Shriram) to restart its power plant as also plants for manufacture of caustic chlorine including its by-products and recovery plants like soap, glycerine and technical hard oil, subject to the conditions set out in the Judgment.  

But while the writ petition was pending there was escape of oleum gas from one of the units of Shriram on 4th and 6th December, 1985 and applications were filed by the Delhi Legal Aid & Advice Board and the Delhi Bar Association for award of compensation to the persons who had suffered harm on account of escape of oleum gas.

The court was of the view that these applications for compensation raised a number of issues of great constitutional importance and the Bench of three Judges therefore formulated the issues and asked the petitioner and those supporting him as also Shriram to file their respective written submissions so that the Court could take up the hearing of these applications for compensation.

When these applications compensation came up for hearing it was felt that since the issues raised involved substantial questions of law relating to the interpretation of Articles 21 and 32 of the Constitution, the case should be referred to a larger Bench of five Judges and this is how the case has arrived before the bench in present case.

Submission of the counsels and the answers of the court

The submission of shriram’s counsel was too technical. Mr. Diwan, the counsel appearing on behalf of Shri- ram raised a preliminary objection that the Court should not proceed to decide these constitutional issues since there was no claim for compensation originally made in the writ petition and these issues could not be said to arise on the writ petition.

Mr. Diwan conceded that the escape of oleum gas took place subsequent to the filing of the writ petition but his argument was that the petitioner could have applied for amendment of the writ petition so as to include a claim for compensation for the victims of oleum gas but no such application for amendment was made and hence on the writ petition as it stood, these constitutional issues did not arise for consideration.

But the court Denied to accept this submission and said that

  • when the applications for compensation are for enforcement of the fundamental right to life enshrined in Article 21 of the Constitution, the court cannot adopt a hyper technical approach which would defeat the ends of justice.
  • The court recalled that it had on numerous occasions pointed out that where there is a violation of a fundamental or other legal right of a person or class of persons who by reason of poverty or disability or socially or economically disadvantaged position cannot approach a Court of law for justice, it would be open to any public spirited individual or social action group to bring an action for vindication of the fundamental or other legal right of such individual or class of individuals and this can be done not only by filing a regular writ petition but also by addressing a letter to the Court.
  • If this Court is prepared to accept a letter complaining of violation of the fundamental right of an individual or a class of individuals who cannot approach the Court for justice, there is no reason why these applications for compensation which have been made for enforcement of the fundamental right of the persons affected by the oleum gas leak under Article 21 should not be entertained.
  • The Court while dealing with an application for enforcement of a fundamental right must look at the substance and not the form.

It was also the submission of shriram’s counsel that shriram does not come under the definition of ‘other authority’ in article 12. But the court recognised that Shriram received sizable assist- ance in the shape of loans and overdrafts running into several crores of rupees from the Government through various agencies. Moreover, Shriram is engaged in the manufacture of caustic soda, chlorine etc. Its various units are set up in a single complex surrounded by thickly populated colonies. Chlorine gas is admittedly dangerous to life and’ health. If the gas escapes either from the storage tank or from the filled cylinders or from any other point in the course of production, the health and wellbeing of the people living in the vicinity can be seriously affected. Thus Shriram is engaged in an activity which has the potential to invade the right to life of large sections of people.

But the court did not decide whether a private corporation like Shriram would fall within the scope and ambit of Article 12, because the court was of the view that it have not had sufficient time to consider and reflect on this question in depth.

Because the hearing of this case concluded only on 15th December 1986 and the court are called upon to deliver our judgment within a period of four days, on 19th December 1986.

But the court dealt other question as to what is the measure of liability of an enterprise which is engaged in a hazardous or inherently dangerous industry, if by reason of an accident occurring in such industry, persons die or are injured.

The court held that an enterprise which is engaged in a hazardous or inherently dangerous industry which poses a potential threat to the health and safety of the persons working in the factory and residing in the surrounding areas owes an absolute and non-delegable duty to the community to ensure that no harm results to anyone on account of hazardous or inherently dangerous nature of the activity which it has undertaken.

The enterprise must be held to be under an obligation to provide that the hazardous or inherently dangerous activity in which it is engaged must be conducted with the highest standards of safety and if any harm results on account of such activity, the enterprise must be absolutely liable to compensate for such harm and it should be no answer to the enterprise to say that it had taken all reasonable care and that the harm occurred without any negligence on its part.

The court therefore held that where an enterprise is engaged in a hazardous or inherently dangerous activity and harm results to anyone on account of an accident in the operation of such hazardous or inherently dangerous activity resulting, for example, in escape of toxic gas the enterprise is strictly and absolutely liable to compensate all those who are affected by the accident and such liability is not subject to any of the exceptions which operate vis-a-vis the tortious principle of strict liability under the rule in Rylands v. Fletcher.


M.C. Mehta and Anr vs Union Of India; 1987 AIR 1086, 1987 SCR (1) 819