Absolute Liability — M.C. Mehta v Union of India — Law of Torts Notes

Absolute Liability — M.C. Mehta and the Indian Rule

In December 1985, one year after Bhopal, oleum gas leaked from a Shriram Foods plant in the middle of Delhi. When the case reached the Supreme Court, the Court faced a choice: apply the English rule from 1868, complete with its six exceptions, or write a rule for a country with hazardous factories next door to homes. Chief Justice Bhagwati refused to be “inhibited” by a nineteenth-century English decision, and created a rule of absolute liability.

Strict liability with the escapes closed

Absolute liability means that an enterprise engaged in a hazardous or inherently dangerous activity owes an absolute and non-delegable duty to the community. If harm results, the enterprise is liable without any exceptions — no Act of God, no act of a stranger, no consent, no statutory authority.

A. The four features of the rule.

1. It applies to an enterprise engaged in a hazardous or inherently dangerous activity.
2. The duty is absolute and non-delegable — it cannot be shifted to a contractor.
3. No exceptions apply — this is the whole point of the departure from Rylands.
4. Compensation must have a deterrent effect, and may therefore be correlated to the magnitude and capacity of the enterprise — the larger and more prosperous the enterprise, the greater the compensation.

B. Strict liability compared with absolute liability.

C. What followed.

1. Union Carbide Corporation v Union of India (the Bhopal litigation) — the disaster that made the question urgent, ultimately settled.
2. The Bhopal Gas Leak Disaster (Processing of Claims) Act, 1985, and the Public Liability Insurance Act, 1991, which made insurance compulsory for handlers of hazardous substances and created a no-fault relief scheme.
3. Indian Council for Enviro-Legal Action v Union of India (1996) — absolute liability applied to chemical industries, together with the polluter pays principle.

🧩 WORKED EXAMPLE — gas escapes from a chemical plant

Facts. Toxic gas escapes from a chemical plant in a residential area and injures several people. The company proves the escape was caused by sabotage by an unknown third party, and that it had taken every precaution known to the industry.

Rule. An enterprise engaged in a hazardous or inherently dangerous activity owes an absolute and non-delegable duty, subject to no exceptions (M.C. Mehta).

Apply. Under Rylands v Fletcher the company would escape entirely: act of a stranger is one of the six recognised exceptions, and the absence of negligence would answer a claim in negligence. Under the Indian rule neither argument is available. The enterprise chose to conduct a hazardous activity in a populated area and must bear the whole cost of the harm.

Decoy. The sabotage, which is a complete answer under English law and no answer at all under Indian law.

Note the limit. The rule applies to hazardous or inherently dangerous activity. An ordinary factory that is merely careless is judged by negligence, not by M.C. Mehta.

Conclusion. The company is absolutely liable, and compensation may be correlated to its size and capacity.

Bhagwati CJ in M.C. Mehta v Union of India (1987): “We have to evolve new principles and lay down new norms which would adequately deal with the new problems which arise in a highly industrialised economy. We cannot allow our judicial thinking to be constricted by reference to the law as it prevails in England… An enterprise which is engaged in a hazardous or inherently dangerous industry… owes an absolute and non-delegable duty to the community.”

In Simple Terms: the Court said plainly that an English rule written for a Victorian reservoir cannot govern a chemical plant in a crowded Indian city, and that a company which chooses to run a dangerous industry must bear the whole cost of the harm it causes.

flowchart TD
    L1["NEGLIGENCE — liable only if at FAULT"]
    L1 --> L2["STRICT LIABILITY — Rylands v Fletcher: liable without fault, BUT six exceptions"]
    L2 --> L3["ABSOLUTE LIABILITY — M.C. Mehta: no fault, NO exceptions, damages tied to capacity"]
    L3 --> S["Statutory follow-up: Bhopal Act 1985 · Public Liability Insurance Act 1991 · polluter pays"]

Case Laws

• [C-16] M.C. Mehta v Union of India (1987) — the Oleum gas leak; absolute liability created.
• Union Carbide Corporation v Union of India (1989) — the Bhopal litigation and settlement.
• Indian Council for Enviro-Legal Action v Union of India (1996) — absolute liability and the polluter-pays principle.
• Charan Lal Sahu v Union of India (1990) — constitutional validity of the Bhopal Act upheld.

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