When Does Section 17 Of NGT Act Bar To Levy Compensation? NGT Explains

The principal bench of NGT (National Green Tribunal) comprising Justice Adarsh Kumar Goel (Chairperson), Justice Sudhir Agarwal (Judicial Member), and Dr Senthil Vel (Expert Member) has awarded compensation of ten lakhs rupees to the victims of the recent Gujarat explosion incident.

The bench rejected the argument that the NGT is barred from granting compensation to the workmen under Section 17 of the NGT Act, 2010, on the basis that they are eligible for compensation under the Workmen Compensation Act, 1923.

The suo moto cognizance was taken by NGT on the NDTV report of the death of two persons and injuries to other two in an explosion in Ven Petrochem & Pharma India Pvt. Ltd., Valsad (Project Proponent), Gujarat on 28.02.2023.”

The Gujarat State Pollution Control Board has submitted that the number of deaths in the explosion incident is four and two persons have been injured.

The Pharma Company where the incident took place has accepted that the incident occurred, resulting in the deaths of four individuals and injuries to two others. However, the Company has argued that it did not breach any regulations and that the reason for the accident is not known. The Company has also deposited a compensation amount of Rs. 25 lakhs, as determined by the State PCB.

It was submitted by the Pharma Company that it has given a cheque of Rs. 10 lakhs to the heirs of each of the four deceased victims. Further, compensation can be paid under the Workmen Compensation Act, 1923 and NGT may not go into the matter because of the bar under Section 17 of the NGT Act, 2010.

After hearing both parties and considering the material on record, NGT decided that as held in M.C. Mehta vs. UOI & Ors, (1987) 1 SCC 395 the Project Proponent has absolute liability for any loss arising out of such incidents.

Referring to In re: News item published in The Indian Express dated 07.01.2021 titled “Four workers dead due to toxic gas leak in Rourkela Steel Plant” the bench explained that, “On the issue of bar under section 17 of the NGT Act for claims in respect of workmen, it was held that the said bar will apply only if the PP (Pharma Company) has paid such compensation under the Workmen Compensation Act or any other law and not otherwise, object of bar being to avoid duplication and if no compensation has been paid, NGT can award compensation at least at floor level.”

Thus, while if workmen are covered by the Workmen Compensation Act, 1923 and are paid compensation under the provisions of the said Act, there can be no claim under the NGT Act, where compensation under Workmen Compensation Act has not been paid by the Project Proponent, the said bar will not apply and NGT can direct payment of floor level compensation at the rate mentioned above, the PP has to be held liable to pay such compensation.

The bench said that it is undisputed that the total amount paid by the Pharma Company to the victims is only Rs. 10 lakhs to heirs of each of the deceased which is neither adequate as per provisions of the Workmen Compensation Act nor according to the scale of minimum compensation awarded by NGT in similar cases.

“The liability to pay compensation is over and above accountability under criminal law and statutory regulators have to ensure that safety protocols are duly observed in conducting such industrial activity which is hazardous and has potential for loss of human lives”, NGT observed.

In light of the above the bench has directed the Company to pay a further amount of Rs. 10 lakhs to the heirs of each of the deceased and Rs. 10 lakhs be paid to each of the injured.

However,It will be open to the Company to adjust the amount in its liability under the Workmen Compensation Act.

NGT has also constituted a joint Committee of the Regional Director, CPCB, Vadodara, GPCB and District Magistrate Valsad to undertake a visit to the site, ascertain the cause of the incident and suggest measures to be adopted in future to prevent such incidents. The Committee is also tasked to suggest a manner of utilization of the amount of compensation of Rs. 25 lakhs deposited by the Pharma Company towards restoration of the environment.

Case- In re: news item in NDTV dated 28.02.2023 titled “2 Dead, 2 Injured in Explosion at Gujarat Pharma Company”

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