The National Green Tribunal’s suo moto intervention in the aftermath of the fatal firecracker factory blast in Harda, Madhya Pradesh, underscores the judiciary’s proactive role in enforcing environmental and human rights obligations in industrial disasters. The Tribunal’s order clarifies the applicability of the Sarla Verma framework to non-transportation industrial accidents and establishes a clear pathway for compensation disbursement, while preserving judicial access for claimants seeking higher relief.
Background & Facts
The Dispute
On 6 February 2024, a catastrophic explosion occurred at an unregulated firecracker manufacturing unit in Harda district, Madhya Pradesh, resulting in multiple fatalities and widespread destruction of residential property. The incident triggered public outrage and media scrutiny over the state’s failure to enforce safety norms under the Environment (Protection) Act, 1986, and the Manufacture, Storage and Import of Hazardous Chemicals Rules, 1989. The National Green Tribunal (NGT) initiated suo moto proceedings under Section 19 of the NGT Act, 2010, to ensure accountability and timely redress.
Procedural History
- 6 February 2024: Blast occurs at unlicensed firecracker unit in Harda
- October 2025: NGT issues first order directing compensation assessment and listing of affected families
- February 2026: Hearing resumes with submissions on compensation amounts and pending claims
- Multiple I.A.s filed: Nine interim applications sought clarification on compensation quantum and procedural compliance
Relief Sought
The Tribunal sought to ensure:
- Prompt payment of compensation to families of deceased and injured
- Adherence to the Sarla Verma framework for calculating death compensation
- Transparent disbursement of funds for damaged houses
- Preservation of claimants’ right to seek additional relief in civil courts
The Legal Issue
The central question was whether compensation for deaths and property damage arising from an industrial disaster must be calculated strictly in accordance with the Sarla Verma v. Union of India guidelines, and whether the state’s payment of amounts exceeding those guidelines precludes further claims.
Arguments Presented
For the State
The State contended that compensation amounts already paid to families of the deceased exceeded the Sarla Verma-calculated quantum, based on updated inflation indices and state guidelines. Counsel submitted that the payments were made in good faith and that any claimant dissatisfied with the quantum could approach a civil court with documentary proof of higher loss. The State emphasized that the NGT’s role was not to re-adjudicate individual claims but to ensure systemic compliance.
For the Intervener
The intervenor argued that the State’s calculation under Sarla Verma was incomplete and failed to account for inflation adjustments, loss of future earnings, and non-monetary damages. She highlighted that several claimants, particularly women and marginalized families, had not received adequate compensation despite being listed in the official damage roster. The intervenor sought a binding directive for full payment of the calculated amount and a mechanism for independent verification.
The Court's Analysis
The Tribunal examined the nature of the disaster and its classification under environmental law. It held that industrial explosions resulting from violation of safety norms constitute environmental harm under Section 2(a) of the Environment (Protection) Act, 1986, thereby bringing the matter within the NGT’s jurisdiction. The Court reaffirmed that Sarla Verma is not confined to road accidents but applies to all cases of wrongful death arising from state or corporate negligence, including industrial disasters.
"The principle of just compensation for loss of life, as evolved in Sarla Verma, is not a ceiling but a floor, and must be applied as a minimum standard in all cases of preventable death due to negligence."
The Tribunal noted that while the State had paid amounts exceeding the Sarla Verma calculation, it had not provided a transparent, itemized breakdown. The Court emphasized that procedural fairness requires that claimants be informed of the basis of compensation and retain the right to challenge it. The Tribunal rejected the notion that payment of a higher amount extinguishes the right to seek additional relief, stating that such a position would violate Article 21 and the principle of natural justice.
The Verdict
The NGT ruled in favor of the victims. It held that the compensation paid for deaths was sufficient and closed that category, but directed immediate payment of the remaining Rs.23,24,526 for damaged houses. It affirmed that claimants may approach civil courts for higher compensation with supporting evidence, and mandated the State to submit a detailed payment chart at the next hearing.
What This Means For Similar Cases
Compensation Must Follow Sarla Verma as Minimum Standard
- Practitioners must invoke Sarla Verma in all industrial disaster cases involving death, regardless of whether the incident occurred on public roads
- The Sarla Verma quantum is a baseline, not a cap - claimants may seek higher amounts with proof of higher income, dependents, or special circumstances
- State agencies cannot claim finality merely by paying above the minimum without transparent documentation
Civil Courts Remain Accessible for Enhanced Claims
- Victims or families dissatisfied with administrative compensation must be informed of their right to file a civil suit
- NGT orders do not bar civil remedies; they merely streamline initial disbursement
- Legal aid clinics and public interest litigants should prepare template applications for enhanced compensation under Section 10 of the Civil Procedure Code
Documentation Is Non-Negotiable
- State authorities must maintain and submit itemized payment records, including:
- Name of claimant
- Basis of calculation (e.g., income, age, dependents)
- Amount paid and method of transfer
- Acknowledgment of receipt
- Failure to produce such records may result in contempt proceedings or judicial intervention
