occurring in such industry, persons die or are injured. Does the rule in Rylands v. Fletcher, (1866 Law Report 1 Excheq- uer 265) apply or is there any other principle on which the liability can be determined. Disposing of the applications, HELD: 1. The question whether a private corporation like Shriram would fall within the scope and ambit of Art. 12 so as to be amenable to the discipline of Art. 21 is left for proper and detailed consideration at a later stage if it becomes necessary to do so. [844F-G] Rajasthan Electricity Board v. Mohan Lal, [1967] 3 SCR 377; Sukhdev v. Bhagwat Ram, [1975] 1 SCC 421; Ramanna Shetty v. International Airport Authority, [1979] 3 SCR 1014; Ajay Hasia v. Khalid Mujib, [1981] 2 SCR 79; Som Prakash v. Union of India, [1981] 1 S.C.C. 449; Appendix I to Industrial Policy Resolution, 1948; Industries (Develop- ment and Regulation) Act, 1951; Delhi Municipal Act, 1957 Water (Prevention and Control of Pollution) Act, 1974; Air (Prevention and Control of Pollution) Act, 1981; Eurasian Equipment and Chemicals Ltd. v. State of West Bengal, [1975] 2 SCR 674; Rasbehari Panda v. St.ate, [1969] 3 SCR 374; Kas- turi Lal Reddy v. State of Jammu & Kashmir, [1980] 3 SCR 1338, referred to. 821 2. The Delhi Legal Aid and Advice Board is directed to take up the cases of all those who claim to have suffered on account of oleum gas and to file actions on their behalf in

the appropriate Court for claiming compensation and the Delhi Administration is directed to provide necessary funds to the Board for the purpose. [844G-H; 845A] 3.(i) 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 regular writ petition under Art. 226 in the High Court and under Art. 32 in this Court, but also by addressing a letter to the Court. [828B-C; E-F] 3.(ii) Even if a letter is addressed to an individual Judge of the Court, it should be entertained, provided of course it is by or on behalf of a person in custody or on behalf of a woman or a child or a class or deprived or disadvantaged persons. [829B-C] 3.(iii) Letters addressed to individual Justices of this Court should not be rejected merely because they fail to conform to the preferred form of address nor should the Court adopt a rigid stance that no letters will be enter- tained unless they are supported by an affidavit. If the Court were to insist on an affidavit as a condition of entertaining the letters the entire object and purpose of

epistolary jurisdiction would be frustrated because most of the poor and disadvantaged persons will then not be able to have easy access to the Court and even the social action groups will find it difficult to approach the Court. [828H; 829B] Bandhua Mukti Morcha v. Union of India & Ors., [1984] 2 SCR 67; S.P. Gupta v. Union of India, [1981] (Suppl) SCC 87 and Union for Democratic Rights & Ors. v. Union of India, [1983] 1 SCR 456, relied upon. 4.(i) Article 32 does not merely confer power on this Court to issue direction, order or writ for enforcement of the fundamental rights but it also lays a constitutional obligation on this Court to protect the fundamental rights of the people and for that purpose this Court has all inci- dental and ancillary powers including the power to forge new remedies and fashion new strategies designed to enforce the fundamental rights. It is in realisation of this constitu- tional obligation that this Court 822 has, in the past, innovated new methods and strategies for the purpose of securing enforcement of the fundamental rights, particularly in the case of the poor and the disad- vantaged who are denied their basic human rights and to whom freedom and liberty have no meaning. [827F-828A] 4.(ii) The power of the Court is not only injunctive in ambit, that is, preventing the infringement of fundamental right but it is also remedial in scope and provides relief

against a breach of the fundamental right already committed. [830A-B] 4.(iii) The power of the Court to grant such remedial relief may include the power to award compensation in appro- priate cases. The infringement of the fundamental right must be gross and patent, that is incontrovertible and exfacie glaring and either such infringement should be on a large scale affecting the fundamental rights of a large number of persons or it should appear unjust or unduly harsh or op- pressing on account of their poverty or disability or so- cially or economically disadvantaged position to require the person or persons affected by such infringement to initiate and pursue action in the Civil Courts. [830D; E-F] 4. (iv) Ordinarily a petition under Art. 32 should not be used as a substitute for enforcement of the right to claim compensation for infringement of a fundamental right through the ordinary process of Civil Court. It is only in exceptional cases that compensation may be awarded in a petition under Art. 32. [830F-G] 4.(v) The applications for compensation in the instant writ petition are for enforcement of the fundamental right to life enshrined in Art. 21 of the Constitution and while dealing with such applications the Court cannot adopt a hyper-technical approach which would defeat the ends of justice. The Court must look at the substance and not the form. Therefore, the instant applications for compensation

are maintainable under Art. 32. [827A-B] Bandhua Mukti Morcha v. Union of India & Ors., [1984] 2 SCR 67; S.P. Gupta v. Union of India, [1981] (Suppl.) SCR 87; Union for Democratic Rights & Ors. v. Union of India, [1983] 1 SCR 456 and Rudul Shah v. State of Bihar, AIR 1983 SC 1086, relied upon. 5. The rule in Rylands v. Fletcher (supra) laid down a principle of liability that if a person who brings on to his land and collects and keeps there anything likely to do harm and such thing escapes and does 823 damage to another, he is liable to compensate for the damage caused. This rule applies only to non-natural user of the land and it does not apply to things naturally on the land or where the escape is due to an act of God and an act of a stranger or the default of the person injured or where the thing which escapes is present by the consent of the person injured or in certain cases where there is statutory author- ity. This rule evolved in the 19th century at a time when all these developments of science and technology had not taken place cannot afford any guidance in evolving any standard of liability consistent with the constitutional norms and the needs of the present day economy and social structure. In a modern industrial society with highly de- veloped scientific knowledge and technology where hazardous or inherently dangerous industries are necessary to carry on as part of developmental programme, the Court need not feel

inhibited by this rule merely because the new law does not recognise the rule of strict and absolute liability in case of an enterprise engaged in hazardous and dangerous activi- ty. [842D-G] Halsburry Laws of England, Vol. 45 Para 1305, relied upon. 6.(i) Law has to grow in order to satisfy the needs of the fast changing society and keep abreast with the economic developments taking place in the country. Law cannot afford to remain static. The Court cannot allow judicial thinking to be constricted by reference to the law as it prevails in England or in any other foreign country. Although this Court should be prepared to receive light from whatever source it comes, but it has to build up its own jurisprudence, evolve new principles and lay down new norms which would adequately deal with the new problems which arise in a highly indus- trialised economy. If it is found that it is necessary to construct a new principle of law to deal with -an unusual situation which has arisen and which is likely to arise in future on account of hazardous or inherently dangerous industries which are concommitant to an industrial economy the Court should not hesitate to evolve such principles of liability merely because it has not been so done in England. [843A-E] 6(ii) This Court has throughout the last few years expanded the horizon of Art. 12 primarily to inject respect for human-rights and social conscience in corporate struc-

ture. The purpose of expansion has not been to destroy the raison d'etre of creating corporations but to advance the human rights jurisprudence. The apprehension that including within the ambit of Art. 12 and thus subjecting to the discipline of Art. 21 those private corporations whose activities have the potential of affecting the life and health of the people, would deal a death blow to 824 the policy of encouraging and permitting private enterpre- neurial activity is not well founded. It is through creative interpretation and bold innovation that the human-rights jurisprudence has been developed in India to a remarkable extent and this forward march of the humanrights movement cannot be allowed to be halted by unfounded apprehensions expressed by status quoists. [841C-E] 7.(i) 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 abso- lute non-delegable duty to the community to ensure that if any harm results to anyone, the enterprise must be held to be under an obligation to provide that the hazardous or inherently dangerous activity 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 irrespective of the fact

that the enterprise had taken all reasonable care and that the harm occurred without any negligence on its part. [843E-G] 7.(ii) If the enterprise is permitted to carry on an hazardous or inherently dangerous activity for its profit, the law must presume that such permission is conditional on the enterprise absorbing the cost of any accident arising on account of such activity as an appropriate item of its overheads. The enterprise alone has the resource to discover and guard against hazards or dangers and to provide warning against potential hazards. [844A-B] 7.(iii) The measure of compensation in such kind of cases must be co-related to the magnitude and capacity of the enterprise because such compensation must have a deter- rent effect. The larger and more prosperous the enterprise, the greater must be the amount of compensation payable by it for the harm caused on account of an accident in carrying on of the hazardous or inherently dangerous activity by the enterprise. [844E-F] 8. The historical context in which the American doctrine of State action evolved in the united States is irrelevant for the purpose of Indian Courts, especially in view of Art. 15(2) of the Indian Constitution. But, it is the principle behind the doctrine of State aid, control and regulation so impregnating a private activity as to give it the colour of State action which can be applied to the limited extent to

which it can be Indianised and harmoniously blended with Indian constitutional 825 jurisprudence. Indian Courts are not bound by the American exposition of constitutional law. The provisions of American Constitution cannot always be applied to Indian conditions or to the provisions of Indian Constitution and whilst some of the principles adumberated by the American decisions may provide a useful guide, close adherence to those principles while applying them to the provisions of the Indian Consti- tution is not to be favoured, because the social conditions in India are different. [840D-H] Ramanna Shetty v. International Airport Authority, [1979] 3 SCR 1014; Jackson v. Metropolitan Edison Co., 42 L.ed. (2d) 477; Air India v. Nargesh Mirza, [1982] 1 SCR 438 and General Electric Co. Maratha v. Gilbert, 50 L.ed (2d) 343, relied upon. JUDGMENT: ORIGINAL JURISDICTION: Writ Petition (Civil) No. 12739 of 1985. (Under Article 32 of the Constitution of India.) Petitioner-in-person. B. Datta, Additional Solicitor General, A.B. Diwan, F.S. Nariman, B.R.L. lyengar, Hardev Singh, Hemant Sharma, C.V.S. Rao, R.D. Aggarwal, Ms. S. Relan, R.S. Sodhi, S. Sukumaran, Ravinder Narain, D.N. Mishra, Aditya Narayan, Ms. Lira Goswami, S. Kachwaha, Mohan, Ravinder Bana, K.C. Dua, K. Kumaramangalam, O.C. Jain and K.R.R. Pilai for the Respond- ents. Raju Ramachandran for the Intervener.

Soli J. Sorabji for Citizens Action Committee. The Judgment of the Court was delivered by BHAGWATI, CJ. This writ petition under Article 32 of the Constitution has come before us on a reference made by a Bench of three Judges. The reference was made because cer- tain questions of seminal importance and high constitutional significance were raised in the course of arguments when the writ petition was originally heard. The facts giving rise to the writ petition and the subsequent events have been set out in some detail in the Judgment given by the Bench of three Judges on 17th February 1986, and it is therefore not necessary to reiterate the same. Suffice it to state that the Bench of three Judges 826 permitted Shriram Foods and Fertiliser Industries (hereinaf- ter 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. That would have ordinarily put an end to the main controversy raised in the writ petition which was filed in order to obtain a direction for closure of the various units of Shriram on the ground that they were hazardous to the community and the only point in dispute which would have survived would have been whether the units of Shriram should be directed to be removed from the place where they are presently situate and relocated in another place where there would not be much human habitation so that there would not be any real danger to the health and safety of the people. 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. These applications for compensation raised a number of issues of great constitu- tional 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 for 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 now come before us.

Mr. Diwan, learned 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. We do not think this preliminary objection raised by Mr. Diwan is sustainable. It is undoubt- edly true that the petitioner could have applied for amend- ment of the writ petition so as to include a claim for compensation but merely because he did 827 not do so, the applications for compensation made by the Delhi Legal Aid & Advice Board and the Delhi Bar Association cannot be thrown out. These applications for compensation are for enforcement of the fundamental right to life en- shrined in Article 21 of the Constitution and while dealing with such applications, we cannot adopt a hypertechnical approach which would defeat the ends of justice. This Court has 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. We cannot therefore sustain the preliminary objection raised by Mr. Diwan. The first question which requires to be considered is as to what is the scope and ambit of the jurisdiction of this Court under Article 32 since the applications for compensa- tion made by the Delhi Legal Aid and Advice Board and the Delhi Bar Association are applications sought to be main-

tained under that Article. We have already had occasion to consider the ambit and coverage of Article 32 in the Bandhua Mukti Morcha v. Union of India & Ors., [1984] 2 SCR 67 and we wholly endorse what has been stated by one of us namely, Bhagwati, J. as he then was in his judgment in that case in regard to the true scope and ambit of that Article. It may now be taken as well settled that Article 32 does not merely confer power on this Court to issue a direction, order or writ for enforcement of the fundamental rights but it also lays a constitutional obligation on this Court to protect the fundamental rights of the people and for that purpose this Court has all incidental and ancillary powers including the power to forge new remedies and fashion new strategies designed to' enforce the fundamental rights. It is in reali- sation of this constitutional obligation that this Court has in the past innovated new methods and strategies for the purpose of securing enforcement of the fundamental rights, 828 particularly in the case of the poor and the disadvantaged who are denied their basic human rights and to whom freedom and liberty have no meaning.

Thus it was in S,P. Gupta v. Union of India, [1981] Supp. SCC 87 that this Court held that "where a legal wrong or a legal injury is caused to a person or to a determinate class of persons by reason of violation of any constitution- al or legal right or any burden is imposed in contravention of any constitutional or legal provision or without authori- ty of law or any such legal wrong or legal injury or illegal burden is threatened, and any such person or determinate class of persons is by reason of poverty or disability or socially or economically disadvantaged position unable to approach the court for relief, any member of the public or social action group can maintain an application for an appropriate direction, order or writ in the High Court under Article 226 and in case of breach of any fundamental right of such person or class of persons, in this Court under Article 32 seeking judicial redress for the legal wrong or injury caused to such person or determinate class of per- sons." This Court also held in S.P. Gupta's case (supra) as also in the People's Union for Democratic Rights and Ors. v. Union of India, [1983] 1 SCR 456 and in Babdhua Mukti Mor- cha's case (supra) that procedure being merely a hand-maden of justice it should not stand in the way of access to justice to the weaker sections of Indian humanity and there- fore where the poor and the disadvantaged are concerned who are barely eking out a miserable existence with their sweat and toil and who are victims of an exploited society without any access to justice, this Court will not insist on a regular writ petition and even a letter addressed by a public spirited individual or a social action group acting probono publico would suffice to ignite the jurisdiction of this Court. We wholly endorse this statement of the law in regard to the broadening of locus standi and what-has come to be known as epistolary jurisdiction.

We may point out at this stage that in Bandhua Mukti Morcha's case (supra) some of us apprehending that letters addressed to individual justices may involve the court in frivolous cases and that possibly the view could be taken that such letters do not invoke the jurisdiction of the court as a whole, observed that such letters should not be addressed to individual justices of the court but to the Court or to the Chief Justice and his companion judges. We do not think that it would be right to reject a letter addressed to an individual justice of the court merely on the ground that it is not addressed to the court or to the Chief Justice and his companion Judges. We must not forget that 829 letters would ordinarily be addressed by poor and disadvan- taged persons or by social action groups who may not know the proper form of address. They may know only a particular Judge who comes from their State and they may therefore address the letters to him. If the Court were to insist that the letters must be addressed to the court, or to the Chief Justice and his companion Judges, it would exclude from the judicial ken a large number of letters and in the result deny access to justice to the deprived and vulnerable sec- tions of the community. We are therefore of the view that even if a letter is addressed to an individual Judge of the court, it should be entertained, provided of course it is by

or on behalf of a person in custody or on behalf of a woman or a child or a class of deprived or disadvantaged persons. We may point out that now there is no difficulty in enter- taining letters addressed to individual justice of the court, because this Court has a Public Interest Litigation Cell to which all letters addressed to the Court or to the individual justices are forwarded and the staff attached to this Cell examines the letters and it is only after scrutiny by the staff members attached to this Cell that the letters are placed before the Chief Justice and under his direction, they are listed before the Court. We must therefore hold that letters addressed to individual justice of the court should not be rejected merely because they fail to conform to the preferred form of address. Nor should the court adopt a rigid stance that no letters will be entertained unless they are supported by an affidavit. If the court were to insist on an affidavit as a condition of entertaining the letters the entire object and purpose of epistolary juris- diction would be frustrated because most of the poor and disadvantaged persons will then not be able to have easy access to the Court and even the social action groups will find it difficult to approach the Court. We may point out that the court has so far been entertaining letters without an affidavit and it is only in a few rare cases that it has

been found that the allegations made in the letters were false. But that might happen also in cases where the juris- diction of the Court is invoked in a regular way: In order to deal with these rival contentions we think it is necessary that we should trace that part of the devel- opment of Article 12 where this Court embarked on the path of evolving criteria by which a corporation could be termed 'other authority' under Article 12. In Rajasthan Electricity Board v. Mohan Lal, [1967] 3 SCR 377 this Court was called upon to consider whether the Rajasthan Electricity Board was an 'authority' within the meaning of the expression 'other authorities' in Article 12. Bhargava, J. who delivered the judgment of the majority pointed out that the expression 'other authorities' in Article 12 would include all constitutional and statutory authorities on whom powers are conferred by law. The learned Judge also said that if any body of persons has authority to issue directions, the dis-

obedience of which would be publishable as a criminal of- fence, that would be an indication that the concerned au- thority is 'State'. Shah, J., who delivered a separate judgment agreeing with the conclusion reached by the majori- ty, preferred to give a slightly different meaning to the expression 'other authorities'. He said that authorities, constitutional or statutory, would fail within the expres- sion "other authorities" only if they are invested with the sovereign power of the State, namely, the power to make rules and regulations which have the force of law. The ratio of this decision may thus be stated to be that a constitu- tional or statutory authority would be within the expression "other authorities" if it has been invested with statutory power to issue binding directions to third parties, the disobedience of which would entail penal consequences or it has the sovereign power to make rules and regulations having the force of law.

This test was followed by Ray, C J, in Sukhdev v. Bhagat Ram, [1975] 1 SCC 421. Mathew, J. however, in the same case propounded a broader test. The learned Judge emphasised that the concept of 'State' had undergone drastic changes in recent years and today 'State' could not be conceived of simply as a coercive machinery wielding the thunderbolt of authority; rather it has to be viewed mainly as a service corporation. He expanded on this dictum by stating that the emerging principle appears to be that a public corporation being an instrumentality or agency of the 'State' is subject to the same constitutional limitations as the 'State' it- self. The preconditions of this are two, namely, that the corporation is the creation of the 'State' and that there is existence of power in the corporation to invade the consti- tutional rights of the individual. This Court in Ram anna Shetty v. International Airport Authority, [1979] 3 SCR 1014 accepted and adopted the rational of instrumentality or agency of State put forward by Mathew, J., and spelt out certain criteria with whose aid such an inference could be made. However, before we come to these criteria we think it necessary to refer to the concern operating behind the exposition of the broader test by Justice Mathew which is of equal relevance to us today, especially considering the fact that the definition under Article 12 is. an inclusive and not an exhaustive definition. That concern is the need to curb arbitrary and unregulated power wherever and howsoever reposed.

In Ramanna D. Shetty v. International Airport Authority (supra) this Court deliberating on the criteria on the basis of which to determine whether a corporation is acting as instrumentality or agency of Government said that it was not possible to formulate an all inclu-

sive or exhaustive test which would adequately answer this question. There is no out and dried formula which would provide the correct division of corporations into those which are instrumentalities or agencies of Government and those which are not. The Court said whilst formulating the criteria that analogical aid can be taken from the concept of State Action as developed in the United States wherein the U.S. Courts have suggested that a private agency if supported by extra-ordinary assistance given by the State may be subject to the same constitutional limitations as the State. It was pointed out that the State's general common- law and statutory structure under which its people carry on their private affairs, own property and enter into con- tracts, each enjoying equality in terms of legal capacity, is not such assistance as would transform private conduct into State Action. "But if extensive and unusual financial assistance is given and the purpose of such assistance coincides with the purpose for which the corporation is expected to use the assistance and such purpose is of public character, it may be a relevant circumstance supporting an inference that the corporation is an instrumentality or agency of the Government".

On the question of State control, the Court in R.D. Shetty's case (supra) clarified that some control by the State would not be determinative of the question, since the State has considerable measure of control under its police power over all types of business organisations. But a find- ing of State financial support plus an unusual degree of control over the management and policies of the corporation might lead to the characterisation of the operation as State Action.

Whilst deliberating on the functional criteria namely, that the corporation is carrying out a governmental func- tion. the Court emphasised that classification of a function as governmental should not be done on earlier day percep- tions but on what the State today views as an indispensable part of its activities, for the State may deem it as essen- tial to its economy that it owns and operate a railroad, a mill or an irrigation system as it does to own and operate bridges street lights or a sewage disposal plant. The Court also reiterated in R.D. Shetty's case (supra) what was pointed out by Mathew, J. in Sukhdev v. Bhagatram that "Institutions engaged in matters of high public interest or public functions are by virtue of the nature of the func- tions performed government agencies. Activities which are too fundamental to the society are by definition too impor- tant not to be considered government functions." The above discussion was rounded off by the Court in R.D. 835 Shetty's case (supra) by enumerating the following five factors namely, (1) financial assistance given by the State and magnitude of such assistance (2) any other form of assistance whether of the usual kind or extraordinary (3) control of management and policies of the corporation by the State-nature and extent of control (4) State conferred or State protected monopoly status and (5) functions carried out by the corporation, whether public functions closely related to governmental functions, as relevant criteria for determining whether a corporation is an instrumentality or agency of the State or not, though the Court took care to point out that the enumeration was not exhaustive and that it was the aggregate or cumulative effect of all the rele- vant factors that must be taken as controlling. The criteria evolved by this Court in Ramanna Shetty's case (supra) were applied by this Court in Ajay Hasia v. Khalid Mujib, [1981] 2 SCR 79 where it was further empha- sised that:

On the canon of construction to be adopted for interpreting constitutional guarantees the Court pointed out: In this case the Court also set at rest the controversy as to whether the manner in which a corporation is brought into existence had any relevance to the question whether it is a State instrumentality or agency. The Court said that it is immaterial for the purpose of determining whether a corpora- tion is an instrumentality or agency of the State or not whether it is created by a Statute or under a statute: "the inquiry has to be not as to how the juristic person is born but why it has been brought into existence. The corporation may be a statutory corporation created by statute or it may be a Government company or a company formed under the Compa- nies Act, 1956 or it may be a society registered under the Societies Registration Act, 1860 or any other similar stat- ute". It would come within the ambit of Article 12, if it is found to an instrumentality or agency of the State on a proper assessment of the relevant factors. It will thus be seen that this Court has not permitted the corporate device to be utilised as a barrier ousting the constitutional control of the fundamental rights. Rather the Court has held:

hensions expressed by status quoists. But we do not propose to decide finally at the present stage whether a private corporation like Shriram would fall within the scope and ambit of Article 12, because we have not had sufficient time to consider and reflect on this question in depth- The hearing of this case before us 842 concluded only on 15th December 1986 and we are called upon to deliver our judgment within a period of four days, on 19th December 1986. We are therefore of the view that this is not a question on which we must make any definite pro- nouncement at this stage. But we would leave it for a proper and detailed consideration at a later stage if it becomes necessary to do so.

We must also deal with one other question which was seriously debated before us and that question is as to what is the measure of liability of an enterprise which is en- gaged in an hazardous or inherently dangerous industry, if by reason of an accident occurring in such industry, persons die or are injured. Does the rule in Rylands v. Fletcher apply or is there any other principle on which the liability can be determined? The rule in Rylands v. Fletcher was evolved in the year 1866 and it provides that a person who for his own purposes being on to his land and collects and keeps there anything likely to do mischief if it escapes must keep it at his peril and, if he falls to do so, is prima facie liable for the damage which is the natural consequence of its escape. The liability under this rule is strict and it is no defence that the thing escaped without that person's wilful act, default or neglect or even that he had no knowledge of its existence. This rule laid down a principle of liability that if a person who brings on to his land and collects and keeps there anything likely to do harm and such thing escapes and does damage to another, he is liable to compensate for the damage caused. Of course, this rule applies only to non-natural user of the land and it does not apply to things naturally on the land or where the escape is due to an act of God and an act of a stranger or

the default of the person injured or where the thing which escapes is present by the consent of the person injured or in certain cases where there is statutory authority. Vide Halsbury Laws of England, Vol. 45 para 1305. Considerable case law has developed in England as to what is natural and what is non-natural use of land and what are precisely the circumstances in which this rule may be displaced. But it is not necessary for us to consider these decisions laying down the parameters of this rule because in a modern industrial society with highly developed scientific knowledge and technology where hazardous or inherently dangerous indus- tries are necessary to carry out part of the developmental programme. This rule evolved in the 19th Century at a time when all these developments of science and technology had not taken place cannot afford any guidance in evolving any standard of liability consistent with the constitutional norms and the needs of the present day economy and social structure. We need not feel inhibited by this rule which was evolved in this context of a totally different kind of 843 economy. Law has to grow in order to satisfy the needs of the fast changing society and keep abreast with the economic developments taking place in the country. As new situations arise the law has to be evolved in order to meet the chal- lenge of such new situations. Law cannot afford to remain

static. 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 or for the matter of that in any other foreign country. We no longer need the crutches of a foreign legal order. We are certainly prepared to receive light from whatever source it comes but we have to build up our own jurisprudence and we cannot countenance an argument that merely because the new law does not recog- nise the rule of strict and absolute liability in cases of hazardous or dangerous liability or the rule as laid down in Rylands v. Fletcher as is developed in England recognises certain limitations and responsibilities. We in India cannot hold our hands back and I venture to evolve a new. principle of liability which English courts have not done. We have to develop our own law and if we find that it is necessary to construct a new principle of liability to deal with an unusual situation which has arisen and which is likely to arise in future on account of hazardous or inherently dan- gerous industries which are concommitant to an industrial economy, there is no reason why we should hesitate to evolve such principle of liability merely because it has not been so done in England. We are of the view 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 nondelegable 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. Since the persons harmed on account of the hazardous or inherently dangerous activity carried on by the enterprise would not be in a position to isolate the process of operation from the hazardous prepara- tion of substance or any other related element that caused the harm must be held strictly liable for causing such harm as a part of the social cost for carrying on the hazardous or 844 inherently dangerous activity. If the enterprise is permit- ted to carry on an hazardous or inherently dangerous activi- ty for its profit, the law must presume that such permission

is conditional on the enterprise absorbing the cost of any accident arising on account of such hazardous or inherently dangerous activity as an appropriate item of its over-heads. Such hazardous or inherently dangerous activity for private profit can be tolerated only on condition that the enter- prise engaged in such hazardous or inherently dangerous activity indemnifies all those who suffer on account of the carrying on of such hazardous or inherently dangerous activ- ity regardless of whether it is carried on carefully or not. This principle is also sustainable on the ground that the enterprise alone has the resource to discover and guard- against hazards or dangers and to provide warning against potential hazards. We would therefore hold that where an enterprise is engaged in a hazardous or inherently dangerous activity and harm results to anyone on account of an acci- dent in the operation of such hazardous or inherently dan- gerous 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 (supra). We would also like to point out that the measure of compensation in the kind of cases referred to in the preced-

ing paragraph must be co-related to the magnitude and capac- ity of the enterprise because such compensation must have a deferent effect. The larger and more prosperous the enter- prise, the greater must be the amount of compensation pay- able by it for the harm caused on account of an accident in the carrying on of the hazardous or inherently dangerous activity by the enterprise.

Since we are not deciding the question as to whether Shriram is an authority within the meaning of Article 12 so as to be subjected to the discipline of the fundamental right under Article 21, we do not think it would be justi- fied in setting up a special machinery for investigation of the claims for compensation made by those who allege that they have been the victims of oleum gas escape. But we would direct that Delhi Legal Aid and Advice Board to take up the cases of all those who claim to have suffered on account of oleum gas and to file actions on their behalf in the appro- priate court for claiming compensation against Shriram. Such actions claiming compensation may be filed by the Delhi Legal Aid and Advice Board.within two months from 845 today and the Delhi Administration is directed to provide the necessary funds to the Delhi Legal Aid and Advice Board for the purpose of filing and prosecuting such actions. The High Court will nominate one or more Judges as may be neces- sary for the purpose of trying such actions so that they may be expeditiously disposed of. So far as the issue of reloca- tion and other issues are concerned the writ petition will come up for hearing on 3rd February, 1987. A.P.J. Petition dis- posed of. 846

occurring in such industry, persons die or are injured. Does the rule in Rylands v. Fletcher, (1866 Law Report 1 Excheq- uer 265) apply or is there any other principle on which the liability can be determined. Disposing of the applications, HELD: 1. The question whether a private corporation like Shriram would fall within the scope and ambit of Art. 12 so as to be amenable to the discipline of Art. 21 is left for proper and detailed consideration at a later stage if it becomes necessary to do so. [844F-G] Rajasthan Electricity Board v. Mohan Lal, [1967] 3 SCR 377; Sukhdev v. Bhagwat Ram, [1975] 1 SCC 421; Ramanna Shetty v. International Airport Authority, [1979] 3 SCR 1014; Ajay Hasia v. Khalid Mujib, [1981] 2 SCR 79; Som Prakash v. Union of India, [1981] 1 S.C.C. 449; Appendix I to Industrial Policy Resolution, 1948; Industries (Develop- ment and Regulation) Act, 1951; Delhi Municipal Act, 1957 Water (Prevention and Control of Pollution) Act, 1974; Air (Prevention and Control of Pollution) Act, 1981; Eurasian Equipment and Chemicals Ltd. v. State of West Bengal, [1975] 2 SCR 674; Rasbehari Panda v. St.ate, [1969] 3 SCR 374; Kas- turi Lal Reddy v. State of Jammu & Kashmir, [1980] 3 SCR 1338, referred to. 821 2. The Delhi Legal Aid and Advice Board is directed to take up the cases of all those who claim to have suffered on account of oleum gas and to file actions on their behalf in

the appropriate Court for claiming compensation and the Delhi Administration is directed to provide necessary funds to the Board for the purpose. [844G-H; 845A] 3.(i) 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 regular writ petition under Art. 226 in the High Court and under Art. 32 in this Court, but also by addressing a letter to the Court. [828B-C; E-F] 3.(ii) Even if a letter is addressed to an individual Judge of the Court, it should be entertained, provided of course it is by or on behalf of a person in custody or on behalf of a woman or a child or a class or deprived or disadvantaged persons. [829B-C] 3.(iii) Letters addressed to individual Justices of this Court should not be rejected merely because they fail to conform to the preferred form of address nor should the Court adopt a rigid stance that no letters will be enter- tained unless they are supported by an affidavit. If the Court were to insist on an affidavit as a condition of entertaining the letters the entire object and purpose of

epistolary jurisdiction would be frustrated because most of the poor and disadvantaged persons will then not be able to have easy access to the Court and even the social action groups will find it difficult to approach the Court. [828H; 829B] Bandhua Mukti Morcha v. Union of India & Ors., [1984] 2 SCR 67; S.P. Gupta v. Union of India, [1981] (Suppl) SCC 87 and Union for Democratic Rights & Ors. v. Union of India, [1983] 1 SCR 456, relied upon. 4.(i) Article 32 does not merely confer power on this Court to issue direction, order or writ for enforcement of the fundamental rights but it also lays a constitutional obligation on this Court to protect the fundamental rights of the people and for that purpose this Court has all inci- dental and ancillary powers including the power to forge new remedies and fashion new strategies designed to enforce the fundamental rights. It is in realisation of this constitu- tional obligation that this Court 822 has, in the past, innovated new methods and strategies for the purpose of securing enforcement of the fundamental rights, particularly in the case of the poor and the disad- vantaged who are denied their basic human rights and to whom freedom and liberty have no meaning. [827F-828A] 4.(ii) The power of the Court is not only injunctive in ambit, that is, preventing the infringement of fundamental right but it is also remedial in scope and provides relief

against a breach of the fundamental right already committed. [830A-B] 4.(iii) The power of the Court to grant such remedial relief may include the power to award compensation in appro- priate cases. The infringement of the fundamental right must be gross and patent, that is incontrovertible and exfacie glaring and either such infringement should be on a large scale affecting the fundamental rights of a large number of persons or it should appear unjust or unduly harsh or op- pressing on account of their poverty or disability or so- cially or economically disadvantaged position to require the person or persons affected by such infringement to initiate and pursue action in the Civil Courts. [830D; E-F] 4. (iv) Ordinarily a petition under Art. 32 should not be used as a substitute for enforcement of the right to claim compensation for infringement of a fundamental right through the ordinary process of Civil Court. It is only in exceptional cases that compensation may be awarded in a petition under Art. 32. [830F-G] 4.(v) The applications for compensation in the instant writ petition are for enforcement of the fundamental right to life enshrined in Art. 21 of the Constitution and while dealing with such applications the Court cannot adopt a hyper-technical approach which would defeat the ends of justice. The Court must look at the substance and not the form. Therefore, the instant applications for compensation

are maintainable under Art. 32. [827A-B] Bandhua Mukti Morcha v. Union of India & Ors., [1984] 2 SCR 67; S.P. Gupta v. Union of India, [1981] (Suppl.) SCR 87; Union for Democratic Rights & Ors. v. Union of India, [1983] 1 SCR 456 and Rudul Shah v. State of Bihar, AIR 1983 SC 1086, relied upon. 5. The rule in Rylands v. Fletcher (supra) laid down a principle of liability that if a person who brings on to his land and collects and keeps there anything likely to do harm and such thing escapes and does 823 damage to another, he is liable to compensate for the damage caused. This rule applies only to non-natural user of the land and it does not apply to things naturally on the land or where the escape is due to an act of God and an act of a stranger or the default of the person injured or where the thing which escapes is present by the consent of the person injured or in certain cases where there is statutory author- ity. This rule evolved in the 19th century at a time when all these developments of science and technology had not taken place cannot afford any guidance in evolving any standard of liability consistent with the constitutional norms and the needs of the present day economy and social structure. In a modern industrial society with highly de- veloped scientific knowledge and technology where hazardous or inherently dangerous industries are necessary to carry on as part of developmental programme, the Court need not feel

inhibited by this rule merely because the new law does not recognise the rule of strict and absolute liability in case of an enterprise engaged in hazardous and dangerous activi- ty. [842D-G] Halsburry Laws of England, Vol. 45 Para 1305, relied upon. 6.(i) Law has to grow in order to satisfy the needs of the fast changing society and keep abreast with the economic developments taking place in the country. Law cannot afford to remain static. The Court cannot allow judicial thinking to be constricted by reference to the law as it prevails in England or in any other foreign country. Although this Court should be prepared to receive light from whatever source it comes, but it has to build up its own jurisprudence, evolve new principles and lay down new norms which would adequately deal with the new problems which arise in a highly indus- trialised economy. If it is found that it is necessary to construct a new principle of law to deal with -an unusual situation which has arisen and which is likely to arise in future on account of hazardous or inherently dangerous industries which are concommitant to an industrial economy the Court should not hesitate to evolve such principles of liability merely because it has not been so done in England. [843A-E] 6(ii) This Court has throughout the last few years expanded the horizon of Art. 12 primarily to inject respect for human-rights and social conscience in corporate struc-

ture. The purpose of expansion has not been to destroy the raison d'etre of creating corporations but to advance the human rights jurisprudence. The apprehension that including within the ambit of Art. 12 and thus subjecting to the discipline of Art. 21 those private corporations whose activities have the potential of affecting the life and health of the people, would deal a death blow to 824 the policy of encouraging and permitting private enterpre- neurial activity is not well founded. It is through creative interpretation and bold innovation that the human-rights jurisprudence has been developed in India to a remarkable extent and this forward march of the humanrights movement cannot be allowed to be halted by unfounded apprehensions expressed by status quoists. [841C-E] 7.(i) 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 abso- lute non-delegable duty to the community to ensure that if any harm results to anyone, the enterprise must be held to be under an obligation to provide that the hazardous or inherently dangerous activity 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 irrespective of the fact

that the enterprise had taken all reasonable care and that the harm occurred without any negligence on its part. [843E-G] 7.(ii) If the enterprise is permitted to carry on an hazardous or inherently dangerous activity for its profit, the law must presume that such permission is conditional on the enterprise absorbing the cost of any accident arising on account of such activity as an appropriate item of its overheads. The enterprise alone has the resource to discover and guard against hazards or dangers and to provide warning against potential hazards. [844A-B] 7.(iii) The measure of compensation in such kind of cases must be co-related to the magnitude and capacity of the enterprise because such compensation must have a deter- rent effect. The larger and more prosperous the enterprise, the greater must be the amount of compensation payable by it for the harm caused on account of an accident in carrying on of the hazardous or inherently dangerous activity by the enterprise. [844E-F] 8. The historical context in which the American doctrine of State action evolved in the united States is irrelevant for the purpose of Indian Courts, especially in view of Art. 15(2) of the Indian Constitution. But, it is the principle behind the doctrine of State aid, control and regulation so impregnating a private activity as to give it the colour of State action which can be applied to the limited extent to

which it can be Indianised and harmoniously blended with Indian constitutional 825 jurisprudence. Indian Courts are not bound by the American exposition of constitutional law. The provisions of American Constitution cannot always be applied to Indian conditions or to the provisions of Indian Constitution and whilst some of the principles adumberated by the American decisions may provide a useful guide, close adherence to those principles while applying them to the provisions of the Indian Consti- tution is not to be favoured, because the social conditions in India are different. [840D-H] Ramanna Shetty v. International Airport Authority, [1979] 3 SCR 1014; Jackson v. Metropolitan Edison Co., 42 L.ed. (2d) 477; Air India v. Nargesh Mirza, [1982] 1 SCR 438 and General Electric Co. Maratha v. Gilbert, 50 L.ed (2d) 343, relied upon. JUDGMENT: ORIGINAL JURISDICTION: Writ Petition (Civil) No. 12739 of 1985. (Under Article 32 of the Constitution of India.) Petitioner-in-person. B. Datta, Additional Solicitor General, A.B. Diwan, F.S. Nariman, B.R.L. lyengar, Hardev Singh, Hemant Sharma, C.V.S. Rao, R.D. Aggarwal, Ms. S. Relan, R.S. Sodhi, S. Sukumaran, Ravinder Narain, D.N. Mishra, Aditya Narayan, Ms. Lira Goswami, S. Kachwaha, Mohan, Ravinder Bana, K.C. Dua, K. Kumaramangalam, O.C. Jain and K.R.R. Pilai for the Respond- ents. Raju Ramachandran for the Intervener.

Soli J. Sorabji for Citizens Action Committee. The Judgment of the Court was delivered by BHAGWATI, CJ. This writ petition under Article 32 of the Constitution has come before us on a reference made by a Bench of three Judges. The reference was made because cer- tain questions of seminal importance and high constitutional significance were raised in the course of arguments when the writ petition was originally heard. The facts giving rise to the writ petition and the subsequent events have been set out in some detail in the Judgment given by the Bench of three Judges on 17th February 1986, and it is therefore not necessary to reiterate the same. Suffice it to state that the Bench of three Judges 826 permitted Shriram Foods and Fertiliser Industries (hereinaf- ter 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. That would have ordinarily put an end to the main controversy raised in the writ petition which was filed in order to obtain a direction for closure of the various units of Shriram on the ground that they were hazardous to the community and the only point in dispute which would have survived would have been whether the units of Shriram should be directed to be removed from the place where they are presently situate and relocated in another place where there would not be much human habitation so that there would not be any real danger to the health and safety of the people. 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. These applications for compensation raised a number of issues of great constitu- tional 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 for 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 now come before us.

Mr. Diwan, learned 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. We do not think this preliminary objection raised by Mr. Diwan is sustainable. It is undoubt- edly true that the petitioner could have applied for amend- ment of the writ petition so as to include a claim for compensation but merely because he did 827 not do so, the applications for compensation made by the Delhi Legal Aid & Advice Board and the Delhi Bar Association cannot be thrown out. These applications for compensation are for enforcement of the fundamental right to life en- shrined in Article 21 of the Constitution and while dealing with such applications, we cannot adopt a hypertechnical approach which would defeat the ends of justice. This Court has 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. We cannot therefore sustain the preliminary objection raised by Mr. Diwan. The first question which requires to be considered is as to what is the scope and ambit of the jurisdiction of this Court under Article 32 since the applications for compensa- tion made by the Delhi Legal Aid and Advice Board and the Delhi Bar Association are applications sought to be main-

tained under that Article. We have already had occasion to consider the ambit and coverage of Article 32 in the Bandhua Mukti Morcha v. Union of India & Ors., [1984] 2 SCR 67 and we wholly endorse what has been stated by one of us namely, Bhagwati, J. as he then was in his judgment in that case in regard to the true scope and ambit of that Article. It may now be taken as well settled that Article 32 does not merely confer power on this Court to issue a direction, order or writ for enforcement of the fundamental rights but it also lays a constitutional obligation on this Court to protect the fundamental rights of the people and for that purpose this Court has all incidental and ancillary powers including the power to forge new remedies and fashion new strategies designed to' enforce the fundamental rights. It is in reali- sation of this constitutional obligation that this Court has in the past innovated new methods and strategies for the purpose of securing enforcement of the fundamental rights, 828 particularly in the case of the poor and the disadvantaged who are denied their basic human rights and to whom freedom and liberty have no meaning.

Thus it was in S,P. Gupta v. Union of India, [1981] Supp. SCC 87 that this Court held that "where a legal wrong or a legal injury is caused to a person or to a determinate class of persons by reason of violation of any constitution- al or legal right or any burden is imposed in contravention of any constitutional or legal provision or without authori- ty of law or any such legal wrong or legal injury or illegal burden is threatened, and any such person or determinate class of persons is by reason of poverty or disability or socially or economically disadvantaged position unable to approach the court for relief, any member of the public or social action group can maintain an application for an appropriate direction, order or writ in the High Court under Article 226 and in case of breach of any fundamental right of such person or class of persons, in this Court under Article 32 seeking judicial redress for the legal wrong or injury caused to such person or determinate class of per- sons." This Court also held in S.P. Gupta's case (supra) as also in the People's Union for Democratic Rights and Ors. v. Union of India, [1983] 1 SCR 456 and in Babdhua Mukti Mor- cha's case (supra) that procedure being merely a hand-maden of justice it should not stand in the way of access to justice to the weaker sections of Indian humanity and there- fore where the poor and the disadvantaged are concerned who are barely eking out a miserable existence with their sweat and toil and who are victims of an exploited society without any access to justice, this Court will not insist on a regular writ petition and even a letter addressed by a public spirited individual or a social action group acting probono publico would suffice to ignite the jurisdiction of this Court. We wholly endorse this statement of the law in regard to the broadening of locus standi and what-has come to be known as epistolary jurisdiction.

We may point out at this stage that in Bandhua Mukti Morcha's case (supra) some of us apprehending that letters addressed to individual justices may involve the court in frivolous cases and that possibly the view could be taken that such letters do not invoke the jurisdiction of the court as a whole, observed that such letters should not be addressed to individual justices of the court but to the Court or to the Chief Justice and his companion judges. We do not think that it would be right to reject a letter addressed to an individual justice of the court merely on the ground that it is not addressed to the court or to the Chief Justice and his companion Judges. We must not forget that 829 letters would ordinarily be addressed by poor and disadvan- taged persons or by social action groups who may not know the proper form of address. They may know only a particular Judge who comes from their State and they may therefore address the letters to him. If the Court were to insist that the letters must be addressed to the court, or to the Chief Justice and his companion Judges, it would exclude from the judicial ken a large number of letters and in the result deny access to justice to the deprived and vulnerable sec- tions of the community. We are therefore of the view that even if a letter is addressed to an individual Judge of the court, it should be entertained, provided of course it is by

or on behalf of a person in custody or on behalf of a woman or a child or a class of deprived or disadvantaged persons. We may point out that now there is no difficulty in enter- taining letters addressed to individual justice of the court, because this Court has a Public Interest Litigation Cell to which all letters addressed to the Court or to the individual justices are forwarded and the staff attached to this Cell examines the letters and it is only after scrutiny by the staff members attached to this Cell that the letters are placed before the Chief Justice and under his direction, they are listed before the Court. We must therefore hold that letters addressed to individual justice of the court should not be rejected merely because they fail to conform to the preferred form of address. Nor should the court adopt a rigid stance that no letters will be entertained unless they are supported by an affidavit. If the court were to insist on an affidavit as a condition of entertaining the letters the entire object and purpose of epistolary juris- diction would be frustrated because most of the poor and disadvantaged persons will then not be able to have easy access to the Court and even the social action groups will find it difficult to approach the Court. We may point out that the court has so far been entertaining letters without an affidavit and it is only in a few rare cases that it has

been found that the allegations made in the letters were false. But that might happen also in cases where the juris- diction of the Court is invoked in a regular way: In order to deal with these rival contentions we think it is necessary that we should trace that part of the devel- opment of Article 12 where this Court embarked on the path of evolving criteria by which a corporation could be termed 'other authority' under Article 12. In Rajasthan Electricity Board v. Mohan Lal, [1967] 3 SCR 377 this Court was called upon to consider whether the Rajasthan Electricity Board was an 'authority' within the meaning of the expression 'other authorities' in Article 12. Bhargava, J. who delivered the judgment of the majority pointed out that the expression 'other authorities' in Article 12 would include all constitutional and statutory authorities on whom powers are conferred by law. The learned Judge also said that if any body of persons has authority to issue directions, the dis-

obedience of which would be publishable as a criminal of- fence, that would be an indication that the concerned au- thority is 'State'. Shah, J., who delivered a separate judgment agreeing with the conclusion reached by the majori- ty, preferred to give a slightly different meaning to the expression 'other authorities'. He said that authorities, constitutional or statutory, would fail within the expres- sion "other authorities" only if they are invested with the sovereign power of the State, namely, the power to make rules and regulations which have the force of law. The ratio of this decision may thus be stated to be that a constitu- tional or statutory authority would be within the expression "other authorities" if it has been invested with statutory power to issue binding directions to third parties, the disobedience of which would entail penal consequences or it has the sovereign power to make rules and regulations having the force of law.

This test was followed by Ray, C J, in Sukhdev v. Bhagat Ram, [1975] 1 SCC 421. Mathew, J. however, in the same case propounded a broader test. The learned Judge emphasised that the concept of 'State' had undergone drastic changes in recent years and today 'State' could not be conceived of simply as a coercive machinery wielding the thunderbolt of authority; rather it has to be viewed mainly as a service corporation. He expanded on this dictum by stating that the emerging principle appears to be that a public corporation being an instrumentality or agency of the 'State' is subject to the same constitutional limitations as the 'State' it- self. The preconditions of this are two, namely, that the corporation is the creation of the 'State' and that there is existence of power in the corporation to invade the consti- tutional rights of the individual. This Court in Ram anna Shetty v. International Airport Authority, [1979] 3 SCR 1014 accepted and adopted the rational of instrumentality or agency of State put forward by Mathew, J., and spelt out certain criteria with whose aid such an inference could be made. However, before we come to these criteria we think it necessary to refer to the concern operating behind the exposition of the broader test by Justice Mathew which is of equal relevance to us today, especially considering the fact that the definition under Article 12 is. an inclusive and not an exhaustive definition. That concern is the need to curb arbitrary and unregulated power wherever and howsoever reposed.

In Ramanna D. Shetty v. International Airport Authority (supra) this Court deliberating on the criteria on the basis of which to determine whether a corporation is acting as instrumentality or agency of Government said that it was not possible to formulate an all inclu-

sive or exhaustive test which would adequately answer this question. There is no out and dried formula which would provide the correct division of corporations into those which are instrumentalities or agencies of Government and those which are not. The Court said whilst formulating the criteria that analogical aid can be taken from the concept of State Action as developed in the United States wherein the U.S. Courts have suggested that a private agency if supported by extra-ordinary assistance given by the State may be subject to the same constitutional limitations as the State. It was pointed out that the State's general common- law and statutory structure under which its people carry on their private affairs, own property and enter into con- tracts, each enjoying equality in terms of legal capacity, is not such assistance as would transform private conduct into State Action. "But if extensive and unusual financial assistance is given and the purpose of such assistance coincides with the purpose for which the corporation is expected to use the assistance and such purpose is of public character, it may be a relevant circumstance supporting an inference that the corporation is an instrumentality or agency of the Government".

On the question of State control, the Court in R.D. Shetty's case (supra) clarified that some control by the State would not be determinative of the question, since the State has considerable measure of control under its police power over all types of business organisations. But a find- ing of State financial support plus an unusual degree of control over the management and policies of the corporation might lead to the characterisation of the operation as State Action.

Whilst deliberating on the functional criteria namely, that the corporation is carrying out a governmental func- tion. the Court emphasised that classification of a function as governmental should not be done on earlier day percep- tions but on what the State today views as an indispensable part of its activities, for the State may deem it as essen- tial to its economy that it owns and operate a railroad, a mill or an irrigation system as it does to own and operate bridges street lights or a sewage disposal plant. The Court also reiterated in R.D. Shetty's case (supra) what was pointed out by Mathew, J. in Sukhdev v. Bhagatram that "Institutions engaged in matters of high public interest or public functions are by virtue of the nature of the func- tions performed government agencies. Activities which are too fundamental to the society are by definition too impor- tant not to be considered government functions." The above discussion was rounded off by the Court in R.D. 835 Shetty's case (supra) by enumerating the following five factors namely, (1) financial assistance given by the State and magnitude of such assistance (2) any other form of assistance whether of the usual kind or extraordinary (3) control of management and policies of the corporation by the State-nature and extent of control (4) State conferred or State protected monopoly status and (5) functions carried out by the corporation, whether public functions closely related to governmental functions, as relevant criteria for determining whether a corporation is an instrumentality or agency of the State or not, though the Court took care to point out that the enumeration was not exhaustive and that it was the aggregate or cumulative effect of all the rele- vant factors that must be taken as controlling. The criteria evolved by this Court in Ramanna Shetty's case (supra) were applied by this Court in Ajay Hasia v. Khalid Mujib, [1981] 2 SCR 79 where it was further empha- sised that:

On the canon of construction to be adopted for interpreting constitutional guarantees the Court pointed out: In this case the Court also set at rest the controversy as to whether the manner in which a corporation is brought into existence had any relevance to the question whether it is a State instrumentality or agency. The Court said that it is immaterial for the purpose of determining whether a corpora- tion is an instrumentality or agency of the State or not whether it is created by a Statute or under a statute: "the inquiry has to be not as to how the juristic person is born but why it has been brought into existence. The corporation may be a statutory corporation created by statute or it may be a Government company or a company formed under the Compa- nies Act, 1956 or it may be a society registered under the Societies Registration Act, 1860 or any other similar stat- ute". It would come within the ambit of Article 12, if it is found to an instrumentality or agency of the State on a proper assessment of the relevant factors. It will thus be seen that this Court has not permitted the corporate device to be utilised as a barrier ousting the constitutional control of the fundamental rights. Rather the Court has held:

hensions expressed by status quoists. But we do not propose to decide finally at the present stage whether a private corporation like Shriram would fall within the scope and ambit of Article 12, because we have not had sufficient time to consider and reflect on this question in depth- The hearing of this case before us 842 concluded only on 15th December 1986 and we are called upon to deliver our judgment within a period of four days, on 19th December 1986. We are therefore of the view that this is not a question on which we must make any definite pro- nouncement at this stage. But we would leave it for a proper and detailed consideration at a later stage if it becomes necessary to do so.

We must also deal with one other question which was seriously debated before us and that question is as to what is the measure of liability of an enterprise which is en- gaged in an hazardous or inherently dangerous industry, if by reason of an accident occurring in such industry, persons die or are injured. Does the rule in Rylands v. Fletcher apply or is there any other principle on which the liability can be determined? The rule in Rylands v. Fletcher was evolved in the year 1866 and it provides that a person who for his own purposes being on to his land and collects and keeps there anything likely to do mischief if it escapes must keep it at his peril and, if he falls to do so, is prima facie liable for the damage which is the natural consequence of its escape. The liability under this rule is strict and it is no defence that the thing escaped without that person's wilful act, default or neglect or even that he had no knowledge of its existence. This rule laid down a principle of liability that if a person who brings on to his land and collects and keeps there anything likely to do harm and such thing escapes and does damage to another, he is liable to compensate for the damage caused. Of course, this rule applies only to non-natural user of the land and it does not apply to things naturally on the land or where the escape is due to an act of God and an act of a stranger or

the default of the person injured or where the thing which escapes is present by the consent of the person injured or in certain cases where there is statutory authority. Vide Halsbury Laws of England, Vol. 45 para 1305. Considerable case law has developed in England as to what is natural and what is non-natural use of land and what are precisely the circumstances in which this rule may be displaced. But it is not necessary for us to consider these decisions laying down the parameters of this rule because in a modern industrial society with highly developed scientific knowledge and technology where hazardous or inherently dangerous indus- tries are necessary to carry out part of the developmental programme. This rule evolved in the 19th Century at a time when all these developments of science and technology had not taken place cannot afford any guidance in evolving any standard of liability consistent with the constitutional norms and the needs of the present day economy and social structure. We need not feel inhibited by this rule which was evolved in this context of a totally different kind of 843 economy. Law has to grow in order to satisfy the needs of the fast changing society and keep abreast with the economic developments taking place in the country. As new situations arise the law has to be evolved in order to meet the chal- lenge of such new situations. Law cannot afford to remain

static. 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 or for the matter of that in any other foreign country. We no longer need the crutches of a foreign legal order. We are certainly prepared to receive light from whatever source it comes but we have to build up our own jurisprudence and we cannot countenance an argument that merely because the new law does not recog- nise the rule of strict and absolute liability in cases of hazardous or dangerous liability or the rule as laid down in Rylands v. Fletcher as is developed in England recognises certain limitations and responsibilities. We in India cannot hold our hands back and I venture to evolve a new. principle of liability which English courts have not done. We have to develop our own law and if we find that it is necessary to construct a new principle of liability to deal with an unusual situation which has arisen and which is likely to arise in future on account of hazardous or inherently dan- gerous industries which are concommitant to an industrial economy, there is no reason why we should hesitate to evolve such principle of liability merely because it has not been so done in England. We are of the view 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 nondelegable 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. Since the persons harmed on account of the hazardous or inherently dangerous activity carried on by the enterprise would not be in a position to isolate the process of operation from the hazardous prepara- tion of substance or any other related element that caused the harm must be held strictly liable for causing such harm as a part of the social cost for carrying on the hazardous or 844 inherently dangerous activity. If the enterprise is permit- ted to carry on an hazardous or inherently dangerous activi- ty for its profit, the law must presume that such permission

is conditional on the enterprise absorbing the cost of any accident arising on account of such hazardous or inherently dangerous activity as an appropriate item of its over-heads. Such hazardous or inherently dangerous activity for private profit can be tolerated only on condition that the enter- prise engaged in such hazardous or inherently dangerous activity indemnifies all those who suffer on account of the carrying on of such hazardous or inherently dangerous activ- ity regardless of whether it is carried on carefully or not. This principle is also sustainable on the ground that the enterprise alone has the resource to discover and guard- against hazards or dangers and to provide warning against potential hazards. We would therefore hold that where an enterprise is engaged in a hazardous or inherently dangerous activity and harm results to anyone on account of an acci- dent in the operation of such hazardous or inherently dan- gerous 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 (supra). We would also like to point out that the measure of compensation in the kind of cases referred to in the preced-

ing paragraph must be co-related to the magnitude and capac- ity of the enterprise because such compensation must have a deferent effect. The larger and more prosperous the enter- prise, the greater must be the amount of compensation pay- able by it for the harm caused on account of an accident in the carrying on of the hazardous or inherently dangerous activity by the enterprise.

Since we are not deciding the question as to whether Shriram is an authority within the meaning of Article 12 so as to be subjected to the discipline of the fundamental right under Article 21, we do not think it would be justi- fied in setting up a special machinery for investigation of the claims for compensation made by those who allege that they have been the victims of oleum gas escape. But we would direct that Delhi Legal Aid and Advice Board to take up the cases of all those who claim to have suffered on account of oleum gas and to file actions on their behalf in the appro- priate court for claiming compensation against Shriram. Such actions claiming compensation may be filed by the Delhi Legal Aid and Advice Board.within two months from 845 today and the Delhi Administration is directed to provide the necessary funds to the Delhi Legal Aid and Advice Board for the purpose of filing and prosecuting such actions. The High Court will nominate one or more Judges as may be neces- sary for the purpose of trying such actions so that they may be expeditiously disposed of. So far as the issue of reloca- tion and other issues are concerned the writ petition will come up for hearing on 3rd February, 1987. A.P.J. Petition dis- posed of. 846