27

COMMITTEE ON SUBORDINATE LEGISLATION

(FIFTEENTH LOK SABHA)
(2011-2012)

TWENTY SEVENTH REPORT

THE CIVIL LIABILITY FOR NUCLEAR DAMAGE RULES, 2011

(PRESENTED ON 28.8.2012)

LOK SABHA SECRETARIAT

NEW DELHI

August, 2012/Bhadra,1934 (Saka)

COSL No.36

PRICE: Rs.

(C) 2012 BY LOK SABHA SECRETARIAT

Published under Rule 382 of the Rules of Procedure and Conduct of

Business in Lok Sabha (Fourteenth Edition) and printed by the Manager,
Government of India Press, Minto Road, New Delhi.
 CONTENTS

Para No. Page No.

COMPOSITION OF THE COMMITTEE (iii)

INTRODUCTION (v)

REPORT

I. Background 1.1-1.10 1
II. Interim Relief to the victims of Nuclear 2.1-2.8 7
Damage
III. Right of Recourse 3.1-3.15 10

IV. Notification of Nuclear incident 4.1-4.4 21

V. Delay in framing Rules 5.1-5.7 23
VI. Legislation by reference 6.1-6.5 26
VII.LDefinition of Terms in Act/Rules 7.1-7.6 28

APPENDICES

I. Summary of main recommendations/observations made by the 31

Committee

II. Extracts of the Minutes of the fourth sitting of the Committee 35

(2011-12) held on 16.4.2012 and Minutes of the Ninth sitting
of the Committee (2011-12) held on 27.8.2012.

(ii)
COMPOSITION OF THE COMMITTEE ON SUBORDINATE LEGISLATION
(2011-2012)

1. Shri P. Karunakaran Chairman

2. Shri Ghanshyam Anuragi

3. Shri Praveen Singh Aron
4. Shri Kalyan Banerjee
5. Shri E.T. Mohammed Basheer
6. Shri Ramen Deka
7. Shri Mahesh Joshi
8. Shri Virender Kashyap
9. Shri Jitender Singh Malik
10. Dr. Thokchom Meinya
11. Ms. Mausam Noor
12. Shri Gajendra Singh Rajukhedi
13. Dr. Bhola Singh
14. Shri Vijay Bahadur Singh
15. Shri A.K.S. Vijayan
SECRETARIAT

1. Shri A. Louis Martin - Joint Secretary

2. Shri S.C. Chaudhary - Director
3. Shri Sirinivasulu Gunda - Addl. Director
4. Shri Krishendra Kumar - Under Secretary
(iii)
 INTRODUCTION

I, the Chairman, Committee on Subordinate Legislation having been

authorized by the Committee to submit the report on their behalf, present this
Twenty Seventh Report.

2. The matters covered by this Report were considered by the Committee on

Subordinate Legislation at their sitting held on 16.4.2012.

3. The Committee considered and adopted this Report at their sitting held on
27.8.2012.

4. For facility of reference and convenience, recommendations/observations

of the Committee have been printed in thick type in the body of the Report and
have also been reproduced in Appendix-I of the Report.

5. Extracts of the Minutes of the fourth sitting of the Committee (2011-12) held
on 16.4.2012 and Minutes of the Ninth sitting of the Committee (2011-12) held on
27.8.2012 relevant to this Report are included in Appendix-II.

P. KARUNAKARAN
New Delhi; Chairman,
August, 2012 Committee on Subordinate Legislation
Bhadra, 1934 (Saka)

(v)
 REPORT

BACKGROUND

The Civil Liability For Nuclear Damage Rules, 2011

The nuclear industry in India is growing and it is expected to form an

important part of the energy mix of the country. In the unlikely event of a
nuclear accident or incident, there may be damage to individuals, property
and environment on a large scale.

1.2 Details of the major nuclear incidents/accidents involving loss of life

and damage to property, that have taken place in nuclear power plants
across the world over a period of time as furnished by the Department of
Atomic Energy (DAE) are as follows:-
“Over the years three major nuclear accidents have occurred in the world
at Three Mile Island, USA in 1979, Chernobyl, Ukraine (in the then USSR) in
1986, and Fukushima Daiichi, Japan in 2011. While 30 people have
reportedly died due to Chernobyl accident, no deaths have been reported
due to nuclear accidents at TMI and Fukushima. Brief details are as follows-
(1) In 1979 at Three Mile Island nuclear power plant in USA a cooling
malfunction caused part of the core to melt in the TMI-2 reactor. Some
radioactive gas was released a couple of days after the accident, but not
enough to cause any dose above background levels to local residents.
 There were no injuries or adverse health effects from the Three Mile Island
accident. More than a dozen major, independent health studies of the
accident showed no evidence of any abnormal number of cancers around
TMI year after the accident. The only detectable effect was psychological
stress during and shortly after the accidents.
(2) The Chernobyl accident in 1986 was the result of a flawed reactor
design that was operated with inadequately trained personnel. Two
Chernobyl plant workers died on the night of the accident, and a further 28
people died within a few weeks as a result of acute radiation poisoning.
United Nations Scientific Committee on the Effects of Atomic Radiation says
that apart from increased thyroid cancers, “there is no evidence of a major
public health impacts attributable to radiation exposure 20 years after the
accident”. Resettlement of areas from which people were relocated is
ongoing.
(3) Following a major earthquake, a 15-meter tsunami disabled the
power supply and cooling of three Fukushima Daiichi reactors, causing a
nuclear accident on 11 March 2011. There have been no deaths or cases of
radiation sickness form the nuclear accidents. In accordance with directive
of the Government, over 100,000 people were evacuated from their
homes’’.
1.3. At the international level, there are four instruments for nuclear
liability i.e, the 1960 Paris Convention, 1963 Vienna Convention, 1997
protocol to amend the Vienna Convention and 1997 Convention on
Supplementary Compensation for nuclear damage. India is not a party to
any of the Nuclear Liability Conventions.

1.4 Indian nuclear industry has developed over a period of time within
the context of a domestic framework established by the Atomic Energy
Act, 1962. There is no provision in the Atomic Energy Act, 1962, about
nuclear liability or compensation for nuclear damage due to nuclear
accident or incident and no other law deals with nuclear liability for
nuclear damage in the event of nuclear incident. It was, therefore,
considered necessary to enact a legislation which provides for nuclear
liability that might arise due to a nuclear incident and also on the necessity
of joining appropriate international liability regime.

1.5 The Civil Liability for Nuclear Damage Act, 2010 (CLND Act) received
the assent of the President on 21 September, 2010 and enforced with
effect from 11 November, 2011.

1.6 The Act provides for Civil Liability for Nuclear Damage and prompt
compensation to the victims of a nuclear incident through a no-fault
liability regime channelling liability to the operator, appointment of Claims
Commissioner, establishment of Nuclear Damage Claims Commission
(NDCC) and for matters connected therewith or incidental thereto. It
extends to the whole of India. It applies to nuclear damage suffered (i) in
or over the maritime areas beyond the territorial waters of India, (ii) in or
over exclusive economic zones of India, (iii) on board or by a ship/aircraft
registered in India, and; (iv) on or by an artificial island, installation or
structure under the jurisdiction of India. It applies only to the nuclear
installation owned or controlled by the Central Government either by itself
or through any authority or corporation established by it or a Government
company.

1.7 As per Section 48 of the Act, the Central Government may make rules
for carrying out the purposes of this Act by notification. Such rules may
provide for (i) the other financial security and the manner thereof; (ii) the
salary and allowances payable to and the other terms and conditions of
service of Claims Commissioner; (iii) the procedure to be followed by
Claims Commissioner; (iv) the person to be associated by Claims
Commissioner and the manner thereof; (v) the remuneration, fee or
allowances of associated person; (vi) the form of application, the
particulars it shall contain and the documents it shall accompany; (vii) the
salary and allowances payable to and other terms and conditions of
service of Chairperson and other Members of Nuclear Damage Claims
Commission; (viii) the powers of Chairperson; (ix) the salary and
allowances payable to and the terms and other conditions of service of
officers and other employees of the Commission; (x) the form of
application, the particulars it shall contain and the documents it shall
accompany; (xi) the form and the time for preparing annual report by the
Commissioner , and; (xi) the manner of transfer of officers and other
employees of the Commission.

1.8 In exercise of powers conferred under section 48 of the Civil Liability

for Nuclear Damage Act, 2010, the Department of Atomic Energy (DAE)
published the Civil Liability for Nuclear Damage Rules, 2011, in Gazette of
India (GSR 804/E) on 11 November, 2011 and laid the same on the Table of
the House on 23 November, 2011.
1.9 On scrutiny of the Civil Liability for Nuclear Damage Rules, 2011
(CLND Rules) framed by the Government in pursuance of section 48 of the
Act, the following infirmities/shortcomings were observed:

(i) Absence of provision with regard to Interim Relief to the victims of

Nuclear Damage; and
(ii) Substantial limitations on the Supplier’s liability without specific
warrant in the Civil Liability for Nuclear Damage Act, 2010;
(iii) Time lag of 15 days provided for notification of Nuclear incident
under Section 3(1) of the Act;
 (iv) Delay in framing of rules on the terms and conditions of service of
Claims Commissioner and also of Chairperson and other members
of the Commission as stipulated in section 11 and 22 of the Act;
(v) Delay of more than one year in enforcement of the Civil Liability
for Nuclear Damage Act, 2010 which has been assented to by the
President of India on 21 September 2010;
(vi) Deficiency in the rules by making reference to other Acts/Rules viz.
reference of Atomic Energy Act, 1962 in Rule 5 and Atomic Energy
(Radiation Protection) Rules 2004 in Rule 24(2).
(vii) Use of undefined terms such as, supplier, representative, etc. in
the Rules.
1.10 Comments of the DAE were sought on the aforesaid
infirmities/shortcomings. The Committee on Subordinate Legislation, also,
took oral evidence of the representatives of the Department of Atomic
Energy on 16 April, 2012.
 II

Interim Relief to the victims of Nuclear Damage

2.1 As per section 9 (1) of the Act, whoever suffers nuclear damage is
entitled to claim compensation in accordance with the provisions of the
Act. The Central Government, as per section 9(2) of the Act is required to
appoint one or more Claims Commissioner to adjudicate upon claims for
compensation in respect of nuclear damage. As per section 19, the Central
Government may also appoint Nuclear Damage Claims Commission, if it is
of the opinion that it is expedient in public interest that such claims for
such damage be adjudicated by the Commission instead of a Claims
Commissioner.

2.2 Section 13 of the CLND Act provides for inviting applications for
claims by Claims Commissioner, after notification of the nuclear incident
under sub section 1 of section 3 of the Act, from the persons affected by
the nuclear incident for damages.

2.3 As per section 16(I), on receipt of an application under sub-section (I)

of section 15, the Claims Commissioner shall, after giving notice of such
application to the operator and affording an opportunity of being heard to
the parties, dispose of the application within a period of three months
from the date of such receipt and make an award accordingly.

2.4 Section 16(5) of the Act specifies that every award made under
section 16 (1) shall be final. The DAE, in post evidence written reply to a
query as to whether section 16(1) of the Act implies that no appeal lie
against the compensation for nuclear damage given by the Claims
Commissioner, stated as follows:
“The orders of the Claims commissioners and the Commission are
final under the Act in the absence of any appellate provision in the
Act. However, the same are subject to judicial review by the High
Courts and Supreme Court as provided under Section 35 of the Act.”

2.5 In response to a query as to whether there is any provision for

interim relief, the Secretary, DAE, while deposing before the Committee on
16.04.2012 stated as under-
“If you put interim then it is further delayed. The purpose was that
the claims should be immediately settled. That is all.”

2.6 Elaborating further on the issue, the Secretary, DAE stated as follows-
“With regard to interim relief, the issue is that it has to be settled so
quickly that there will be no requirement of interim relief”

2.7 Reiterating their stand that there is no need for interim relief, the
DAE, in written reply to a post evidence query as to whether it was
desirable to have a provision for interim relief in the rules in view of the
sensitivity/severity of the nuclear incidents and also the time involved in
providing compensation to the losses suffered, stated as follows:
“The Act prescribes under sub-section 16 and sub-section (6) of Section
32 a period of 3 months from the date of application for disposal of the
claim. This period is short and pre-empts the need for a provision for
interim relief.”

2.8 The Civil Liability for Nuclear Damage Act, 2010 provides that the
Claims Commissioner or the Nuclear Damage Claims Commission
(NDCC) are required to adjudicate claims and award claims for nuclear
damage within three months of receipt of application. The Committee
observe that though there is no provision in the Act for appeal against
the award of Claims Commissioner/NDCC, any applicant not satisfied
with the award, can seek judicial review of the awards. The Committee
feel that in the event of an applicant seeking judicial review of the award
given by Claims Commissioner/NDCC, the amount awarded as
compensation should be treated as interim relief and be disbursed
pending verdict of the court. The Committee desire that a suitable
enabling provision be incorporated in this regard either in the CLND Act
or the CLND Rules as may be deemed appropriate.
 III
Right of Recourse

3.1 Rule 24 dealing with right of recourse provides that any contract under
sub section (a) of Section 17 of the Act shall not be for an amount less than
the amount of operator liability under the Act or the value of the contract
itself, whichever is less.

3.2. Section 17 of the Act which provides for right of recourse to the
operators of the nuclear installations reads as follows:
“The Operator of the nuclear installation, after paying the compensation for
nuclear damage in accordance with section 6, shall have a right of recourse
where
(a) such right is expressly provided for in a contract in writing;
(b) the nuclear incident has resulted as a consequence of an act of
supplier or his employee, which includes supply of equipment
or material with patent or latent defects or sub-standard
services;
(c) the nuclear incident has resulted from the act of commission
or omission of an individual done with the intent to cause
nuclear damage.”

3.3 Rule 24 of Civil Liability for Nuclear Damage Rules, 2011 on the right of
recourse states as follows:
“(1):- A contract referred to in clause (a) of section 17 of the Act shall
include a provision for right of recourse for not less than the extent of the
operator’s liability under sub-section (2) of Section 6 of the Act or the
value of the contract itself, whichever is less.
 (2) The provision for right of recourse referred to in sub-rule (1) (1)
shall be for the duration of initial license issued under the Atomic Energy
(Radiation Protection) Rules, 2004, or the product liability period,
whichever is longer

Explanation 1- For the purposes of this rule, the expressions:-

(a) “product liability period” means the period for which the
supplier has undertaken liability for patent or latent defects or
sub-standard services under a contract,

(b) “supplier” shall include a person who-

(i) Manufactures and supplies, either directly or through an

agent, a system, equipment or component or builds a
structure on the basis of functional specification, or
(ii) provides build to print detailed design specifications to
a vendor for manufacturing a system, equipment or
component or building a structure and is responsible to
the operator for design the quality assurance, or
(iii) provides quality assurance or design services

Explanation 2- For the removal of doubts it is clarified that an operator’s

claim under this rule shall in no case exceed the actual amount of
compensation paid by him up to the date of fling such claim’’

3.4 Section 17 of the Act enables the operator of the nuclear installation
after paying compensation for nuclear damage in accordance with section
6 of the Act to have the right of recourse in case inter-alia such right is
expressly provided for in a contract in writing. Explaining the rationale for
the provision, the Secretary, DAE during the evidence held on 16.04.2012
stated as under:-
 ‘’Supplier shall also include a person who manufactures and supplies either
directly or through an agent a system, equipment or component or he builds
a structure on the basis of functional specifications. There is a difference
between functional specifications and engineering drawings. If the operator
provides all the details and has the quality control, then he cannot go to the
supplier and say this is because of you because you have provided everything.
They have only provided the service.
When the operator is giving a functional specification and not a detailed
drawing and design, to a vendor for manufacturing a system, then the
supplier is responsible. If the operator is giving complete details, even
manufacturing details, equipment or components for building a structure,
then he is responsible for design and quality assurance. Only when you can
pinpoint the responsibility of the supplier, then only it should be possible to
make the supplier liable for the damage. Otherwise, because of the fault of
somebody else, you will make the supplier responsible. That should not be
done. That is what has been explained by the rules related to the provision of
the CLND Act.
How will you make the contract between the two parties? At present contract
between the two parties take care of the product liability for covering. That is
for their own damage. This will allow that to happen for external damages
also, that is nuclear damage.”

3.5. Section 6 (2) of the Act which prescribes the liability of the operator
for nuclear incidents reads as under:
‘’ the liability of an operator for each nuclear incident shall be

(a) in respect of nuclear reactors having thermal

power equal to or above ten MW , rupees one
thousand five hundred crores ;
(b) in respect of spent fuel reprocessing plants , rupees
three hundred crores;
(c) in respect of the research reactors having thermal
power below ten MW , fuel cycle facilities other
 than spent fuel reprocessing plants and
transportation of nuclear materials , rupees one
hundred crores:
Provided that the Central Government may review the
amount of operator’s liability from time to time and specify,
by notification, a higher amount under this sub section:

Provided further that the amount of liability shall not

include any interest or cost of proceedings.”

3.6 Responding to a query as to whether operators’ claim can exceed

the actual amount, Secretary, DAE, deposing before the Committee on
16.04.2012, stated as under-
“ for the removal of doubt, it is also clarified that the operator’s claim
under this rule shall in no case exceed the actual amount. The operator’s
liability is fixed to Rs. 1500 crore. You have seen some of the components
we are buying are at the price of Rs. 2500 crore or even more. But can you
go to him for a damage exceeding Rs. 1500 crore? It is because the
operator is paying only Rs. 1500 crore. Can they claim more than that? That
is not possible. What we are saying is that if the operator is paying Rs. 1500
crore, that is the limit, they should not claim more than that. It is a kind of
reimbursement. You can’t reimburse an amount larger than what you have
paid. The operator will pay only Rs. 1500 crore and not more. That is all’’

3.7 Rule 24 prescribes that the contract between the supplier and the
operator shall include a provision for the right of recourse for not less
than the extent of operator’s liability as mentioned under section 6 (2) (i)
of the Act or the value of the contract itself. In reply to a query as to
whether Rule 24 (1) violates the substantive provisions of the Act as it
restricts the liability prescribed by the Act, the Department of Atomic
Energy vide their reply dated 21.2.2012 inter-alia stated as follows:

“Under the right of recourse, an operator will have the right to claim
reimbursement from the supplier and reimbursement cannot be more
than what he has paid. Liability of operator is prescribed by sub-section 2
of section 6. The Rule 24 automatically links sub-section 2 of section 6
and section 17. Rule 24 prescribes minimum requirements for contract
made under clause (a) of section 17 of the Act. It does not restrict the
parties from entering into a contract involving an amount higher than the
contract value (limited of course to the provision of sub section 2 of
section 6) or a longer duration.”

3.8 The following are the main principles of the liability regimes under
1960 Paris convention and 1963 Vienna Convention:

“(i) Liability is channelled exclusively to the operators of the nuclear

installations

(ii) Liability of the operator is absolute, i.e. the operator is held liable
irrespective of fault
(iii) Liability is limited in amount. Under the Vienna Convention, it may
be limited to not less than US$ 5 million (value in gold on 29 April
1963), but an upper ceiling is not fixed. The Paris Convention sets a
maximum liability of 15 million SDR provided that the installation
State may provide for a greater or lesser amount but not below 5
million SDRs taking into account the availability of insurance
coverage.
(iv) Liability is limited in time. Compensation rights are extinguished
under both Conventions if an action is not brought within ten years
from the date of the nuclear incident. Longer periods are
permissible if, under the law of the installation State, the liability of
the operator is covered by financial security. National law may
establish a shorter time limit, but not less than two years (the Paris
 Convention) or three years(the Vienna Convention) from the date
the claimant knew or ought to have known of the damage and the
operator liable;
(v) The operator must maintain insurance of other financial security for
an amount corresponding to his liability; if such security is
insufficient, the installation State is obliged to make up the
difference up to the limit of the operator´s liability;
(vi) Jurisdiction over actions lies exclusively with the courts of the
Contracting Party in whose territory the nuclear incident occurred;
(vii) Non-discrimination of victims on the grounds of nationality, domicile
or residence.”

3.9 On the issue of liability regime fixed under 1960 Paris Convention,
1963 Vienna Convention, and the Protocol to amend the Vienna
convention, the Secretary, DAE , deposing before the Committee on 16
April, 2012 , stated as under-

“Today, in the world over, if you see liability law, the Indian Liability Act
has become most strict. All over the world the trend is that you have to fix
the liability to the operator. If you can’t fix the liability to the operator,
then you go to the litigation and it can never be settled within short time ,
So, that was the reason for which the Parliament has also cleared the act
on the spirit that it has to be done by Claims Commissioner in the time
frame

... In the nuclear liability regime internationally, this third party damage is
not there in other places. We have introduced it in the Act. Now the
question is there is a question of cause - effect relationship that is
because of the fault of somebody’s supply that this damage is caused.
This fault is not fault of one particular company. A series of companies
have to have a cause ...”
 Limiting the Liability Period

3.10 Rule 24(2) of the Rules imposes restrictions in terms of time period
during which liability is applicable – five years or the product liability period
whichever is longer.
3.11 On being inquired that the Rule 24(2) not only inhibits the very purpose of
the Act but is in conflict with the Act itself as the right of recourse has been
restricted to duration of initial license issued under the Atomic Energy Rules
2004 (which is 5 years) or the product liability whichever is longer, the
Department of Atomic Energy vide their reply dated 21.2.2012 furnished
following comments:
“Section 17 (b) refers to the liability for patent or latent defect in the
nuclear material, equipment or sub-standard services and therefore,
refers to the product liability which is dependent on the relevant clause in
the contract. The equipment and components are subject to periodic
inspection and quality check throughout the process of contraction of a
nuclear installation. When the plant goes into operation, checks on the
health of components, equipment and systems are carried out by the
operator based on a planned schedule. Any weakness or defects in the
plant would invariably manifest themselves during commissioning or
during the first few days and months of operation. Atomic Energy
Regulatory Board gives license for a limited period so as to be in a position
to keep checking that operator maintains the plant in a healthy condition
and also asks operator to keep upgrading the plant safety system in
accordance with any new safety requirements that might emerge due to
operating experience anywhere in the world or development in science
and technology. The equipment and components requiring replacement is
changed as and when their useful life is over and this ensures that reactor
 always remains healthy even as the reactor ages. Since significant changes
might be done during initial operation of the plant and the fact that
operation and maintenance is the responsibility of the operator, it is not
desirable to hold the supplier responsible beyond certain initial period.
Period of initial license becomes a natural choice for the period for the
supplier’s liability.

Further, in view of redundancy provided in the design of a reactor, no

single failure can lead to an incident. An incident will happen only when
there are multiple failures.

It is to be noted that suppliers will have to take insurance equal to their

liability and burden of the premium will increase the capital cost of the
plant and will be passed on to the consumer of electricity in terms of
higher tariff”.

3.12 In response to a query whether the product liability period is akin to

standard warranty period which is generally 12 months from the
commissioning of the Nuclear Plant, DAE in a written reply dated
21.02.2012 stated as follows:

“Each contract has a product liability clause and the product liability period
is regulated in accordance therewith. General conditions of contract
generally include a period of 12 months for patent defects and 5 years for
latent defects.”

3.13 In response to a query as to why initial license period is kept five

years and whether there is any difficulty in extending this, representative
of DAE deposing before the Committee on 16 April, 2012 replied as
follows:
 “there are couple of reasons for that. All equipment requires a certain
maintenance schedule. The maintenance is the responsibility of the
operator and not of the supplier. The moment we want to go beyond the
product liability period, supplier will have to be given responsibility for
maintenance also. So, we will end up paying more money for those cases
where we ourselves have the competence. The moment we say the period
is 10 years or 20 years, the supplier will take insurance for that period. The
cost of the insurance premium will be added to the cost of the equipment.
The net result will be that Indian money will be going to foreign insurance
companies without any benefit to us. Thirdly, AERB, the regulatory body,
gives license only for five years. After five years they will inspect. They can
always say, to keep the plant modern as per latest scientific knowledge,
make this, this, and this change. Once the operator has made the changes
as directed by the regulatory body, then we can’t hold the Original supplier
responsible. So these are the three reasons: (1) regulatory provision which
enjoins on the operator to keep the plant up to date. , (2) the equipment
cost will go up because unnecessary insurance premium which will be
invariably outside the country and Indian money will flow outside, and (3)
the maintenance. If we entrust maintenance of everything to foreign
companies, then what are our engineers and scientists there for? They are
capable of doing it. Why should we let our money go outside for those jobs
which we can do ourselves.”

3.14 The explanation to Rule 24 of the CLND Rules states that an

operator’s claim against the supplier shall in no case exceed the actual
amount of compensation paid by him up to the date of filing of such a
claim. The Committee in this connection note that Section 15(2) of the
CLND Act enables filing of application for compensation within three
years from the date of knowledge of nuclear damage by the person
suffering from such damage subject to section 18 which stipulates
extinction of the right to claim compensation, if such claim is not made
within ten years in case of damage to property and 20 years in case of
personal injury. In such cases, in the event of an applicant filing a suit
against the award, the final disposal of the suit by the judiciary may even
fall beyond the 20 year period. There is no clarity in the CLND Act and
Rules as to whether the operator can make successive claims from the
supplier in such an eventuality, irrespective of time limit, in case the
maximum amount of recourse available is not exhausted. The
Committee, therefore, urge that the CLND Act or Rules thereunder should
be suitably amended to provide necessary clarity on this aspect and the
Committee be informed of the action taken in this regard.

3.15 Rule 24 of the CLND Rules has the effect of diluting the stringent
liability provided in section 17 of the CLND Act by imposing limitations in
terms of the amount which can be claimed by exercising right of recourse
(limiting to the extent of operator’s liability or the value of the contract
whichever is less) and also the duration for which a supplier can be held
liable, not contemplated under the CLND Act. The Committee hold that
delegated legislation (viz. rules made by the Executive) should be
consistent with the substantial provisions of the Act and should not
contain any limitations or excesses which are not contemplated under
the Act. The Committee are of the firm view that rule 24 has inserted
limitations not mandated by the CLND Act as brought out above. The
Committee, therefore, exhort DAE to amend rule 24 suitably to remove
the limitations imposed on the liability as well as the duration of the
liability period.
 IV

Notification of Nuclear incident

4.1 As per Section 3(1) of the CLND Act, 2010 the Atomic Energy
Regulatory Board (AERB) constituted under the Atomic Energy Act,
1962 shall notify nuclear incidents within a period of fifteen days from
the date of occurrence of a nuclear incident.

4.2 To a query whether the fifteen days provided for notification of

the nuclear incident are on the higher side, the Department of Atomic
Energy in their written reply dated 21.2.2012, stated:
“The notification of nuclear incident by AERB would involve complex
technical issues, analysis of data, deliberations by experts and
decision by the Board of AERB. Keeping this in view a time of 15 days
has been stipulated in the Act. Emergency response team will, of
course, come into action immediately after any nuclear accident.”

4.3 When enquired during the course of evidence on 16.04.2012

whether the time allowed for notification of nuclear incident can be
curtailed to 7 or 10 days. The Secretary, DAE, deposed as follows:
“……One has to do a complete analysis of what is the radiation
distribution in that area. Second, many people also inhale the
radiation. It has to be assessed by pathological determination. This
process will go on. Actually this issue has been debated for long in
the Parliamentary Committee also. After all the consideration, from
the Parliament Committee we got this number of 15 days…..”
4.4 The Committee note that though 15 days time has been
stipulated in the Act to notify a nuclear incident as it involves complex
technical issues, analysis of data, deliberations by experts and the
decision by Atomic Energy Regulatory Board, the Committee feel that
in the event of a nuclear incident, the matter should be handled at the
shortest possible time on a war footing and no time should be lost in
bureaucratic procedures in notifying a nuclear incident.
 V

Delay in framing Rules

A. Delay in framing Rules

5.1 As per instruction, rules under an Act should ordinarily be framed as

soon as possible after the commencement of the Act and in no case this
period should exceed six months. The Civil Liability for Nuclear Damage
Act, 2010, assented to by the President on 21 September, 2010, was
enforced from 11 November, 2011 by Department of Atomic Energy. The
Civil Liability for Nuclear Damage Rules, 2011 (herein after referred to as
the Rules) were, however, notified on 11 November, 2011.

5.2 In response to the query on the reasons for delay of about thirteen
months in enforcing the Act, the Department of Atomic Energy, in a
written reply dated 16.05.2012, submitted as follows:
“It was necessary to notify the Act and the Rules together. The drafting of
Rules took quite some time as the Department had to go through legal
consultations including multiple consultations with the Attorney General
for India.”

5.3 The submission of the Department of Atomic Energy with regard to

delay in enforcement of the Act is not tenable as framing of draft Rules
should have been initiated along with the drafting of the proposed bill so
that the draft rules would have been ready by the time the bill was
introduced in the House.

5.4 The Committee are distressed to note that delay in framing of rules
under the CLND Act has caused delay of thirteen months in notification /
enforcement of the Act. Had the Department of Atomic Energy initiated
action to frame the rules along with drafting of the legislation, there
would not have been such inordinate delay in enforcement of the Act.
The Committee hope that the Department will initiate timely action in
framing rules while drafting any legislation in future.

B.Delay in framing of rules on various aspects under Section 48 of the Act

5.5 As per Section 48 of the Act, the Central Government may, by

notification, make various rules for carrying out the purposes of the Act.
On scrutiny of the rules, it was observed that the rules required to be
framed in terms of section 11 and 22 of the Act with regard to other terms
and conditions of services of Claims Commissioners and also of the
Chairperson and other Members of the Commission could not be framed.

5.6. In response to a query as to whether other terms & conditions of

service of claims commissioner and the Chairman and members of the
Commission have been prescribed, the Department of Atomic Energy vide
their reply dated 16 May, 2012, submitted as under:

“A departmental Committee is working on the rules governing other

terms and conditions of service of the Claims Commissioner and the
Chairperson and members of the Commission. Rules will be notified in
due course”

5.7 The Committee regret to note that the CLND Rules notified more
than one year after the Bill was assented to by the President are not
complete and “the other terms and conditions of service” of the Claims
Commissioner and the Chairperson and the members of the Commission
are stated to be still under the consideration of a departmental
committee of DAE. The Committee do not expect such lackadaisical
approach in framing of rule by the DAE The Committee hope that the
Departmental Committee would complete its task without any further
loss of time and DAE will notify the rules under intimation to the
Committee.
 VI

Legislation by reference

6.1 In rule 5(1) and 24 (2) reference is made to the Atomic Energy Act,
1962 and the Atomic Energy (Radiation Protection) Rules, 2004
respectively. The Committee on Subordinate Legislation have time and
again recommended that the legislation by reference should be avoided
and the rules should be self-contained.

6.2 Rule 5 (1) of the Rules reads as follows:

“ Report of licensing authority. – (1) The claims adjudication authority

shall, as soon as a claim arising out of a nuclear incident notified under
section 3 of the Act is filed, issue direction in Form A to the licensing
authorities as applicable under sections 14, 16 and 17 of the Atomic
Energy Act, 1962 (33 of 1962).”

6.3 The Rule 24 (2) of the Rules provides as under:

“The provision for right of recourse referred to in sub rule (1) shall be for
the duration of initial license issued under the Atomic Energy (Radiation
Protection) Rules, 2004 or the product liability period, whichever is
longer.”

6.4 Asked about their comments for not making the rules self contained
and making references to other Act and Rules in the CLND Rules, 2011
[Reference to Atomic Energy Act, 1962 and Atomic Energy (Radiation
Protection) Rules, 2004], the Department of Atomic Energy (DAE)
submitted as follows:

“Reference to the Atomic Energy Act, 1962 and the rules made there
under is necessary in order to avoid duplication. Since the licensing of
facilities is regulated by the Atomic Energy (Radiation Protection) Rules,
2004, reference to the same adds clarity to the provision. A reference
to Atomic Energy Act and the Atomic Energy (Radiation Protection) Rules
would mean that any change therein will automatically be reflected in
the Rules.”

6.5 The submission of the Department regarding reference to other

Acts and Rules in CLND Rules (viz. Section 14, 16 and 17 of the Atomic
Energy Act, 1962 and the Atomic Energy (Radiation Protection) Rules,
2004) is not convincing as such references necessitate one to search for
the relevant Act and the Rules to make a complete reading of the Rules.
The Committee stress that Rules should, as far as possible, be self-
contained and drafted in such a manner as to make available to the public
the entire text of the rules including the relevant extracts of these
Acts/rules which are cited in the rules.
 VII

Definition of Terms in Act/Rules

A. Definition of the term representative / legal representative

7.1 The term ‘Supplier’ is occurring in section 17 of the Act, but the term
is not defined in Section 2 of the Act. However, the same has been defined
in the rule 24.

7.2 The Department of Atomic Energy in their comments dated

21.02.2012, on the issue of not defining the term ‘supplier’ in the Act,
stated as under:
‘’ The word ‘supplier’ occurs only in Section 17. Rule 24 has been framed
to implement section 17 and the explanation to the rule has been added
for the sake of clarity in implementation of the provision’’.

7.3 The term ‘supplier’ which appears in Section 17 of the CLND Act has
not been defined in the Act but defined in CLND Rule 24. Definition of a
term appearing in an Act should be made in the very statute and not in
the rules made thereunder. It is not for the Executive to lay down the
contours of a term or to interpret it through the rules. This again
amounts to Executive exceeding the authority delegated by the
Parliament. The Committee, therefore expect the DAE to amend the Act
to incorporate the definition regarding ‘supplier’.

B. Ambiguity in the term ‘Representative’

7.4 The term ‘legal representative’ is defined in Rule 2 (d) (Definitions).

However, the term ‘representative’ is used in Rule 6(1) (c) for the purposes
of application for compensation. The term ‘representative’ is not defined
either in Rule 2 or in section 2 of the Act.
7.5 In response to a post evidence query as to whether there is a need
for defining the term ‘ representative’ used in Rule 6(1)(c), the department
of Atomic Energy in a written reply submitted as under:
“Legal representative is a term in vogue in legislations and includes the
legal heirs and successors in interest of the deceased ‘’

7.6. The term ‘representative’ used in rule 6(1) (c) of the CLND Rules has
not been defined and leaves scope for different interpretations. The
contention of the DAE that the term ‘representative’ carries same
meaning as the term ‘legal representative’ is not convincing as it fails to
explain the reason for not using the term ‘legal representative’ in Rule
6(1)(c). There should be uniformity in usage of terms in the Rules as
these have legal implications. The Committee, therefore, desire that the
term ‘representative’ should be replaced with the term ‘legal
representative’ in the rule.

P. KARUNAKARAN
New Delhi; Chairman,
August, 2012 Committee on Subordinate Legislation
Bhadra, 1934 (Saka)
 APPENDIX –I

(Vide Para 4 of the Introduction of the Report)

SUMMARY OF RECOMMENDATIONS MADE IN THE TWENTY SEVENTH

REPORT OF THE COMMITTEE ON SUBORDINATE LEGISLATION

(FIFTEENTH LOK SABHA)

Sl. No. Reference to

Para No. in the Summary of Recommendations
Report
1 2 3

1 Interim Relief to the victims of Nuclear Damage

2.8 The Civil Liability for Nuclear Damage Act, 2010 provides
that the Claims Commissioner or the Nuclear Damage
Claims Commission (NDCC) are required to adjudicate
claims and award claims for nuclear damage within three
months of receipt of application. The Committee observe
that though there is no provision in the Act for appeal
against the award of Claims Commissioner/NDCC, any
applicant not satisfied with the award, can seek judicial
review of the awards. The Committee feel that in the
event of an applicant seeking judicial review of the award
given by Claims Commissioner/NDCC, the amount
awarded as compensation should be treated as interim
relief and be disbursed pending verdict of the court. The
Committee desire that a suitable enabling provision be
incorporated in this regard either in the CLND Act or the
CLND Rules as may be deemed appropriate.

2 Right of Recourse

The explanation to Rule 24 of the CLND Rules states that

3.14
an operator’s claim against the supplier shall in no case
exceed the actual amount of compensation paid by him up
to the date of filing of such a claim. The Committee in this
connection note that Section 15(2) of the CLND Act
enables filing of application for compensation within three
years from the date of knowledge of nuclear damage by
the person suffering from such damage subject to section
 18 which stipulates extinction of the right to claim
compensation, if such claim is not made within ten years
in case of damage to property and 20 years in case of
personal injury. In such cases, in the event of an applicant
filing a suit against the award, the final disposal of the suit
by the judiciary may even fall beyond the 20 year period.
There is no clarity in the CLND Act and Rules as to
whether the operator can make successive claims from
the supplier in such an eventuality, irrespective of time
limit, in case the maximum amount of recourse available is
not exhausted. The Committee, therefore, urge that the
CLND Act or Rules thereunder should be suitably
amended to provide necessary clarity on this aspect and
the Committee be informed of the action taken in this
regard.

Rule 24 of the CLND Rules has the effect of diluting the

3.15
stringent liability provided in section 17 of the CLND Act
by imposing limitations in terms of the amount which can
be claimed by exercising right of recourse (limiting to the
extent of operator’s liability or the value of the contract
whichever is less) and also the duration for which a
supplier can be held liable, not contemplated under the
CLND Act. The Committee hold that delegated legislation
viz. rules made by the Executive should be consistent with
the substantial provisions of the Act and should not
contain any limitations or excesses which are not
contemplated under the Act. The Committee are of the
firm view that rule 24 has inserted limitations not
mandated by the CLND Act as brought out above. The
Committee, therefore, exhort DAE to amend rule 24
suitably to remove the limitations imposed on the liability
as well as the duration of the liability period.
3.

Notification of Nuclear incident

The Committee note that though 15 days time has been

4.4 stipulated in the Act to notify a nuclear incident as it
involves complex technical issues, analysis of data,
deliberations by experts and the decision by Atomic
Energy Regulatory Board, the Committee feel that in the
event of a nuclear incident, the matter should be handled
at the shortest possible time on a war footing and no time
should be lost in bureaucratic procedures in notifying a
nuclear incident.
4. Delay in framing Rules

5.4
The Committee are distressed to note that delay in framing
of rules under the CLND Act has caused delay of thirteen
months in notification / enforcement of the Act. Had the
Department of Atomic Energy initiated action to frame the
rules along with drafting of the legislation, there would not
have been such inordinate delay in enforcement of the
Act. The Committee hope that the Department will initiate
timely action in framing rules while drafting any legislation
in future.

5.7 The Committee regret to note that the CLND Rules notified
more than one year after the Bill was assented to by the
President are not complete and “the other terms and
conditions of service” of the Claims Commissioner and
the Chairperson and the members of the Commission are
stated to be still under the consideration of a departmental
committee of DAE. The Committee do not expect such
lackadaisical approach in framing of rule by the DAE The
Committee hope that the Departmental Committee would
complete its task without any further loss of time and DAE
will notify the rules under intimation to the Committee.

5. Legislation by reference

6.5 The submission of the Department regarding reference to

other Acts and Rules in CLND Rules (viz. Section 14, 16 and
17 of the Atomic Energy Act, 1962 and the Atomic Energy
(Radiation Protection) Rules, 2004) is not convincing as
such references necessitate one to search for the relevant
Act and the Rules to make a complete reading of the
Rules. The Committee stress that Rules should, as far as
possible, be self-contained and drafted in such a manner
as to make available to the public the entire text of the
rules including the relevant extracts of these Acts/rules
which are cited in the rules.

6. 7.3 Definition of Terms in Act/Rules

 The term ‘supplier’ which appears in Section 17 of the
CLND Act has not been defined in the Act but defined in
CLND Rule 24. Definition of a term appearing in an Act
should be made in the very statute and not in the rules
made thereunder. It is not for the Executive to lay down
the contours of a term or to interpret it through the rules.
This again amounts to Executive exceeding the authority
delegated by the Parliament. The Committee, therefore
expect the DAE to amend the Act to incorporate the
definition regarding ‘supplier’.

7.6 The term ‘representative’ used in rule 6(1) (c) of the CLND
Rules has not been defined and leaves scope for different
interpretations. The contention of the DAE that the term
‘representative’ carries same meaning as the term ‘legal
representative’ is not convincing as it fails to explain the
reason for not using the term ‘legal representative’ in
Rule 6(1)(c). There should be uniformity in usage of
terms in the Rules as these have legal implications. The
Committee, therefore, desire that the term ‘representative’
should be replaced with the term ‘legal representative’ in
the rule.
 APPENDIX –II
(Vide Para 5 of the Introduction of the Report)

MINUTES OF THE FOURTH SITTING OF THE COMMITTEE ON SUBORDINATE

LEGISLATION (2011-2012)
______

The Fourth sitting of the Committee held on Monday, the 16th April, 2012 from
1400 to 1600 hours in Committee Room No. G-074, Parliament Library Building, New
Delhi.

PRESENT

1. Shri P. Karunakaran Chairman

MEMBERS
LOK SABHA

2. Shri Kalyan Banerjee

3. Shri E.T. Mohammed Basheer

4. Shri Ramen Deka

5. Shri Mahesh Joshi

6. Dr. Thokchom Meinya

7. Dr. Bhola Singh

8. Shri Vijay Bahadur Singh

SECRETARIAT

1. Shri A. Louis Martin - Joint Secretary

2. Shri S.C. Chaudhary - Director
3. Shri Srinivasulu Gunda - Additional Director
4. Shri Krishendra Kumar - Under Secretary
 :2:

REPRESENTATIVES OF DEPARTMENT OF ATOMIC ENERGY

1 Dr. Srikumar Banerjee, Secretary

2. Dr. R. B. Grover, Principal Advisor

3. Shri Rahul Kulshresth, Joint Secretary (ER)

4. Shri Vijay Bhushan Pathak, Joint Secretary, DAE Branch

Sectt., Delhi

5. Shri Ashok Chavan, Executive Director, NPCIL

2. At the outset, the Chairman welcomed the Members of the Committee and the

representatives of the Department of Atomic Energy and drew the attention of the

witnesses to Direction 55 (1) of Directions by the Speaker, Lok Sabha regarding

confidentiality of the proceedings of the sitting of the Committee.

3. The Committee, thereafter, held discussion with the representatives of the

Department of Atomic Energy in connection with examination of the Civil Liability for

Nuclear Damage Rules, 2011, particularly on the issues such as exceeding the power

of delegation, right of recourse, time limit for settlement of claims, period of liability of

supplier, etc.

4. The Chairman then desired that the Department may furnish written replies to

those points which remained unanswered during the discussion.

The Committee then adjourned.

-----
MINUTES OF THE NINTH SITTING OF THE COMMITTEE ON SUBORDINATE
LEGISLATION (2011-2012)
______

The Ninth sitting of the Committee held on Monday, the 27th August, 2012 from
1500 to 1530 hours in Chairman’s Room No. 143, Parliament House, New Delhi.

PRESENT

1. Shri P. Karunakaran Chairman

MEMBERS

2. Shri Ghanshyam Anuragi

3. Dr. Thokchom Meinya

4. Dr. Bhola Singh

5. Shri Vijay Bahadur Singh

SECRETARIAT

1. Shri A Louis Martin - Joint Secretary

2. Shri S.C. Chaudhary - Director
3. Shri Srinivasulu Gunda - Additional Director
4. Shri Krishendra Kumar - Under Secretary
2. At the outset, the Chairman welcomed the Members of the Committee

3. The Committee, then, considered the draft ‘Twenty Seventh Report’ and

adopted the same without any modification. The Committee authorized the Chairman to

present the same to the House.

The Committee then adjourned.

-----