Given the fierce opposition from the Bharatiya Janata Party (BJP) and the Left parties, the government on Monday decided against moving the contentious Civil Liability for Nuclear Damage Bill in the Lok Sabha.
The BJP, opposing the bill "tooth and nail", had moved a notice against it at the introduction stage itself.
However, Speaker Meira Kumar said the she had received an intimation from Minister of State for Parliamentary Affairs Prithviraj Chavan that the "government doesn't intend to table the bill today".
But the BJP demanded that the bill be withdrawn.
"We request that the bill should be withdrawn," Leader of Opposition Sushma Swaraj said.
"It is the duty of the government to inform the house about it. The house has the right to know. It was in the listed business. When was the list changed?" BJP leader LK Advani asked.
Chavan was to move the bill in Lok Sabha. It seeks to limit the liability a nuclear plant's operator in case of an accident at Rs 500 crore.
The legislation also envisages the setting up of a commission that which will investigate and decide, if there is an accident, who was responsible for the error.
The passing of the bill in parliament is a crucial step that India is required to take under the 123 agreement with the US.
Private companies in the US are not willing to sell nuclear equipment to India without such a law in place.
Government sources say that Prime Minister Manmohan Singh is keen to get the bill passed in parliament ahead of his US visit in April.
The Left parties say the bill "is a harmful piece of legislation meant to serve the interests of the US and its nuclear industry".
"It is a blatant attempt to protect US suppliers from claims of liability and compensation. Even if there is a manufacturing defect which causes a nuclear accident that can affect the lives of people, there is no liability for the supplier. The clauses of the bill are so devised as to practically make it impossible to assign liability to the supplier," the Left parties said in a joint statement to oppose the legislation.
Senior BJP leader Yashwant Sinha said: "We will force the government to refer it to a standing committee."
Defending the bill, Congress spokesperson Abhishek Manu Singhvi said: "It is necessary to integrate India with the rest of the world in terms of civilian nuclear energy."