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Court To The Rescue Of Coca Cola

By Karthika Thampan

04 June, 2005

In an unprecedented judgement Division Bench of the Kerala High Court directed Perumatty gramapanchayath (local council) to renew within one week from Wednesday, the licence granted by the panchayat to Hindustan CocaCola Beverages Ltd to run its plant at Plachimada in Palakkad district, in the south Indian state of Kerala. The court ordered that if a formal licence is not issued by the panchayat within the time prescribed, it should be deemed that the company possesses the renewed licence, and the company will have the right to carry on its functions for a period of two years with effect from June 10, 2004.direction was issued by the Bench consisting of Justice M. Ramachandran and Justice Balachandran while allowing a writ petition filed by the company praying to direct the panchayat to comply with the court's judgment on April 7, 2005, declaring that the company was entitled to function, drawing half a million litres of ground water per day.

April, 26 the Perumatty grama panchayath (local council) had refused to renew the licence of the cola company. The Panchayath unanimously decided to reject an application submitted by CocaCola on April 13 to renew its licence as it had not submitted along with the application the clearance of the Kerala State Pollution Control Board and a licence issued under the Factories Act.

April 7, 2005 the Division Bench of the Kerala High Court had ordered the panchayath to grant licence to the company if it submitted an application within two weeks along with the above certificates. "The company informed the panchayath that it has the licence issued under the Factories Act and the clearance of the of the State Pollution Control Board. But it has not produced the documents to the panchayath." Perumatty Panchayath president Mr A.Krishnan told the media. The Division Bench also ordered that the company could extract up to half a million litres of groundwater a day form the 34 acre premises of its bottling plant at Plachimada during 200506. The Bench said that "a person has the right to extract water from his property,unless is prohibited by a statute." The Perumatty panchayath has filed an appeal in the Supreme Court of India against the Kerala Hight Court order.

The courts order has drawn flak from all sections of the society. Eminent jurist JusticeV.R.Krishnayyar has said that the the court order has nullified panchayat raj laws of India. He said " I have doubts about the constitutional propriety and the wisdom of the judgement."

Perumatty panchayath president A. Krishnan said that the judgement derails the autonomy of the local councils. He also said that the panchayath would question the order in the Supreme Court of India.

Journalist P.Sainath has said that the judicial interference in the decision making process of the local bodies will spell disaster for India, as it will belittle the entire panchayath raj system. He also said that
to give a corporate body the legal status of an individual is fundamentally wrong.

The protracted legal battle began when the the panchayath cancelled the licence of the company on April 7, 2003, at the risk of losing almost half of its annual income some 700,000 rupees or $16300 on the plea that it had received complaints from local people that the drawing of huge quantity of ground water by the company had resulted in wells drying up, causing acute drinking water scarcity in the area. But the factory managed to function till March 10, 2004 on the strength of a Government order and a stay from a Single Bench of the Kerala High Court overruling the civic body's decision.

The bottling unit was established in 2000 on 34 acres (15.2 hectares) of mostly multicropped agricultural land in Palghat District, barely 2 km away from the river Chitturpuzha and near a number of reservoirs and irrigation canals. Palghat is tradionally called the rice bowl of Kerala. Every day the company drew nearly 1.5 million litres of groundwater and about 85 truckloads of products left the factory premises. The company also resorted to bringing water from borewells in neighbouring villages because the borewells it had sunk on its premises had failed to provide the required yield. The company siphons off enough water to meet the minimum requirements of about 20,000 people. They have not only lost their water but, with the driedout farms closing, also their jobs. Those worst affected are up to 10,000 landless labourers.

Then there is pollution. Chemical effluents produced by bottlewashing contaminate the groundwater. Early attempts to dry the foulsmelling sludge and market it as fertiliser failed when farmers started to develop sores on their skin and noticed that their coconut palms were dying. The plant tried to give it away but no one wanted it. Lab analysis by the Kerala State Pollution Control Board has shown dangerous levels of cadmium in the sludge. Another report done at Exeter University in England at the request of the BBC Radio 4 (whose reporter John Waite visited Plachimada and broadcast his report in July of 2003) found in water in a well near the plant not only impermissible amounts of cadmium but lead at levels that "could have devastating consequences", particularly for pregnant women. The Exeter lab also found the sludge useless as fertiliser.

December 16, 2003, a Single Bench of the High Court directed the coke unit to stop exploiting the ground water resources of the panchayath and find alternative sources for its production needs. Though a Division Bench set aside the Single Bench ruling, the Kerala State Cabinet on February 17, 2004 directed the company to stop the operation in view of the acute drought situation in Palakkad district. Consequently, the unit stopped operation on March 10, 2004.











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