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Hazardous History From Bhoposhima To Vishakha: Destroying The Poor And Rule Of Law

Prof. Madabhushi Sridhar Acharyulu
11 May 2020 3:50 PM GMT
Hazardous History From Bhoposhima To Vishakha: Destroying The Poor And Rule Of Law
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V R Krishna Iyer, legendary justice has described Bhopal catastrophe as 'Bhoposhima'[1]. It is not less serious than Hiroshima – both the man-made-disasters. Can the 'rule of law' make the original owner of the LG Polymers, a multi-nationa,l vicariously liable according principle of absolute liability? Whether criminal liability for causing culpable homicide of 11 lives and attempting to end lives of 25 persons besides injuring the flora and fauna and ecology around Visakhapatnam?

The LGPI gave capital punishment to people of Visakha, to be the capital of AP, by running a hazardous industry without Environment Clearance. Production of hazardous chemicals is regulated by the Manufacture, Storage and Import of Hazardous Chemical Rules 1989, according to which styrene is classified as a "hazardous and toxic chemical". This being "A category" the competent authority to accord Environmental Clearance is Union Ministry for Environment, which has not given any clearance. This fact is revealed by an "Undertaking Affidavit dated 9.5.2019', filed by Director (Operations) Pitchuka Poorna Chandra Mohan Rao. He agreed that it had expanded the production at the plant "beyond the limit of environmental clearance or changed the product mix without obtaining prior environmental clearance as mandated under the EIA notification, 2006". In a letter on 10th May 2019 to Chairman, State level Environment Impact Assessment Authority (SEIAA) Hyderabad, Mohan Rao filed a request for Environmental Clearance along with the "undertaking affidavit'. This undertaking includes a promise that it would not repeat any such violation in future.

Confession

The LG Polymers confessed that hazardous chemicals would be used for the manufacture of polystyrene and expandable polystyrene, but said that it would not have "any significant impact" on the heath of vulnerable people such as the patients, children and the elderly people. The affidavit says: "All the hazardous materials will be stored in MS (mild steel) drums, in a covered shed and no contamination of soil is expected. Same philosophy will be followed for the after expansion," the application stated. It had also said that all the inbuilt safety precautions would be taken during the expansion, and that there "will not be any damage to environment or human health". Paragraph 6 of Affidavit stated: "As on this date our industry does not have a valid EC substantiating the produced quantity, issued by the competent authority, for continuing operations. However we are continuing our plant operations with valid consent for operation from the APSPCB. Further I submit that the conditions specified in the CFE/CFO have been fulfilled to the satisfaction of APPCEB".

It also expanded the production again without clearance. Director claims that they got consent for establishment for this unit from APPCB on 16.11.2001, and consent for operation for manufacture of Polystyrene 233.3 tonnes per day, and expandable polystyrene 45 tpd, on 8.5.2002 from APPCB. Similarly the APPCB gave 7 consents from March 2004 to June 2018.

People as scapegoats

With the 36 years of experience of Bhoposhima, not learning any lesson from, the Visakha leak is staring at bleak future of enforcing liabilities as per the laid down law, besides the absence of enforceable international trans-national liability regime. How can a state which is not bothered about safety and survival of its own people make a foreign company liable for such disasters? From Bhopal to Visakhapatnam, the successive governments are shamelessly sacrificing their people for profit hungry inhuman corporate criminality. The corrupt regimes cannot correct corporate crimes and provide adequate remedies to victims. Such irresponsible governments are proving the age-old maxim Ubi jus ibi remedium – where there is a right there shall be a remedy, a myth.

Who are the real owners of LGPI?

Where the profits are going? Who are the owners? International companies escape liabilities. Whether domestic governments are subdued by money power?

In 1997 LG Chem (South Korea) took over Hindustan Polymers and renamed it LG Polymers India LGPI. The company makes chemical, chemical products, pharmaceuticals, medical chemicals and botanical products according to its filing. LGPI says it is one of the leading manufacturers of Polystyrene and Expandable Polystyrene in India. The company makes General Purpose polystyrene, Expandable Polystyrene, and Engineering plastics Compounds.

In 1961 it was Hindustan Polymers went to hands of liquor major UB Group's McDowell in 1978. South Korea's LG Chem took over the operation of Visakhapatnam unit. Thus LG Chem is the parent company of LG Polymers, which is listed in South Korea, suffered a slip of its stock by 1.94 per cent. It was set up in December 1996 and was assessed to be worth $23 billion. This South Korea's LG Group geared up to establish its footprint in India's consumer durables space in the mid-1990, it acquired the plant under a share transfer deal against its Rs 100 crore investment in the plant.

There was a controversy related to land, as the land transfer and use agreement between its previous owner and the Andhra Pradesh government dragged both LG and the state to court. Unauthorised use of land, like setting up a luxury resort on land offered for industrial purposes, and breaching the state's land ceiling norms were the bones of contention between the parties. There is also another legal controversy over the using of LG trademark with the parent South Korean Company LG Chem involving all key companies such as LG International Corporation and LG Corporation (both from Korea) to its direct parent here, LG Chemical India during early 2010s, as reported[2].

Two Indian and four Korean directors

Hoonchung Chung is Managing Director of LG Polymers India, according to Company filings with the Ministry of Corporate Affairs, its directors include Byungkeun Song, Chan Sik Chung, Poorna Chandra Mohan Rao Pitchuka, Sunkey Jeong and Ravinder Reddy Surukanti. One of the directors, Hyun Seok Jang, is also the director of three other companies, LG Chemical India Private Limited (New Delhi), LGC Petrochemical India Private Limited (Mumbai) and LG Chem Life Sciences India Private Limited (New Delhi).

The company reported a net worth of Rs 479.60 cr in 2018 according to company filings. Net revenue stood at Rs 1570 crore compared with Rs 1497 crore a year ago. Profit after tax was Rs 3.6 crore in 2018 and Rs 68.3 Cr in 2017[3].

The NGT order

Quickly taking suo moto cognizance of the gas leak, the National Green Tribunal on 8th May directed the firm, LGPI, to deposit an initial amount of Rs 50 crores with the Vizag District Magistrate. It said: "Having regard to the prima facie material regarding the extent of damage to life, public health and environment, we direct LG Polymers India Pvt., Limited to forthwith deposit an initial amount of Rs. 50 Crore, with the District Magistrate, Vishakhapatnam, which will abide by further orders of this Tribunal". The tribunal arrived at this amount considering the financial worth of the company and the extent of the damage caused due to leak.

The litigation: A worst experience

The worst industrial disaster world over till the date, Bhopal tragedy left several disputes unresolved and remained a question mark as to whether law could provide any remedy to massive violation of human rights by the multi-national corporate giants like US based Union Carbide then and South Korea based LG Chem now.

The litigation experience of Bhopal proves that neither victims get complete justice nor we can implement criminal justice against the corporate culprits. Union Carbide, with huge financial strength could hire the top-most Indian law personalities like Fali S Nariman, to reduce the compensation. Upendra Baxi, an eminent professor continuously expressed agony and anguish against violation of human rights without a system to provide adequate remedy. Against the charge of the "Corporate Negligence" every corporate argues that the disaster was caused by a potent combination of under-maintained and decaying facilities, a weak attitude towards safety, and an undertrained workforce, culminating in worker actions that inadvertently enabled leakage in the absence of properly working safeguards. No multinational agrees that their design, machinery and training was inherently defective, and they exported disaster prone outdated equipment, or not effectively supervised the operation in India.

The law formed and reformed after Bhopal tragedy is blatantly violated by these giants, while Executive administration does not care to insist on clearances as per the notifications under Environment Impact Assessment.

Sevin and Styrene

If pesticide Sevin manufactured with chemical of MIC by UCIL (Union Carbide) was the cause of mayhem in 1984, it is Styrene Monomer now. As per the criminal complaint, in early hours of May 7, at around 3.30 am gas emanated from LG Polymers India in Gopalapatnam, endangering life around that area, killing eight and making thousands flee with fear into fields, roads etc in search of safety. The leaked poisonous gas also affected the animal and plant life. Hundreds well unconscious.

There was neither any Environmental law nor any international liability principle in 1984. India should have understood the lessons from this tragedy and strengthened systems to implement new laws. New Chemical Emergency Preparedness was mandated for companies to develop process safety and risk management. A duty is imposed on managements to report their possible leaks and crisis management systems to Government. The principle of Absolute Liability was laid down by Supreme Court after the Bhopal Gas tragedy in Oleum Gas Leak case, which was later codified by Parliament - 'Public Liability Insurance Act, 1991, under which the victims are entitled to immediate compensation of Rs 25,000 even without raising questions of proof of liability of culprits in the factory management.

Absolute liability: Can we enforce?

SC laid down the principle[4] saying: "where an enterprise is engaged in a hazardous or inherently dangerous activity and harm results to anyone on account of an accident in the operation of such hazardous or inherently dangerous 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-à-vis the tortious principle of strict liability under the rule in Rylands v. Fletcher, an English case of 1868". The absolute liability is strict liability without any exception.

Justice PN Bhagwati said in this case: We are of the view that an enterprise, which is engaged in 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 non-delegable duty to the community to ensure that no harm results to anyone on account of hazardous or inherently dangerous activity which it has undertaken.

It has to conduct itself with highest standard of safety and if any harm results it is absolutely liable and it should be no answer to enterprise to say that it has taken all reasonable care and that the harm occurred without any negligence on its part. Another major rule laid down was that the measure of compensation in the kind of cases referred to must be correlated to the magnitude and capacity of the enterprise because such compensation must have a deterrent effect. The large and more prosperous the enterprise, greater must be the amount of compensation. It's thrilling to read these noble poetic quotes coming from higher judiciary. Can we enforce any of these fantastic justice principles?

Environment Protection Act (EPA) was made in 1986. In 1987 a new chapter was added to the Factories Act, 1948. The word 'occupier' was redefined to include of the director of the company which implies a responsibility for the affairs of the factory including the safety. Another major change is that 'Hazard' and 'disaster' were now extended to people living nearby and not just on the factory premises. The amended Factories Act now states it is the occupier's obligation to show, in the event of an accident, that due diligence had been exercised to enforce the safety obligations.

The Public Liability Insurance Act 1991 requires industry owners to obtain insurance policies which shall not be less than the paid-up capital of the unit and limited to Rs 50 crore. This was amended in 1992 because insurance companies were unwilling to insure hazardous companies for a sum without a cap on compensation per victim. Even though the PLIA prescribed limits on the amounts to be paid to each affected person where death, serious injury, loss of work, or damage to property occurs, a victim can sue the multi-national, prove the damage, and collect amounts higher than given, in principle. Can a parent who could not save his child from poisonous gas in Gopalapatnam village of Viskhapatnam district, pursue the litigation against LGPI, which can afford to hire the services of lawyer of great face value? If Fali S Nariman like giants fight against Indian victims fully pledging their intelligence, rapport with apex court based on their years of hard-work and experience, Visakha villager is no match. First of he cannot travel to Delhi to lobby against South Korean based multinationals.

Criminals and Criminal Law

There were massive murders of innocent and poor people in Bhopal. Through Visakha leak, 11 persons were murdered.

It is almost impossible in our system to convict any for such murders. There will no cases even for culpable homicide. The lessons remain in law school text books, while dynamics do not allow prosecution of multinational companies for criminal charges. Chief Justice of India AH Ahmadi in 1996 heading the highest seat of justice dropped charges under IPC Section 304 –II (culpable homicide not amounting to murder) against head of Union Carbide, Warren Anderson and other accused. It is as if Union of India with its Constitution surrendered to Union Carbide. This defective SC order lead to immunity to international criminals and lesser jail terms to Indian criminals. Whole Indian system waited for the death of Warren Anderson (92) for thirty years since Bhopal massacre, that happened on 29 September 2014, and felt it was freed from burden of convicting him.

Rajkumar Keshvani, a senior journalist and petitioner, wrote: "It's an irony that Justice Ahmedi, on retirement, got appointed as lifetime chairman by the Supreme Court for the Bhopal Memorial Hospital Trust, created by the funding of Union Carbide. Lawyer Indira Jaisingh opposed his appointment on the grounds that Ahmedi provided relief to Carbide officials accused in the Bhopal criminal case."[5]. The CBI stood strong with the people. On its behalf Additional Solicitor General Altaf Ahmad showed ample material to prove all accused shared common criminal knowledge about potential danger of escape of lethal gas - MIC, both on account of defective plant, operated under their control and on account of operational shortcomings detected by the Varadarajan expert committee. But Bench of CJI Ahmedi and Justice S B Majumdar felt not even prima facie case was made out. ASG Altaf Ahmad was sad and dissatisfied. He said: "Apex court had erred …. management of Union Carbide knew that necessary safety measures were not in place and a leak of the kind that resulted in the tragedy was a distinct possibility[6].

Keshub Mahindra, the chairman of the Indian arm of the Union Carbide (UCIL); VP Gokhale, managing director; Kishore Kamdar, vice-president; J Mukund, works manager; SP Chowdhury, production manager; KV Shetty, plant superintendent; SI Qureshi, production assistant, were convicted in 2010 for causing death by negligence with 2 years of imprisonment. Seven of them were former employees, some of whom were in their 70s, a decade ago. They were also ordered to pay fines of Rs 100,000 (£1,467; $2,125) each[7]. Although Warren Anderson was named as an accused and later declared an "absconder" by the court, he was not mentioned in verdict. When Anderson came to India to visit the site of tragedy in Bhopal, he was formally arrested and released immediately on bail based on security of a small constable. District Magistrate of Bhopal was under express orders to ensure bail for him and escorted safely to the aircraft[8]. Newspapers reported that External Affairs Ministry was pressurizing the officials against extortion of Anderson. While the Madhya Pradesh Government demanded $ 3.3 billion demanded, the compensation was reduced to a settled amount of $470 million dollars in 1989, which was ratified and further confirmed by the apex court. Nothing further happened to enforce the liability against UCC and worlds' worst disaster ended without appropriate remedy to victims.

It is the duty of such factories who deal with poisonous gases to give due publicity to required measures to counter the leaked gases. There should be an advance warning system of the leak, and if leak occurs immediate addressing of the public through Public Address System to advise them how to escape. They should be made liable both under civil and criminal law. The state is expected to respect human lives, which is absent among the rich transnational companies. The agreements should be specify the absolute liability and complete compensation to victims without litigation. The officers of state involved in facilitating disasters should be criminally prosecuted. Should we hang killers in street as cruel murderers, and leave out such criminals of hazardous and poisonous gas killings?

Views are personal only
(Author is former Chief Information Commissioner of India)

[1] 'Bhoposhima: Crime without Punishment' (1991) 26:47 Economic and Political Weekly 2705.

[3] https://www.bloombergquint.com/business/vizag-gas-leak-all-about-lg-polymersowner-of-vizag-unit-where-gas-leak-killed-11

[4] a PIL by MC Mehta AIR 1987 SC 1086

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