Gemini Distillery (Pvt.) Ltd. vs State of Karnataka

D.H. Waghela, C.J.—The petitioner has approached this Court with the factual background of its distillery unit having caused extensive damage to crops in the surrounding areas by pollution of the ground water. Upon the widespread complaints, the then lokayuktha is stated to have orally permitted the petitioner to settle certain farm loans with Nanjangud local banks and the petitioner is stated to have promptly made arrangements to settle the bank loans of 13 farmers totaling to Rs. 5,06,000/-. After an extensive study by Tata Energy Research Institute (TERI), it was found that some pocket of ground water was contaminated. Subsequently, in December 2006, the Deputy Commissioner, Mysore called upon the petitioner to deposit the sum of Rs. 56,96,800/- as compensation assessed by the officers of sericulture, horticulture and agricultural departments. The petitioner is stated to have not been aware of the assessment of crop loss for the years 1994-2002, which was assessed in the years 2002 and 2003. Under the circumstances, the Secretary, Environment and Ecology, Government of Karnataka, directed the petitioner and the farmers concerned to reach an amicable settlement in the matter of compensation. That effort having failed, the respondents have directed the company to pay total amount of compensation running into Rs. 66,75,800/- towards crop damage. The company appears to have approached this Court at that juncture in 2008 The petitioner has challenged order dated 14.12.2006 of the Deputy Commissioner, Mysore at Annexure-G calling upon the petitioner to deposit the amounts of compensation as also order dated 23.02.2008 at Annexure-M, demanding again the payment of Rs. 66,75,800 upon failure of the parties to arrive at an amicable settlement.

It is the case of petitioner that subsequent to the aforesaid impugned orders and during pendency of the present proceeding, the Company has arrived at an amicable settlement with some of the aggrieved farmers on 02.07.2011 and that they have agreed to accept 65% of the amount which was originally determined and demanded by the Deputy Commissioner, Mysore. Learned counsel further submitted, on instruction, that the plant of petitioner has been closed since last two years.

The Court has to take serious note of the fact that original claimants suffering losses and damage to their crops are not made parties in the present proceeding, nor any legal and binding agreement or settlement among the parties is placed on record. It is, however, submitted for the petitioner that even as the petitioner itself has no objection to payment of compensation at the rate of 65% of the original amount calculated for payment of compensation, such amounts may be allowed to be deposited with the Deputy Commissioner concerned, so as to bring to an end the present proceeding before this Court.

It was pointed out by learned Principal Government Advocate appearing for the respondent that, apparently loss has been caused to the farmers way back in the year 2002 onwards and impugned orders have been made in the year 2006 and 2008. The petitioner-company has come forward to pay 65% of the amounts now, at the end of the year 2014. On that basis, he submitted that, although the original claimants may not agree and some of them may not be surviving now, if the amounts of compensation were to be deposited by the petitioner at this stage, it has to be with interest at reasonable rate. Learned counsel for the petitioner fairly conceded the fact that payment of even the admitted amount of compensation by the petitioner was being delayed by more than six years, even after filing of the petition. Therefore, the petitioner-company has agreed to pay the amounts agreed by itself to be paid, with interest at the rate of 9% p.a., for the period from 20.03.2008 to 31.12.2014. A statement in that regard is prepared and placed on record.

In the above facts and circumstances, as requested on behalf of the petitioner, the petitioner is permitted to deposit on or before 31.01.2015 the total amount of Rs. 61,59,225/-as computed and agreed to be paid by the petitioner, according to the statement taken on record. At the request of petitioner and by consent of learned Principal Government Advocate, it is directed that upon receipt of the aforesaid amounts, the Deputy Commissioner, Mysore shall call upon the original complainants to receive the amount of compensation respectively allocated to them as per the statement, without prejudice to their rights and contentions. In case, any of the original claimants are not available, the Deputy Commissioner, Mysore shall examine the case of such claimant for determining the person/s to whom the amount should be disbursed, in accordance with the personal law applicable to the claimant. Even then, if any amount is left without being disbursed, it shall be deposited in a Nationalised Bank in fixed deposit for six months, which may be renewed from time-to-time till the amount could be appropriated and paid in accordance with this order or further order that may be made. It is clarified with consent of the parties before us that payment to be made to the individual claimants shall be without prejudice to the rights and contentions of such claimants or their legal heirs, as the case may be, and it may not be treated as full and final settlement of their claims. Since the petition is not argued and decided on the basis of any legal contention, all the contentions of the parties remain open for being argued, if occasion arises therefor.

The petition is accordingly disposed with the aforesaid direction, with no order as to cost.