NGT Imposes Rs. 286 Crore Fine on HPCL, BPCL, Sealford and Aegis

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The National Green Tribunal (NGT) passed an order on 13th August 2020, imposing a fine of Rs. 286 crore on four companies Bharat Petroleum Limited, Hindustan Petroleum Corporation Limited, Sealord Containers and Aegis Logistics for creating “substantially” contribution to the presence of pollutants or Volatile Organic Compounds and creating “gas chamber” like conditions in Mahul, Chembur and Ambapada areas of Mumbai.

Brief Facts of the Case 

The Principal Bench heard the proceedings via video conferencing an execution application filed by Charudatt Koli for implementation of NGT’s order which was dated on 18th December 2015 where the Tribunal took into consideration the matter of speedy steps to be taken for control of air pollution in the Ambapada, Chembur, Mahul areas in Mumbai. Directions had been issued to the Maharashtra Pollution Control Board to come up with a plan of controlling air pollution. Other than VOC assessment study Health Impact Assessments study was also instructed to be carried out. After a respiratory morbidity survey was conducted in the KEM hospital, it was found out that there were serious problems of choking sensation in chest, breathlessness, irritation in eyes. Hence, an execution application was filed before the Tribunal claiming that the directions had not been fulfilled. Accordingly, On March 18, 2020, the Central Pollution Control Board filed a report ascertaining the amount of VOCs emitted by the alleged companies in the outskirts of Mumbai.

Arguments before the Court

The Petitioners presented the data of environmental damage cost for individual industries. In the process, the AERMOD model was applied to calculate the concentration of each pollutant. A number of affected persons were assessed based on the density. The damage was based on the treatment cost as far as public health is concerned and the value of the environmental damage. Furthermore, The Petitioners presented the data on VOC Emissions estimation, environmental damage costs, etc. Accordingly, petitioners also presented the report on the monetary values of damages due to VOC emissions in the air which might have resulted in health and property damages in nearby areas.

The Respondents argued before the courts that the calculations provided by the CPCB were made by the CPCB in-house Technical Committee for assessing the VOC emissions which indicate that CPCB itself is not aware of the formulae applied in CPCB report and as such credibility of CPCB report is in serious question.

The Respondents also argued that the CPCB report erroneously fails to distinguish between products classified as VOCs under Indian Regulatory Standards or USEPA and those not so classified under either standard. The CPCB report erroneously includes all products handled by ALL whether the same have been classified as VOC or VOC Hazardous Air Pollutants (HAPs) as per Environment (Protection) Rules, 1986.

Furthermore, they argued that CPCB has omitted to take into consideration the control efficiencies while calculating tank storage emission of ALL. The calculation of estimated emission from ALL has been wrongly calculated by NEERI by not applying the correct formula.

Rules Applicable 

The case dealt with the provisions of the Environmental (Protection) Act, 1986 and EP 4th Amendment Rules, 2012.

Court’s Observation

Based on the aforesaid facts, The National Green Tribunal, Principal Bench, observed that The CPCB has duly provided the details of the assumptions and calculations made by the CPCBs in-house Technical Committee for assessing the quantum of VOC emissions to all the four companies i.e. SLCL, ALL, HPCL and BPCL.

After going through the said report the bench, headed by chairperson Adarsh Goel stated as follows, “While it is true that there may be many reasons for the presence of VOCs in the atmosphere like vehicular emissions, etc., it cannot be denied that the said four companies e.g. ALL, SLCL, BPCL and HPCL contribute substantially and predominantly to the VOCs in Mahul and Ambapada villages. It is also scientifically proved that VOCs are a potential cause for various serious ailments if humans are exposed to it for a long time. Conditions prevailing in the area are sometimes likened to that of ‘Gas Chamber’.”

“The objections of the units regarding the use of data prior to control measures and the incorrect application of the formula and methodology are untenable. We are satisfied that all the objections raised by the respondent companies have been duly considered by the CPCB’s in-house Technical Committee and we are satisfied with the correctness of the conclusion arrived at by the CPCB.”

Court’s Decision

The NGT accepted the report filed by the Petitioners and determined the liability of the respondents accordingly without a deterrent factor. The NGT assessed the compensation of Rs. 286 crores for the damage caused due to VOC pollutants emitted by HPCL, BPCL, AEGIS, SEALORD (SLCL). The respective amounts of compensation are kept in ring-fenced (separate) accounts by the BPCL and HPCL and in escrow account by other respondents. A ten-member joint committee comprising two senior nominees of CPCB, a representative of MoEF&CC, State PCB, District Magistrate, Mumbai, NEERI, TISS, Mumbai, IIT Mumbai, KEM Hospital, Mumbai and a nominee of Health Secretary Maharashtra, may prepare an action plan for restoration measures spread over a span of time, not beyond five years. The plan may, in particular, provide for dealing with health issues of the inhabitants and measures for control of pollution in the area, treating Ambapada, Mahul, Chembur and contiguous area (as may be specified by the Committee) to be a Special Air Pollution Control Area for the restoration plan. 


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