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Corporate - Courts/Legal Issues


Kerala High Court stays Govt order on renewing Coca-Cola licence

K.C. Gopakumar

Kochi , April 7

THE Kerala High Court on Wednesday stayed the Government action in staying the Perumatty Gram Panchayat's order refusing to renew the licence of the Coca-Cola company and also directing it not to resume the operation in the company's plant.

Mr Justice Kurian Joseph passed the stay order on a writ petition filed by the Panchayat President, Mr A. Krishnan, challenging the Government action. The President contended that the order was beyond the power conferred on the Government in the matter of renewal of licence.

As per Chapter 21 A of the Kerala Panchayat Raj Act, the panchayat had been given ample power to suspend a licence, impose conditions and not to renew a licence if the panchayat felt that it was not in public interest.

The Government had passed the order even without hearing the panchayat. In fact, the company should have sought the remedy as provided under the Kerala Pachayat Raj Act, instead of indirectly approaching the Government.

The Government had not considered the fact that the Pollution Control Board had already declined it permission to run the factory.

The order would enable the company to run the factory even without necessary certification from the Pollution Control Board. The question whether the licence should be renewed or not was a matter coming under the Panchayat.

The petitioner said that in view of the serious health hazards, drought conditions in Chitoor taluk, the panchayat had informed the company that unless it

satisfied the conditions specified in the notice of the panchayat, the renewal would not be granted. The conditions included undertaking by the company not to draw ground water, stopping of discharge of waste including dangerous contents.

However, the company had refused to abide by the conditions. The petition sought to quash the Government order issued on April 1.

The Panchayat also pleaded that the government be restrained from interfering with the exercise of constitutional and statutory power by the Panchayat.

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