Government of India-Dow deal illegal, legal professionals say

Bhopal Gas Peedit Mahila Stationery Karmachari Sangh
Bhopal Gas Peedit Mahila Purush Sangarsh Morcha
Bhopal Group for Information and Action

NEW DELHI, 21 April, 2008 — More than 280 legal professionals, including retired judges and eminent lawyers, have said the attempts by the Prime Minister’s office to grant immunity to Dow Chemical from its Bhopal liabilities are unconstitutional and illegal. A memorandum signed by lawyers, retired judges and law students says that Government of India has colluded with Dow Chemical to extinguish is legal liability in an exchange of promise to invest $ 1 billion in India. Congress spokesperson Abhishek Manu Singhvi, counsel for Dow in the MP high court and co-chairman of the US-India CEO Forum Mr. Ratan Tata are playing key role in helping Dow Chemical walk away from its legal liabilities. “Seen in light of the case in Madhya Pradesh High Court, this collusion constitutes a Contempt of Court by the Government”, the memorandum states.
In 2005, the Department of Chemicals and Petrochemicals had asked the Madhya Pradesh High Court to direct Dow Chemical to deposit Rs. 100 crores as advance towards clean-up of contamination in Bhopal. A note prepared by the former Cabinet Secretary Mr. B.K. Chaturvedi refers to letters from Ratan Tata, and from Dow Chemical to the Indian Ambassador in USA highlighting Dow’s difficulty in investing in India unless the application filed by the Department of Chemicals is withdrawn. The Cabinet Secretary concludes that “. . .given the scope of future investments in the sector, it stands to reason that instead of continuing to agitate these issues in court for a protracted period, due consideration be given to the prospect of settling these issues appropriately. An important aim is to remove uncertainties and pave the way for promoting investments in the sector.”
Addressing a press conference today, Supreme Court Advocate Prashant Bhushan said that the Governments of India, and Madhya Pradesh and Dow Chemical are “joint tort feasors” and are collectively responsible for the condition of the Bhopal site and its surroundings.  Through this proposed settlement, the Government of India is contemplating letting Dow off the hook, even while failing to discharge its own statutory duties of protecting the environment and holding the polluters liable.
Citing numerous Supreme Court precedents, Mr. Bhushan argued that the principles of “polluter pays” and strict and absolute liability for compensation of affected persons, and remediation of damaged health and environment are well established in Indian law. The Environmental Protection Act, based on which the Department of Chemicals application was filed, empowers the Government to impose the cost of remedial measures on polluters, and even recover it retrospectively if needed.
Dow has argued that its wholly-owned subsidiary Union Carbide is a separate legal entity that handles its own liabilities, and that the Government of India should pursue Union Carbide and not Dow. “Dow’s argument that the Government should pursue Union Carbide is specious. Carbide has been an absconder since 1992. Dow knows very well that its subsidiary will not respond to summons from Indian courts,” said Adv. Bhushan.
“As a 100% owner of Union Carbide after the merger, Dow is saddled with successor liability. Dow’s attempts to use the corporate veil separating it and Union Carbide to evade liability is demonstrably fraudulent,” said Bhushan.
In March 1992 the Chief Judicial Majistrate, order confiscation of all properties of Union Carbide in India. However following its acquisition by Dow Chemical in 2001, Dow has served as an agent as an unlawful sale of Union Carbide’s properties in India. In 2006, the Government of India approved the sale of Union Carbide’s UNIPOL technology through Dow to Reliance Industries. “It is very curious that the Government has been able to locate Union Carbide to facilitate sales of its products in India. But it claims it has not been able to locate Carbide’s correct address so that notice can be served on it in the environmental clean-up matter,” said Satinath Sarangi of Bhopal Group for Information and Action.
Survivors of the 1984 Bhopal disaster, and victims of water contamination are currently camped out in Jantar Mantar after a 800 km padyatra from Bhopal to Delhi. Besides their demand for a special
empowered commission to address issues of rehabilitation, the Bhopalis have also demanded that the Government should pursue Union Carbide and Dow for their respective liabilities, and that the Government should abandon efforts to shield Dow from liabilities for clean-up.
See also US attorney Rajan Sharma’s article on Dow’s inheritance of Union Carbide’s Bhopal liabilities.
For more information, contact: Rachna Dhingra: +91 9717516005

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