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Judgment
Grievance in this application is against running of a bulk drug chemical unit near Chandrapid Village, Vinjamur Mandal, Nellore District, Andhra Pradesh by M/s Venkata Narayana Active Ingredients Pvt Ltd. The violations include non adherence to safety norms resulting in two fatal accidents dated 29.7.2020 and 11.5.2021 resulting in five deaths - two in first incident and three in the second incident. Further, there is illegal extraction of ground water, uncontrolled odour, apart from violation of the Water (Prevention and Control of Pollution) Act, 1974 and the Air (Prevention and Control of Pollution) Act, 1981, and the EP Act, 1986 and Rules framed thereunder, including the Hazardous and Other Wastes (Management and Transboundary Movement) Rules, 2016, Manufacture, Storage and Import of Hazardous Chemical Rules, 1989 and the Chemical Accidents (Emergency planning, Preparedness and response) Rules, 1996.
The matter was last considered on 02.06.2021 in the light of report furnished by the State PCB and the District Magistrate about the compliance status. Since the status reported did not appear to be satisfactory, the Tribunal constituted a joint committee of the Regional Office, CPCB, Chief Inspector of Factories Andhra Pradesh, Member Secretary, State PCB and the District Magistrate, Nellore to provide compliance status of the Industry with respect to consents under the Water and the Air Acts, Authorization under the Hazardous and Other Wastes (Management and Transboundary Movement) Rules, 2016 and clearances under the Manufacture, Storage and Import of Hazardous Chemical Rules, 1989 and the Chemical Accidents (Emergency planning, Preparedness and response) Rules, 1996. The Tribunal also took cognizance of the media report dated 11.05.2021 to the effect that three workers had died due to gas leak in the factory in question. Accordingly, it was directed that the Committee may also ascertain the extent of damage to the environment and individuals in the incident dated 11.5.2021 and remedial action taken in terms of the compensation for restoration of the environment and to the victims.
In pursuance of above, the joint Committee has filed its report on 04.10.2021 giving compliance status in terms of inspection conducted on 10.08.2021 as follows:-
"Report of the Joint Committee in the matter of OA No. 144/2020 (PB).
Sl. No.
Consent condition as per APPCB consent order 15.6.2021
Actual status
Compliance status as on date of committee
inspection 10.08.2021
1
The unit is presently operating at full capacity 1393.89 Kg/ day (worst case scenario) of 35 products and
227.23 Kg/day of by-products.
APPCB has issued Consent for operation to unit valid till 30.09.2021 for expansion. Unit is manufacturing consented products.
Partially Complying
License from Inspectorate of
Factories for expansion unit is yet
to be obtained
2
Water consumption
The unit is permitted to utilize
173.80 KLD.
Source of water is ground water.
Separate meters with necessary pipe-line shall be maintained for assessing the quantity of water used for each of the purposes mentioned above. The industry shall provide magnetic digital flow meters with totalizers at the inlet and outlet of Stripper, MEE, ETP and RO and maintain the records of effluents generated, treated, reused, etc.
The unit is utilizing ground water (two bore wells). The total water consumption before expansion was 173.80 KLD against production capacity of 142.32 TPA. Though after expansion to 500 TPA, APPCB has restricted water consumption to 173.80 KLD. in consent order. APPCB may assess the actual water consumption.
Partially Complying.
The unit has installed flow meters only at raw water inlet, MEE feed, LTDS inlet, inlet & outlet of stripper, boiler feed, cooling tower but not connected to the APPCB server. Hence water consumed in various stages cannot be quantified.
The unit shall install flow meters at MEE condensate, ETP outlet, RO feed, RO reject and RO permeate.
Sl.
No
Purpose
Quantity
KLD
1
Processing
13.80 KLD
2
Industrial Cooling
100 KLD
3
Boiler feed
42
The committee submits to Hon'ble NGT to direct APPCB to ascertain actual water consumption during full production and to connect all water meters to the APPCB server to get the live
data
4
Domestic
8
5
Gardening purposes
10
Total
173.80 KLD
3
HTDS effluent→14.23 KLD
HTDS effluent shall be stripped off for organics recovery.
Stripper distillate for separation of organic compounds followed by disposal to Cement Plants for coprocessing & distilled effluents shall be recycled. Stripped effluents for forced evaporation in MEE followed by ATFD.
Condensate from MEE & ATFD shall be recycled after treatment in ETP along with other LTDS effluents.
ATFD salts to TSDF
Reported that actual effluent generation is 35 KLD. The unit vide letter dated 24.08.2021 requested APPCB to amend CFO in line with CFE and to permit quantity of effluent generation to 35 KLD.
HTDS effluent is stripped in two stripper column of capacity 1 KL/hr. stripped effluent is treated in MEE of capacity 3 KL/hr followed by 0.5 KL/hr. ZLD system is present MEE condensate is taken to biological ETP.
ATFD salts is sent to TSDF
Since flow meters were not installed at MEE outlet, the quantity of effluent generation
could not be ascertained
4
LTDS effluents (Boiler Blow Down -
11.8 KLD + Cooling Tower Blow Down - 35 KLD
Reported that unit is generating 61.8 KLD LTDS effluent →61.8 KLD is treated in ETP of 100 KL comprising of flocculation tank, primary clarifier, aeration, secondary clarifier, sand filters RO of capacity 7 KL/hr. The committee observed that ETP is not adequate to treat the effluent generated. Effluent
was overflowing from the tanks. This implies that effluent generation is more than consented quantity. Moreover the unit was neutralizing the effluent in the reactors itself..
Since flow meters were not installed, the quantity of effluent generation could not be ascertained
5
One 4 TPH boiler and one 3 TPH
boiler→PM 10-115 mg/Nm3
The industry is having two Nos of boilers using Biomass briquettes as a fuel. The industry has provided dust collector to 3.0 TPH boiler and bag filter to 4TPH boiler as air pollution control equipment and provide common stack of height 30 m
Complying
Stack of height 30m is installed. As per stack monitoring conducted by dated 29.06.2021, particulate matter is 102mg/Nm3 and found complying with APPCB stipulated standards of
115 mg/ Nm3.
6
Odour nuisance
The industry has provided Two Nos. of double stage scrubbers for control of process emissions and provided online pH meter with data logger in each production block. The online pH indicators were not properly working. The committee monitored VOC concentration using hand held VOC meter and following values were recorded:
Cooling tower, utility building→ 13ppm to 20 ppm Utility block entrance→ 8 ppm to 13 ppm Production block II→ 8 ppm to 10 ppm
Inside production block-II→ 23ppm to 40 ppm VOC scrubber→ 2ppm ETP→ upto 5ppm
New production block→ 2ppm to 3 ppm
Not complying
Spent solvent storage room→3 ppm Hazardous waste storage shed→ 13 ppm
The industry has provided 2 nos. of VOC analysers in the plant premises i.e. near main gate towards village and near engineering department. Further, the industry installed an online VOC analyzer at Panchayath office of Chandrapadiya (V), Vinjamur (M), SPSR Nellore District and connected the same to the APPCB server. The average VOC values recorded is submitted below:
Sl No.
Date
Near Main gate
Near Engineering
Dept
Village Panchayat
Office
1
2021-08-01
0.94
4.67
0
2
2021-08-02
0.94
4.76
0.04
3
2021-08-03
0.94
4.87
0
4
2021-08-04
0.97
4.95
0
5
2021-08-05
0.96
4.95
0.02
6
2021-08-06
0.94
4.79
0.02
7
2021-08-07
0.98
5.14
0.04
8
2021-08-08
1
5.12
0.01
9
2021-08-09
1.01
4.89
0
10
2021-08-10
0.89
4.24
0
The above value indicates that there is odour nuisance to the surroundings.
Hazardous wastes
Though unit has provided separate shed for storing hazardous wastes, but all category of wastes are dumped without any segregation. There is no provision for leachate collection.
Not complying
Sl No.
Name of Hazardous
Waste
Stream
Quantity
Method of disposal
1
olid Waste from process
and
28.1 of Schedule
-I
6134.1
7
Kg/day
Shall be routed through APEMC so as to dispose to TSDF Parawada for secured
2
ETP
Sludge
35.3 of Schedule
of -I
25
Kg/da
3
Salts from Forced Evaporati
on system
--
2101.9
4
Kg/day
4
Carbon Waste
28.3 of Schedule-
I
49.4
Kg/day
Shall be routed through APEMC so as to dispose to pre- processors/to authorised Cement industries for co- process(as utilizable
waste)
5
Stripper distillate
--
4144.2
Kg/day
6
Used Oil
5.1 of Schedule
- I
500
LPA
Shall be routed through APEMC so as to dispose to APPCB authorised agencies for reprocessing (as
recyclable waste)
7
Mixed Solvents
--
45 TPM
Shall be routed through APEMC so as to dispose to pre- processors/to authorised Cement industries for co-
process(as utilizable waste)
8
Container and container liners of hazardou s chemicals (after
detoxifica tion)
33.1 of Schedule
-I
60 no.
/month
After complete detoxification, shall be routed through APEMC so as send back to supplier/APPCB authorised parties (as recyclable waste)
From the above it is concluded that the unit is not complying with two conditions of CFO, partially complying with two conditions of CFO issued by APPCB.
V Compliance Status of Safety Provisions under Factories Act 1948 and MSIHC Rules 1989 and the Chemical Accidents (Emergency planning, Preparedness and response) Rules, 1996.
Sl.
No.
Observations
Status of Compliance as given by Inspector of
factories
1
Submission of HARA and HAZOP reports for the manufacturing process of Vildagliption drug
Complied, Reported that unit submitted HARA and HAZOP
submitted on 31.08.2020 to
Inspector of Factories
2
The manual charging of chemicals into the reactors shall be replaced with powder transfer system / auto transfer system.
Complied
3
Industry shall provide proper training to regular and contract workers on SOP's. They shall display at work place
Not complied
4
The industry shall provide oxygen analyzers, multi gas detectors, hydrocarbon detectors , Volatile organic compound (VOC) detectors, smoke detectors in a strategic places and connected with audio and visual alarm so as to alert the workers whenever solvent vapors or toxic gases or smoke were observed in working areas.
Not provided at solvent storage area and solvent recovery plant area.
5
The industry shall provide sufficient number of SCBA, Canister masks, chemical cartridges, fire suits and chemical suits etc. in the factory at very short distance from working area and provide effective training to the workers on its usage.
Not complied
6
The industry should issue the suitable personal protective equipment (PPE) to all the employees being engaged in hazardous operations and get train them in proper usage of suitable PPE
at workplace.
Not complied
7
The management should ensure availability of antidote in Occupational
Health Centre (OHC) for each harmful chemicals handling inside the factory
Complied
8
Unskilled and untrained workers shall not be employed in hazardous
operations
Not complied
9
The management should extend the atmospheric vent pipe line of all
reactors to the scrubber system
Not complied
10
The management should ensure adequate/effective ventilation at work place by circulation of fresh air and also ensure the proper/required air changes in all production blocks and
clean rooms
Not working
11
Industry shall arrange to conduct safety audit
Complied
12
Not obtained license from the Department of factories for operations in New production block.
Not complied
13
The industry shall ensure the transfer of solvents by using pumps and closed conveyance instead of manual handling.
Not complied
14
Industry shall provide Colour coding and flow directions to the pipe lines carrying chemicals
Not complied
15
Industry shall prepare on-site emergency plan
Complied
16
The industry shall provide automatic steam cutoff valve in the old production block
Not Complied
17
Water seepage observed in Raw material storage shed
Not complied
18
Industry shall provide a dump tank at outlet end of the reactors
Not complied
19
The industry shall provide dedicated stainless steel pipes for transfer of solvents in place HDPE pipes
Not complied
20
There is no proper means of access on the west side of old production block
Not complied
21
Earth continuity jumpers shall be provided to the flanges of the all solvent carrying pipelines
Not complied
21
The industry shall Display SOP's for all critical operations
Not complied
22
The minutes of safety committee meetings , mock drill reports shall be communicated to the factories inspectorate
Not complied
23
Working hours' notice form no-11 is not displayed in the factory premises. The working hours is not approved by the inspector of factories
Not complied
As per the reports of Inspector of factories, the unit is not complying with 18 Safety measures out of 23 safety measures stipulated by the department. This clearly indicates that safety lapses may be one major cause for accidents.
VI Damage assessment to the environment and individuals in the incident dated 11.5.2021 and remedial action taken in terms of compensation for restoration of the environment and to the victims
Accidents that have occurred at M/s Venkata Narayana Active Ingredients Pvt Ltd during 01.01.2020 to 10.08.2021 (till the date of committee inspection):
VI.a Fire accident in reactor on July 29, 2020: During the early hours around 2:10 AM on 29.07.2020 Methanol vapours accumulated in clean room-2 and while charging chemical powder into reaction vessel fire accident has occurred. Due to fire accident four employees suffered severe burn injuries and two employees Sh. Sd Hafeez and Sh. N. Rajani Kumar helper died while undergoing treatment in the hospital. Two employees Sh. S. Bhaskar and Sh. B. Ravindra Reddy underwent treatment. It was reported by the unit that the unit borne the expenditure incurred towards treatment of the injured.
Soon after receiving the information on the accident, officials from APPCB and Inspectorate of Factories have visited the accident site. District Collector cum District Magistrate, Nellore constituted a committee consisting of 1. Inspector of Factories, Nellore, 2. Deputy Chief Inspector of Factories, Nellore, 3. General Manager, District Industries Center, Nellore, 4. Deputy Commissioner of Labour, Nellore, 5. Revenue Divisional Officer, Atmakur, 6. Deputy Superintendent of Police, Kavali and 7. Environmental Engineer, APPCB, Nellore to enquire into the accident. The committee constituted by District Magistrate conducted enquiry of the accident on 04.08.2020 to 05.08.2020 and submitted a detailed report to the District Magistrate and concluded that since the Management has opted unsafe procedures of charging chemicals into reactors which caused fire cloud and then led to an explosion. APPCB issued Directions vide order dated 29.07.2020 to the unit to "To Stop the operations of the industry immediately by following the Standard Operating Procedures (SOP's) ". Inspector of Factories, Nellore issued "Prohibitory Orders" to the unit on 29.07.2020. As a corrective measure the unit has stopped manual charging of chemicals into the reactor and replaced with powder charging or auto transfer of chemicals.
As informed by the unit to the committee members, for the deceased families the unit offered Rs.30.00 lacs compensation & job offer for dependent family member or one-time compensation of Rs.36.00 lacs. Accordingly, the unit has paid compensation of Rs. 30.00 lacs to the family of Late Sh. Sd Hafeez and offered job to his dependent family member. To other deceased employee Late Sh. Rajani Kumar the unit has paid compensation of Rs.36.00 lacs. For the injured employees, the unit informed to the committee that it has borne the cost of treatment and reported to have given paid leave till the employees recover and they are yet to join duty. Further, the unit reported that unit has paid compensation of Rs.7.00 lacs each to the injured employees. During committee visit, the committee could not interact with injured employees or family of deceased of the first accident.
VI.b Gas leakage on May 11, 2021: Accident occurred due to thionyl chloride gas leakage from reactor 0101 during manufacture of Vildagliptin.
· The unit was involved in the manufacture of Vildagliptin (consented product).
· On May 10, 2021 batch was completed and night shift incharge loaded mixed liquor generated during production of vildagliptin into GLR reactor 0101. Further the night shift incharge added caustic lye into reactor 0101 for neutralization.
· On May 11, 2021 during morning shift, around 8:30 AM, the employees working in production block-II where accident occurred have opened the vent of reactor 0101 soon after which thionyl chloride gas is released and three employees deceased and four employees were exposed to gas.
· Quantity of mixed liquor present in the reactor and exact causes for accident were not disclosed to the committee.
· During the accident three employees working near reactor-0101 died due to inhalation of thionyl chloride gas and other three employees who came for rescue were also affected due to gas inhalation. Due to odour, other employees in the unit have suspected gas leakage and have closed the reactor vent preventing further damage.
· Soon after the accident, the deceased and injured employees were shifted to hospital. Out of six employees exposed to gas, three of them deceased (declared brought dead in the hospital).
·
VI.b.i Sequence of Events and Causes of Accident
10.05.2021
21:00 hrs
:
Vildagliptin batch completed. Mother liquor or aqueous layer transferred to reactor GLR 0101
11.05.2021
5:15 hrs to 6:00 hrs
:
Caustic lye added to reactor 0101 for neutralization. Shift change at 6:00 AM. Transferring of neutralized Vildagliptin aqeous
layer was still pending.
11.05.2021
7:00 hrs
:
Workers were experiencing odour problem. Generally the employees are facing odour issues due to which the employees could not understand that gas leakage was taking place from reactor
0101.
11.05.2021
8:00 hrs
:
Workers left to canteen to have breakfast. six workers stayed back in production block-II. Since the transfer pump was under repair, transfer of
aqeous layer to ETP was not undertaken.
11.05.2021
8:15 hrs
:
Sh. Shareefuddin, shift supervisor instructed Sh. Bellamkonda Srinu to transfer the partially
neutralized 3200 liters of Vildagliptin aqeous layer to ETP under nitrogen pressure.
11.05.2021
8:30 hrs
:
Due to partial neutralization of aqueous layer nitrogen purging may have trigerred exothermic reaction leading to increase in temperature and pressure inside the reactor. At this time, Sh, Srinu may have opened atmospheric vent which lead to sudden release of harmful gases and immediately three workers present in production block have fallen unconscious on the floor and other three workers who came to rescue fell on the stairs. Due to high concentration of thionyl chloride, three employees near the reactor have
immediately died.
11:05.2021
8:35 hrs
:
Other workers have entered production block-II by wearing safety masks and shifted the
affected employees from production block-II to safe zone.
11:05.2021
8:45 hrs
:
Reactor vent closed. There was severe odour
nuisance but till this time, the gas was not identified.
11.05.2021
9:00 hrs
:
Affected workers shifted to ambulance. Safety persons were called for and based on the smell & irritation caused to nose & throat, safety persons suspected that the accident has taken place due to thionyl chloride. Reported that previously also during Vildagliptin manufacture similar odour issue was experienced due to thionyl chloride gas leakage was experienced in the unit (especially during neutralization) based on which it was concluded that the accident is
due thionyl chloride.
11.05.2021
10:00 hrs
:
Workers shifted to hospital. Three workers declared brought dead. Safety personnel from the unit administered an antidote Sulbutamol
sulphate+ asthaline hydrocartezone along with
oxygen was to affected employees and within 30 mins, two employees recovered and became normal while one employee recovered in a day. All three affected employees have joined duty.
Parallely, the unit has transferred the contents of reactor 0101 to the ETP and washed the reactor. The unit has not informed to any Regulatory
Authorities regarding the accident till 10.30 AM.
11.05.2021
11:45 hrs
:
The villagers have informed the news channel about the accident and officials from APPCB, Inspectorate of Factories, representatives from District Collectorate, Nellore inspected the unit. But by the time the officials have visited the unit,
reactor 0101 was completely cleaned due to which APPCB could not collect samples.
VI.b.ii Possible causes for accident on May 11, 2021 as per committee constituted by District Magistrate
Suction and dump tanks are not provided.
Fumes/ dust suction or vapour absorption system was not in operation. Strong smell was noticed by the employees in the production block but it was ignored and no immediate measures were taken.
The mother liquor generated during the production process has to be treated in ETP but instead the unit was neutralizing the same in the reactor itself. The mother liquor was neutralized by addition of caustic lye and retention time of 8hrs to 12 hrs was allowed. The neutralized effluent from reactor was directly taken for aeration tank of ETP. It was learnt from the discussions that the unit was directly neutralizing the effluent in reactor since April, 2021 onwards.
On May 11, 2021, the workers in the morning shift experienced odour nuisance from reactor 0101 and workers near the reactor have opened the reactor vent and the toxic gases from the reactor have vented into production block and workers are exposed to toxic gases.
Batch manufacturing records, batch sheets and reactor labels are not maintained. At the time of shift change, batch information or data sheets was not exchanged between the shift incharges.
Personnel protective equipment like safety goggles gloves face masks is not provided to employees.
There was no VOC sensor with alarm in the production block which could have alerted the employees of possibly high VOC concentration. There was no vapour absorption system/ suction system to route the escaping vapours/ gases into atmosphere through scrubber. Treating effluent in the reactor instead of ETP, lack of automation, Lack of comprehensive standard operating procedure, lack of training & ignorance of employees, not carrying out HARA and HAZOP study for production block, absence of VOC sensors/ alarm system in the reactor to alert the personnel, lack emergency of preparedness are all the causes of accident. Immediate trigger was opening of atmospheric vent of reactor 0101 instead of opening scrubber vent which resulted in sudden release of unreacted thionyl chloride gas from reactor 0101.
During the NGT committee visit, it was observed that the unit has dismantled GLR reactor 0101 and replaced it with SLR reactor. Reported that GLR reactor 0101 is sent to Hyderabad. The unit has not obtained permission for shifting the reactor to Hyderabad and also information was not communicated to any of the regulatory Authorities.
VII Damage Assessment and Calculation of Compensation
The committee learnt that the unit had cleaned the reactor & its surroundings by the time, the Authorities have reached the accident spot and it was very difficult for the Authorities to ascertain the root cause of the accident and to assess total extent of damage. By the time of NGT committee visit, the GLR reactor-0101 was shifted outside the unit premises.
VII.a. Loss of life and status of award of compensation:
Accident on May 11, 2021: Out of six employees present in production block, three employees deceased and three were affected & recovered within a day. During inspection, the committee interacted with injured employees and families of the deceased.
VII.a.i Late Sh. P. Thirupataiah studied upto 5th grade aged 62 years contractual labour working in the unit since 11 years. The employee was drawing Rs. 13,500/- per month salary. The unit has paid compensation of Rs.10.00 lacs to the family of the deceased.
VII.a.ii Late Sh. V. Thirupataiah studied upto 3rd grade aged 64 years contractual labour working in the unit since 11 years. The employee was drawing Rs. 12,000/- per month salary. The unit has paid compensation of Rs.10.00 lacs to the family of the deceased.
VII.a.iii Late Sh. B. Srinu studied upto M.Sc aged 27 years contractual labour working in the unit since 1 ½ years. The employee was drawing Rs. 37,000/- per month salary. The unit has paid compensation of Rs. 10.00 lacs to the family of the deceased.
The unit has announced to pay compensation of Rs.40.00 lacs to the family of the deceased. To ascertain the adequacy of compensation announced, the committee has calculated compensation by two methods:
As per the Judgement dated 16th August 2019 of Hon'ble Supreme Court of India in civil appeal No. 6339 of 2019 and judgement in the matter of Sunita Tokas vs New India Insurance Co. Ltd. & civil appeal No.3483 of 2008 and as per Employee Compensation Act, 1923. Out of the three, the committee has considered the highest amount to be paid as compensation to the family of the deceased. calculation of compensation is explained in table 1 and table 2.
Table 1: Assessment of compensation
Name of deceased
A*
Amount of compensation in INR as per Hon'ble Supreme Court Judgement in civil appeal No. 6339 of 2019 and civil
appeal No.3483 of 2008
B
As per Employee/ Workmen Compensation Act, 1923
Compensation= fifty percent of the monthly wages of
the deceased x relevant factor
Compensation announced by the unit
P. Thirupatiaih
Rs. 10,93,800/-
Rs. 7,43,445/-
Rs. 40.00 lacs
Sh. V.
Thirupataiah
Rs. 10,05,600/-
Rs. 6,17,580/-
Rs. 40.00 lacs
Sh. Srinu
Rs. 50,55,240/-
Rs. 16,01,775/-
Rs. 40.00 lacs
* A→ calculation is explained in table-2.
&→ As per EC Act, 1923 the Central Government has specified Rs.15,000/- as monthly wages with effect from 03.01.2020. The relevant factor as per EC Act, 1923 is (the completed years of age on the last birthday of the workman immediately preceding the date on which the compensation fell due).
Considering the points in table1, the compensation amount of Rs.40.00 lacs announced by the unit is adequate to the family of Late Sh. P. Thirupataih and Late Sh. V. Thirupatiah while the unit shall pay Rs. 15, 55, 240/- in addition to Rs.40.00 lacs to the family of B. Srinu. The health conditions of the affected employees shall be monitored for minimum period of two years
Table 2: : A→ Amount of compensation in INR as per Hon'ble Supreme Court Judgement in civil appeal No. 6339 of 2019 and civil appeal No.3483 of 2008
Name
DOB & Age at the time of death
Qualification on &
Designation
Salary per
month for contractual labours
Future prospects
*40% of the income)
Deduction towards personal expenses
Loss of
monthly income to the dependent
Annual Income
Loss of future income
Expenses for shifting mortal remains and Loss of estate & funeral expenses (a pp. cost)
Loss of Love and affection
Compensation
As per Workmen Compensation Act.
B*
C=50% of B
D=B-C
E=D*12
F #
G $
H &
I=F+G+ H
Compensatio n= fifty percent of the monthly wages of the deceased x relevant factor
P.
Thiru patia
ih
62
5th Standard
13500
1890.0
9450.0
9450
113400
793800
100000
200000
1093800
743445
V.
thirup
ataia h
64
3rd Standard
12000.0
16800.0
8400
8400
100800
705600
100000
200000
1005600
617580
Srinu
27
MSc Chemistry
37000.0
46620.0
23310
23310
279720
4755240
100000
200000
5055240
1601775
* tax if any is deducted @ of 10%
As per Employee Compensation Act minimum wages fixed by Government is Rs. 15,000 per month. For permanent employee Srinu Employee Compensation Act is applicable while other two were contractual labours for whom workmen compensation Act is applicable
Depending on the age, the relevant factor is fixed. 17 for age group 26-30 years and 7 for age group 61 to 65 years.
VII.b. Environmental Compensation on account of non-compliances: From the available records the following non-compliances are observed:
In the matter of Appeal No. 21 of 2019 in Honble NGT (SZ), the unit paid Environmental Compensation of Rs. 37.20 lacs to CPCB as per Hon'ble NGT order dated 28.08.2020. Environmental compensation was levied by CPCB from the appellant unit mainly for the reason for violation of closure directions issued by CPCB during 2017.
The unit had undertaken expansion activities without obtaining prior EC clearance and CFE from APPCB. EC was accorded to unit by SEIAA on 08.12.2020 by which expansion activities were in progress.
From available records it is observed that during the annual production during 2018-19 is 131.247 TPA and 2019-20 is 146.985 TPA against the consent quantity of 142.32 TPA. Due to excess production excess hazardous waste is generated. During 2019-20 the unit has generated double the consented quantity of hazardous wastes and disposed to cement industries for co-processing without informing to APPCB.
Storm water drains were filled with effluent near scrubber section.
During committee inspection it was observed that hazardous wastes such as ETP sludge and ATFD salts were dumped in the shed and there was no provision for leachate collection.
Reactor 0101 where accident occurred on May 11, 2021 was dismantled and shifted outside the unit without informing to any Regulatory Authorities.
The total area of the unit is 33 acres and one of the EC condition was develop green belt in 11 acres (33 % of total plant area) but as on date unit has developed green belt in 6.0 acres and green belt under development in another 5 acres.
The unit has installed flow meters at MEE feed, LTDS inlet, inlet & outlet of stripper, boiler feed, cooling tower but not connected to the APPCB server to get live data. Hence water consumed in various stages cannot be quantified.
The industry has provided 2 nos. of VOC analyzers in the plant premises i.e. near main gate towards village and near engineering department. Further, the industry installed an online VOC analyzer at Panchayath office of Chandrapadiya (V), Vinjamur (M), SPSR Nellore District and connected the same to the APPCB server. The average VOC values recorded is submitted below:
Sl. No.
Date
Near Main gate towards village
Near Engineering Dept towards village
Village Panchayat Office
1
2021-08-01
0.94
4.67
0
2
2021-08-02
0.94
4.76
0.04
3
2021-08-03
0.94
4.87
0
4
2021-08-04
0.97
4.95
0
5
2021-08-05
0.96
4.95
0.02
6
2021-08-06
0.94
4.79
0.02
7
2021-08-07
0.98
5.14
0.04
8
2021-08-08
1
5.12
0.01
9
2021-08-09
1.01
4.89
0
10
2021-08-10
0.89
4.24
0
The above VOC value indicates that persistence of odour nuisance to the surroundings. The nearest habitation is at a distance of 300m from the unit. As per wind direction, the surrounding village are susceptible to odour nuisance.
APPCB issued "Stop Production Order" to the unit vide order dated 18.08.2020 and subsequently issued revocation order on 08.09.2020 with certain conditions and copy of order is placed as Annexure-VI. APPCB again issued "Stop Production Order" on 26.05.2021 to the unit and the unit has approached Hon'ble High Court against APPCB order. The Hon'ble High Court set aside the stop production order issued by the APPCB. APCCB issued CFO to the unit with certain conditions and to ensure compliance of those conditions.
Though unit has obtained Consent for operation for 35 products from APPCB. The unit has carried out HARA and HAZOP study for only 12 products and Inspectorate of Factories has granted permission for only 12 products. Inspectorate of Factories issued Prohibitory orders to the unit on 29.07.2020 wherein the unit was directed "the manufacturing process of products 1) Allyl Isopropyl acetyl urea 2) Tetracaine hydrochloride 3) Levetiracetam 4) Risperidone 5) Lacosamide 6) Vildagliptin 7) Moxifloxacin hydrochloride 8) Loxoprofen sodium hydrate 9) Voglibose 10)Olmesartan medoxomil 11) Linagliptin 12) Warfarin sodium shall not be carried on unless HARA and HAZOP study report covering this products are prepared and submitted in this office along with the compliance of recommendations if any in the reports". Accident occurred on 11.05.2021 due to thionyl chloride gas leakage while neutralizing mother liquor generated from Vildagliptin manufacture violating the directions of Inspectorate of Factories. Inspector of Factories revoked the Prohibitory orders vide order 04.09.2020 with a condition that " the operations/ processes pertaining to 12 products for which the HARA and HAZOP reports submitted now are only permitted". Copy of the revocation order is placed as Annexure-VII.
The unit has failed to comply with the conditions given by APPCB and Inspector of factories in the CFO order and revocation orders respectively. Hence the committee has calculated EC as per CPCB formula.
EC=PI x N x R x S x LF
Where,
EC = Environmental Compensation in INR
PI = Pollution Index of industrial sector (Red-80)
N = Number of days of violation took place (start of unit operation to date of accident)→08.09.2020 to 11.05.2021 (till the date of accident)→ 245 days
R = A factor in Rupees for EC (Rs. 250/- )
S = Factor for scale of operation (large -1.5)
LF = Location factor (the unit is located in Chandrapadiya village at a distance of about 16 Km and hence LF will be 1.0 )
Total EC= 80 x 1.5 x 1 x 250 x 245
Total EC for violations= 73,50,000/- Rupees Seventy three lakhs fifty thousand only
VII.d. Total Compensation M/s Venkata Narayana Industries Pvt Ltd liable to Pay
a. The unit has already paid Rs. 10.00 lacs to the family of each deceased. (Total Rs.30.00 lacs paid towards Compensation to the deceased persons). In addition the unit shall pay compensation of:
Sl. No
Name
Compensationpaid
Additional amount liable to be paid by the unit as per the calculation made by committee
1
Late Sh. P. Thirupataiah
Rs. 10.00 lacs
Rs.30.00 lacs
2.
Late Sh. V Thirupataiah
Rs. 10.00 lacs
Rs. 30.00 lacs
3.
Late Sh. Bellamkonda Srinu
Rs.10.00 lacs
Rs. 40,55,240/-
b. The unit shall pay Environmental Compensation to CPCB for non-compliances resulting in three major accidents. → Rs. 73,50,000/-to CPCB.
IX Concluding remarks
Two major accidents occurred in M/s Venkata Narayana Active Ingredients Pvt Ltd on 29.07.2021 and 11.05.2021. During accident on 11.05.2021, three employees deceased due to thionyl chloride gas leakage.
There was no VOC sensor with alarm in the production block which could have alerted the employees of possibly high VOC concentration. There was no vapour absorption system/ suction system to route the escaping vapours/ gases into atmosphere through scrubber. Treating effluent in the reactor instead of ETP, lack of automation, Lack of comprehensive standard operating procedure, lack of training & ignorance of employees, not carrying out HARA and HAZOP study for neutralisation aqueous layer of Vildagliptin in reactor, absence of VOC sensors/ alarm system in the reactor to alert the personnel, lack emergency of preparedness are all the causes of accident. Immediate trigger was opening of atmospheric vent of reactor 0101 instead of opening scrubber vent which resulted in sudden release of unreacted Thionyl Chloride gas from reactor 0101.
The unit is continuing to operate at full capacity of 500 TPA. As per Inspectorate of Factories the unit is not complying with safety guidelines. The committee submits to Hon'ble NGT to direct Inspector of Factories to direct the unit to stop the operations and to safely shutdown the unit till the unit ensures compliance with revocation order issued by Inspector of Factories.
APPCB issued CFO- expansion to the unit for manufacture of 500 TPA of consented 35 products. APPCB shall ascertain the actual water consumption, wastewater generation, hazardous waste generation during full production. APPCB shall also assess the adequacy of ETP and air pollution control devices installed in the unit. The committee submits to Hon'ble NGT to direct APPCB to renew CFO only after ensuring that ETP and APCD's are adequate and working properly.
The committee constituted by the District Collector, SPSR Nellore district shall inspect the industry once in six months for minimum period of two years to verify the compliance status of the industry and to issue necessary directions as and when required.
The VOC values indicate that the odour control measures taken by the industry are inadequate and the industry need to take immediate measures to bring down the VOC levels to control odour nuisance to the surroundings."
From the above, it is seen that apart from illegality in ground water extraction beyond permission, including not installing proper flow meter at MEE condensate, ETP outlet, RO feed, RO reject and RO permeate, in absence of which the effluent generation could not be ascertained, there are other violations - non working of online pH indicator, dumping of waste without segregation in violation of Hazardous Waste Management Rules, 2016. Further, there is violation of safety norms like proper training to regular and contract staff, providing solvent storage area and solvent recovery plant area, safety equipment, PPE kits, employing unskilled staff, absence of atmospheric vent pipe line of reactors to the scrubber system, working of ventilation in the production blocks, license from the Factories Department, transfer of solvents using closed conveyance, color coding and flow directions to the pipelines, steam cut of wall, raw material shed, dump tank at the outlet, absence of dedicated stainless steel pipes for transfer of solvents, absence of means of access west side of old production block, absence of earth continuity jumpers to the flanges of the all solvent carrying pipelines, SOPs not displayed, safety committee meetings minutes not drawn up, working hours not displayed nor approved by the Inspector of Factories.
Such failures have resulted in two fatal incidents on 29.07.2020 in which two workers died and two received burn injuries and incident dated 11.05.2021 wherein three employees died due to inhalation of thionyl chloride gas and other three other were affected. The District Magistrate conducted an enquiry about the first incident and concluded that procedures followed by the management were not safe. State PCB issued directions on 29.07.2020 to stop operations of the unit. The unit offered compensation to the families of the deceased victims of incident dated 29.07.2020. The said incident was also on account of failure of the unit to adopt safety norms. The unit has paid compensation of Rs. 10 Lakh each to the families of the deceased. Further Compensation of Rs. 40 lakh each has been announced but not yet paid. Additional compensation proposed to be paid to the family members of the deceased is as follows:
Late Sh. P. Thirupataiah Rs. 30.00 lacs
Late Sh. V Thirupataiah Rs. 30.00 lacs
Late Sh. Bellamkonda Srinu Rs. 40,55,240/-
In pursuance of order dated 28.08.2020 in Appeal No. 21 of 2019 the unit has paid environmental compensation of Rs. 37.20 lacs to the CPCB. The Committee has assessed additional compensation of Rs. 73,50,000/- for damage to the environment. The Committee has concluded that the measures taken by the unit were not adequate.
The industrial unit in question has filed I.A No. 226, 227 and 228 of 2021 for impleadment, directions and exemptions from filing fair copies of the documents. The stand in the said applications is that compensation for damage to the environment needs to be reduced and the two incidents resulting in death of the workers are due to human error. The unit has not taken steps for compliance.
Principles for determining environmental compensation are well known and are based on restitution principle with deterrent element, as per financial capacity of the unit. While floor level compensation may be calculated on adhoc basis using rule of thumb, the same cannot have universal application, without considering the cost of remediation and financial capacity of the unit. In this regard, reference is made to law laid down in MC Mehta v. Union of India, (1987)1 SCC 395, pr 31, Indian Council for Enviro Legal Action Sterlite Industries (India) Ltd. v. Union of India (1996) 3 SCC 212 Pr 12,13,60,67, Uphaar Cinema, (2011) 14 SCC 481 Pr 101-108, Strerlite (2013) 4 SCC 575, pr 45-47, Goel Ganga Developers v. Union of India & Ors. (2018) 18 SCC 257 and MC Mehta, (2018) 18 SCC 397, pr 134. In the present case, the Committee has found serious violations resulting in damage to the environment spread over for long period. There is still failure to take remedial measures. There is loss of five lives within one year, apart from injuries to others. The turnover of the unit is 150 crores, as shown from the document filed by the unit itself (page 360 of the paper book), which is insurance policy dated 10.08.2021 issued by the Future Generali. Premium for the insurance policy is Rs. 1,04, 13, 307/- from 01.07.2021 to 30.06.2022. Having regard to serious continuous violations and financial capacity of the unit, compensation has to be atleast 5% of the annual turnover i.e. 7.5 crore, under the head of loss to the environment. We assess the same accordingly. There is no scope of reduction of compensation as sought. The compensation already assessed under the said head may be excluded from the said amount. The amount may be deposited by the unit with the State PCB within three months, failing which State PCB may take coercive measures, including closure of the unit, till compliance by disconnecting the electricity. The amount may be utilized for restoration/improvement of the environment in the area by preparing an action plan by a five-member expert committee comprising of MoEF&CC, CPCB, State PCB, Prof. P. Jagannadha Rao, Dept. of Chemical Engineering, Andhra University, Vishakhapatnam and District Magistrate, Nellore with State PCB as the nodal agency for coordination and compliance. The execution of the action plan may also be overseen by the same Committee through an appropriate agency. The Committee may meet within two weeks, verify remedial steps taken to prevent any future incident compliance of environmental norms, including those claimed by the unit. The Committee may interact with the stake holders, including the management, staff and representatives of public. Proceedings may be conducted online, whenever considered necessary, except the site visit. Execution may be completed as far as possible within six months. Proposed compensation may be paid to the victims as early as possible.
The application is disposed of.
All IAs are also disposed of.
A copy of this order be forwarded to the MoEF&CC, CPCB, State PCB, Prof. P. Jagannadha Rao, Dept. of Chemical Engineering, Andhra University, Vishakhapatnam and District Magistrate, Nellore, for compliance by e-mail.