In an unprecedented move, a division bench of the High Court of Kerala on June 1, 2005 has directed the Perumatty panchayat (village council) to renew Coca-Cola's license to re-open its bottling plant in Plachimada, Kerala, in southern India. India Resource Center says that the struggle will intensify.

The High Court's decision is confusing because the Coca-Cola company has not met the conditions necessary by law to re-open its plant. Local groups in Plachimada and Kerala, along with national and international groups, have vowed to increase the pressure on the Coca-Cola company.

The Perumatty panchayat had refused to renew Coca-Cola's license on April 26, 2005 because the company failed to provide the necessary permits required by law.

The High Court has further ruled that if the license is not granted, the Coca-Cola could resume operations nevertheless.

Coca-Cola's bottling plant in Plachimada in the southern state of Kerala has remained shut down since March 2004 because the local village council has refused to renew Coca-Cola's license to operate. Local groups have been campaigning actively for over three years to hold Coca-Cola accountable for creating severe water shortages as well as polluting the groundwater and soil.

The June 1st decision by the Kerala High Court has been received very unfavorably by a wide cross-section of the community.

"The decision to allow Coca-Cola to resume operations is problematic on many counts," said R. Ajayan of the Plachimada Solidarity Committee. "It undermines the power of the panchayat, it goes against the High Court's own recent decisions, and it allows a company to operate without being compliant of the laws," continued Ajayan.

Honorable Justice Shri V.R. Krishna Iyer, a former Supreme Court judge and an internationally respected personality, has also come out strongly against the latest decision. "When license has been refused for the Coca-Cola (company) by the local authority which is necessary under the Municipal Law, the court cannot hold that, in certain circumstances, the license may be deemed to have been granted, thus nullifying the statute," said Honorable Justice Shri V.R. Krishna Iyer in a prepared statement. The statement also accuses the Coca-Cola company, a 'powerful litigant', of 'bench shopping' in order to get a favorable judgment.

The Coca-Cola company is the subject of intense campaigns all across India, accusing it of creating severe water shortages and well as polluting the groundwater and soil.

"Coca-Cola is using dubious methods to force its plant to re-open but the community has resoundingly rejected the company. It doesn't make sense, business or otherwise, to operate when you are not welcome and company should pack up and leave," said Amit Srivastava of the India Resource Center.

Coca-Cola will find it difficult to re-open its factory in Plachimada because many issues remain outstanding.

The Perumatty panchayat has appealed the High Court's past decision of April 7, 2005 to the Supreme Court in India, and the appeal is scheduled to be heard in the Supreme Court. The April 7 ruling by a division bench of the Kerala High Court allowed the Coca-Cola company to extract up to half million liters of water per day, under normal rainfall conditions.

The recent decision by the High Court is also baffling because the Coca-Cola plant has not complied with the directives of the Supreme Court Monitoring Committee on Hazardous Waste (SCMC), a committee set up by the Supreme Court of India. The SCMC had cited the Coca-Cola company for various violations, and had instructed the Keral State Pollution Control Board to ensure that the company installs new systems to treat wastewater as well as provide piped drinking water to community residents around the bottling plant.

One of the conditions set forth by the Kerala High Court on April 7, 2005 was that Coca-Cola furnish the necessary permits, including a permit from the Kerala State Pollution Control Board (KSPCB), to the panchayat for the renewal of the license. However, the health minister of Kerala, K.K. Ramachandran, had stated that the KSPCB will not issue a permit to Coca-Cola.

On April 26, the panchayat refused to renew Coca-Cola's license because the necessary permits were not presented.

The current ruling allows the Coca-Cola facility to operate without being compliant of the laws in India.

Contacts:
R. Ajayan, Plachimada Solidarity Committee (India) Tel: +91 98471 42513
Amit Srivastava, India Resource Center E: info(AT)IndiaResource.org Tel: +44 7731 865 591 (UK)

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