Environment Ministry bent norms to favour Rs 149-cr distillery that has Shivraj Patil’s son on its board

N V Distilleries, sprawled across 52 acres in Naraingarh in Ambala district, commenced bottling operations for major liquor brands, including Seagram’s only two months ago. Started with an investment of Rs 149 crore, the plant is now the centre of a controversy with the HSPCB asking the Union Environment Ministry (MoEF) to “re-examine” the environmental clearances given for project expansion and change in raw material used by the distillery.

The consent applications granted to N V Distilleries in 2006 show industrialist Ashok Jain (who has been in the distillery business for two decades), Shailesh Patil and his wife Archana Patil as “Managing Directors/ Managing Partners” in the company. While Shailesh Patil told The Sunday Express that he has a 50 per cent stake in the distillery, Jain said he had “no financial stake,” admitting that having him on board “added to the profile of my project.”

Haryana Excise and Taxation Commissioner Arun Kumar confirmed: “Ashok Jain, Shailesh Patil and his wife are all partners in the distillery. The last two first wanted authorised signatories nominated by them to sign the permits and Memorandum of Understanding but we insisted on the rules and they signed.”

Contacted by The Sunday Express, Jain said: “We obtained every type of approval before we commenced operations.”

Given the potential impact of distilleries on ground, water and air pollution, the sanction process is guided by elaborate norms of the CREP (Corporate Responsibility for Environmental Protection), Environmental Impact Assessment (EIA) as well as strict guidelines imposed by the MoEF, the Central Pollution Control Board (CPCB) and the state Boards, in this case the HSPCB.

Official records show how the Centre’s permission came in the face of the state pollution control board’s objections:

• In August 2006, the HSPCB issued a No-Objection Certificate (NoC) to N V Distilleries, imposing 24 conditions for environmental protection.

• The Environment Impact Clearance from the MoEF came in February 2007, with 17 fresh conditions. These clearances were for starting “grain-based liquor production with zero discharge levels” and with a production capacity of 60 KLPD (kilo litres per day).

• However, on September 17, 2007, the MoEF sent a letter permitting the distillery to expand the project from 60 KLPD to 75 KLPD. And to exercise a “dual feed” option, that is, production of liquor from either grain or molasses (where the comparative environmental hazard is much higher).

• Barely a month later, an inspection by the HSPCB showed deficiencies in the distillery’s water treatment/ effluent flow plants. The inspectors in their report said: “The discharge of waste waster from the processes is a violation of the NoC of the Board/ Environmental clearances issued by the MoEF.”

The HSPCB team said that company representatives be called for a personal explanation and consent for operation of the bottling plant be decided based on the outcome of that meeting.

HSPCB officials in Panchkula told The Sunday Express that in view of these deficiencies, they were surprised by the Central clearance for expansion of the project.

Allowing dual feed, too, was a violation of current guidelines for stand-alone distilleries, Para 2 of which state: “Proposal for stand-alone new distilleries and expansion of existing distilleries without achieving zero discharge in surface water/ ground water will not be considered by MoEF…”

With N V Distilleries becoming a subject of a tussle between the Central and HSPCB authorities, chairman of the pollution control board A S Chahal stepped in and sent a strongly worded letter dated March 31 this year to the Joint Secretary in the MoEF.

Quoting guidelines, he wrote: “The subsequent environmental clearance granted by the Government of India on their own appears to be in violation of guidelines…In view of this, it is requested that facts of the case may please by re-examined…in case of any inconsistency with the provisions of the relevant Act/Rules/Notifications/Guidelines, Environmental clearance so granted may please be reviewed and action, if any at our end may please be intimated accordingly.”

When The Sunday Express visited the distillery, it was business as usual with truckloads of liquor consignments rolling out of Naraingarh. When questioned about the objection raised by the HSPCB, Ashok Jain said, “The Ministry of Environment has cleared our expansion to 75 KLPD and it is up to the HSPCB to give us the final authorization. But we will switch to molasses-based production only when it becomes commercially viable for us. It is the Centre that has given us the option of doing so.”

Tomorrow: At distillery site, angry villagers complain of an unfair deal