Minor mineral mining major environmental problem in Kerala, IT Order exposes unholy nexus

Leaders of both the ruling and the Opposition parties are named as payees taking crores of rupees in the loose sheets seized by the income tax department from Cochin Minerals and Rutile Ltd. The names include Pinarayi Vijayan and Oomen Chandy. 

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SO far, it was hearsay that corporations will hush up environmental concerns by bribing politicians, authorities and media.

However, now an Income Tax Board Settlement Order agreed by Cochin Minerals and Rutile Ltd (CMRL) shockingly exposes how an unholy nexus in Kerala, which includes the ruling party and Opposition, police and media, compromised the environmental safety of Kerala after taking crores of rupees as bribes.

Interestingly, everything is written in black and white in the settlement Order agreed to by CMRL.

In 2019, income tax (IT) officials raided CMRL offices, factories, and residences of the managing director and key officials and discovered "the issues of inflation of expenses, non-consideration of software expenses of ₹1.72 crore and undisclosed income offered for the 2019–20."

The IT officials found around ₹134 crore in fake expenses. As a follow-up procedure, the settlement board convened, where the chief financial officer (CFO) of CMRL, K.S. Suresh Kumar, who has been working for 27 years in the company, spilled the beans.

When Suresh Kumar was confronted with the seized documents, he said that the company was receiving numerous threats to obstruct its business or hinder its smooth functioning.

"To overcome these threats and to obtain their cooperation, illegal payments were being made to multiple individuals and media houses," Suresh Kumar informed the IT officials.

In response to the IT officials' question about the purpose of the payments, Suresh Kumar said that they were being made to functionaries and members of various political parties, media houses and the police to ensure the smooth functioning of the company's business. The IT Order cites that the payments were running into crores of rupees.

Furthermore, Suresh Kumar stated that the company obtains ilmenite from public sector undertakings (PSUs) that mine it. The mining has a negative environmental impact.

There is a constant threat of the media and concerned citizens highlighting this impact, raising questions on the issue, even registering complaints with the courts or the National Green Tribunal. 

To prevent this from happening, CMRL pays off numerous individuals and organisations to earn their silence.

Suresh Kumar also said that the CMRL cashier, K.M. Vasudevan, had kept records of the payments as per the advice of the managing director, S.N. Sasidharan Kartha.

Kartha acknowledged that the confiscated documents were indeed records of financial transfers that had been made to various parties on his orders  

When confronted with the confiscated records, general manager, CMRL, P. Suresh Kumar concurred with the IT officials that payments had been made.

When the IT officials confronted Suresh Kumar with some seized loose sheets with the abbreviations P.V., A.G., O.C., K.K., I.K., and R.C. scribbled as payees, he disclosed that the abbreviations stood for Pinari Vijayan, A. Govindan, Oommen Chandy, Kunjali Kutty, Ibrahim Kunju and Ramesh Chennithala, respectively.

Chandy was the chief minister of Kerala between 2004 to 2011 and Vijayan has been the chief minister from 2016.

Chennithala was Leader of the Opposition in the legislative assembly between 2016 and 2021. 

Kunjali Kutty has been a parliamentarian, and a minister and member of legislative assembly from the Indian Union Muslim League, an ally of the Congress-led United Democratic Front. 

Ibrahim Kunju is also a former minister. Unfortunately, details of A. Govindan are unavailable in the public domain.

About the company

CMRL is a publicly listed chemicals company based in Kerala and founded in 1989 by Dr S.N. Sasidharan Kartha with assistance from the Kerala State Industrial Development Corporation.

CMRL's main product is synthetic rutile, which is a raw material for the titanium pigment, and titanium sponge and metal industry. The company has an annual licensed and installed capacity of 50,000 metric tonnes.

In 1991, CMRL initiated action for carrying out mining and mineral separation. The company had also promoted Kerala Rare Earths and Minerals Limited (KREML) in 2001 and had applied for a mining lease in light of the change in policy by the governments of India and Kerala.

However, there were numerous legal complications. Indian government prematurely terminated all mineral concessions for beach sand minerals held by private companies across the country in 2019, in accordance with Section 4A (1) of the Mines and Minerals (Development and Regulation) Act.

Additionally, the government mandated that going forward, any mineral concession for beach sand minerals shall only be granted to a government company or corporation that is owned or controlled by the government.

Due to this, CMRL was compelled to buy raw materials from PSUs like Indian Rare Earth Limited (IREL).

Unfortunately, the environmental impact, which was 'overcome' by bribing politicians, state police and media, is visible in the Kollam and Alappuzha coasts where the mining takes place.

Alappad, a coastal village in Kollam, lies in the mineral-rich Chavara deposits, and may disappear from the map in a few decades, reportedly due to 'excessive' mining.

The village is home to a 22.5 kilometre-long mineral sand beach with heavy mineral content.

These minerals, such as ilmenite, rutile, zircon and sillimanite, are used in the production of various industrial goods, for example titanium dioxide, welding electrodes and ceramics.

In the past 50 years, Alappad has shrunk from 87.5 square kilometres to 8.7 square kilometres. 

"The mining has caused the coastline to recede, and it has also led to the loss of agricultural land and fishing grounds. The villagers of Alappad are now facing an uncertain future, as their village is slowly disappearing. 

"Many have fled the village. Thousands of fishermen have lost their livelihood and moved to other villages. Even schools have been shut down due to a lack of students. We are living in a panchayat that will soon disappear from the map," said Kartik Sasi, a local activist protesting against the mining.

According to a study, from 1985 to 2021, the change in the land area of the village is about 33.25 percent. It is predicted that the change in land area from 2021 to 2070 will be 73.5 percent.

A fisherman from Alappad, N. Sathyarajan, said: "Climate change and mining have stolen our shore and livelihoods. We are losing our livelihood. We are losing everything. But as there is no place to go, we will try to stay back till we lose this land too."

"Earlier, there used to be a lot of houses in this row. Now, only less than six houses survive," Sathyarajan said, adding that the rest of the villagers have moved to other towns or places.

According to him, nobody wants to buy land in the village as they fail to get even a loan from the bank by pledging their land as the banks see it as a high risk investment.

Meanwhile, Sridhar Radhakrishnan, an observer on development, climate and environmental issues, said that CMRL has always been a rogue company with a dirty legacy of polluting the River Periyar and the public lands in Edayar with hazardous waste and wastewater.

"The struggle of the local community against pollution has never found any sympathisers in the politicians from any party over the decades. 

"We even saw the public and environment-concerned citizens in Eloor and Edayar being harassed, threatened and even arrested and dragged to courts on false accusations. It looks evident that the politicians and the trade union leaderships across parties were bought by such companies," Sridhar said.

Sridhar said that the Order exposes how senior political functionaries were on the payrolls of the company and were bribed for ensuring that the environmental damage and public outcry at the now notorious and ecologically destructive ilmenite mines on the shores of Kerala do not affect the business of the company.

He concluded that CMRL has no business continuing to destroy the environment both at the mining sites as well as at the sites where it dumps waste and wastewater.

"They need to be stopped. More importantly, the politicians who have been named for being corrupt and their relatives, who were also beneficiaries of the payoffs, have no moral right to continue their public and political work," he added.