NGT directs MSBB to collect ABS on commercial utilisation of bio-resources

NGT directs MSBB to collect ABS on commercial utilisation of bio-resources

Shardul Nautiyal, Mumbai  Tuesday, November 03, 2015, 08:00 Hrs  [IST]

National Green Tribunal (NGT) has recently passed an order for ABS payments by companies engaged in commercial utilisation of castor plant and other bio-resources for drugs and cosmetics. Castor oil is extracted from castor plant which is an agriculture produce. Justice VR Kingaonkar, judicial member and Ajay Deshpande, expert member of the western zone bench of Pune delivered judgment based on a public interest litigation (PIL) making it clear that if a bio-resource like castor oil is commercially utilised, Maharashtra State Biodiversity Board (MSBB) has the mandate to collect ABS payment under the provisions of Biological Diversity (BD) Act, 2002. Judgment clearly specifies that ABS is applicable to bio-resources from agriculture or forest area as well. Castor oil which is an agriculture bio-resource when utilised for general commodities, no ABS is applicable. However, when utilised for commercial purposes for use in drugs and cosmetic products, ABS is applicable to it. ABS is also applicable for access to biological resources, bio survey and bio-utilisation for commercial utilisation. Member-secretary of MSBB Dr Dilip Singh had issued notices to defaulting traders and manufacturers of castor oil in response to non-payment of ABS to MSBB as commercial utilisation of castor oil is tantamount to violation of Section 2(c) (f) and Section 7 of Biological Diversity Act, 2002. The NGT therefore gave instructions to MSBB to take appropriate action against defaulting parties and in case the parties do not respond, their names to be published in newspapers and thereafter prosecution to be filed against them as per the law. It has been further directed that violation of Sections 7 and 24 (2) of Biological Diversity Act, 2002 by not giving prior intimation to State Biodiversity Board (SBB) in case of access to biological resources for commercial purposes, companies shall be held liable and punishable with imprisonment for a term which may extend to 3 years or with fine which may extend to Rs.5 lakhs or with both under Section 55 (2) of the BD Act. The argument in NGT was done by advocate Dr N D Choudhari and assisted by Shashank Vakil. Dr Dilip Singh, member-secretary, MSBB gave information regarding notices given to defaulting parties and assured strict action against defaulting parties. "As per the law, around 95 per cent of ABS will be given to Biodiversity Management Committee (BMC) for sustainable development of bio resources. The ABS should be adopted like a corporate social responsibility (CSR) activity by industries towards bio resources development and environment protection. Thus industries can be associated with the local people from where bio resources are obtained to get continuous supply of bio resources in perpetuity," said MSBB officials in their argument. The judgment was based on a public interest litigation for court case no. 25/2015 (WZ) of Asim Sarode & others versus the state of Maharashtra & others. Under section 55(1) whoever contravenes the provisions of Section 3 or Section 4 or Section 6 shall be punishable with imprisonment for a term which may extend to five years, or with fine which may extend to Rs.10 lakhs and where the damage caused exceeds Rs.10 lakhs such fine may commensurate with the damage caused, or with both. If the defaulting parties contravenes any directions given or order made by central government, state government, NBA, MSBB, they shall be punished with a fine which may extend Rs.1 lakh and in case of a second or subsequent offence, with fine which may extend to Rs.2 lakhs and in the case of continues contravention with additional fine which may extend to Rs.2 lakhs every day during which default continues. As per the MOEF notification, dated November 21, 2014 the benefit sharing obligation from trader and manufacturer shall be in the range of 1 to 3 per cent and 3 to 5 per cent respectively of the purchase price of the biological resources. However, there is option to pay benefit sharing on sale price of the biological resources accessed for commercial utilisation under the law. For annual gross ex factory sale of product, in case of one crore benefit sharing will be 0.1 per cent, for 1 to 3 crores, it would be 0.2 per cent, for above 3 crores turn over, the benefit sharing will be 0.5 per cent. "Traders and manufacturers are hereby appealed to deposits ABS for sustainable development of bio-resources, " according to Dr ND Choudhari, legal consultant, MSBB, Nagpur.