The South West District Consumer Disputes Redressal Forum directed HPCL and its distributor to jointly and severally pay Rs50,000 as compensation to Delhi resident Dinesh Kumar
State-owned refining and marketing major Hindustan Petroleum Corporation (HPCL) and one of its distributors have been directed to pay Rs50,000 as compensation to a customer for damage caused to his home due to an explosion triggered by LPG leakage.
The South West District Consumer Disputes Redressal Forum held the state-run enterprise and its distributor jointly or severally liable to pay the amount to the complainant for the financial loss and harassment suffered by him.
“We are of the opinion that the explosion took place due to gas leakage, that leaked due to the defective pipe and regulator. We hold the opposite parties (HPCL and its distributor) responsible for deficiency in service on their part which caused financial loss and harassment to complainant for which he is entitled to be reasonably compensated,” a bench presided by Narendra Kumar said.
The forum directed HPCL and its distributor to jointly and severally pay Rs50,000 as compensation to Delhi resident Dinesh Kumar.
In his complaint, Dinesh had alleged that on 15 June 2004 there was gas leakage from the LPG cylinder he had bought from HPCL and on informing the distributor it had sent one of its employees to rectify the leak.
The distributor’s employee instead of replacing the old gas pipe, from which gas was leaking, had cut out its torn ends and attached it again to the cylinder, he had alleged.
Three days after the repair, gas had again leaked out at night and there was an explosion in the kitchen, he had said.
In its defence, HPCL and its distributor had denied the allegations and had contended the gas leakage was due to lapse on the part of consumer.
The forum rejected their contentions, saying “there is sufficient evidence to prove that the cause of leakage of the gas was due to old and outdated pipe and also defective regulator” which were supplied by HPCL to its distributor who passed it on to the customers.
India's growth is already very weak and tighter domestic liquidity will worsen financial conditions for corporates and banks, hurting asset quality and the growth outlook. But the RBI had no choice
Reversing its explicit easing stance over the past 12 months, the Reserve Bank of India (RBI) tightened domestic liquidity to arrest the rupee depreciation. The RBI has announced that it will limit from Wednesday the amount of liquidity available at the repo rate (liquidity adjustment facility or LAF) limited to Rs75,000 crore from the current limit of Rs90,000 crore. The central bank has also raised the rates at which additional liquidity (beyond the LAF) will be provided. This marginal standing facility-MSF and bank rates are raised to 300 basis points (bps) from 100 bps above the repo rate (to 10.25% from 8.25%). Further, the RBI said it will also conduct open market sales (OMS) of government securities worth Rs12,000 crore on 18th July which will further drain liquidity from the system.
This followed high-level meetings between prime minister Dr Manmohan Singh, an internationally acclaimed economist, and finance minister P Chidambaram with RBI governor. RBI’s hand was forced by poor economic efficiency under the Dr Singh when exports are weak, foreign investment has slowed down and India is solely dependent on capital inflows for equity and debt. These strong measures were probably necessary because the RBI saw no immediate solution to India's fundamental problems of a wide current account deficit and funding this deficit in an uncertain global economy. This is further aggravated by the populist announcements by the United Progressive Alliance (UPA) government, like the Food Security Bill.
According to economists, this (RBI’s) move would affect corporates and banks, especially private banks and non-banking finance companies (NBFCs) that are mostly dependent on short-term wholesale funding.
According to Nomura, India's growth is already very weak and tighter domestic liquidity will worsen the financial conditions for corporates and banks, hurting asset quality and the growth outlook. As such, while the RBI may be successful in stemming debt outflows, growth-sensitive equity flows are now also at risk of a reversal, it added.
“We expect these to result in higher money market rates or short-end wholesale rates. Depending on demand-supply conditions the overnight interbank or call money rate could move up to as much as 300 bps above the policy rate. In terms of direct impact, it hurts banks that rely on these markets like Yes Bank and IndusInd Bank and NBFCs. If these rates were to impact GDP growth even further then they would hurt the entire sector as asset quality would come under further pressure,” said Barclays Research in a note.
According to Nomura, financial stability concerns are pre-dominant in the RBI’s mind as the rupee has weakened substantially due to portfolio debt outflows. It said, “The measures announced (by RBI) are a classic textbook response to a weakening currency: tighten liquidity and raise rates. They will tighten domestic liquidity, raise short-term interest rates, increase the relative interest rate differential and possibly stem debt outflows.”
“However,” Nomura said, “Whether the measures will have a sustainable impact remains to be seen. As we have argued before, we see a gradual rupee depreciation and a tight fiscal policy as a solution to India's macro-economic problem, and not higher interest rates. There is a risk that today's measures could backfire.”
Barclays says the move (by RBI) would impact banks and NBFCs in two ways, one directly through net interest margins (NIMs) and two, indirectly through the impact of GDP growth. “In terms of direct impact we believe entities that are most reliant on short-term wholesale funding will be adversely impacted. Yes Bank and IndusInd Bank have significant reliance on these markets. NBFCs should also be negatively impacted. PSU banks, particularly State Bank of India (SBI) have little or no reliance on short-term wholesale funding. PSU banks, in general, based on guidance from the finance ministry, have been reducing their reliance on wholesale funding,” it said.
If the higher rates were to persist depending on how long RBI adopts this stance and impact GDP growth, then that would affect the entire banking system negatively, Barclays added.
Dr Tirthankar Patnaik, India strategist and chief economist at Religare Capital Markets, said, “Hardening of short-term rates is an overall macro-negative on working capital funding, given the benchmarked loans, especially on small and medium enterprises. From a funding perspective we would turn incrementally negative on banks and NBFCs with access to wholesale funding like Canara Bank, OBC among PSUs, Yes Bank, and IndusInd Bank among privates, and most NBFCs.”
The context and the responses from RBI are similar to 1997–98, when the rupee depreciated sharply following the East Asian crisis—an external-event shock. The outlook for capital inflows was bleak because of several domestic and external factors, and the RBI took certain extremely strong measures to tighten liquidity and increase policy rates by 200 bps in January 1998. Overnight rates shot up to 65%, making it prohibitively costly to hoard US dollars. Although this time, the RBI has refrained from using the cash reserve ratio (CRR), its overall approach to tightening liquidity to stem currency depreciation broadly follows the 1997-98 episode.
On paper, there was a ban on dance bars in Maharashtra since 2005. In reality, there never was a dearth of dance bars and bar girls for those with money and power in the state. The Maharashtra government, which came up with the ban orders through an amendment in the Bill, did not back it up before the judiciary
In a democracy, especially like India's multi-coloured culture, bans and that too from the government never really work in practice. The ruling by the Supreme Court on the dance bar ban in Maharashtra is one of the examples of this stark reality. At the same time, it also shows the laidback attitude of politicians and bureaucrats, who are dependent on such bans, before the judiciary.
The apex court bench of Chief Justice Altamas Kabir and Justice SS Nijjar on Tuesday upheld the right of bar dancers while rejecting the Maharashtra government’s plea against the Bombay High Court verdict striking down the police orders that bar dancing in hotels below three stars.
The bar dancers had contended that besides being discriminative, the police order impinged on their right to livelihood. They had also contended that besides dancing at the bar they knew no other trade to earn their living. This exactly was the point on which the Maharashtra government could not defend its position either in the high court or in the Supreme Court. The apex court upheld the right of bar dancers to pursue their profession subject to dancing bars taking licence from the state authorities.
During 2005, the Maharashtra government, after a discussion in the legislative assembly decided to ban dance bars across the state. At that time, there were 700 dance bars only in Mumbai while the number of dance bars in rest of the state was about 650. It used to employ about 75,000 bar girls. RR Patil, the then and incumbent minister of home in Maharashtra was at the forefront in this move to ban dance bars.
The state government had sought to effect a ban by promulgating an ordinance, but the governor had returned the same on 23 June 2005, saying the government could introduce a bill on the issue in the assembly during its forthcoming session. Then on 14th July, the Mumbai Police (amendment) Bill, 2005, was introduced during the monsoon session and was passed by both the houses unanimously. Subsequently, SM Krishna, the then governor, on 9 August 2005 gave his assent to the Bill.
At that time Patil, who introduced the Bill in the assembly had said that the attention of the government was drawn to the mushrooming of illegal dance bars and their ill-effects on the society, including ruining of dancers’ families. “The members of ruling and opposition benches pointed out that such dance bars are used as meeting points by criminals and pick-up joints for girls indulging in immoral activities and demanded that such dance bars, should therefore be closed down,” he had said.
Soon after the ban, Manjit Singh Sethi, the then president of Association of Hotel and Restaurants (AHAR) and Manjit Singh Abrol, a hotel owner, challenged the Bill in the Bombay High Court. Varsha Kale, president of Dance Bar Girls' Association also filed a petition in the HC alleging that the state government had not made any rehabilitation plan for dancers and due to the ban, bar girls would be forced to adopt prostitution as they would be jobless. In 2006, the HC struck down the ban enforced by the state government. Then Maharashtra government filed an appeal before the Supreme Court.
Several women's group from across the country also opposed the arbitrary ban on dance bars in Maharashtra. These groups alleged that banning dance-bars would compel women to resort to activities where there is even greater sexual exploitation and the government will not be in a position to either monitor or regulate these activities.
Earlier in 2010, while speaking with IANS, San Francisco-based writer Sonia Faleiro, who wrote a book on the lives of bar dancers, had said, “A lot of them (bar girls or dancers) work on their own as sex workers independent of pimps. They are attached to brothels or they offer their services at private parties in Mumbai, Madh Island and Uttar Pradesh.” Faleiro’s second book, “Beautiful Thing: Inside the Secret World of Bombay's Dance Bars” casts a candid look at the lives of bar girls after the ban.
The ban was largely a political ploy, Faleiro had said. “Politicians require issues to attach their manes to the issues—bring them attention and keep them in the news. The ban was a clever subject... meant to trigger controversy with issues of wine, women and morality”.
Over the years, dance bars have proliferated because the excise department freely granted licences, without bothering with the rules. As per the claims of bar owners, Maharashtra government was officially earning about Rs1,500 crore a year from these dance bars.
Anyway, the state government decided to forget this amount and enforced the ban on dance bars. However, for anyone with surplus cash and powerful connections, there was never any dearth of dance bars in the state. Especially, all the roads, new and old, leading to Mumbai have several bars that offered such service, albeit charging more. Since the entire operation was illegal, there was more exploitation. Bar girls, who used to pay about 30% to 40% of their earnings to bar owners, were the easy prey of everybody from bar owners to goons, police and babus for exploitation in this illegal business. In short, during the seven year after the ban, we find a boost in everything, the number of dance bars, exploitation, ‘protection money’ or hafta, arrests and last but not least prostitution.
So long as lewd music videos, promos can freely enter our living rooms and salacious advertisements (including ManForce condom's ad featuring porn-star turned actor Sunny Leone) are beamed on all channels all the time, let us not pass moral judgement about the business of dance bars.