13.The forest department has done afforestation and mangrove plantation at a cost of nearly 50 lakhs and now this area has been given to the Mundra SEZ. This is not acceptable. The Mundra SEZ must not be given clearance.
14.There is significant horticulture in the area, which will be affected if the Mundra SEZ is allowed, therefore the Mundra SEZ should not be given Environmental Clearance.
15.The company has not enclosed any ToR given by the MoEF for the EIA of the Mundra SEZ. No ToR compliance report has been submitted. It is not clear whether the EIA is complete or not.
16.The EIA is based on data collected between 2006 and 2008. However, several changes have taken place in the meantime. Why has the EIA report containing latest data not been submitted for the public hearing ?
17.Eight CFS terminals are under operation without permission in the Mundra SEZ. The Kandla SEZ has also raised this issue. This is a violation of environmental laws. Now the public hearing is being held so that the violations can be regularized. Will the company clarify in this matter ?
In view of the above objections, I demand that :
1. The Adani Mundra SEZ must not be given Environment Clearance.
2. Construction has already taken place in the area notified for the SEZ. The environment public hearing committee may visit these areas and take videography of the construction that has taken place and submit it to the authorities.
3. The construction that is going in the SEZ area must be stopped immediately and heavy fine imposed on the Adani group for the violations."
If respondent nos.10 and 11 are permitted to go ahead with the construction so far as their units are concerned on the assumption or hope that environmental clearance would be Page 77 of 186 77 of 189 C/WPPIL/21/2013 CAV JUDGEMENT granted to the MPSEZ in recent future, and in the same manner if other units also identically situated like respondent nos.10 and11 proceed ahead, then practically the right of appeal which has been provided under the Act against grant of environmental clearance to any aggrieved person would also stand frustrated.
In view of what has been discussed above holding that action of respondent nos.10 and 11 in implementation of the project without environmental clearance being accorded in favour of the MPSEZ under the provisions of the Environment (Protection) Act, 1986, the rules framed thereunder and the Notification, is illegal, it is not permissible for respondent nos.10 and 11 to proceed ahead with the implementation of their project till the MPSEZ obtains the environmental clearance.
We dispose of this writ-petition with a direction to respondent nos.10 and 11 not to proceed ahead in implementation of their project and not to undertake any further construction work, whether preliminary or otherwise, till the MPSEZ is granted environmental clearance. The writ-petition to that extent is allowed."
One of us, His Lordship Bhaskar Bhattacharya, CJ., in a separate but a concurring judgment, made the following observations :
"The moot question that falls for determination in this Public Interest Litigation is, if the MPSEZ itself has not been granted environmental clearance under the Notification of 2006 by the Central Government, whether any unit setup within the MPSEZ, as a Lessee of the MPSEZ, can proceed with the construction work irrespective of the fact whether such individual unit is required to obtain separate environmental clearance or not.
Mr Thakore and Mr Joshi, the learned Senior Counsel appearing on behalf of MPSEZ and respondent No.10 respectively, submitted that even if, ultimately, the environmental clearance is not given to the MPSEZ, the infrastructural facilities which the MPSEZ is required to provide to all the units within the same, will have to be arranged by the individual unit itself within the MPSEZ, after obtaining direct permission from the Central Government.
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There is no dispute that although MPSEZ has applied for environmental clearance as required under the law, till date, the same has not been conferred and notwithstanding such fact, MPSEZ has already executed separate lease deeds in favour of different units like respondent No.10.
It appears from the Lease Deed executed between MPSEZ and respondent No.10 that there is clear mention of the fact that the Government of India has permitted MPSEZ, the Lessor, vide a Letter of Approval dated April 12, 2006 to establish a Multi- Product Special Economic Zone at Mundra and the Lessee, i.e., the respondent No.10, was desirous to take on lease a plot of land in the processing area of the MPSEZ for setting up a unit for manufacture of Turbine, Generator and other spares and auxiliaries related to those products and also for providing services of erection and commissioning of above mentioned products. According to the terms of the lease-deed, the Lessee is required to pay Annual Lease Rent at the rate of Rs.20 a square meter payable annually in advance and the same shall be escalated every five (5) years at the rate of twenty percent (20%) and the first escalation of Annual Lease Rent shall be made in the year 2015-16 with effect from 1st April 2015. According to the terms of the lease, in addition to the Annual Rent indicated above, the Lessee is also required to pay SEZ maintenance charges at the rate of Rs.18/- a square meter per annum for the maintenance and upkeep of all the infrastructural facilities provided to the Land and the determination of such amount of Maintenance charges shall be done in an open and transparent manner and would be reviewed by the Development Commissioner of Mundra SEZ. According to the said term, any upward revision of the Maintenance Charges with a maximum frequency of once a year can be made unless a requirement of refurbishment due to damages to infrastructure caused by natural or man made factor arises. The said deed further provides that the Lessor shall have right to charge fifteen percent (15%) towards management and coordination of Mundra SEZ maintenance and refurbishment as above. The deed further mentions that in case of failure of the Lessee to pay the above Annual Lease Rent or SEZ Maintenance Charge would make the Lessee a defaulter and will give right to the Lessor to terminate the Lease before expiry of the period mentioned therein.
In the Lease Deed, the Lessor covenants that it would comply with all the terms and conditions from time to time which have been mentioned in Letter of Approval under which it has been permitted by the Government to establish Mundra SEZ. In clause 3.4, it has been further asserted by the Lessor that it has obtained all the required permissions and the Page 79 of 186 79 of 189 C/WPPIL/21/2013 CAV JUDGEMENT Governmental Approvals as required in the name of Lessor for granting lease of the land to the Lessee and shall be responsible to comply with all the required terms and conditions and such permissions and approvals received from the Government and shall keep such approvals and permissions in force (to the extent necessary under applicable Laws) and shall make all its statutory compliances to keep the Lease in full force and effect during the entire term.
From the above clause of the Lease Deed, it is clear that the Lease has been executed not only for enjoyment of the land under the SEZ, but also for the purpose of giving infrastructural facilities provided to the land for which separate maintenance charge has been provided. It further appears that the Lessor was conscious that it was required to comply with all the terms and conditions from time to time which has been mentioned in the Letter of Approval and it further asserted that it has obtained all the required permissions and Governmental Approvals as required in the name of Lessor and is also responsible to comply with all the permissions and approvals received from the Government and shall keep such approvals and permissions in force to keep the lease in full force and effect during the entire term.
It is an admitted fact that environmental clearance required to be taken by the Lessor has been applied for but has not yet been granted. Nevertheless, the Lessor has asserted the above fact of getting permission and keeping such permission alive during the subsistence of lease in favour of the respondent no.
10. Over and above, it has also decided to accept not only rent for land but also the maintenance charges for giving infrastructural facilities in advance as mentioned in the Deed.
I, therefore, find no substance in the contention of Mr Thakore or Mr Joshi, the learned senior counsel appearing on behalf of the respondent nos. 8 and 10 respectively that if in the long run, no environmental clearance is given by the Central Government, the separate unit holders would be to make independent arrangements for infrastructural facilities by taking separate permission of their own from the Central Government because such provision is not indicated in the lease deed. On the other hand, the Lease Deed casts a duty upon the Lessor to provide for such facilities in lieu of rent and maintenance charge.
I have already pointed out that the Lease is executed not only for the enjoyment of the possession in the land but also for enjoyment of infrastructural facilities to be arranged by the Lessor and if required permission for such infrastructural Page 80 of 186 80 of 189 C/WPPIL/21/2013 CAV JUDGEMENT facilities has not yet been given by the Central Government, the Lessor, in my opinion, was not even competent to create a Lease for the above purpose.
I, thus, find substance in the contention of the petitioner that so long the Lessor itself is not vested with the right to have establishment of various infrastructural facilities by taking environmental clearance, it cannot confer the right of enjoyment of such facilities to its Lessee.
It is now well known that Lease is a doctrine of separation of title from actual enjoyment of the subject matter. Before execution of a Lease in favour of a Lessee, the Lessor retains both the title and the right of enjoyment of the property. Once a Lease is executed, the Lessor retains only the title to the property but loses its right of enjoyment thereof by conferring the same in favour of its Lessee. According to the 2006 Notification, in order to have such right of creation of infrastructural facilities over the land allotted, prior approval of the Central Government is necessary before making any construction and thus, without having acquired such right, the MPSEZ, the allottee from the Government, could not convey such right to its Lessee. In other words, a Lessee cannot have better right than that of his Lessor in the property. Law is also well settled that there cannot any valid Lease for enjoyment of a property, which is not in existence and not capable of being put into possession of the Lessee at the time of execution of the Lease.
I, thus, find that so long the environmental clearance is not granted by the Central Government in favour of MPSEZ for creation of infrastructural facilities on the land so allotted and consequent to such permission, such facilities have been actually created by the allottee, the latter cannot lawfully lease out the right of enjoyment of the infrastructural facilities to its Lessee.
I, consequently, agree with my learned Brother as regards the relief granted to the petitioner in this application ordered by His Lordship."
Thus, from the above, it is evident that we took the view that so long as the environmental clearance is not granted by the Central Government in favour of the MPSEZ for creation of infrastructural facilities on the land so allotted and consequent to such permission such facilities have been actually created Page 81 of 186 81 of 189 C/WPPIL/21/2013 CAV JUDGEMENT by the allottee, the lessor cannot lawfully lease out the right of enjoyment of the infrastructural facilities to its lessee. Accordingly, we allowed the petition restraining the two unit holders against whom the petition was filed from proceeding ahead in the implementation of their projects with a direction that they shall not undertake any further construction work, whether preliminary or otherwise, till the MPSEZ was granted environmental clearance.
At this stage, it may not be out of place to state that the aforesaid judgment and order passed by us has attained finality. Till this date, it remains in operation and during the course of the hearing of the Special Civil Application No.2621 of 2013, Mr.Gopal Subramaniam, the learned senior advocate appearing for the petitioners who were the respondents in the Writ Petition (PIL) No.194 of 2011, made a statement at the bar that his clients have accepted the verdict of this Court and conceded to the proposition of law laid down by us.
However, Mr.Subramaniam submitted that his clients had to file a substantive petition only with a view to inform this Court that since the MPSEZ has now obtained a deemed environmental clearance, it would be open for his clients to proceed with the construction in light of such deemed environmental clearance, but still thought fit to first bring it to the notice of this Court about the so-called deemed environmental clearance before actually commencing with the construction work as in the earlier petitions they were restrained from putting up any construction.
Therefore, the picture that emerges as on today is that as Page 82 of 186 82 of 189 C/WPPIL/21/2013 CAV JUDGEMENT against the law laid down by us in the Writ Petition (PIL) No.194 of 2011 that if the MPSEZ itself has not been granted environmental clearance under the EIA Notification, 2006 by the Central Government, any unit setup within the MPSEZ as a lessee of the MPSEZ could not have proceeded with the construction work irrespective of the fact that such individual unit was required to obtain separate environmental clearance, the units i.e. the respondent nos.10 to 21 are now taking the shelter of the deemed environmental clearance granted in favour of the MPSEZ by a fiction of law.
Whether such a deemed environmental clearance would save the situation or not, is the moot question which we propose to consider, but before we answer this question, we deem it necessary to deal with the preliminary contentions raised by the respondents as regards the maintainability of the Writ Petition (PIL) No.21 of 2013.
Delay and Laches :
We first propose to take up the contention of delay and laches.
According to the learned counsel appearing for the respondents, the Writ Petition (PIL) No.21 of 2013 should not be entertained on the ground of delay and laches. The units are in operation since 2008 and by now each of the units have invested a huge amount running in crores of rupees. Besides the huge investment, hundreds of local have been employed in the respective units and if the units are asked to stop their operations, then even the locals would be without Page 83 of 186 83 of 189 C/WPPIL/21/2013 CAV JUDGEMENT employment.
It was also sought to be contended that the petitioners being the residents of the same village where the units have been setup, would have been aware of the fact that the units are being setup in the MPSEZ. The units have been setup since 2010 and thereafter been commissioned. It was also submitted before us that in the earlier round of litigation being Writ Petition (PIL) No.194 of 2011, the villagers had thought fit to implead only two unit holders, more particularly when they were aware that there are many units in operation within the SEZ. Even the present petitioners were aware about the various units in operation within the SEZ and such fact is evident considering that a public hearing for environmental clearance had taken place on 5th October 2010 and during the public hearing, the villagers were aware of the fact that 20 units have been setup.
As against the above, Mr.Yagnik submitted that the SEZ is spread over in 18000 hectares of land covering more than 14 villages. It is more than 35 kms. in length in terms of the available road. According to Mr.Yagnik, it was not possible for the petitioners to know in which part of the entire SEZ the activities were going on. Mr.Yagnik submitted that after the pronouncement of the judgment in the Writ Petition (PIL) No.194 of 2011, efforts were made to find out about the other units in operation, and after a thorough inquiry, the villagers have brought to the notice of this Court that there are other units also operating within the SEZ without any environmental clearance granted in favour of the MPSEZ.
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We are not impressed by the submission of delay and laches vociferously canvassed on behalf of the respondents because this is not a matter which deserves to be rejected on a technical plea of delay.
We are conscious of the fact that the principle of delay applies even in cases of public interest litigations, but the rule which says that the Court may not inquire into belated and stale claims is not a rule of law, but a rule of practice based on sound and proper exercise of discretion, and there is no inviolable rule that whenever there is a delay, the court must necessarily refuse to entertain the petition. Each case must depend on its own facts. The question of delay is one of discretion of the court to follow from case to case. There is no lower limit and there is no upper limit. It will all depend on what the breach of the fundamental right and the remedy claimed are and how the delay arose. (see Ramchandra Shankar Deodhar and others v. The State of Maharashtra and others, reported in AIR 1974 SC 259) We are dealing with a very important issue of environment and the rights of the people who are likely to be affected and, therefore, in such circumstances, we do not deem fit to reject the petition on a plea of delay and laches.
In the case before us, it is not in dispute that the respondent nos.10 to 21 started their industrial units after being put into possession by the lessor MPSEZ in the year 2008 knowing fully well that the lessor has not been granted the environmental clearance by the Central Government as required under the Notification, 2006. They continued with Page 85 of 186 85 of 189 C/WPPIL/21/2013 CAV JUDGEMENT their operations. In Writ Petition (PIL) No.194 of 2011, we held that the unit holders as lessees could not have proceeded with the construction of their plots in the absence of any valid environmental clearance granted in favour of the lessor MPSEZ. In such circumstances, the defence of delay do not hold good. When the law requires a thing to be done in a certain way, then it has to be done in that way and no other.
Even though, there may be some doubt as to whether delay and laches can deny the relief prayed for by the petitioners in this petition, we are of the opinion that the unit holders, if acted with the knowledge that they are violating the provisions of law, then in such circumstances, even if there is any inordinate delay in redressing the grievance, the relief to set right the illegality should not be denied. The defence of laches or inordinate delay is a defence in equity. In equity, both the parties must come to the court with clean hands. The equitable defence can be put up by a party who has acted fairly and honestly. A person who is guilty of violating the law or infringing or usurping somebody else's right cannot claim the continued exercise of the usurped right.
In the aforesaid context, we may refer to a recent pronouncement of the Supreme Court in the case of Tukaram Kana Joshi and others v. M.I.D.C. and others, reported in AIR 2013 SC 565. His Lordship Dr.B.S.Chauhan, J. reiterated the position of law on the issue of delay. What was assailed before the Supreme Court was the judgment and order passed by the High Court of Bombay by way of which the High Court had rejected the claim of the appellants for compensation due to them for the land taken by the respondent authorities, without Page 86 of 186 86 of 189 C/WPPIL/21/2013 CAV JUDGEMENT resorting to any procedure prescribed by law. It was contended before the Court that the delay and laches on the part of the appellants had extinguished the right to put forth a claim. In such circumstances, His Lordship made the following observations in paragraphs 10, 11 and 12, which, in our opinion, are very apt and helps the petitioners :
"10. The State, especially a welfare State which is governed by the Rule of Law, cannot arrogate itself to a status beyond one that is provided by the Constitution. Our Constitution is an organic and flexible one. Delay and laches is adopted as a mode of discretion to decline exercise of jurisdiction to grant relief. There is another facet. The Court is required to exercise judicial discretion. The said discretion is dependent on facts and circumstances of the cases. Delay and laches is one of the facets to deny exercise of discretion. It is not an absolute impediment. There can be mitigating factors, continuity of cause of action, etc. That apart, if whole thing shocks the judicial conscience, then the Court should exercise the discretion more so, when no third party interest is involved. Thus analysed, the petition is not hit by the doctrine of delay and laches as the same is not a constitutional imitation, the cause of action is continuous and further the situation certainly shocks judicial conscience.
11. The question of condonation of delay is one of the discretion and has to be decided on the basis of the facts of the case at hand, as the same vary from case to case. It will depend upon what the breach of fundamental right and the remedy claimed are and when and how the delay arose. It is not that there is any period of limitation for the Courts to exercise their powers under Article 226, nor is it that there can never be a case where the Courts cannot interfere in a matter, after the passage of a certain length of time. There may be a case where the demand for justice is so compelling, that the High Court would be inclined to interfere in spite of delay. Ultimately, it would be a matter within the discretion of the Court and such discretion, must be exercised fairly and justly so as to promote justice and not to defeat it.
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The validity of the party's defence must be tried upon principles substantially equitable. (Vide: P.S.Sadasivaswamy v. State of T.N. AIR 1974 SC 2271; State of M.P. and Ors. v. Nandlal Jaiswal and Ors., AIR 1987 SC 251; and Tridip Kumar Dingal and Ors. v. State of West Bengal and Ors., (2009) 1 SCC 768: (AIR 2008 SC (Suppl) 824);)
12.No hard and fast rule can be laid down as to when the High Court should refuse to exercise its jurisdiction in favour of a party who moves it after considerable delay and is otherwise guilty of laches. Discretion must be exercised judiciously and reasonably. In the event that the claim made by the applicant is legally sustainable, delay should be condoned. In other words, where circumstances justifying the conduct exist, the illegality which is manifest, cannot be sustained on the sole ground of laches. When substantial justice and technical considerations are pitted against each other, the cause of substantial justice deserves to be preferred, for the other side cannot claim to have a vested right in the injustice being done, because of a non-deliberate delay. The court should not harm innocent parties if their rights have infact emerged, by delay on the part of the petitioners. (Vide:Durga Prasad v. Chief Controller of Imports and Exports and Ors. AIR 1970 SC 769; Collector, Land Acquisition, Anantnag and Anr. V. Mst. Katiji and Ors., AIR 1987 SC 1353; Delhi Rohtas Light Railway Company Ltd. v. District Board, Bhojpur and Ors., AIR 1993 SC 802: (1992 AIR SCW 3181); Dayal Singh and Ors. v. Union of India and Ors. AIR 2003 SC 1140: (2003 AIR SCW 685); and Shankara Co-op. Housing Society Ltd. v. M.Prabhakar and Ors. AIR 2011 SC 2161 : (2011 AIR SCW 3033))"
Applying the aforesaid proposition of law laid down by the Supreme Court, we hold that there is no substance in the preliminary objection raised on behalf of the respondents as regards the delay and laches.
There is one more reason why we are not inclined to accept the plea of delay and laches. The EIA Notification, 2006 Page 88 of 186 88 of 189 C/WPPIL/21/2013 CAV JUDGEMENT dated 14th September 2006 makes it very clear that no construction of the new projects or activities or the expansion or modernization of the existing projects on the date of the Notification or activities listed in the Schedule to the Notification entailing capacity addition with change in process and/or technology is permissible in the absence of a prior environmental clearance to be granted by the Central Government. In the year 2008, when the respondent nos.10 to 21 setup their individual units by making construction, they were aware of the fact that the lessor who has put them in possession of the land forming a part of the SEZ himself was not possessing a valid environmental clearance in terms of the EIA Notification, 2006, then in such circumstances, they could not have proceeded ahead with the construction of their individual units. Whatever may be their understanding of the position of law at the relevant point of time, but the fact is that the respondent nos.10 to 21 cannot plead ignorance of the mandate laid in the Notification, 2006. This is exactly what we have held in our judgment and order dated 9th May 2012 in Writ Petition (PIL) No.194 of 2011.
Such being the position, the respondent nos.10 to 21 cannot take advantage of their own wrong by pleading delay and laches to meet with the petition filed against them.
The maxim: 'Nullus commandum capere potest de injuria sua propria' (No man can take advantage of his own wrong) applies directly to the facts of the present case. The maxim: 'Nullus commandum capere potest de injuria sua propria' (No man can take advantage of his own wrong) is one of the salient tenets of equity. The respondents cannot secure the assistance Page 89 of 186 89 of 189 C/WPPIL/21/2013 CAV JUDGEMENT of a Court of law for enjoying the fruit of their own wrong.
In this connection, we may quote with profit a decision of the Supreme Court explaining this principle of law, in the matter of Union of India and others v. Major General Madan Lal Yadav [Retd.], reported in (1996)4 SCC 127. In paragraph 28, the Supreme Court observed as under :-
"In this behalf, the maxim 'nullus commandum capere potest de injuria sua propria' - meaning no man can take advantage of his own wrong - squarely stands in the way of avoidance by the respondent and he is estopped to plead bar of limitation contained in Section 123(2). In Broom's Legal Maximum [10th Edn.] at page 191 it is stated :-
"...it is a maxim of law, recognized and established, that no man shall take advantage of his own wrong; and this maxim, which is based on elementary principles, is fully recognized in courts of law and of equity, and, indeed, admits of illustration from every branch of legal procedure."
"The reasonableness of the rule being manifest, we proceed at once to show its application by reference to decided cases. It was noted therein that a man shall not take advantage of his own wrong to gain the favourable interpretation of the law. In support thereof, the author has placed reliance on another maxim 'frustra legis auxilium invocat quaerit qui in legem committit'. He relies on Perry v. Fitzhowe [(1846)8 Q.B. 757]. At page 192, it is stated that if a man be bound to appear on a certain day, and before that day the obligee puts him in prison, the bond is void. At page 193, it is stated that "it is moreover a sound principle that he who prevents a thing from being done shall not avail himself of the non- performance he has occasioned". At page 195, it is further stated that "a wrong doer ought not to be permitted to make a profit out of his own wrong". At page 199 it is observed that "the rule applies to the extent of undoing the advantage gained where that can be done and not to the extent of taking away a right Page 90 of 186 90 of 189 C/WPPIL/21/2013 CAV JUDGEMENT previously possessed."
In view of the above, we reject the first preliminary objection of delay and laches canvassed on behalf of the respondents.
Res Judicata and Constructive Res Judicata :
We shall now deal with the second preliminary objection raised by the respondents as regards the doctrine of res judicata and constructive res judicata.
Mr.Dave, the learned senior advocate appearing on behalf of the respondent no.8 MPSEZ vehemently submitted that the Writ Petition (PIL) No.21 of 2013 is hit by the doctrine of res judicata inasmuch as it could have been argued in the earlier round of litigation before this Court that even if the environmental clearance is granted it would not save the situation for the unit holders because they had completed the construction way back in the year 2008. In short, according to Mr.Dave, in the judgment and order rendered by this very Bench in Writ Petition (PIL) No.194 of 2011, it has been very clearly observed that the two unit holders who were made respondents shall not proceed further with any type of construction till the environmental clearance is obtained by the lessor i.e. the MPSEZ. According to Mr.Dave, at that very stage it should have been argued and it could have been argued by the petitioners of Writ Petition (PIL) No.194 of 2011 that it would not make any difference whether environmental clearance is now granted or not.
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Thus, according to Mr.Dave, the doctrine of constructive res judicata would apply in the present petition despite the fact that the petitioners are different, but the question of law remains the same which could have been raised but was not raised in the earlier round of litigation.
In this connection, we may refer to a decision of the Supreme Court in the case of Forward Construction Co. v. Prabhat Mandal, (1986)1 SCC 100, wherein the Supreme Court held that the principles of constructive res judicata are applicable to public interest litigation, particularly in view of the Explanation VI to Section 11 of the Code of Civil Procedure, 1908: The Court observed thus :
"But it is only when the conditions of Explanation VI are satisfied that a decision in the litigation will bind all persons interested in the right litigated and the onus of providing the want of bona fides in respect of the previous litigation is on the party seeking to avoid the decision. The words "public right" have been added in Explanation VI in view of the new S.91 CPC and to prevent multiplicity of litigation in respect of public right. In view of Expln. VI it cannot be disputed that Section 11 applies to public interest litigation not by way of a private grievance. It has to be a bona fide litigation in respect of a right which is common and is agitated in common with others."
The aforenoted decision has been considered in a subsequent judgment of a Bench of two Judges of the Supreme Court in the case of V.Purushotham Rao v. Union of India, (2001)10 SCC 305, wherein the Supreme Court held thus :
"In our considered opinion, therefore, the principle of constructive res judicata cannot be made applicable in Page 92 of 186 92 of 189 C/WPPIL/21/2013 CAV JUDGEMENT each and every public interest litigation, irrespective of the nature of litigation itself and its impact on the society and the larger public interest which is being served. There cannot be any dispute that in competing rights between the public interest and individual interest, the public interest would override."
Thus, from the above, it is evident that the question as to whether the principles of constructive res judicata will apply in the facts of a particular litigation instituted in public interest will depend, inter alia, on the nature of the litigation, its impact on the society and the public interest involved.
In Sheodan Singh v. Daryao Kunwar, (1966)4 SCR 300, the Supreme Court laid down the ingredients of Section 11 of the Code of Civil Procedure, the principles of which could be extended even to the writ proceedings, stating as under :
"9. A plain reading of Section 11 shows that to constitute a matter res judicata, the following conditions must be satisfied, namely -
(i) The matter directly and substantially in issue in the subsequent suit or issue must be the same matter which was directly and substantially in issue in the former suit;
(ii) The former suit must have been a suit between the same parties or between parties under whom they or any of them claim;
(iii) The parties must have litigated under the same title in the former suit;
(iv) The Court which decided the former suit must be a Court competent to try the subsequent suit or the suit in which such issue is subsequently raised;
and
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(v) The matter directly and substantially in issue in the subsequent suit must have been heard and finally decided by the Court in the first suit. Further Explanation 1 shows that it is not the date on which the suit is filed that matters but the date on which the suit is decided, so that even if a suit was filed later, it will be a former suit if it has been decided earlier. In order therefore that the decision in the earlier two appeals dismissed by the High Court operates as res judicata it will have to be seen whether all the five conditions mentioned above have been satisfied."
In this regard, we may also quote with profit the decision of the Supreme Court in the case of Bhama Kumar Jain (supra), wherein the Supreme Court has explained the distinction between the principle of estoppel and constructive res judicata. The Court observed thus :
"Res judicata debars a Court from exercising its jurisdiction to determine the lis if it has attained finality between the parties whereas the doctrine issue estoppel is invoked against the party. If such an issue is decided against him, he would be estopped from raising the same in the latter proceeding. The doctrine of res judicata creates a different kind of estoppel viz. estoppel by accord."
Thus, the question which is required to be posed is what was in issue in the Writ Petition (PIL) No.194 of 2011 filed by the residents of village Navinal. The issue was, whether the lessor MPSEZ could have allotted the plots in favour of the lesses within the SEZ, and whether the lesses, in turn, could have developed their plots and put up construction on their units in the absence of grant of environmental clearance in terms of the EIA Notification, 2006 issued by the Ministry of Page 94 of 186 94 of 189 C/WPPIL/21/2013 CAV JUDGEMENT Environment and Forests, Government of India, in favour of the lessor MPSEZ.
We held that in the absence of the grant of environmental clearance in favour of the lessor MPSEZ, the unit holders had no right to put up any construction or undertake any activity on their individual plots and, accordingly, we restrained the two respondents who were before us.
In the present petition, the villagers other than the one who had filed the earlier petition have come with a case that the dictum of law laid down by this Court in Writ Petition (PIL) No.194 of 2011 should equally apply to all other units which are in operation as on today within the SEZ. In defence, the lessor MPSEZ and the individual unit holders, namely, the respondent nos.10 to 21 have come out with a case that there is a deemed environmental clearance as on today and, therefore, there is no question of now restraining the unit holders from operating their individual units.
In this petition, we are considering the question, whether there is a deemed environmental clearance and what would be the effect of such a deemed environmental clearance, as pleaded by the respondents in their defence. Thus, it could not be said by any stretch of imagination that such issue was directly and substantially involved in the earlier round of litigation and has been finally decided by this Court.
As a matter of fact, the petitioners herein had no idea or knowledge of any deemed environmental clearance obtained Page 95 of 186 95 of 189 C/WPPIL/21/2013 CAV JUDGEMENT by the lessor MPSEZ and it is only when a reply was filed taking up this contention that they realized that pursuant to the recommendations made by the EAC, there is a deemed environmental clearance as the Central Government failed to pass any orders within a period of 45 days as stipulated in the EIA Notification, 2006.
Thus, we are not impressed by the submissions of Mr.Dave that the petition is hit by the doctrine of res judicata or constructive res judicata and we, accordingly, reject the second preliminary objection as regards the maintainability of this petition. On the other hand, the MPSEZ and the petitioner of Special Civil Application No.2621 of 2013 who were parties to the earlier proceedings are bound by our observations made in Writ Petition (PIL) No.194 of 2011 decided on 9 th May 2012 and which has attained finality that so long the environmental clearance is not granted by the Central Government in favour of the MPSEZ for creation of infrastructural facilities on the land so allotted and consequent to such permission, such facilities have been actually created by the allottee, the latter could not have lawfully leased out the right of enjoyment of the infrastructural facilities to its lessee.
Lack of Pleadings and Relief :
The above takes us to deal with the third preliminary objection raised on behalf of the respondents as regards the lack of pleadings and relief prayed for in the Writ Petition (PIL) No.21 of 2013. It has been stated that in the Writ Petition (PIL) No.21 of 2013 there is no prayer to set aside the recommendations made by the EAC as regards the grant of Page 96 of 186 96 of 189 C/WPPIL/21/2013 CAV JUDGEMENT environmental clearance and also no prayer to declare that there is no deemed environmental clearance in favour of the lessor MPSEZ.
In short, the objection is to the effect that the petition has become infructuous and should be rejected because the petitioners are unaware of the fact that a deemed environmental clearance could be said to have been granted in favour of the lessor MPSEZ.
It is now well-settled that strict rules of pleading may not apply to a public interest litigation if there is sufficient material on record on the basis of which the Court may proceed. The technicalities of the rules of pleadings cannot be made applicable vigorously. Pleadings prepared sometimes on the basis of incomplete information in a public interest litigation should be considered having regard to the issue which is being brought before the Court. It is now well-settled that even a simple letter addressed by a citizen could be treated as a public interest litigation and the Court may look into the same by calling upon the respondents to explain.
In the present case, there is no doubt that the petition proceeds only on the footing that there are many units operating within the SEZ as on today in the absence of any environmental clearance granted in favour of the lessor MPSEZ and, therefore, they should be restrained from operating their units.
It is only when the respondents appeared and filed their counter that the petitioners realized that the EAC, in its Page 97 of 186 97 of 189 C/WPPIL/21/2013 CAV JUDGEMENT meetings conducted some time in the months of April, June and July 2012 respectively, had discussed the issue of grant of environmental clearance in favour of the MPSEZ and, accordingly, recommended to the Central Government to grant such environmental clearance. The Central Government, having not acted on such recommendations within a period of 45 days as prescribed in the Notification, a deemed environmental clearance is said to have been granted in favour of the MPSEZ by a deeming fiction.
Ordinarily, a writ court should not grant relief to the petitioner on a case for which there is no foundation in the pleadings and which the other side is not called upon or had an opportunity to meet. But, when the alternative case, which the petitioner is able to make is not only admitted by the respondents in their reply but is expressly put forward as an answer to the complaint which the petitioner makes in the petition, there would be nothing improper or illegal now giving the petitioner the relief as prayed for in the petition. In the present case, to meet with the petition of the petitioners, the respondents have pleaded and put forward in defence the deemed environmental clearance with necessary materials on record.
We are considering the issue of the deemed environmental clearance based on the materials which have been produced by the respondents themselves, and after considering such materials if we reach to the conclusion that there is merit in what the petitioners have to say as regards the deemed environmental clearance, then it could not be said that the respondents have been taken by surprise.
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In this connection, we may quote with profit a decision of the Supreme Court in the case of Firm Sriniwas Ram Kumar v. Mahabir Prasad and others, reported in AIR 1951 SC 177.
In the said case, the appeal before the Supreme Court was on behalf of the original plaintiff and it arose out of a suit for specific performance of a contract to sell a house belonging to the defendants (second party) who had agreed to sell the house to the plaintiff, but subsequently, resiled from the agreement and sold the same to the defendants (first party) who purchased it with notice of the contract.
The suit was contested by both sets of defendants. The second party defendants contended, inter alia, that they had never agreed to sell their house to the plaintiff and the story of a contract of sale as setup by the plaintiff was entirely false. They admitted that they were in need of money and had approached the plaintiff for a loan and the plaintiff had advanced to them a sum of Rs.30,000=00 at the rate of 6% interest per annum. According to the second party defendants, it was entirely for facilitating the payment of interest due on the loan and not in part performance of the contract of sale that the plaintiff was put in possession of the same.
The trial Judge dismissed the plaintiff's claim for specific performance, but as the second party defendants admitted that they had taken an advance of Rs.30,000=00 from the plaintiff, a money decree was given to the plaintiff for such sum against the defendants with interest at the rate of 6% per annum from the date of the suit till realization.
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Against such a decision, the plaintiff filed an appeal in the High Court at Patna and the second party defendants also filed cross-objections challenging the propriety of the money decree that was passed against them.
The High Court, vide its judgment, dismissed the appeal of the plaintiff and allowed the cross-objections preferred by the second party defendants. The High Court agreed with the trial Judge in holding that the sum of Rs.30,000=00 was advanced as a loan by the plaintiff to the second party defendants. However, on the basis of the evidence on record, the High Court reached to the conclusion that the money decree granted against the second party defendants was not warranted in law as no case of a loan was made out by the plaintiff in the plaint and no relief was claimed on that basis. The result was that the suit was dismissed in its entirety and a decree for recovery of money that was made in favour of the plaintiff by the trial Court was set aside. Against the judgment passed by the High Court, the plaintiff came up in appeal before the Supreme Court. In the aforesaid background, the Supreme Court held as under :
"As regards the other point, however, we are of the opinion that the decision of the trial Ct. was right and that the H.C. took an undoubtedly rigid and technical view in reversing this part of the decree at the Subordinate Judge. It is true that it was no part of the pltf's case as made in the plaint that the sum of Rs.
30,000 was advanced by way of loan to the defts. second party. But it was certainly open to the pltf. to make an alternative case to that effect and make a prayer in the alternative for a decree for money even if the allegations of the money being paid in pursuance of a contract of Page 100 of 186 100 of 189 C/WPPIL/21/2013 CAV JUDGEMENT sale could not be established by evidence. The fact that such a prayer would have been inconsistent with the other prayer is not really material. A pltf. may rely upon different rights alternatively and there is nothing in the Civil P.C. to prevent a party from making two or more inconsistent sets of allegations and claiming relief thereunder in the alternative. The question, however, arises whether, in the absence of any such alternative case in the plaint it is open to the Ct. to give him relief on that basis. The rule undoubtedly is that the Ct. cannot grant relief to the pltf. on a case for which there was no foundation in the pleading and which the other side was not called upon or had an opportunity to meet. But when the alternative case, which the pltf. could have made, was not only admitted by the deft. in his written statement but was expressly put forward as an answer to the claim which the pltf. made in the suit, there would be nothing improper in giving the pltf. a decree upon the case which the deft. himself makes. A demand of the pltf. based on the deft's own plea cannot possibly be regarded with surprise by the latter and no question of adducing evidence on these facts would arise when they were expressly admitted by the deft. in his pleadings. In such circumstances when no injustice can possibly result to the deft., it may not be proper to drive the pltf, to file a separate suit. As an illustration of this principle, reference may be made to the pronouncement of the Judicial Committee in Mohan Manucha v. Manzoor Ahmad,70 I.A. 1 : (A.I.R. (30) 1943 P.C. 29). This appeal arose out of a suit commenced by the pltf applt. to enforce a mtge. security. The plea of the deft. was that the mtge. was void. This plea was given effect to by both the lower Ct. as well as by the P.C. But the P.C. held that it was open in such circumstances to the pltf to repudiate the transaction altogether and claim a relief outside it in the form of restitution under S. 65, Contract Art. Although no such alternative claim was made in the plaint, the P.C. allowed it to be advanced and gave a decree on the ground that the resp. could not be prejudiced by such a claim at all and the matter ought not to be left to a separate suit. It may be noted that this relief was allowed to the applt. even though the appeal was heard ex parte in the absence of the resp."
Following the aforesaid principles as laid down by the Page 101 of 186 101 of 189 C/WPPIL/21/2013 CAV JUDGEMENT Supreme Court, we reject the submission canvassed on behalf of the respondents that the petition deserves to be rejected on the ground of lack of proper pleadings and relief.
Plea of Alternative Remedy :
It was also sought to be contended that the petition should not be entertained as there is an alternative remedy available to the petitioners by approaching the National Green Tribunal constituted under the National Green Tribunal Act. We are not impressed by such submission canvassed on behalf of the respondents. It is true that the power of the High Court to issue prerogative writs under Article 226 of the Constitution of India is plenary in nature and cannot be curtailed by other provisions of the Constitution of India or a statute, but the High Courts have imposed upon themselves certain restrictions on the exercise of such powers. One of such restriction that if an effective and efficacious remedy is available, the High Court would not normally exercise its jurisdiction under Article 226 of the Constitution of India. But again this rule of exclusion of writ jurisdiction on account of availability of an alternative remedy does not operate as an absolute bar to entertain a writ petition but is a discretion to be exercised depending upon the facts of each case.
In an appropriate case, inspite of availability of alternative remedy, the High Court may still exercise its jurisdiction in atleast three contingencies : (1) where the writ petition seek enforcement of any of the fundamental rights; (2) where there is a failure of principles of natural justice; or (3) where the orders or proceedings are wholly without jurisdiction Page 102 of 186 102 of 189 C/WPPIL/21/2013 CAV JUDGEMENT or vires of an Act is challenged.
In the present case, the petitioners are seeking implementation of the judgment rendered by this Court in Writ Petition (PIL) No.194 of 2011 decided on 9th May 2012 so far as the other units are concerned, namely, the respondent nos.10 to 21 who have continued their manufacturing activities in the absence of any environmental clearance. Whether there is a deemed environmental clearance and what would be the effect of the same, is the issue which we are considering in this petition.
However, the fact is that the petitioner are seeking enforcement of fundamental rights under Article 21 of the Constitution of India by seeking implementation of Environmental Laws on the allegations that there is gross violations of the regulations of the Notification, 2006 at the end of the respondents.
In such circumstances, we reject the submissions canvassed on behalf of the respondents as regards the alternative remedy.
Deemed Environmental Clearance :
The above takes us to the main and the core issue of deemed environmental clearance. Before we proceed to answer the issue of deemed environmental clearance, it is necessary for us to consider the Environment Impact Assessment Notification, 2006 dated 14th September 2006.
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We quote the relevant part of the Notification as under :
"Whereas, a draft notification under sub-rule (3) of Rule 5 of the Environment (Protection) Rules, 1986 for imposing certain restrictions and prohibitions on new projects or activities, or on the expansion or modernization of existing projects or activities based on their potential environmental impacts as indicated in the Schedule to the notification, being undertaken in any part of India1, unless prior environmental clearance has been accorded in accordance with the objectives of National Environment Policy as approved by the Union Cabinet on 18th May, 2006 and the procedure specified in the notification, by the Central Government or the State or Union territory Level Environment Impact Assessment Authority (SEIAA), to be constituted by the Central Government in consultation with the State Government or the Union territory Administration concerned under sub-section (3) of section 3 of the Environment (Protection) Act, 1986 for the purpose of this notification, was published in the Gazette of India, Extraordinary, Part II, section 3, sub-section (ii) vide number S.O. 1324 (E) dated the 15 th September ,2005 inviting objections and suggestions from all persons likely to be affected thereby within a period of sixty days from the date on which copies of Gazette containing the said notification were made available to the public;
And whereas, copies of the said notification were made available to the public on 15th September, 2005;
And whereas, all objections and suggestions received in response to the above mentioned draft notification have been duly considered by the Central Government;
Now, therefore, in exercise of the powers conferred by sub-section (1) and clause (v) of sub-section (2) of section 3 of the Environment (Protection) Act, 1986, read with clause (d) of sub-rule (3) of rule 5 of the Environment (Protection) Rules, 1986 and in supersession of the notification number S.O. 60 (E) dated the 27th January, 1994, except in respect of things done or omitted to be done before such supersession, the Central Government hereby directs that on and from the date of its publication the required construction of new Page 104 of 186 104 of 189 C/WPPIL/21/2013 CAV JUDGEMENT projects or activities or the expansion or modernization of existing projects or activities listed in the Schedule to this notification entailing capacity addition with change in process and or technology shall be undertaken in any part of India only after the prior environmental clearance from the Central Government or as the case may be, by the State Level Environment Impact Assessment Authority, duly constituted by the Central Government under sub-section (3) of section 3 of the said Act, in accordance with the procedure specified hereinafter in this notification."
"4. Categorization of projects and activities:-
(i) All projects and activities are broadly categorized in to two categories - Category A and Category B, based on the spatial extent of potential impacts and potential impacts on human health and natural and man made resources.
(ii) All projects or activities included as Category 'A' in the Schedule, including expansion and modernization of existing projects or activities and change in product mix, shall require prior environmental clearance from the Central Government in the Ministry of Environment and Forests (MoEF) on the recommendations of an Expert Appraisal Committee (EAC) to be constituted by the Central Government for the purposes of this notification;
(iii) All projects or activities included as Category 'B' in the Schedule, including expansion and modernization of existing projects or activities as specified in sub paragraph (ii) of paragraph 2, or change in product mix as specified in sub paragraph (iii) of paragraph 2, but excluding those which fulfill the General Conditions (GC) stipulated in the Schedule, will require prior environmental clearance from the State/Union territory Environment Impact Assessment Authority (SEIAA). The SEIAA shall base its decision on the recommendations of a State or Union territory level Expert Appraisal Committee (SEAC) as to be constituted for in this notification. In the absence of a duly constituted SEIAA or SEAC, a Category 'B' project shall be treated as a Category 'A' project;"
Page 105 of 186105 of 189 C/WPPIL/21/2013 CAV JUDGEMENT "6. Application for Prior Environmental Clearance (EC):-
An application seeking prior environmental clearance in all cases shall be made in the prescribed Form 1 annexed herewith and Supplementary Form 1A, if applicable, as given in Appendix II, after the identification of prospective site(s) for the project and/or activities to which the application relates, before commencing any construction activity, or preparation of land, at the site by the applicant. The applicant shall furnish, along with the application, a copy of the pre-feasibility project report except that, in case of construction projects or activities (item 8 of the Schedule) in addition to Form 1 and the Supplementary Form 1A, a copy of the conceptual plan shall be provided, instead of the pre-feasibility report."
"8. Grant or Rejection of Prior Environmental Clearance (EC):
(i) The regulatory authority shall consider the recommendations of the EAC or SEAC concerned and convey its decision to the applicant within forty five days of the receipt of the recommendations of the Expert Appraisal Committee or State Level Expert Appraisal Committee concerned or in other words within one hundred and five days of the receipt of the final Environment Impact Assessment Report, and where Environment Impact Assessment is not required, within one hundred and five days of the receipt of the complete application with requisite documents, except as provided below.
(ii) The regulatory authority shall normally accept the recommendations of the Expert Appraisal Committee or State Level Expert Appraisal Committee concerned. In cases where it disagrees with the recommendations of the Expert Appraisal Committee or State Level Expert Appraisal Committee concerned, the regulatory authority shall request reconsideration by the Expert Appraisal Committee or State Level Expert Appraisal Committee concerned within forty five days of the receipt of the recommendations of the Expert Appraisal Committee or State Level Expert Appraisal Committee concerned while Page 106 of 186 106 of 189 C/WPPIL/21/2013 CAV JUDGEMENT stating the reasons for the disagreement. An intimation of this decision shall be simultaneously conveyed to the applicant. The Expert Appraisal Committee or State Level Expert Appraisal Committee concerned, in turn, shall consider the observations of the regulatory authority and furnish its views on the same within a further period of sixty days. The decision of the regulatory authority after considering the views of the Expert Appraisal Committee or State Level Expert Appraisal Committee concerned shall be final and conveyed to the applicant by the regulatory authority concerned within the next thirty days.
(iii) In the event that the decision of the regulatory authority is not communicated to the applicant within the period specified in sub-paragraphs (i) or (ii) above, as applicable, the applicant may proceed as if the environment clearance sought for has been granted or denied by the regulatory authority in terms of the final recommendations of the Expert Appraisal Committee or State Level Expert Appraisal Committee concerned.
(iv) On expiry of the period specified for decision by the regulatory authority under paragraph (i) and (ii) above, as applicable, the decision of the regulatory authority, and the final recommendations of the Expert Appraisal Committee or State Level Expert Appraisal Committee concerned shall be public documents.
(v) Clearances from other regulatory bodies or authorities shall not be required prior to receipt of applications for prior environmental clearance of projects or activities, or screening, or scoping, or appraisal, or decision by the regulatory authority concerned, unless any of these is sequentially dependent on such clearance either due to a requirement of law, or for necessary technical reasons.
(vi) Deliberate concealment and/or submission of false or misleading information or data which is material to screening or scoping or appraisal or decision on the application shall make the application liable for rejection, and cancellation of prior environmental clearance granted Page 107 of 186 107 of 189 C/WPPIL/21/2013 CAV JUDGEMENT on that basis. Rejection of an application or cancellation of a prior environmental clearance already granted, on such ground, shall be decided by the regulatory authority, after giving a personal hearing to the applicant, and following the principles of natural justice."
"9. Validity of Environmental Clearance (EC):
The "Validity of Environmental Clearance" is meant the period from which a prior environmental clearance is granted by the regulatory authority, or may be presumed by the applicant to have been granted under sub paragraph (iv) of paragraph 7 above, to the start of production operations by the project or activity, or completion of all construction operations in case of construction projects (item 8 of the Schedule), to which the application for prior environmental clearance refers. The prior environmental clearance granted for a project or activity shall be valid for a period of ten years in the case of River Valley projects (item 1(c) of the Schedule), project life as estimated by Expert Appraisal Committee or State Level Expert Appraisal Committee subject to a maximum of thirty years for mining projects and five years in the case of all other projects and activities. However, in the case of Area Development projects and Townships [item 8(b)], the validity period shall be limited only to such activities as may be the responsibility of the applicant as a developer. This period of validity may be extended by the regulatory authority concerned by a maximum period of five years provided an application is made to the regulatory authority by the applicant within the validity period, together with an updated Form 1, and Supplementary Form 1A, for Construction projects or activities (item 8 of the Schedule). In this regard the regulatory authority may also consult the Expert Appraisal Committee or State Level Expert Appraisal Committee as the case may be."
"10. Post Environmental Clearance Monitoring:
(i) It shall be mandatory for the project management to submit half-yearly compliance reports in respect of the stipulated prior environmental clearance terms and Page 108 of 186 108 of 189 C/WPPIL/21/2013 CAV JUDGEMENT conditions in hard and soft copies to the regulatory authority concerned, on 1st June and 1st December of each calendar year.
(ii) All such compliance reports submitted by the project management shall be public documents. Copies of the same shall be given to any person on application to the concerned regulatory authority. The latest such compliance report shall also be displayed on the web site of the concerned regulatory authority."
What is discernible from the aforenoted Notification, 2006 is as under :
(1) From the date of its publication there shall not be any construction of new projects or activities or the expansion or modernization of the existing projects or activities listed in the Schedule to the Notification entailing capacity addition with change in process and/or technology without a prior environmental clearance from the Central Government;
(2) The language used in the Notification is plain and clear. It reads : "only after the prior environmental clearance from the Central Government".
(3) The regulatory authority shall consider the recommendations of the EAC within 45 days of the receipt of the recommendations of the EAC;
(4) The regulatory authority shall normally accept the recommendations of the EAC, and in case of disagreement, shall request the EAC to reconsider within 45 days of the receipt of the recommendations of the Page 109 of 186 109 of 189 C/WPPIL/21/2013 CAV JUDGEMENT EAC while stating the reasons for the disagreement;
(5) If the regulatory authority fails to communicate its decision to the applicant within a period of 45 days as specified in Clause (1), the applicant may proceed as if the environmental clearance sought for has been granted or denied by the regulatory authority in terms of the final recommendations of the EAC.
The emphasis is on the use of the words "the applicant may proceed as if the environmental clearance sought for has been granted or denied". It is evident that it is only on the expiry of 45 days from the date of the recommendations of the EAC that a deeming fiction comes into play due to failure on the part of the regulatory authority to take appropriate decision on such recommendations. On expiry of 45 days, it would be permissible for the applicant to proceed as if the environmental clearance sought for has been granted.
Something else, that is of utmost importance is to understand that the deeming fiction as provided in Clause 8 of the EIA Notification, 2006 can only operate prospectively and not retrospectively. That is to say, the deeming provision would give rise to presumption that the clearance is granted on the expiry of 45 days' period from the date of the recommendations of the EAC in the absence of any order passed by the Central Government.
It is to be noted that what is to be deemed is a matter of fact; there is a 'deeming fiction'. It is also to be noted that when a fact is to be deemed, its consequences and incidents Page 110 of 186 110 of 189 C/WPPIL/21/2013 CAV JUDGEMENT are also to be deemed; that is to say, what follows from the deemed fact is also to be deemed.
Object of obtaining prior environmental clearance from the Central Government :
The Supreme Court, in N.D.Jayal and another v. Union of India and others, reported in (2004)9 SCC 362, has explained the aspects related to conditional clearance. We may quote with profit the observations made by the Supreme Court in paras 22 to 26, which read as under :
"22. Before adverting to other issues, certain aspects pertaining to the preservation of ecology and development have to be noticed. In Vellore Citizens Welfare Forum v. Union of India, (1996)5 SCC 647, and in M.C.Mehta v. Union of India, (2002)4 SCC 356, it was observed that the balance between environmental protection and developmental activities could only be maintained by strictly following the principle of 'sustainable development.' This is a development strategy that caters the needs of the present without negotiating the ability of upcoming generations to satisfy their needs. The strict observance of sustainable development will put us on a path that ensures development while protecting the environment, a path that works for all peoples and for all generations. It is a guarantee to the present and a bequeath to the future. All environmental related developmental activities should benefit more people while maintaining the environmental balance. This could be ensured only by the strict adherence of sustainable development without which life of coming generations will be in jeopardy.
23. In a catena of cases we have reiterated that right to clean environment is a guaranteed fundamental right, May be in different context, the right to development is also declared as a component of Article 21 in cases like Samata v. State of Andhra Pradesh, (1997)8 SCC 191, Page 111 of 186 111 of 189 C/WPPIL/21/2013 CAV JUDGEMENT and in Madhu Kishore v. State of Bihar, (1996)5 SCC 125.
24. The right to development cannot be treated as a mere right to economic betterment or cannot be limited to as a misnomer to simple construction activities. The right to development encompasses much more than economic well being, and includes within its definition the guarantee of fundamental human rights. The 'development' is not related only to the growth of GNP, in the classic work - 'Development As Freedom' the Nobel prize winner Amartya Sen pointed out that 'the issue of development cannot be separated from the conceptual framework of human right'. This idea is also part of the UN Declaration on the Right to Development. The right to development includes the whole spectrum of civil, cultural, economic, political and social process, for the improvement of peoples' well being and realization of their full potential. It is an integral part of human right. Of course, construction of a dam or a mega project is definitely an attempt to achieve the goal of wholesome development. Such works could very well be treated as integral component for development.
25. Therefore, the adherence of sustainable development principle is a sine qua non for the maintenance of the symbiotic balance between the rights to environment and development. Right to environment is a fundamental right. On the other hand right to development is also one. Here the right to 'sustainable development' cannot be singled out. Therefore, the concept of 'sustainable development' is to be treated an integral part of 'life' under Article 21. The weighty concepts like inter- generational equity (State of Himachal Pradesh v. Ganesh Wood Products, (1995)6 SCC 363, public trust doctrine (M.C.Mehta v. Kamal Nath, (1997)1 SCC 388) and precautionary principle (Vellore Citizens, (1996)5 SCC 647), which we declared as inseparable ingredients of our environmental jurisprudence, could only be nurtured by ensuring sustainable development.
26. To ensure sustainable development is one of the goals of Environmental Protection Act, 1986 (for short 'the Act') and this is quiet necessary to guarantee 'right Page 112 of 186 112 of 189 C/WPPIL/21/2013 CAV JUDGEMENT to life' under Article 21. If the Act is not armed with the powers to ensure sustainable development, it will become a barren shell. In other words, sustainable development is one of the means to achieve the object and purpose of the Act as well as the protection of 'life' under Article 21. Acknowledgment of this principle will breath new life into our environmental jurisprudence and constitutional resolve. Sustainable development could be achieved only by strict compliance of the directions under the Act. The object and purpose of the Act - "to provide for the protection and improvement of environment" could only be achieved by ensuring the strict compliance of its directions. The concerned authorities by exercising its powers under the Act will have to ensure the acquiescence of sustainable development. Therefore, the directions or conditions put forward by the Act need to be strictly complied with. Thus the power under the Act cannot be treated as a power simpliciter, but it is a power coupled with duty. It is the duty of the State to make sure the fulfillment of conditions or direction under the Act, Without strict compliance, right to environment under Article 21 could not be guaranteed and the purpose of the Act will also be defeated. The commitment to the conditions thereof is an obligation both under Article 21 and under the Act. The conditions glued to the environmental clearance for the Tehri Dam Project given by the Ministry of Environment vide its Order dated July 19, 1990 has to be viewed from this perspective."
A lot has been argued on the deeming fiction provided in Clause 8 of the EIA Notification, 2006 and the deemed environmental clearance said to have been granted in favour of the MPSEZ. What is the effect of such a deeming provision and what could be the legislative intent behind providing such a deeming provision.
The word "deemed" is used in various senses. Sometimes, it means "generally regarded". At other time, it signifies 'taken prima facie to be', while in other case, it Page 113 of 186 113 of 189 C/WPPIL/21/2013 CAV JUDGEMENT means, 'taken conclusively'. Its various meanings are, - 'to deem' is 'to hold in belief, estimation or opinion'; to judge; adjudge; decide; considered to be; to have or to be of an opinion; to esteem; to suppose, to think, decide or believe on considerations; to account, to regard; to adjudge or decide; to conclude upon consideration. (see Major Law Lexicon by P.Ramanatha Aiyar, 4th Edition 2010 Vol.2) A deeming fiction is a supposition of law that the thing is true without inquiring whether it be so or not, that it may have the effect of truth so far as it is consistent with justice. A deeming provision is made to include what is obvious or what is uncertain or to impose, for the purpose of statute, an ordinary construction of a word or phrase that would not otherwise prevail but, in each case, it would be a separate question as to that what object the Legislature has made on such a deeming fiction.
In this connection, we deem it necessary to consider few precedents on the true meaning of the word 'deem' and 'deeming fiction'.
In Consolidated Coffee Ltd. v/s. Coffee Board, Bangalore, reported in AIR 1980 SC 1468, the purpose of the word 'deemed' occurring in Section 5(3) of the Central Sales Tax Act, 1956 came for consideration. The issue that emanated was whether a legal fiction had been created by use of the word 'deemed'. It is fruitful to reproduce what has been exposited by Their Lordships:
"A deeming provision might be made to include what is Page 114 of 186 114 of 189 C/WPPIL/21/2013 CAV JUDGEMENT obvious or what is uncertain or to impose for the purpose of a statute an artificial construction of a word or phrase that would not otherwise prevail, but in each case it would be a question as to with what object the legislature has made such a deeming provision. In St. Aubyn and Ors. v/s. Attorney General, 1952 A.C. 15 at p.53 Lord Radcliffe observed thus:
"The word 'deemed' is used a great deal in modern legislation. Sometimes it is used to impose for the purposes of a statute an artificial construction of a word or phrase that would not otherwise prevail. Sometimes it is used to put beyond doubt a particular construction that might otherwise be uncertain. Sometimes it is used to give a comprehensive description that includes what is obvious, what is uncertain and what is, in the ordinary sense, impossible."
In State of Tamil Nadu v/s. M/s. Arooran Sugars Ltd., reported in AIR 1997 SC 1815, a Constitution Bench, while dealing with the deeming provision in a statute, opined that the role of a provision in a statute creating legal fiction is well settled. Their Lordships referred to the decisions in East End Dwellings Co. Ltd. v/s. Finsbury Borough Council, 1952 AC 109, Chief Inspector of Mines v/s. Karam Chand Thapar, AIR 1961 SC 838, J.K. Cotton Spinning and Weaving Mills Ltd. v/s. Union of India, AIR 1988 SC 191, M.Venugopal v/s. Divisional Manager, Life Insurance Corporation of India, AIR 1994 SC 1343 and Harish Tandon v/s. Addl. District Magistrate, Allahabad, AIR 1995 SC 676, and came to hold that when a statute creates a legal fiction saying that something shall be deemed to have been done which in fact and truth has not been done, the Court has to examine and ascertain as to for what purpose and between which persons such a statutory fiction is to be resorted to and Page 115 of 186 115 of 189 C/WPPIL/21/2013 CAV JUDGEMENT thereafter the courts have to give full effect "6. ... It is a well known principle of construction that in interpreting a provision creating a legal fiction, the Court is to ascertain for what purpose the fiction is created, and after ascertaining this, the Court is to assume all those facts and consequences which are incidental or inevitable corollaries to giving effect to the fiction. But in so construing the fiction it is not to be extended beyond the purpose for which it is created, or beyond the language of the Section by which it is created..."
From the aforesaid pronouncements, the principle discernible is that, it is the bounden duty of the court to ascertain for what purpose the legal fiction has been created. It is also the duty of the Court to imagine the fiction with all real consequences and instances unless prohibited from doing so. That apart, the use of the term deemed has to be read in its context and further the fullest logical purpose and import are to be understood. It is because in modern legislation, the term deemed has been used for manifold purposes. The object of the Legislature has to be kept in mind. (See Andaleeb Sehgal v/s. Union of India and another, AIR 2011 Delhi 29 (FB)) In the aforesaid context, we may also profitably state that the language employed in Clause 8 of the EIA Notification, 2006 must be read in a holistic and purposeful manner. The Court has a sacrosanct duty to understand the intention of the Legislature while interpreting a provision.
In Lt. Col. Prithi Pal Singh Bedi v/s. Union of India and Ors., reported in AIR 1982 SC 1413, the Apex Court has Page 116 of 186 116 of 189 C/WPPIL/21/2013 CAV JUDGEMENT expressed the view as follows:
"The dominant purpose in construing a statute is to ascertain the intention of the Parliament. One of the well recognised canons of construction is that the legislature speaks its mind by use of correct expression and unless there is any ambiguity in the language of the provision the Court should adopt literal construction if it does not lead to an absurdity. The first question to be posed is whether there is any ambiguity in the language used in Rule 40. If there is none, it would mean the language used speaks the mind of Parliament and there is no need to look somewhere else to discover the intention or meaning. If the literal construction leads to an absurdity, external aids to construction can be resorted to. To ascertain the literal meaning it is equally necessary first to ascertain the juxtaposition in which the rule is placed, the purpose for which it is enacted and the object which it is required to subserve and the authority by which the rule is framed. This necessitates examination of the broad features of the Act."
In Reserve Bank of India v/s. Peerless General Finance and Investment Co. Ltd. and others, reported in AIR 1987 SC 1023, Their Lordships have ruled thus:
"Interpretation must depend on the text and the context. They are the bases of interpretation. One may well say if the text is the texture, context is what gives the colour. Neither can be ignored. Both are important. That interpretation is best which makes the textual interpretation match the contextual. A statute is best interpreted when we know why it was enacted. With this knowledge, the statute must be read, first as a whole and then section by section, clause by clause, phrase by phrase and word by word. If a statute is looked at, in the context of its enactment, with the glasses of the statute- maker, provided by such context, its scheme, the sections, clauses, phrases and words may take colour and appear different than when the statute is looked at without the glasses provided by the context. With these glasses we must look at the Act as a whole and discover Page 117 of 186 117 of 189 C/WPPIL/21/2013 CAV JUDGEMENT what each section, each clause, each phrase and each word is meant and designed to say as to fit into the scheme of the entire Act. No part of a statute and no word of a statute can be construed in isolation. Statutes have to be construed so that every word has a place and everything is in its place..."
Bearing the aforesaid principles in mind, it is necessary for us now to consider the object of such deeming provisions provided by the Legislature in the EIA Notification, 2006.
The environmental clearance process is required for 39 types of projects and covers aspects like screening, scoping and evaluation of the upcoming projects. The main purpose is to assess impact of the project on the environment and the people and to try to minimize the same.
The environmental clearance process has been a subject of significant debate, particularly on how uncertainty in the granting process affects the implementation period and costs of the projects.
Every provision of a statute is brought into by the Legislature with a particular object in mind, and when a provision requires a thing to be done in a particular manner and charged the executive with the task of getting it done in that fashion alone, the power under the provision has to be exercised responsibly to ensure proper governance of matters which have a direct bearing on the welfare of each and every citizen individually and the society as a whole.
It is also a settled law that whenever there are two Page 118 of 186 118 of 189 C/WPPIL/21/2013 CAV JUDGEMENT possible interpretations, the one which subserves to the intent of the Legislature is to be accepted. The object of the Notification, 2006 is to assess impact of the plant project on the environment and the people and to try to minimise the same, and thus, the interpretation which upholds any such scheme should be followed. Heydon's principle is now well- recognized in interpreting any enactment. It lays down : the courts must see (a) what was the law before making of the Act;
(b) what was the mischief or defect for which the law did not provide; (c) what is the remedy that the Act has provided; and
(d) what is the reason of the remedy. It states that courts must adopt that construction which suppresses the mischief and advances remedy. (see Raipur Development Authority v. Anupam Sahakari Gruh Nirman Samiti, (2000)4 SCC 357) It appears to us that the object behind providing for such a deeming fiction is to see that the project does not get delayed, as a result of which, the project proponent may not have to suffer hardship. This is precisely the reason why Clause 8 of the EIA Notification, 2006 provides that the Central Government should act on the recommendations of the EAC within a period of 45 days; failing which, the applicant may proceed as if the environmental clearance sought for has been granted in terms of the final recommendations of the Expert Appraisal Committee.
Clause 8(3) of the EIA Notification, 2006 states that the applicant may proceed as if the environmental clearance sought for has been granted. Thus, it is very evident that it is only after the deeming fiction comes into play on the expiry of the period specified in sub-para (1) of Clause 8 that the Page 119 of 186 119 of 189 C/WPPIL/21/2013 CAV JUDGEMENT applicant gets a right to proceed ahead with the project and in any case not before the grant of the same.
It was sought to be contended very vociferously that the term 'deemed clearance' in the facts of the case is a misnomer. The fiction created is not that the application as made by the project proponent is deemed to be granted, but that the recommendations of the EAC after scoping and due appraisal, whether approving or rejecting the proposal, are to be treated as the decision of the regulatory authority, which is a different matter altogether.
It was also sought to be contended on behalf of the respondents that the construction having been undertaken prior to the grant/deemed grant of the clearance, could not be termed as invalid because there is no provision in the Notification, 2006 laying down that any breach by commencing construction prior to clearance would invalidate the deemed clearance. According to the respondents, reading in such a condition would amount to legislating, which is impermissible.
We are not impressed by such submission canvassed on behalf of the respondents because if such submissions are accepted, we will be doing violence with the terms of the Notification and the very object with which such Notification has been issued would stand frustrated. When the Notification makes it very clear that it is only after the expiry of 45 days' period it would be permissible for the applicant to proceed with the project, then it necessarily implies that the applicant cannot proceed with the project before the deeming fiction comes into play. In taking such a view, it could not be said that Page 120 of 186 120 of 189 C/WPPIL/21/2013 CAV JUDGEMENT we are reading something in the Notification which would amount to legislating. We have merely construed the plain meaning and object of the Notification which makes it abundantly clear that prior to the grant of environmental clearance, be it actual grant by the Central Government or by a deeming fiction, no construction or any other activity could be undertaken. Once the first part of the Notification makes this very clear, then by any stretch of imagination, it cannot be said that any construction or activity undertaken prior to the grant of deemed clearance would stand automatically validated.
It was also sought to be vociferously contended on behalf of the unit holders that the individual unit holders have obtained clearance from the concerned authorities so far as their part of the obligation is concerned before they started operating the units. In view of such clearance and permission being granted by the authorities, they proceeded ahead with the construction on the premise that it was permissible for them to put up the construction. It was also sought to be argued that the units were not made aware at any stage that the SEZ had not obtained the required clearance.
We are not impressed even by such submission because this issue has been set at rest by us while deciding the Writ Petition (PIL) No.194 of 2011. In so many words we have held that so long the environmental clearance is not granted by the Central Government in favour of the MPSEZ for creation of infrastructural facilities on the land so allotted and consequent to such permission, such facilities have been actually created by the allottee, the latter cannot lawfully lease out the right of Page 121 of 186 121 of 189 C/WPPIL/21/2013 CAV JUDGEMENT enjoyment of the infrastructural facilities to its lessees. We have held in so many words that a lessee cannot have a better right than that of the lessor in the property. Law is also well- settled that there cannot be any valid lease for enjoyment of the property, which is not in existence and not capable of being put into possession to the lessee at the time of execution of the lease.
Therefore, the submissions that the unit holders have been granted permission by the Development Commissioner of the SEZ and GPCB is of no avail to the unit holders. Even if they had obtained the permission from the other authorities, then only after the grant of the environmental clearance to the lessee i.e. the MPSEZ, they could have setup their units on the strength of the individual permission which has been granted in their favour.
It was also sought to be argued on behalf of the respondents that no useful purpose is going to be served by asking the unit holders to stop operating their units and remove the construction, more particularly, when the environmental clearance is deemed to have been granted and there is no serious impact so far as the issue of pollution is concerned.
The learned counsel appearing for the respondents tried to convince us that when the EAC made the recommendations, they were conscious of the fact that the unit holders have already started operating their respective industrial units and despite the same, thought fit to recommend to the Central Government granting of the environmental clearance.
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The question is not whether the units who have already started their operations since 2008 have created problems of pollution and environment, but it is a matter of complying with the provisions of law laid down by the Legislature.
Unfortunately, in the present case, the respondent no.1 Union of India, in its Ministry of Environment and Forests, has taken this issue very lightly. We are at pains to state that in such an important matter relating to environment and gross violations of the EIA Notification, 2006, it has not thought fit even to file a formal reply and clarify the matter. Time and again we kept on inquiring during the course of the hearing of the petition with the learned Assistant Solicitor General of India as to what was the material considered by the EAC while recommending the environmental clearance to the Central Government. We also kept on inquiring why the Central Government kept quiet upon the recommendations of the EAC and allowed the time period to expire so as to give effect to the deeming provision under Clause 8 of the Notification. Till the conclusion of the hearing of this petition, there was no answer at the end of the Union of India. We were completely bereft of the materials which the EAC must have taken into consideration while making the recommendations for grant of environmental clearance.
We understand the anxiety of the Central Government in speedy implementation of the project for which the project proponent might be committed. But the question before us is that can the project proponent as a lessor and the unit holders within the SEZ as lessees be permitted to flout the provisions Page 123 of 186 123 of 189 C/WPPIL/21/2013 CAV JUDGEMENT of the Notification, 2006 or the laws made by the Parliament. The answer has to be in the negative. Considering the mandatory nature of the environmental clearance, procedure has to be meticulously followed. Only on grant of environmental clearance any construction, preliminary or otherwise, relating to setting up of the project can be undertaken. There is an express prohibition that 'no construction work, preliminary or otherwise, relating to setting up of the project may be undertaken till the environment and/or site clearance is obtained'.
It is preposterous to suggest that such prohibition would apply to the respondent no.8 MPSEZ as the developer of the SEZ, but the same would not apply to the unit holders who are put into possession by the lessor without any environmental clearance.
In this connection, we may quote with profit a decision of the Supreme Court in the case of Indian Council Enviro Legal Action v. Union of India, reported in AIR 1996 SC 1446.
In the said case, the Supreme Court noted that the Governmental authorities were showing scant respect in the matter of enforcement of the Acts and developments were taking place for personal gains at the expense of the environment and with disregard to the law. The Supreme Court expressed thanks to the public spirited persons initiating public interest which enables the Courts to examine the matters and issue appropriate directions. The Court observed as under :
"With rapid industrialisation taking place, there is an Page 124 of 186 124 of 189 C/WPPIL/21/2013 CAV JUDGEMENT increasing threat to the maintenance of the ecological balance. The general public is becoming aware of the need to protect environment. Even though, laws have been passed for the protection of environment, the enforcement of the same has been tardy, to say the least. with the governmental authorities not showing any concern with the enforcement of the said Acts, and with the development taking place for personal gains at the expense of environment and with disregard to the mandatory provisions of law, some public spirited persons have been initiating public interest litigations. The legal position relating to the exercise of jurisdiction by the Courts for preventing environmental degradation and thereby, seeking to protect the fundamental right of the citizens, is now well settled by various decisions of this Court. The primary effect of the Court, while dealing with the environmental related issues, is to see that the enforcement agencies, whether it be the State or any other authority, take effective steps for the enforcement of the laws. The Courts, in a way act as the guardian of the people's fundamental rights but in regard to many technical matters, the Courts may not be fully equipped. Perforce it has to rely on outside agencies for reports and recommendations whereupon orders have been passed from time to time. Even though it is not the function of the Court to see the day to day enforcement of the law, that being the function of the Executive but because of the non-functioning of the enforcement agencies, the Courts as of necessity have had to pass orders directing the enforcement agencies to implement the law."
We may also quote with profit a decision of the Supreme Court in the case of Sterlite Industries (India) Limited and others v. Union of India and others, reported in (2013)4 SCC
575. In the said decision, the Supreme Court considered the scope of the Court to take environmental clearance in judicial review and the power to quash the same. The Supreme Court also considered the power of the High Court to quash the Page 125 of 186 125 of 189 C/WPPIL/21/2013 CAV JUDGEMENT environmental clearance on the complaint of breach of a mandatory requirement in the procedure. We may quote with profit the observations made by the Supreme Court in paras 32, 34 and 40 :
"32. Where, however, the challenge to the environmental clearance is on the ground of procedural impropriety, the High Court could quash the environmental clearance only if it is satisfied that the breach was of a mandatory requirement in the procedure. As stated in Environmental Law edited by David Woolley QC, John Pugh-Smith, Richard Langham and William Upton, Oxford University Press:
"It will often not be enough to show that there has been a procedural breach. Most of the procedural requirements are found in the regulations made under primary legislation. There has been much debate in the courts about whether a breach of regulations is mandatory or directory, but in the end the crucial point which has to be considered in any given case is what the particular provision was designed to achieve."
As we have noticed, when the plant of the appellant- company was granted environmental clearance, the notification dated 27.01.1994 did not provide for mandatory public hearing. The Explanatory Note issued by the Central Government on the notification dated 27.01.1994 also made it clear that the project proponents may furnish rapid EIA report to the IAA based on one season data (other than monsoon), for examination of the project Comprehensive EIA report was not a must. In the absence of a mandatory requirement in the procedure laid down under the scheme under the Environment (Protection) Act, 1986 at the relevant time requiring a mandatory public hearing and a mandatory comprehensive EIA report, the High Court could not have interfered with the decision of the Central Government granting environmental clearance on the ground of procedural impropriety.
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34. In Belize Alliance of Conservation Non-governmental Organizations v. The Department of the Environment and Belize Electric Company Limited (supra) cited by Mr. Prakash, the Lords of the Judicial Committee of the Privy Council have quoted with approval the following words of Linden JA with reference to the Canadian legislation in Bow Valley Naturalists Society v. Minister of Canadian Heritage [2001] 2 FC 461 at 494:
"The Court must ensure that the steps in the Act are followed, but it must defer to the responsible authorities in their substantive determinations as to the scope of the project, the extent of the screening and the assessment of the cumulative effects in the light of the mitigating factors proposed. It is not for the judges to decide what projects are to be authorized but, as long as they follow the statutory process, it is for the responsible authorities."
The aforesaid passage will make it clear that it is for the authorities under the Environment (Protection) Act, 1986, the Environment (Protection) Rules, 1986 and the notifications issued thereunder to determine the scope of the project, the extent of the screening and the assessment of the cumulative effects and so long as the statutory process is followed and the EIA made by the authorities is not found to be irrational so as to frustrate the very purpose of EIA, the Court will not interfere with the decision of the authorities in exercise of its powers of judicial review.
40. This takes us to the argument of Mr. Prakash that had the Ministry of Environment and Forests, Government of India, applied its mind fully before granting the environment clearance and had the TNPCB applied its mind fully to the consents under the Air Act and the Water Act and considered all possible environmental repercussions that the plant proposed to be set up by the appellants would have, the environmental problems now created by the plant of the appellants would have been prevented. As we have already held, it is for the administrative and statutory Page 127 of 186 127 of 189 C/WPPIL/21/2013 CAV JUDGEMENT authorities empowered under the law to consider and grant environmental clearance and the consents to the appellants for setting up the plant and where no ground for interference with the decisions of the authorities on well recognized principles of judicial review is made out, the High Court could not interfere with the decisions of the authorities to grant the environmental clearance or the consents on the ground that had the authorities made a proper environmental assessment of the plant, the adverse environmental effects of the industry could have been prevented. If, however, after the environmental clearance under the Environment (Protection) Act, 1986, and the Rules and the notifications issued thereunder and after the consents granted under the Air Act and the Water Act, the industry continues to pollute the environment so as to effect the fundamental right to life under Article 21 of the Constitution, the High Court could still direct the closure of the industry by virtue of its powers under Article 21 of the Constitution if it came to the conclusion that there were no other remedial measures to ensure that the industry maintains the standards of emission and effluent as laid down by law for safe environment (see M.C.Mehta v. Union of India and others, [(1987) 4 SCC 463] in which this Court directed closure of tanneries polluting the waters of River Ganga)."
It may not be out of place at this stage to consider the recommendations of the EAC with respect to grant of environmental clearance and CRZ clearance for the proposed multi-product SEZ at Mundra. The minutes of the 113 th Meeting of the Expert Appraisal Committee held on 4th-5th June 2012 are placed on record and Item No.5.5 deals with the clearance with which we are concerned. It reads as under :
"5.5 EC and CRZ clearance for proposed Multi-Product SEZ at Mundra by M/s.Mundra Port and SEZ Ltd. (F.No.10-
138/2008-IA.III) The project involves development of multi-product Page 128 of 186 128 of 189 C/WPPIL/21/2013 CAV JUDGEMENT SEZ on a plot area of 18,000 ha. of which 5,920.7762 ha. is presently notified under Special Economic Zone (SEZ). The multi-product SEZ will provide plots to various industries and also develop dwelling units, hotels, shopping malls and other related amenities and utilities. The total water requirement is 11 MLD (source-River Narmada). It is also proposed to have a desalination plant of 150 MLD capacity and 2 Central Effluent Treatment Plants (CETPs) of 50 MLD capacity and 17 MLD each capacity. It is also proposed to have a STP of 62 MLD capacity.
The project was appraised by the EAC in its meeting held on 30th and 31st January 2009 and finalized the TOR including conduct of Public Hearing. Public Hearing was conducted on 05.10.2010.
It is informed by the proponent that the ongoing court cases do not have any stay in the present project. Only laying of pipeline are proposed within CRZ areas. The SCZMA has recommended the project vide letter dated 27.03.2012.
The proposal was examined by the EAC in its meeting held on 16th-17th April 2012 and Committee sought additional information. The response submitted by the proponent were examined by the Committee.
During the discussion, the following points emerged :
(i) There shall be no allotment of plot in CRZ area to industries except the port and harbor & the activities require foreshore facilities. Proponent shall submit undertaking.
(ii) Monitoring on marine disposal shall be carried out and the quality of marine parameters at the outfall shall be monitored and report submitted to RO, MoEF along with half yearly compliance report.
(iii) There shall be no development activities in CRZ area other than those permissible under the Coastal Regulation Zone Notification, 2011.
(iv) Proponent shall identify 200 ha. of land for
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mangrove plantation as per the condition laid by SEAC.
(v) 50 meter buffer from the existing mangrove area should be provided for any developmental activity.
(vi) Proponent shell develop the green belt of 3 layers of canopy all along the periphery, except water front.
(vii) All the recommendation of the EMP shall be complied with letter and spirit. All the mitigation measures submitted in the EIA report shall be prepared in a matrix format and the compliance for each mitigation plan shall be submitted to MoEF along with half yearly compliance report to MoEF-RO.
(viii) The outfall structure is very close to the turning circle at very shallow depth. This may be extended to water depth of about 6 - 8 m. near the shipping channel.
(ix) Under water pipelines (intake and outfall) shall be laid underground at least 2.0 m. below its crown from the sea bed.
The Committee recommends the proposal for Environmental and CRZ Clearance with the above conditions in the Clearance letter for strict compliance by the project proponent."
It appears on plain reading of the very first paragraph wherein it has been stated that the multi-product SEZ will provide plots to various industries and also develop dwelling units, hotels, shopping malls and other related amenities and utilities.
Whether the EAC had any idea on 4th-5th June 2012 that the SEZ has already provided the plots to various industries and such industries have already started operating their units. We do not find any material except the emphasis placed by the respondents on the observations made in the second Page 130 of 186 130 of 189 C/WPPIL/21/2013 CAV JUDGEMENT paragraph that the project was appraised by the EAC in its meeting held on 30th-31st January 2009 and finalized the terms of reference including the conduct of public hearing which was undertaken on 5th October 2010. Based on such observations, it was submitted that the minutes of public hearing and the objections must have been taken into consideration by the EAC and, therefore, the EAC could be said to be within the knowledge that the MPSEZ has already allotted the plots to various industries and such industries have already started operating.
We deem it necessary to refer to a very recent judgment of the Supreme Court in the case of T.N.Godavarman Thirumulpad v. Union of India and others, Appeal No.202 of 1995 decided on 6th January 2014, wherein the Supreme Court took serious note of the various deficiencies with regard to processing, appraisal and approval of the projects for environmental clearance under the EIA Notification dated 14 th September 2006.
Having taken cognizance of such deficiencies, the Supreme Court directed the Central Government to constitute a Regulator at the national level having its offices in all the States which can carry out an independent, objective and transparent appraisal and approval of the projects for environmental clearances and which can also monitor the implementation of the conditions laid down in the environmental clearances.
The issue before the Supreme Court was, whether the order of the Supreme Court in Lafarge Umiam Mining Private Page 131 of 186 131 of 189 C/WPPIL/21/2013 CAV JUDGEMENT Limited v. Union of India and others, (2011)7 SCC 338, for appointing a National Regulator under Section 3(3) of the Environment (Protection) Act, 1986, was merely a suggestion or a mandamus to the Central Government. The Supreme Court considered sub-paras (i.1), (i.2), (i.3), (i.4) and (i.5) of para 122 of the Lafarge Umiam Mining Private Limited (supra), which are extracted herein below :
"(i.1.) The time has come for this Court to declare and we hereby declare that the National Forest Policy, 1988 which lays down far-reaching principles must necessarily govern the grant of permissions under Section 2 of the Forest (Conservation) Act, 1980 as the same provides the road map to ecological protection and improvement under the Environment (Protection) Act, 1986. The principles/ guidelines mentioned in the National Forest Policy, 1988 should be read as part of the provisions of the Environment (Protection) Act, 1986 read together with the Forest (Conservation) Act, 1980. This direction is required to be given because there is no machinery even today established for implementation of the said National Forest Policy, 1988 read with the Forest (Conservation) Act, 1980. Section 3 of the Environment (Protection) Act, 1986 confers a power coupled with duty and, thus, it is incumbent on the Central Government, as hereinafter indicated, to appoint an appropriate authority, preferably in the form of regulator, at the State and at the Central level for ensuring implementation of the National Forest Policy, 1988.
(i.2.) The difference between a regulator and a court must be kept in mind. The court/tribunal is basically an authority which reacts to a given situation brought to its notice whereas a regulator is a proactive body with the power conferred upon it to frame statutory rules and regulations. The regulatory mechanism warrants open discussion, public participation and circulation of the draft paper inviting suggestions.
(i.3.) The basic objectives of the National Forest Policy, 1988 include positive and proactive steps to be taken.
These include maintenance of environmental stability Page 132 of 186 132 of 189 C/WPPIL/21/2013 CAV JUDGEMENT through preservation, restoration of ecological balance that has been adversely disturbed by serious depletion of forests, conservation of natural heritage of the country by preserving the remaining natural forests with the vast variety of flora and fauna, checking soil erosion and denudation in the catchment areas, checking the extension of sand dunes, increasing the forest/tree cover in the country and encouraging efficient utilisation of forest produce and maximising substitution of wood.
(i.4.) Thus, we are of the view that under Section 3(3) of the Environment (Protection) Act, 1986, the Central Government should appoint a National Regulator for appraising projects, enforcing environmental conditions for approvals and to impose penalties on polluters.
(i.5.) There is one more reason for having a regulatory mechanism in place. Identification of an area as forest area is solely based on the declaration to be filed by the user agency (project proponent). The project proponent under the existing dispensation is required to undertake EIA by an expert body/institution. In many cases, the court is not made aware of the terms of reference. In several cases, the court is not made aware of the study area undertaken by the expert body. Consequently, MoEF/State Government acts on the report (Rapid EIA) undertaken by the institutions who though accredited submit answers according to the terms of reference propounded by the project proponent. We do not wish to cast any doubt on the credibility of these institutions.
However, at times the court is faced with conflicting reports. Similarly, the Government is also faced with a fait accompli kind of situation which in the ultimate analysis leads to grant of ex post facto clearance. To obviate these difficulties, we are of the view that a regulatory mechanism should be put in place and till the time such mechanism is put in place, MoEF should prepare a panel of accredited institutions from which alone the project proponent should obtain the Rapid EIA and that too on the terms of reference to be formulated by MoEF."
After taking note of the observations made by the Page 133 of 186 133 of 189 C/WPPIL/21/2013 CAV JUDGEMENT Supreme Court referred to above, the Supreme Court proceeded to observe as under :
"It will be clear from the underlined portions of the order of this Court in Lafarge Umiam Mining Private Limited extracted above that this Court on an interpretation of Section 3 (3) of the Environment (Protection) Act, 1986 has taken a view that it confers a power coupled with duty to appoint an appropriate authority in the form of a Regulator at the State and at the Central level for appraising projects, enforcing environmental conditions for approvals and to impose penalties on polluters and has accordingly directed the Central Government to appoint a National Regulator under the said provision of the Act. Mr. Parasaran is, therefore, not right in arguing that in the case of Lafarge Umiam Mining Private Limited, this Court has merely suggested that a National Regulator should be appointed and has not issued any mandamus to appoint a National Regulator.
We further find on reading of sub-paragraphs (i.2), (i.3) and (i.5) of Paragraph 122 of the order in the case of Lafarge Umiam Mining Private Limited extracted above that this Court has not found the mechanism of making the EIA appraisals of projects by the MoEF to be satisfactory. As a matter of fact, we also find that the Department of Management Studies, Indian Institute of Technology, Delhi, has prepared report on 'Scope, Structure and Processes of National Environment Assessment and Monitoring Authority (NEAMA)' for the Ministry of Environment and Forest, Government of India, and the Executive Summary of the Report points out the problems with regard to the implementation of EIA 2006 Notification. Paragraph 4 from Section I of the Executive Summary under the heading 'Major Findings & Recommendations', is extracted hereinbelow:
"4. We analysed the implementation of EIA 2006 notification and the proposed CZM notification 2010 in terms of policy, structure and process level issues. Almost all the problems in implementing these notifications relate to structure and processes. Key issues are mentioned below a. The presence of MoEF in both the appraisal and Page 134 of 186 134 of 189 C/WPPIL/21/2013 CAV JUDGEMENT approval processes leads to a perception of conflict of interest. The Member Secretary (who, according to the 2006 notification, was supposed to be the Secretary) is involved in the processing, appraisal and approval of the EIA applications.
b. Lack of permanence in the Expert Appraisal Committees leads to lack of continuity and institutional memory leading to poor knowledge management.
c. Current EIA and CRZ clearances rely predominantly on the data provided by the project proponent and the absence of authenticated and reliable data and lack of mechanisms to validate the data provided by the project proponent might lead to subjectivity, inconsistency and inferior quality of EIA reports.
d. Though the EIA notification requires several documents like ToRs (for every project), minutes of public hearing meetings (for each project), EIA report (with clearance conditions) and self- monitoring reports to be put in public domain (predominantly on the website), this has not been done for lack of institutional mechanisms. This leads to a perception of lack of transparency in the processes.
e. Several studies have pointed toward the poor monitoring of the clearance conditions. Huge gaps in monitoring and enforcement of clearance conditions actually defeats the very purpose of grant of conditional environmental clearance."
Hence, the present mechanism under the EIA Notification dated 14.09.2006, issued by the Government with regard to processing, appraisals and approval of the projects for environmental clearance is deficient in many respects and what is required is a Regulator at the national level having its offices in all the States which can carry out an independent, objective and transparent appraisal and approval of the projects for environmental clearances and which can also monitor the implementation of the conditions laid down in the Environmental Clearances.
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The Regulator so appointed under Section 3(3) of the Environment (Protection) Act, 1986 can exercise only such powers and functions of the Central Government under the Environment (Protection) Act as are entrusted to it and obviously cannot exercise the powers of the Central Government under Section 2 of the Forest (Conservation) Act, 1980, but while exercising such powers under the Environment Protection Act will ensure that the National Forest Policy, 1988 is duly implemented as held in the order dated 06.07.2011 of this Court in the case of Lafarge Umiam Mining Private Limited. Hence, we also do not find any force in the submission of Mr.Parasaran that as under Section 2 of the Forest (Conservation) Act, 1980 the Central Government alone is the Regulator, no one else can be appointed as a Regulator as directed in the case of Lafarge Umiam Mining Private Limited.
We, therefore, direct the Union of India to appoint a Regulator with offices in as many States as possible under sub-section (3) of Section 3 of the Environment (Protection) Act, 1986 as directed in the order in the case of Lafarge Umiam Mining Private Limited and file an affidavit along with the notification appointing the Regulator in compliance of this direction by 31st March, 2014.
The I.As. will stand disposed of accordingly."
However, what next followed is very important. Although the Central Government did not deem fit for any reason to consider the recommendations made by the EAC for grant of environmental clearance within the period of 45 days, which has led the respondents to plead deemed environmental clearance, but the Central Government was forced to issue an Office Memorandum dated 14th September 2012 in the wake of the complaints being received from the Kheti Vikas Sewa Trust regarding severe impact upon the environment safety and integrity in Mundra Port and SEZ Limited in Mundra-Kutch, committed by the Adani Port and SEZ Limited, and considering Page 136 of 186 136 of 189 C/WPPIL/21/2013 CAV JUDGEMENT the severity of the issues involved in the matter, it was decided to constitute a committee known as Sunita Narain Committee.
The broad terms of the reference of the Committee for inspection of M/s.Adani Port and SEZ Limited were to examine the following :
(i) the allegations regarding bunding/diversion/blocking of creeks and reclamation etc. and thereby distortion of original HTL.
(ii) The HTL submitted by the proponent and HTL of approved Coastal Zone Management Plan.
(iii) Whether construction of Mundra Port, roads, railway was taken up prior to grant of Forest/Environmental Clearance.
(iv) The development of port with respect to the approved components.
(v) Compliance to the conditions of the Environmental and CRZ clearance granted for the port development.
(vi) The destruction of mangroves and levelling of sand dunes.
(vii) The development of Power Plant with respect to the approved components.
(viii) Compliance to the conditions of the Environmental clearance granted for the Power plant.
(ix) The likely impacts on agriculture due to ingress of salinity due to creation of huge water body of sea water for Adani Power Plant at Mundra Taluka.
(x) The issues related to handling of fly ash by Adani Power Limited and particularly with reference to the Notification on utilisation of fly ash.
(xi) The issues related to earthquake/Tsunami/other natural calamities and soil liquefaction which may be Page 137 of 186 137 of 189 C/WPPIL/21/2013 CAV JUDGEMENT impacted adversely by the project."
The Sunita Narain Committee took note of the recommendations of the EAC made in its 113 th Meeting for the proposed multi-product SEZ by the MPSEZ and recommended in its report to the Central Government that it should commission a comprehensive study on the cumulative impacts of the projects, which have already been granted clearance. Such study, according to the Committee, should be used to assess and mitigate the impacts in the region. The Committee noted various irregularities like cases of procedural lapses, blocking of creeks, destruction of mangroves, flyash utilization and disposal. The Committee recommended for effective deterrence for non-compliance and remedial measures.
It was argued that the Sunita Narain Committee report is with respect to other clearance.
We may quote the following observations made by the Committee in its report :
"7.2. Recommendation for effective deterrence for non- compliance and remedial measures.
In the Committee's assessment there is incontrovertible evidence of violation of EC condition and non-compliance. It must also be recognized that the Company has bypassed environmental procedures in certain cases.
The question before the Committee is to determine the future course of action. One option would be to recommend the cancellation of clearances, where procedures have been bypassed. In addition, legal proceeding could be initiated against non-compliance and violations of EC conditions. But it is also clear that these steps, however, harsh they may sound, are in the nature of being procedural and would only lead to Page 138 of 186 138 of 189 C/WPPIL/21/2013 CAV JUDGEMENT delay without any gains to the environment and the people. The Committee is cognizant of the fact that large scale development has already been undertaken and it is not possible or prudent at this stage to halt or cease its operations.
Therefore, the Committee has decided to recommend a different course of action, which is both intended to be an effective deterrent and also suggests the way for future remedial action to improve the environment.
Given this the Committee recommends the following:
7.2.1 MoEF should impose a substantial deterrent for noncompliance and violations through the creation of an Environment Restoration Fund.
The Committee is aware that it is practically difficult to assign tangible and intangible costs to non-compliance and violations. However, the inability to quantify these costs should not deter us from setting precedence for the future. This will only result in the issue remaining unresolved and conflicted and will delay action to improve the environment and the livelihoods of people.
Considering the scale of the project, the Committee would recommend that the Environment Restoration Fund should be 1 per cent of the project cost (including the cost of the thermal power plant) or Rs 200 crore, whichever is higher.
The Environment Restoration Fund should operate under the chairmanship of the Secretary, MoEF and be used specifically for remediation of environmental damage in Mundra and also for strengthening the regulatory and monitoring systems.
The purpose of the Fund should be the following:
a. Protection of marine ecology;
b. Protection and conservation of mangroves, including development of new mangrove conservation areas;
c. Restoration and conservation of creeks;
d. Independent studies and monitoring of the entire Page 139 of 186 139 of 189 C/WPPIL/21/2013 CAV JUDGEMENT project areas, including cumulative impacts and public data disclosure systems.
e. Social infrastructure and livelihood support for fishers community, including development of access of fishers from their temporary settlements to villages."
It appears that the Sunita Narain Committee was also cognizant of the fact that large scale development has already been undertaken and, therefore, it was not possible or prudent at that stage to halt or cease its operation. This is suggestive of the fact that such developments have taken place in the absence of any prior environmental clearance.
Thus, in our view, although by a deeming fiction the environmental clearance could be said to have been granted in favour of the respondent no.8 MPSEZ, yet it is too late in the day to contend that whatever illegality has been committed stands cured or rectified by such grant of deemed environmental clearance.
Very curiously we may take note of the submission canvassed on behalf of the respondents that the judgment rendered by us in Writ Petition (PIL) No.194 of 2011 dated 19th May 2012 does not lay down that the developer cannot sublease the land as the observations that the developer was not entitled to sublease the land is found only in the supporting view taken by one of us (His Lordship Bhaskar Bhattacharya, CJ.). It was submitted that the finding in the judgment rendered by J.B.Pardiwala, J. is to the effect that the developer could have allotted the plots to the companies desirous of putting up their units. In such circumstances, it was submitted Page 140 of 186 140 of 189 C/WPPIL/21/2013 CAV JUDGEMENT that the said judgment dated 9th May 2012 contains two contrary views on this issue and, therefore, it may not be considered to be an authority for the proposition that the allotment or lease of the plot is impermissible in law.
We are afraid, we are not impressed by such submissions as it appears that the same has been canvassed as a last effort to salvage the situation. The observations made by one of us J.B.Pardiwala, J. that at the most the developer could have allotted the plots would not mean and could not have been construed by the respondents to convey that the allottees could develop the plots and put up construction on the same. That is not the substance of the judgment. What was sought to be conveyed was that at the most there could be allotment to a particular person interested to setup an industry in the SEZ. His Lordship Bhaskar Bhattacharya, CJ. clarified in no uncertain terms that so long the environmental clearance is not granted by the Central Government in favour of the MPSEZ for creation of infrastructural facilities on the land so allotted and consequent to such permission, such facilities have been actually created by the allottee, the later cannot lawfully lease out the right of enjoyment of the infrastructural facilities to its lessees.
It could not be said that there is any conflict of opinion in this regard.
It is settled principle of law that when the other Judges of the Bench do not express any contrary view or dissenting view than the view expressed by other Judge of the Bench, it is presumed that the Judges who have not expressed contrary to Page 141 of 186 141 of 189 C/WPPIL/21/2013 CAV JUDGEMENT the dissenting view have agreed with the view expressed by the other Judge.
In this connection, we may quote with profit a decision of the Queen's Bench in Guardians of the Poor of the West Derby Union v. The Guardians of the Poor of the Atcham Union, reported in XXIV Queen's Bench Division, 117. In the said case, His Lordship Esher, M.R. observed as under :
"The question is, what is the true construction of the 35th section of the Act of Parliament which is before us, and, when we have got at the true construction, what is the application of it to this case? With regard to the construction of this section, a great many Courts have considered it, and a great many judges have had different opinions about it. That being so, this Court expressed a hope, as we were told that several cases were going to the House of Lords, that the House of Lords would construe the whole section, so that we might know what their view of the true construction was. The House of Lords heard the cases, and did not give judgment at once, but considered the matter carefully, and four of the learned judges in the House of Lords gave judgment. Now we know that each of them considers the matter separately, and they then consider the matter jointly, interchanging their judgments, so that every one of them has seen the judgments of the others. If they mean to differ in their view, they say so openly when they come to deliver their judgments, and if they do not do this, it must be taken that each of them agrees with the judgments of the others."
It was also sought to be vociferously canvassed before us that the Ministry of Environment and Forests as it has granted environmental clearance to the unit in Andhra Pradesh Special Economic Zone on 8th June 2009 and 5th August 2011 before the environmental clearance was granted to the said SEZ on 13th February 2012 and on the strength of such environmental Page 142 of 186 142 of 189 C/WPPIL/21/2013 CAV JUDGEMENT clearance the units were even established before the environmental clearance was granted in favour of the SEZ. It was also brought to our notice that the Ministry of Environment and Forests granted environmental clearance to a unit in Dahej SEZ on 19th August 2008 before the environmental clearance was granted to the said SEZ on 17th March 2010. According to Mr.Thakore, the learned counsel appearing for the respondent no.8 - MPSEZ, even the projects within this SEZ were granted clearance by the Ministry of Environment and Forests prior to the environmental clearance to the SEZ itself. We are of the opinion that this by itself would not help the respondents because there is nothing on record to indicate as to how and in what circumstances such environmental clearance was granted. This by itself is not sufficient to justify the commencement of the construction and the project even before EAC made its recommendations for grant of environmental clearance to the Ministry. At least one thing is clear from the examples relied upon by Mr.Thakore in both the cases, i.e. in Andhra Pradesh SEZ as well as in Dahej SEZ, there was environmental clearance by the Ministry itself to the units. Here, in the present case, all that has been obtained by the individual unit holders is the permission or consent from the GPCB and other authorities. Beside this, the Union would have been the right respondent to explain about the Andhra Pradesh SEZ and the Dahej SEZ, but it has chosen to remain quiet and failed to assist the court in this regard in any manner.
Case Law relied upon by the Petitioners :
We shall now look into few decisions relied upon by Page 143 of 186 143 of 189 C/WPPIL/21/2013 CAV JUDGEMENT Mr.Yagnik, the learned counsel appearing for the petitioners of Writ Petition (PIL) 21 of 2013, in support of his submissions :
In Gram Panchayat Navlakh Umbre (supra) which was a Public Interest Litigation, the challenge was to the environmental clearance granted to the respondent for setting up a 355 MWs combined cycle power project. The Court took note of the fact that on 14th September 2006 the Ministry of Environment and Forests, Union of India, issued a Notification in exercise of powers, inter alia, conferred by Section 3 of the Environment (Protection) Act, 1986 stipulating a requirement of a prior environmental clearance for setting up new projects or activities and for the expansion or modernization of existing projects or activities falling within the purview of the notification. The power project in that case was falling in category B-1 of the Schedule of the Notification.
The Court also took note of the deeming provision, stating that its concept was an integral part of the Notification dated 14th September 2006. The Court, thereafter, exhaustively considered various stages which an environmental clearance has to undergo. The principal argument before the Bench on the part of the respondent was that it had received deemed permission for project on the basis of the recommendations that were issued by the SEAC. The Court took the view that since it held the recommendations of the SEAC to be invalid and contrary to law, the basis on which the submissions of deemed permission had been urged would have no foundation whatsoever. The Court criticized and expressed its concern about the manner in which both the SEAC and SEIAA had proceeded to grant Page 144 of 186 144 of 189 C/WPPIL/21/2013 CAV JUDGEMENT clearances without application of mind in breach of the specific conditions of the Notification dated 14th September 2006. The respondent had carried out development work at the site without prior environmental clearance. The Court also took notice of the fact that its attention was drawn repeatedly by the petitioner to their grievance that even without an environmental clearance, the respondent had proceeded with the work at the site in breach of the Notification dated 14th September 2006.
In the aforenoted factual background, the Court made the following observations which, in our opinion, fortifies the submissions of Mr.Yagnik that the respondent nos.10 to 21 cannot take shelter of the deemed environmental clearance.
"The issue as to whether an applicant for environmental clearance has acted in breach of the condition which prohibits work prior to the receipt of environmental clearance is a material consideration in determining whether environmental clearance should be granted. A project proponent who seeks an environmental clearance under the law must demonstrably act in accordance with law. There is a serious allegation of a breach by the sixth respondent which resulted in the issuance of a notice to show cause by MPCB. That issue cannot be disassociated from the grant of an environmental clearance and a clearance could not have been granted without a definitive conclusion, arrived at in accordance with the principles of natural justice, on the issue of breach."
"In Commissioner of Municipal Corporation, Shimla v.