Case Note & Summary
The Supreme Court allowed appeals by formaldehyde manufacturing units against the National Green Tribunal's order directing closure for want of prior Environmental Clearance. The appellants were industries manufacturing formaldehyde and its resins in Rajasthan and Haryana. They had obtained valid Consent to Establish and Consent to Operate from the respective State Pollution Control Boards. The NGT, in three original applications, held that formaldehyde units cannot operate without prior EC under the EIA Notification 2006. The Supreme Court noted that the Pollution Control Board itself was initially unaware of the EC requirement for such units. When the PCB later issued office orders requiring units to apply for EC, the appellants complied within the stipulated period. The Court relied on its earlier judgment in Pahwa Plastics Private Limited v. Dastak NGO, which held that units cannot be closed for want of prior EC when the PCB was unaware of the requirement. The Court distinguished the Vanashakti judgment on ex-post facto EC, as the units here had applied for EC as directed. The Court set aside the NGT order and allowed the units to continue operations.
Headnote
A) Environmental Law - Environmental Clearance - Prior EC Requirement - EIA Notification 2006 - The core issue was whether formaldehyde manufacturing units that had obtained valid Consent to Establish and Consent to Operate from the State Pollution Control Board could be closed for not having prior Environmental Clearance. The Supreme Court held that where the Pollution Control Board itself was unaware of the applicability of EC for such units, the units cannot be closed merely on account of technical irregularity for want of prior EC. The Court set aside the NGT order and directed continuation of operations. (Paras 4-10) B) Environmental Law - Ex-post facto Environmental Clearance - Validity - Environment Protection Act 1986 - The Court referred to the Vanashakti judgment which struck down OMs permitting ex-post facto EC as illegal, but distinguished the present case as the units had applied for EC within the stipulated time after being directed by the PCB. The Court noted that the units were operating on the basis of CTE and CTO and had complied with the PCB's directions to apply for EC. (Paras 5-10) C) Environmental Law - Consent to Establish and Consent to Operate - Role of Pollution Control Board - The Court emphasized that when CTE and CTO are granted, it means the PCB was satisfied with the establishment and operation of the units. The units were non-polluting with zero trade discharge. The Court held that the PCB's grant of CTE and CTO indicates compliance with legal requirements, and closure for want of prior EC would be unjust. (Paras 7-10)
Issue of Consideration
Whether formaldehyde manufacturing units operating with valid Consent to Establish and Consent to Operate from the State Pollution Control Board can be directed to close for want of prior Environmental Clearance under the EIA Notification 2006.
Final Decision
The Supreme Court allowed the appeals, set aside the NGT order dated 03.06.2021, and directed that the formaldehyde manufacturing units be permitted to continue their operations.
Law Points
- Environmental Clearance
- Ex-post facto EC
- Prior EC requirement
- Consent to Establish
- Consent to Operate
- EIA Notification 2006
- Environment Protection Act 1986
