Supreme Court Dismisses Appeal of Builder in Environmental Clearance Case for Failure to Follow Expansion Procedure. Increase in Construction Area Beyond Prior EC Requires Fresh Environmental Clearance Under EIA Notification, 2006.

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Case Note & Summary

The present civil appeal arises from an order of the National Green Tribunal (NGT) dated 11 February 2019, which held that the increase in total construction area of the appellant's residential redevelopment project from 32,395.17 square metres to 40,480.88 square metres constituted an 'expansion' under the Environmental Impact Assessment (EIA) Notification, 2006. The appellant, Keystone Realtors Pvt. Ltd., had initially received a Commencement Certificate on 8 June 2010 for a project with a total construction area of 8,720.32 square metres. Subsequently, the project was expanded, and the appellant applied for and obtained an Environmental Clearance (EC) on 2 May 2013 from the State Level Environment Impact Assessment Authority (SEIAA) for a total construction area of 32,395.17 square metres. Later, by a letter dated 24 September 2013, the appellant informed the Environment Department of the Government of Maharashtra that the construction area was being further increased by 8,085.71 square metres, making the total 40,480.88 square metres, and sought an 'amendment' to the EC. The SEIAA granted the amendment on 13 March 2014, treating it as a marginal increase. The first respondent, a resident of the area, challenged the amended EC before the NGT. The NGT held that the increase was an expansion requiring compliance with Paragraph 7(ii) of the EIA Notification, which mandates submission of Form 1 and appraisal by the State Level Expert Appraisal Committee (SEAC). The NGT directed the appellant to deposit Rs. 1 crore with the Central Pollution Control Board and appointed an expert committee to study the impact. The appellant appealed to the Supreme Court. The Supreme Court framed the issue as whether the amended EC granted without following the procedure under Paragraph 7(ii) was valid. The appellant argued that the increase was marginal and within the threshold, and that the amendment was valid. The respondents contended that any increase beyond the capacity for which EC was granted constitutes expansion requiring fresh clearance. The Supreme Court analyzed Paragraph 2 and Paragraph 7(ii) of the EIA Notification and held that the increase in construction area from 32,395.17 sq m to 40,480.88 sq m was an expansion under Paragraph 2, as it increased the capacity beyond that for which prior EC was granted. The Court noted that the appellant did not submit an updated Form 1 and the SEIAA granted the amendment without SEAC recommendations, violating the procedure. The Court dismissed the appeal, upholding the NGT order, and directed the appellant to comply with the NGT's directions, including deposit of Rs. 1 crore and cooperation with the expert committee.

Headnote

A) Environmental Law - Environmental Clearance - Expansion of Project - Paragraph 2 and Paragraph 7(ii) of EIA Notification, 2006 - Schedule Entry 8(a) - The increase in total construction area from 32,395.17 sq m to 40,480.88 sq m, being an increase beyond the capacity for which prior EC was granted, constitutes an 'expansion' under Paragraph 2 of the EIA Notification. The procedure under Paragraph 7(ii) requiring submission of Form 1 and appraisal by SEAC must be followed. The SEIAA cannot grant an 'amendment' to EC without following the prescribed procedure. (Paras 6-9, 11-13)

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Issue of Consideration

Whether the increase in total construction area of a building project from 32,395.17 sq m to 40,480.88 sq m constitutes an 'expansion' under Paragraph 2 of the EIA Notification, 2006, requiring compliance with the procedure under Paragraph 7(ii) of the said Notification.

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Final Decision

The Supreme Court dismissed the appeal, upholding the NGT order. The Court held that the increase in construction area was an expansion under Paragraph 2 of the EIA Notification, and the amended EC granted without following Paragraph 7(ii) procedure was invalid. The appellant was directed to comply with the NGT's directions, including deposit of Rs. 1 crore with CPCB and cooperation with the expert committee.

Law Points

  • Environmental Clearance
  • Expansion of Project
  • EIA Notification 2006
  • Paragraph 2
  • Paragraph 7(ii)
  • Schedule Entry 8(a)
  • Prior Environmental Clearance
  • Amendment of EC
  • Procedure for Expansion
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Case Details

2019 LawText (SC) (12) 15

Civil Appeal No. 2435 of 2019

2019-12-03

Dr Dhananjaya Y Chandrachud

Keystone Realtors Pvt. Ltd.

Shri Anil V Tharthare & Ors.

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Nature of Litigation

Civil appeal against order of National Green Tribunal regarding validity of amended Environmental Clearance for expansion of building project.

Remedy Sought

Appellant sought to set aside the NGT order directing deposit of Rs. 1 crore and appointment of expert committee, and to uphold the validity of the amended EC.

Filing Reason

Appellant challenged NGT's finding that increase in construction area constituted 'expansion' under EIA Notification requiring compliance with Paragraph 7(ii).

Previous Decisions

NGT Principal Bench order dated 11 February 2019 held that increase was expansion and directed deposit of Rs. 1 crore and appointment of expert committee. Earlier, Pune Bench of NGT had rejected appellant's challenge to maintainability and limitation; Bombay High Court allowed appellant's writ petition holding appeal not maintainable and barred by limitation; matter was transferred to Principal Bench.

Issues

Whether the increase in total construction area from 32,395.17 sq m to 40,480.88 sq m constitutes an 'expansion' under Paragraph 2 of the EIA Notification, 2006. Whether the amended EC dated 13 March 2014 granted by SEIAA without following the procedure under Paragraph 7(ii) of the EIA Notification is valid.

Submissions/Arguments

Appellant submitted that the increase was marginal (8,085.71 sq m) and within the upper limit of 1,50,000 sq m, and that the amendment was validly granted by SEIAA. Respondents contended that any increase beyond the capacity for which prior EC was granted constitutes expansion requiring fresh EC under Paragraph 7(ii) with submission of Form 1 and appraisal by SEAC.

Ratio Decidendi

Under Paragraph 2 of the EIA Notification, 2006, any increase in the capacity of an existing project beyond the capacity for which prior Environmental Clearance has been granted constitutes an 'expansion' requiring fresh Environmental Clearance. The procedure under Paragraph 7(ii) mandating submission of Form 1 and appraisal by the Expert Appraisal Committee or SEAC must be followed. An 'amendment' to an EC without following this procedure is invalid.

Judgment Excerpts

The present dispute raises important questions regarding the interpretation the EIA Notification. The issue before this Court is whether the 'amended' EC dated 13 March 2014 granted by the SEIAA without following the procedure stipulated in paragraph 7(ii) of the EIA Notification is valid.

Procedural History

The appellant received Commencement Certificate on 8 June 2010. On 2 May 2013, SEIAA granted EC for 32,395.17 sq m. On 24 September 2013, appellant sought amendment for increase to 40,480.88 sq m. On 13 March 2014, SEIAA granted amended EC. First respondent challenged amended EC before Pune Bench of NGT. Appellant filed applications challenging maintainability and limitation; rejected by NGT on 4 May 2016. Appellant filed writ petition in Bombay High Court; High Court allowed on 12 August 2016 holding appeal not maintainable and barred by limitation. Matter transferred to Principal Bench of NGT by administrative order dated 31 July 2018. NGT Principal Bench delivered impugned order on 11 February 2019. Appellant filed Civil Appeal No. 2435 of 2019 in Supreme Court.

Acts & Sections

  • Environment Impact Assessment Notification, 2006: Paragraph 2, Paragraph 7(ii), Schedule Entry 8(a)
  • Air (Prevention and Control of Pollution) Act, 1981:
  • Water (Prevention and Control of Pollution) Act, 1974:
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Supreme Court Supreme Court Dismisses Appeal of Builder in Environmental Clearance Case for Failure to Follow Expansion Procedure. Increase in Construction Area Beyond Prior EC Requires Fresh Environmental Clearance Under EIA Notification, 2006.
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