Case Title: Alembic Pharmaceuticals Ltd V. Rohit Prajapati and Ors.
The Supreme Court has repeatedly stated that the idea of "ex post facto" Environmental Clearance (EC) is contrary to the core values of environmental law.
"Ex post facto clearances are not permitted under environmental legislation. This would go against both the requirement for sustainable development and the precautionary principle ", a bench made up of Justices DY Chandrachud and Ajay Rastogi said.
Due to this, the Supreme Court affirmed the National Green Tribunal's 2016 decision to invalidate a circular that had been published on May 14, 2002, by the Ministry of Environment and Forests which called for the granting of post facto ECs.
The NGT's conclusion that the circular was "unsustainable in law" was accepted by the Supreme Court. According to the Environment Impact Assessment announcement of 1994, the circular permitted enterprises that had started operations without acquiring EC to do so by an extended deadline in 2003.
The EIA notice of 1994 prohibits a post-activity approval or an ex post facto authorisation where it requires a previous EC. The legislative notification dated 27 January 1994 conflicted with what the administrative circular dated 14 May 2002 was attempting to accomplish.
The Supreme Court's ruling in Common Cause v. Union of India, which stated that ECs cannot be awarded post-facto, was followed by the bench in this case.
The Court provided a justification for why a retrospective EC would be harmful. They stated that a retrospective EC or an ex post facto clearance was not acceptable under environmental law since the statutory notice requirement necessitates thorough consideration before issuing an EC, as well as research into the possible environmental effects of a planned activity. Only if all phases of the decision-making process have been accomplished can an EC be issued.
However, the Court overturned the NGT's decision to shut down the industries for failing to get prior EC in accordance with the 1994 EIA notice. The lawsuit involved three businesses that produced medicines and bulk medications in the Gujarati industrial district of Ankleshwar: Alembic Pharmaceuticals, Unique Chemicals, Darshak Pvt Ltd, and Nirayu Pvt Ltd. The panel ruled that the closure order was excessive and permitted the industries to resume operations as long as they each paid compensation of Rs. 10 crores.
“This Court has taken note of the fact that though the three industries operated without an EC for several years after the EIA notification of 1994, each of them had subsequently received ECs including amended ECs for the expansion of existing capacities. In addition, all three units have made infrastructural investments and employed significant numbers of workers in their industrial units.”
The Court had ordered the delinquent companies to pay compensation by invoking its authority under Article 142 of the Indian Constitution.
The sum was deposited with the GPCB and used appropriately for restoration and remedial actions to raise the standard of the environment in the industrial area where the industries operate.