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  • Forest (Conservation) Act, 1980
  • Forest Conservation Act
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Citation Codes
Equivalent Citations
citation codes
Case Number
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  • Forest (Conservation) Act, 1980
  • Forest Conservation Act
Smart Summary

Factual and Procedural Background

The order consolidates directions issued in several interim applications arising out of Writ Petition (Civil) No. 202 of 1995 and related matters. The Court had earlier required agencies diverting forest land for non-forest purposes to deposit the Net Present Value (NPV) of the land with an ad hoc Compensatory Afforestation Fund Management and Planning Authority (Campa). A substantial corpus has since accumulated. The Ministry of Environment & Forests (MoEF), the amicus curiae, and the Central Empowered Committee (CEC) formulated a scheme for utilisation of these funds, which was placed before the Court for approval.

Additional issues considered in the same order include: (i) enforcement of a prior direction prohibiting operation of sawmills within 10 km of forest boundaries in the State of Orissa; (ii) modification of an earlier consent order concerning the Lower Subansiri Hydroelectric Project of NHPC; and (iii) clearance, with conditions, for constructing a fence and patrol road along the Indo-Bangladesh border inside the Dampa Tiger Reserve, Mizoram. Several other interim applications were listed for future dates or disposed of without substantive orders.

Legal Issues Presented

  1. Whether the Court should approve the scheme proposed by MoEF and CEC for phased release and utilisation of the NPV funds lying with the ad hoc Campa.
  2. Whether sawmills operating within 10 km of forest areas in Orissa must be closed notwithstanding interim orders obtained from the High Court, and whether the State should reform its regulatory framework.
  3. Whether the conditions attached to the construction of the Lower Subansiri Hydroelectric Project require modification or reaffirmation, particularly the obligation to declare upstream reserve forests as a national park/sanctuary.
  4. Whether permission should be granted, and on what terms, for use of forest land inside Dampa Tiger Reserve for fencing and road construction along the international border with Bangladesh.

Arguments of the Parties

The opinion does not contain a detailed account of the parties' legal arguments.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Supreme Court Order dated 19-4-2004 in IAs 966 & 1012, reported at (2009) 17 SCC 577; (2005) 4 Scale 508 Conditions imposed on the Lower Subansiri Hydroelectric Project, including declaration of upstream reserve forests as national park/sanctuary Reaffirmed; the present order treats the earlier decision as a consent order binding on the parties and disposes of the modification applications subject to identical conditions

Court's Reasoning and Analysis

Utilisation of NPV Funds: The Court accepted CEC’s concern that “sudden release and utilisation of this large sum all at one time may not be appropriate and may lead to its improper use without any effective control”. Accordingly, it authorised the ad hoc Campa to disburse approximately Rs. 1,000 crore per year for five years, limited to 10 % of each State/UT’s principal amount, and laid down a series of accounting, auditing and monitoring safeguards. Previous orders were modified to the extent necessary to implement the new framework.

Sawmills in Orissa: Recalling its earlier blanket prohibition on sawmills within 10 km of forest boundaries, the Court held that any High Court interim orders to the contrary must give way. All such sawmills were ordered to close immediately. The practice of the Orissa Forest Corporation leasing its own sawmills to private parties was also ordered to stop. The State must establish an industrial estate, amend the 1991 Sawmills Rules, and file an affidavit within four weeks.

Lower Subansiri Hydroelectric Project: The Court noted that approval under the Forest Conservation Act and clearance by the Indian Board for Wildlife (IBWL) were both conditional upon declaring the entire upstream area as a national park/sanctuary. Because those conditions had already been accepted by the State of Arunachal Pradesh and NHPC, and the 2004 consent order merely reiterated them, the Court disposed of the modification applications while restating the four key conditions.

Border Fence in Dampa Tiger Reserve: Recognising the governmental purpose of national security, the Court cleared the project at concessional NPV rates but made the approval contingent on six conditions, including forest-clearance under the Forest Conservation Act, compliance with wildlife mitigation measures, and a ban on quarrying or dumping inside the reserve.

Holding and Implications

HOLDING: The Court APPROVED the CEC/MoEF scheme for phased release of NPV funds; ORDERED immediate closure of all prohibited sawmills in Orissa; DISPOSED OF modification applications concerning the Lower Subansiri project subject to reiterated conditions; and GRANTED conditional clearance for the Indo-Bangladesh border fencing project within Dampa Tiger Reserve. Various other interim applications were listed for future dates or disposed of without substantive orders.

Implications: The decision operationalises a structured, audited mechanism for disbursing thousands of crores earmarked for compensatory afforestation, potentially accelerating ecological restoration projects nationwide. The reaffirmation of restrictions on sawmills strengthens enforcement of forest-protection norms in Orissa and signals deference to Supreme Court directives over conflicting High Court orders. By maintaining stringent ecological conditions on large infrastructure projects (Lower Subansiri HEP and border fencing), the Court underscores that developmental and security objectives must conform to existing forest and wildlife safeguards. No new legal precedent was set, but the order reinforces and implements earlier principles established by the Court in ongoing forest-conservation litigation.

    T.N Godavarman Thirumulpad v. Union Of India And Others

    Order

    IA No. 2143 in WP (C) No. 202 of 1995

    1. Pursuant to a series of orders passed by this Court for afforestation purpose, various agencies had deposited amounts by way of net present value (NPV) when the forest area were utilised for non-forest purposes. This amount is lying with the ad hoc Campa. The MoEF, the amicus curiae and CEC have discussed the matter and they have come up with a scheme as to how to utilise the deposited amount for the purpose of afforestation.

    2. CEC has filed a report framing a scheme and the same has been placed before this Court for consideration. We have examined the scheme and accepted the following recommendations:

    (A) The guidelines and the structure of the State Campa as prepared by MoEF may be notified/implemented. All previous orders passed by this Court regarding this would stand modified to the extent necessary for implementation of the present proposal.
    (B) Substantial amount of funds have been received by the ad hoc Campa and sudden release and utilisation of this large sum all at one time may not be appropriate and may lead to its improper use without any effective control on expenditure. This Court considers it appropriate to permit the ad hoc Campa to release, for the time being, the sum of about Rs 1000 crores per year, for the next 5 years, in proportion of 10% of the principal amount pertaining to the respective State/UT as per the conditions given below:
    (i) the details of the bank account opened by the State Executive Committee (in the nationalised bank) are intimated to the ad hoc Campa;
    (ii) the amount towards NPV and the protected area may be released after the schemes have been reviewed by the State Level Executive Committee and the Annual Plan of Operation is approved by the Steering Committee;
    (iii) the amount towards CA, additional CA, PCA and the Catchment Area Treatment Plan may be released in the respective bank accounts of the States/UTs immediately for taking up site specific works already approved by MoEF while granting prior approval under the Forest (Conservation) Act, 1980.
    (C) An amount up to 5% of the amount released to the State Campa may also be released and utilised by the National Campa Advisory Council, for monitoring and evaluation and for the implementation of the various schemes as given in Para 19 of the guidelines on the State Campa. It is left to the discretion of the National Campa Advisory Council whether it wants to spend money directly or through the ad hoc Campa.
    (D) The recommendations for the release of the additional funds, if any, will be made in due course from time to time after seeing the progress made by the State Level Campa and the effectiveness of the accounting, monitoring and evaluation systems.
    (E) The State Accountant General shall carry out the audit of the expenditure done out of State Campa funds every year on annual basis.
    (F) The State Level Executive Committee shall evolve an appropriate and effective accounting process for maintenance of accounts, returns and for audit.
    (G) The interest received by the State Campa on the amounts placed at their disposal by the ad hoc Campa may be used by it for administrative expenditure.
    (H) Till an alternative system is put in place (after obtaining permission from this Court) the money towards CA, NPV and protected areas (national parks, wildlife sanctuaries) shall continue to be deposited with the ad hoc Campa and its release will continue to be made as per the existing orders of this Court.

    3. While carrying out the work of utilising these funds the broad guidelines adopted by Nrega may be followed and as far as possible work may be allotted mostly to rural unemployed people, maintaining the minimum wage level. CEC may file status reports as regards implementation of the scheme every six months.

    IA No. 941 in IAs Nos. 754-55 with IAs Nos. 777, 1131-33, 1138-46, 1148, 1184, 1272, 1361, 1579-80 in WP (C) No. 202 of 1995 with WP (C) No. 356 of 2007

    4. These matters relate to sawmills in the State of Orissa. This Court had earlier directed that there should be no sawmills within 10 km from the boundary of the forest area. Many of the sawmills in the State of Orissa were closed down. The applicants in IAs Nos. 1579 and 1580 also closed down their sawmills. We are told that some of the sawmills had obtained interim orders from the High Court but as those are contrary to the direction given by this Court, all those sawmills must also be closed down immediately.

    5. We are told that Orissa Forest Corporation has its own sawmills and these mills are given on lease to private parties. Such practices shall be stopped forthwith. The State of Orissa to file a fresh affidavit to this effect within a period of four weeks. The State shall arrange to have an industrial estate and take urgent steps to this effect and shall also take steps to see that there shall be appropriate amendment to the Sawmills Rules of 1991. It shall file an affidavit to this effect. List on 21-8-2009.

    IAs Nos. 1362-63 in Nos. 966 and 1012 in WP (C) No. 202 of 1995

    6. By these interim applications, the applicant seeks modification of this Court's order dated 19-4-2004 (2009) 17 SCC 577, (2005) 4 Scale 508 passed in IAs Nos. 966 and 1012. The matter relates to the construction of Lower Subansiri Hydroelectric Project by NHPC. CEC has made some recommendations and subject to these recommendations the work has to be completed in the entire area of Lower Subansiri Project which will be declared as national park/sanctuary. This is accepted and an affidavit to this effect is filed by the Deputy Inspector General (Wildlife), Government of India wherein it is stated that any proposal in the upper stream of Subansiri River would be considered independently on its own merit by the Standing Committee as and when submitted by the proponents and the State Government would declare 168 sq km of reserve forest as sanctuary and make serious efforts to bring an additional area of 332 sq km reserved forests under the category of conservation reserve in consultation with MoEF. This suggestion is acceptable to the State Government and NHPC and subject to the following conditions the IAs are disposed of:

    (i) approval under the Forest Conservation Act for the project has been granted inter alia on the condition that the entire area upstream of Lower Subansiri Project will be declared as national park/sanctuary;
    (ii) the Standing Committee of IBWL has cleared the project on the condition that the reserve forest area in the catchment of the project will be declared as national park/sanctuary;
    (iii) the conditions imposed by this Court are identical to the conditions on which the project has been cleared under the Forest Conservation Act and by IBWL. These conditions were known to the State of Arunachal Pradesh and a compliance report was also sent by them;
    (iv) this Court's order is a consent order which reiterates the conditions already imposed by MoEF and to which applicant State had already agreed to comply with.

    This is in continuation of the earlier order passed by this Court.

    IAs Nos. 1868, 2091, 2225-27, 2380 and 2568 in WP (C) No. 202 of 1995

    7. List on 4-9-2009.

    IAs Nos. 2616-17 in 1620 and IA No. 2618 in Nos. 2245-46 in WP (C) No. 202 of 1995

    8. Adjourned.

    IA No. 36 in WP (C) No. 171 of 1996

    9. No orders. IA No. 36 is disposed of.

    IAs Nos. 2550 and 2569 in WP (C) No. 202 of 1995

    10. List on 21-8-2009. CEC to file its report in the meantime.

    IA No. 2579 in WP (C) No. 202 of 1995

    11. Permission is sought for construction of fencing and a patrol road along the Indo-Bangladesh Border in Dampa Tiger Reserve, Mizoram. CEC has examined the feasibility and has suggested certain recommendations and also directed that NPV be collected from the agency concerned. As the project is for governmental purpose, NPV will be charged at the concessional rates. Subject to payment of NPV and subject to the following conditions imposed by CEC, the project is cleared:

    (i) for the use of 69.29 ha of forest land approval under the Forest Conservation Act will be obtained;
    (ii) NPV will be deposited as per the rates applicable for the use of forest/non-forest land falling within the national park/wildlife sanctuary;
    (iii) the mitigative measures and the other conditions including the construction of animal corridors on which the project has been cleared by the Mizoram Forest Department will be strictly followed;
    (iv) the conditions imposed by the Chief Wildlife Warden will be strictly complied with;
    (v) the clearance from the Standing Committee of the National Board for Wildlife will be obtained; and
    (vi) no stone quarrying and dumping of malba will be carried out inside the Dampa Tiger Reserve or any forest area falling outside it.

    Subject to fulfilling of the above conditions, the IA is disposed of accordingly.

    IA No. 2580 in WP (C) No. 202 of 1995

    12. CEC has filed its report. The State of Goa seeks time to file a response to the report. Three weeks' time is granted for the same. List on 21-8-2009.

    IA No. 2644 in IA No. 2386 in WP (C) No. 202 of 1995

    13. List IA No. 2386 on 28-8-2009. IA No. 2644 is disposed of accordingly.

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    T.N Godavarman Thirumulpad v. Union Of India And Others
    (Jul 10, 2009)