The National Green Tribunal (Southern Zone) has restored the Consent to Operate (CTO) granted to M/s. GKN Foods Products Pvt. Ltd. after examining whether the unit had complied with the Tribunal's earlier directions on land conversion and environmental safeguards. The Tribunal held that the Appellate Authority of the Tamil Nadu Pollution Control Board (TNPCB) erred in setting aside the CTO solely on the ground that no formal land conversion order was produced, overlooking documentary evidence of compliance with statutory requirements.
Background & Facts
The Genesis of the Dispute
The appellant, M/s. GKN Foods Products Pvt. Ltd., operates a jaggery manufacturing unit at Survey No.892/3A, Kodankipatti Village, Bodinaickanur Taluk, Theni District, Tamil Nadu. The unit initially applied for Consent to Establish (CTE) for manufacturing jaggery powder and blocks. However, on inspection conducted on 16.12.2020, the TNPCB found that the appellant had constructed an industrial shed and office building without obtaining prior CTE under the Water Act, 1974 and the Air Act, 1981. A show cause notice was issued on 20.12.2020, to which the appellant replied on 24.12.2020.
Key Facts
- The appellant's land is classified as "Tharisu" (barren land) and situated in a non-planned area under the Tamil Nadu Town and Country Planning Act, 1971.
- The Deputy Director of Town and Country Planning, Theni, certified on 09.11.2020 that the land was in a non-planned area and had not been classified under any planning zone.
- The appellant applied for planning permission and paid development charges, infrastructure charges, and amenity charges as prescribed.
- The Joint Director of Agriculture, Agriculture-Farmer Welfare Department, opined on 17.08.2021 that the land was unsuitable for agriculture and could be used for non-agricultural purposes.
- The Assistant Director, Town and Country Planning, Theni, granted technical permission for construction on 18.11.2022.
- The appellant remitted Environmental Compensation of Rs.2,65,625 on 10.01.2023 as directed by the Tribunal.
- Fresh CTE was granted on 13.01.2023 and CTO on 20.05.2023, valid until 31.03.2033.
Procedural History
- 16.12.2020: TNPCB inspection revealed unauthorized construction on agricultural land without prior CTE.
- 20.12.2020: Show cause notice issued to the appellant.
- 24.12.2020: Appellant submitted reply to the show cause notice.
- 29.01.2021: TNPCB rejected the appellant's application for CTE under the Water Act and Air Act.
- 10.02.2021: Appellant filed Appeal Nos.10 and 11 of 2021 before the Appellate Authority, TNPCB.
- 06.10.2021: Appellate Authority TNPCB set aside the rejection and directed TNPCB to grant fresh CTE.
- 16.04.2021: Rajsree Sugars & Chemicals Ltd. was impleaded in the appeals.
- 28.01.2022: NGT, Southern Zone, in Appeal Nos.73 and 74 of 2021, set aside the Appellate Authority's order and restored the TNPCB's rejection. The Tribunal directed the appellant to obtain planning permission and land conversion permission before reconsideration of its application and to pay Environmental Compensation for unauthorized construction.
- 03.01.2023: TNPCB levied Environmental Compensation of Rs.2,65,625, which was remitted by the appellant.
- 13.01.2023: Fresh CTE granted by TNPCB.
- 20.05.2023: CTO granted by TNPCB, valid until 31.03.2033.
- 13.08.2024: Appellate Authority TNPCB set aside the CTO in Appeal Nos.65 and 66 of 2023, holding that no formal land conversion order was produced and that the directions of the Tribunal had not been complied with.
- 27.11.2024: TNPCB revoked the CTE and CTO pursuant to the Appellate Authority's order.
- 21.07.2026: Present appeals filed before the NGT, Southern Zone.
The Parties' Positions
For the Appellant: The appellant contended that it had complied with all conditions stipulated by the Tribunal and the TNPCB, including payment of Environmental Compensation, obtaining planning permission, and securing concurrence from the Joint Director of Agriculture. The appellant argued that the Appellate Authority TNPCB erred in overlooking documentary evidence of compliance and in setting aside the CTO solely on the ground that no formal land conversion order was produced.
For the Respondents: The Tamil Nadu Pollution Control Board and the District Environment Engineer contended that the appellant had not produced a specific order evidencing conversion of the land from agricultural to non-agricultural use, as mandated by the Tribunal's directions. The 3rd Respondent, Rajsree Sugars & Chemicals Ltd., argued that the appellant's unit was established in a reserved area and that the appellant had not obtained the requisite licence under the Sugarcane (Control) Order, 1966.
Relief Sought
The appellant sought restoration of the CTO dated 20.05.2023 and a direction to the TNPCB to strictly adhere to the consent conditions and other applicable statutory regulations.
The Legal Issue
The central question was whether the Appellate Authority TNPCB was justified in setting aside the CTO granted to the appellant on the ground that no formal land conversion order evidencing conversion of the land from agricultural to non-agricultural use was produced, despite documentary evidence of compliance with statutory requirements.
Arguments Presented
For the Appellant
- The appellant relied on the Tamil Nadu Change of Land Use (From agriculture to non-agriculture purposes in non-planning areas) Rules, 2017, and contended that the concurrence of the Joint Director of Agriculture and the technical permission from the Town and Country Planning Authority constituted sufficient compliance with the requirement for land conversion.
- The appellant argued that the Appellate Authority TNPCB failed to appreciate that the land was situated in a non-planned area and that the communications from the competent authorities evidenced compliance with the statutory requirements.
- The appellant contended that the Appellate Authority TNPCB overlooked the fact that the TNPCB itself had acknowledged compliance with environmental conditions before granting the CTE and CTO.
For the Respondent
- The respondents contended that the appellant had not produced a specific order evidencing conversion of the land from agricultural to non-agricultural use, as mandated by the Tribunal's directions.
- The respondents argued that the appellant's failure to obtain a formal land conversion order rendered the grant of CTO illegal and in violation of the Tribunal's directions.
- The 3rd Respondent contended that the appeal was not maintainable as it was filed on grounds of commercial rivalry rather than genuine environmental concerns.
The Court's Analysis
The Tribunal examined the core issue of whether the appellant had substantially complied with the directions issued by the Tribunal and whether the ground that no formal land conversion order had been produced could justify the setting aside of the CTO.
The Tribunal noted that the appellant had initially commenced construction without obtaining prior CTE, constituting a violation for which Environmental Compensation was levied. The appellant subsequently complied with the Tribunal's directions by obtaining planning permission, remitting the requisite development and infrastructure charges, securing the concurrence of the Joint Director of Agriculture, and paying the Environmental Compensation of Rs.2,65,625.
The Tribunal observed that the Appellate Authority TNPCB had failed to examine the effect of the communications issued by the competent Town and Country Planning Authority certifying that the land was situated in a non-planned area, the technical approval granted by the planning authority, and the concurrence of the Joint Director of Agriculture. These documents formed the basis upon which the TNPCB was satisfied regarding compliance with the statutory requirements.
"The principal reason assigned by the Appellate Authority TNPCB for setting aside the CTO is that no specific order evidencing conversion of the land from agricultural to non-agricultural use was produced. However, the Appellate Authority TNPCB failed to examine the effect of the communications issued by the competent Town and Country Planning Authority certifying that the land is situated in a non-planned area, the technical approval granted by the planning authority, the concurrence of the Joint Director of Agriculture, and the payment of the prescribed conversion and development charges, all of which formed the basis upon which the TNPCB was satisfied regarding compliance."
The Tribunal held that the Appellate Authority TNPCB erred in overlooking the documentary evidence of compliance and in setting aside the CTO solely on the ground that no formal land conversion order was produced. The Tribunal noted that the appellant had complied with the environmental conditions prescribed under the Water Act, Air Act, and the consent conditions before the issuance of the CTE and CTO.
The Tribunal also examined the maintainability of the appeal filed by the 3rd Respondent. The Tribunal held that the 3rd Respondent had not proved any ecological damage or genuine environmental concern and that the appeal was filed on grounds of commercial rivalry. The Tribunal observed that a loss of commercial profit or increased market competition does not make an entity an "aggrieved person" under environmental statutes.
The Verdict
The Tribunal allowed the appeals and set aside the impugned order dated 13.08.2024 passed by the Appellate Authority TNPCB. The Consent to Operate dated 20.05.2023 issued to the appellant was restored. The appellant was directed to strictly follow the consent conditions and other applicable statutory regulations at all times. The pending interlocutory applications were also closed.
What This Means For Similar Cases
Documentary Compliance Prevails Over Formalistic Scrutiny
- Documentary evidence of compliance with statutory requirements, such as concurrence from the Joint Director of Agriculture and technical permission from the Town and Country Planning Authority, must be considered sufficient to evidence land conversion compliance.
- Formalistic insistence on a specific land conversion order, in the absence of any statutory requirement for such an order, is impermissible.
Environmental Compensation Is a Tool for Compliance, Not Punishment
- Environmental Compensation levied for unauthorized construction must be treated as a compliance mechanism to ensure adherence to environmental safeguards, not as a punitive measure.
- Compliance with environmental conditions must be examined holistically, considering all documentary evidence of compliance.
Commercial Rivalry Does Not Confer Standing Under Environmental Statutes
- Appeals filed on grounds of commercial rivalry or market competition do not confer standing as "aggrieved persons" under environmental statutes.
- Genuine environmental concerns must be demonstrated for maintainability of appeals under environmental laws.
