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CASE NO.:

Appeal (civil) 368-371 of 1999

Appeal (civil) 372 of 1999

Appeal (civil) 373 of 1999

PETITIONER:

A.P. POLLUTION CONTROL BOARD II

Vs.

RESPONDENT:

PROF.M.V. NAYUDU (RETD.)AND ORS

DATE OF JUDGMENT: 22/12/2000

BENCH:

M.J.Rao, M.B.Shah

JUDGMENT:

L.....I.........T.......T.......T.......T.......T.......T..J

M. JAGANNADHA RAO J.

On an earlier occasion, in this very case, this

Court in A.P. Pollution Control Board (I) Vs. Prof.

M.V.

Nayudu ( 1999(2) SCC 718) ( dated 27.1.1999) referred

to

the 'precautionary principle' and the new rule of

'burden of proof' in the matter of environmental

pollution. This Court in that judgment emphasised the

need for scientific inputs before adjudicating

complicated issues of pollution to environment. The

said

approach of this Court was based upon contemporary

trend

in the adjudication of environmental matters in

various

countries and was not intended to restrict the powers

of

this Court under Article 21 of the Constitution of

India

to safeguard environment from pollution.

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Our efforts to get at the best scientific evidence

on the issues involved in the case, have yielded

satisfactory results in the sense that we have today

greater confidence about the correctness of our

conclusions and further that this is a fit case for

affirming the orders of the appellant ( Andhra Pradesh

Pollution Control Board) not to grant 'consent' to the

seventh respondent ( M/s. Surana Oils & Derivatives

(India) Ltd.) under the statute for establishing its

industry. We are now more sure that, on facts, this

is a

pre-eminently fit case which requires grant of an

injunction to prevent irreversible pollution to the

drinking water reservoirs of Osman Sagar and Himayaat

Sagar catering to the needs of over 50 lakhs people,

in

Hyderabad and Secunderabad.

Drinking water is of primary importance in any

country. In fact, India is a party to the Resolution

of

the UNO passed during the United Nations Water

Conference in 1977 as under:

"All people, whatever their stage of development and

their social and economic conditions, have the right to have

access to drinking water in quantum and of a quality equal

to their basic needs."

Thus, the right to access to drinking water is

fundamental to life and there is a duty on the State

under Article 21 to provide clean drinking water to

its

citizens.

Adverting to the above right declared in the

aforesaid Resolution, in Narmada Bachao Andolan Vs.

Union of India ( 2000(7) Scale 34 ( at p.124), Kirpal

J

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observed:

"Water is the basic need for the survival of human

beings and is part of right of life and human rights as

enshrined in Article 21 of the Constitution of India....."

There is therefore need to take into account the

right to a healthy environment along with the right to

sustainable development and balance them.

Competing human rights to healthy environment and

sustainable development:

There is building up, in various countries, a

concept that right to healthy environment and to

sustainable development are fundamental human rights

implicit in the right to 'life'.

Our Supreme Court was one of the first Courts to

develop the concept of right to 'healthy environment'

as

part of the right to "life" under Article 21 of our

Constitution. [ See Bandhua Mukti Morcha Vs. Union

of

India ( 1984(3) SCC 161)]. This principle has now

been

adopted in various countries today.

In today's emerging jurisprudence, environmental

rights which encompass a group of collective rights

are

described as "third generation" rights. The "first

generation" rights are generally political rights such

as those found in the International Convention on

Civil

& Political Rights while "second generation" rights

are

social and economic rights as found in the

International

Covenant on Economic, Social and Cultural Rights.

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"Right

to Healthy Environment". (See Vol.25) 2000 Columbia

Journal of Environmental Law by John Lee P.283, at

pp.293-294 fn.29)

The right to sustainable development has been

declared by the UN General Assembly to be an

inalienable

human right ( Declaration on the Right to Development

)(1986). The 1992 Rio Conference declared that Human

beings are at the centre of concerns for sustainable

development. Human beings are entitled to a healthy

and

productive life in harmony with nature. (Principle

1).

In order to achieve "sustainable development,

environmental protection shall constitute an integral

part of development process and cannot be considered

in

isolation of it". The 1997 Earth Summit meeting of

100

nations in New York reflected the above principles.

The

European Court of Justice, emphasised in Portugal Vs.

E.C. Council, the need to promote sustainable

development while taking into account the environment.

(3 C.M.L.R.331)(1997) (ibid Columbia Journal of

Environmental Law, p. 283)

In Lopez Ostra Vs. Spain ( 303-C,

Eur.Ct.H.R.(Ser.A) 1994), the European Court at

Strasbourg has held that the result of environmental

degradation might affect an individual's well being so

as to deprive him of enjoyment of private and family

life. Under Article 8 of the European Convention,

everyone is guaranteed the right to respect for his

private and family life. ( See also, Powell & Rayner

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Vs.

U.K. ( 172 Eur. Ct H.R.(Ser.A, p.5)(1990). The

Inter-

American Commission on Human Rights has found a

similar

linkage (Yanomani Indians Vs. Brazil) ( Inter-

Amer.C.H.R. 7615 OEA/Ser.L.V/II/66 Doc.10 rev. 1

(1985). The Commission found that Brazil had violated

the Yanomani Indians' right to life by not taking

measures to prevent the environmental damage. The

Philippine Supreme Court dealt with the action against

Government not to continue licensing agreements

permitting deforestation so that the right to a

'balanced and healthful ecology in accordance with the

rhythm and harmony of nature' is not affected. (

Minors

Opasa Vs. Department of Environment and Natural

Resources ( 33, I.L.M. 173)(1994). The judgment was

based on 'intergenerational responsibility'. In

Fundepublico Vs. Mayor of Bugalagrande & Ors. , the

Constitutional Court of Columbia ( 17.6.1992) held in

favour of the right to healthy environment as a

fundamental human right and treated the right as part

of

customary international law. The Court permitted

popular

action mechanism. The Supreme Court of South Africa,

in

a recent case in Wildlife Society of Southern Africa &

Ors. Vs. Minister of Environmental affairs and

Tourism

of the Republic of South Africa and Ors. (

Dt.27.6.1996)( 1996(9) BCLR 1221 (Tk); 1996 SACLR

LEXIS

30) dealt with the right to healthy environment.

About

60 nations since 1990 have recognised in their

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constitutions a right to a healthy environment as a

corollary duty to defend the environment. ( Columbia

Journal of Environmental Law, ibid PP.318-319).

Thus, the concept of a healthy environment as a

part of the fundamental right to life, developed by

our

Supreme Court, is finding acceptance in various

countries side by side with the right to development.

Events after 27.1.99 judgment:

We shall now refer to the events subsequent to our

order dated 27.1.99. They are as follows:

The question is whether in the event of the

seventh respondent being permitted to establish its

industry within 10 Kms. of the lakes -

notwithstanding

the Government's policy to the contrary and the

refusal

of the appellant Board to grant NOC - there is

likelihood of serious pollution to the drinking water

in

these lakes. This Court in its judgment dated 27.1.99

referred the said question to the National

Environmental

Appellate Authority ( constituted under the National

Environmental Appellate Authority Act, 1997) for its

opinion. The said authority visited the site of the

industry at Peddashpur village near Hyderabad and

submitted a detailed and exhaustive report to this

Court, after receiving oral and documentary evidence.

The Report went against the seventh respondent

industry.

The industry filed objections to the said Report.

When the matter was thereafter heard, the seventh

respondent industry relied upon an order passed by the

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appellant-Board on 16.7.97, suggesting that if certain

safeguards were provided by the industry to prevent

pollution, NOC could be granted. The said order had

to

be passed at one stage by the Board because of the

direction of the Government of Andhra Andhra contained

in an order granting exemption from the 10 KM rule.

Before this Court heard arguments on the merits on

the question of validity of the exemption granted by

the

Government, this Court wanted to first ascertain -

without prejudice to the contentions of the parties -

whether the precautions which were suggested by the

appellant Board on 16.7.97 pursuant to the directive

of

the State Government would be adequate and whether any

further precautions were to be taken. The limited

question relating to adequacy or otherwise of the

"safeguards" as stated above was then referred to

another expert body, namely, the University Department

of Chemical Technology, ( Autonomous), Matunga,

Bombay,

headed by Prof. D.N. Bhowmick. It was stated in the

said

order of this Court that Prof. Bhowmick could take

the

assistance of the National Geophysical Research

Institute, Hyderabad (hereinafter called the 'NGRI').

Thereafter, Dr. Bhowmick submitted his Report

dated 16.8.2000 together with a report of June 2000

furnished by the NGRI, Hyderabad. In as much as the

Reports - particularly, that of NGRI- had gone against

the 7th respondent - industry, it again filed

objections

thereto.

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We then finally heard learned Additional Solicitor

General of India, Sri R.N. Trivedi for the appellant

Board and of Sri P.S. Narasimha for the writ

petitioner

(respondent 1) who supported the appellant and Sri A.

Subba Rao, learned counsel for the 7th respondent-

industry. Thus, we have now the Report of the

National

Environmental Appellate Authority, the Report of Dr.

Bhowmick, ( Bombay) and the Report of the National

Geophysical Research Institute, (NGRI) Hyderabad.

Basic facts leading to the grant of exemption:

We may now refer to certain basic facts. The

Ministry of Forests and Environment, Union of India

issued a Notification dated 27.9.88 listing various

industries as hazardous and included them in a 'Red'

list. Item 37 of the said list of hazardous

industries

is the industry which produces 'Vegetable oils

including solvent extracted oils'. The above

notification was expressly stated to be issued by the

Government of India in exercise of its powers vested

under the Water (Prevention and Control of Pollution)

Act, 1974, the Air (Prevention and Control of

Pollution)

Act, 1981 and the Water (Prevention and Control of

Pollution) Cess Act 1977 and the Environment

(Protection) Act, 1986, directing that whenever any

industry sought consent from the Pollution Control

Boards, the said Boards, "while processing the consent

application, should decide, keeping in view the

pollution - causing potential of the industry, as to

which category the industry belongs."

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Consequent to the directive of the Union

Government the State of Andhra Pradesh initially

issued

notification in GO 192 dated 31.3.94 (Municipal

Administration). Therein, the State Government relied

upon the interim report of an Expert Committee of the

Hyderabad Metropolitan Water Supply and Sewerage

Board,

called HMWSSB), and prohibited industries being

located

within 10 K.M. of the two reservoirs.

In spite of the prohibition contained in GO 192

dated 31.3.94 prohibiting industries within 10 KM. of

the reservoirs, the seventh respondent industry

purchased land of 12 acres on 26.9.95 in Peddashpur

village situated on the outskirts of Hyderabad, within

10 KM of the reservoirs. Initially, the industry

applied for consent from the appellant Board in

November

1995, through the Industries Department of the State

Government. The State of Andhra Pradesh, by letter

dated

28.11.95, wrote to the Government of India on

28.11.95,

recommending grant of letter of intent in relaxation

of

10 K.M. rule, subject to the industry obtaining NOC

from

the appellant Board. On 9.1.96, Government of India

gave

letter of intent but required the industry to obtain

No

Objection Certificate from the environmental authority

of the State.

At that stage, the Government re-affirmed the 10

K.M. prohibition in GO 111 dated 8.3.96, after

obtaining the second interim report of the HMWSSB.

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Consequent thereto, in the pre-scrutiny by the Single

Window Clearance Committee Meeting of the Pollution

Control Board held on 24.5.96, the application of the

industry stood rejected because of the 10 K.M.

prohibition.

Undeterred, the industry proceeded to obtain

permission from the Gram Panchayat on 31.5.96 for

establishing a 'factory'. Even though, on 31.5.96 the

Commissioner of Industries, specifically informed the

industry that it should better select an alternative

site, instead of heeding to the said advice, the

industry obtained permission of the District Collector

on 7.9.96 for change of land use from agricultural to

non-agricultural use. It then proceeded to execute

various civil works in spite of the 10 k.m.

prohibition

rule.

Thereafter, the Industry proceeded further with

construction of civil works and then applied to the

appellant Board on 7.4.97 under Section 25 of the

Water

Act for permission to establish the factory. One of

the

bye-products mentioned in the said application was:

"Glycerine, spent bleaching earth and carbon and spent

nickel catalysts".

On 1.6.97, the appellant Board wrote to the

Commissioner of Industries that the industry would be

generating 'nickel' catalyst and other pollutants

which

could find their way to the lakes either directly or

indirectly. Even the solid waste such as activated

carbon bleaching earth and sodium sulphate might find

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entry during rainy season from the storage yard

resulting in polluting to lakes.

In spite of the said opinion of the appellant

Board, the Commissioner of industries, in his letter

dated 6.6.97 stated that there would be no liquid

effluent or acidic fumes and that the limited aqueous

effluent was totally bio-degradable and the solid

wastes

were disposable.

On 25.6.97, the appellant Board once again

rejected the application of the industry inasmuch as

the

said industry was in the 'Red' list annexed to the

Notification dated 1.2.89 of the Ministry of Forests &

Environment, Government of India.

Confronted with the above problems, the industry

approached the State Government on 24.6.96 seeking

exemption from the 10 k.m. rule contained in GO.111

dated 8.3.96 on the ground that it had invested huge

amounts to establish the industry and that it had

almost

completed the civil works, and had purchased machinery

and installed the same. The State Government, in

spite

of the prohibitory directions issued by it earlier,

issued GO. 153 dated 3.7.97 granting exemption from

GO

111 dated 8.3.96 on the ground that the Government of

India had issued letter of intent on 9.1.96, that the

Commissioner of Industries, in his letter dated 6.6.97

opined that there would be no liquid effluents and

that

the solid wastes would be disposable. Government then

granted exemption stating as follows:

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"The Government had considered the matter in its

entirety and feel that if proper control over treatment of

aqueous and solid wastes is exercised, then there can be no

objection to setting up of the industry under reference at

the proposed site".

The Government then directed the Board to prescribe

conditions for treatment/disposal of aqueous/solid

waste.

Compelled by the above direction, the appellant Board

passed an order on 16.7.97 requiring various

precautions

to be taken by the industry. (In fact, after 8.3.96,

Government of Andhra Pradesh issued GO 181 dated

7.8.1997 modifying GO 153 dated 3.7.97 and clarifying

that the exemption granted did not relate to para (1)

of GO 111 but related only to para 3(f)), that para

being the one which related to the 10 K.m.

prohibition.

Meanwhile, the Society for Preservation of

Environment and Quality Life ( SPEQL) filed W.P.

16969/97 for quashing the exemption order in GO 153

dated 3.7.97 and obtained stay on 25.7.97.

The appellant-Board stuck to its decision to

refuse NOC. On 30.7.97, it finally rejected the

application for NOC relying upon GO 111 dated 8.3.96

and also upon the Government of India's notification

dated 1.2.89 which showed this type of industry in its

'Red' list. The Board stated that it was not

desirable

to locate such an industry in the catchment area in

view

of GO. 111 dated 8.3.96. It also referred to the

fact

that earlier the Board had already rejected the NOC on

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24.5.96 at the pre-scrutiny level.

Aggrieved by the order of rejection dated 30.7.97

of the appellant Board, the seventh-respondent

industry

filed appeal under Section 28 of the Water Act, 1974

before the appellate authority. For the first time,

in

the said appeal, it filed an affidavit of Prof. M.

Santappa, ( a former Vice Chancellor) who was the then

Scientific Officer of the Tamil Nadu Pollution Control

Board. The said opinion was in favour of the

industry.

By order dated 5.1.98, the appellate authority

(presided over by a retired Judge of the A.P. High

Court) allowed the appeal and set aside the orders of

the Board. It held that the categorisation into 'Red'

as

made by the Government of India on 1.2.89 was

applicable

only to the industries set up in the Doon valley. It

relied on the affidavit of Prof.M.Shantappa to the

affect that the industry had adopted the latest

technology which was eco-friendly and that the

Chairman

of the Board of Directors of the industry was

Dr.Siddhu,

formerly Director General of CSIR, that the technology

was obtained by the industry from the Indian Institute

of Chemical Technology, Hyderabad (IICT) which issued

a

certificate that the industry will not discharge any

acidic effluents and solid wastes, and that they could

be collected in M.S.Drums mechanically. The appellate

authority referred to Dr. Santappa's report which

stated

that none of the bye products would fall on ground and

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that the conditions laid down by the Technical

Committee

of the appellant Board on 16.7.97 would be fulfilled.

There would be no liquid effluents or acidic fumes as

certified by IICT. The nearest spread would be 8.5

Kms.

There was no possibility of seepage into the

reservoirs.

The appellate authority also held that principle of

'promissory estoppel' applied inasmuch as permission

for change of land-use was given and permission to

erect

factory was also given. It was brought to the notice

of

the said appellate authority that under the Water Act,

long before the State Government issued the

prohibiting

notification, there was an earlier categorisation

dated

27.9.88 made by the Government of India showing

'Vanaspati Hydegenerated vegetable oils for industrial

purposes' in the red category. Even so, the appellate

authority allowed the appeal of the 7th respondent

filed

under Section 28 of the Water (Prevention and Control

of

pollution) Act, 1974 and directed NOC to be issued by

the appellant.

Writ petition 2215/98 was a PIL case filed

for quashing the order dated 5.1.98 of the appellate

authority. The said writ petition and the writ

petition

of SPEQL ( WP. 16969/97 already referred to) and the

W.P. 11803/98 filed by the respondent-industry

seeking

mandamus against the appellant Board for grant of NOC,

were all disposed of by the High Court on 1.5.98,

upholding the orders of the appellate authority and

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directing grant of NOC by the appellant.

The present appeals have arisen out of the said

judgment. We first rendered the judgment dated

27.1.99

as stated earlier. We have already set out the

subsequent facts relating to the reference made by

this

Court to the National Environmental Appellate

Authority

on the main point relating to pollution and also to

its

report dated 25.6.99. Further, we have said that this

Court then made a further reference by order dated

5.5.2000 to the University-Department of Chemical

Technology, Bombay and the latter submitted its Report

dated 16.8.2000 together with Report of National

Geophysical Researach Institute, Hyderabad of June,

2000.

The following points arise for consideration:-

(1) Whether, in view of Sub-section 2(b), 3(2) and 5

of the Environment (Protection) Act, 1986 and the

notification issued by the Central Government on

27.9.88

and the further notification issued by the State

Government on 31.3.94 and 8.3.96 as delegate of the

Central Government, totally prohibiting location of

following industries in an 'area', it was permissible

for the State Government to issue an exemption on

3.7.97

for an individual hazardous industry within the area,

even if it be by way of asking the industry to provide

safeguards?

(2) Whether, in view of Sub-sections 2(e), 2(k), 17,

18

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and 19 of the Water (Prevention and Control of

Pollution) Act, 1974, if the State Government had

issued

notification totally prohibiting polluting industries

in

the area, and if the State Pollution Board had

rejected

the request for location of a polluting industry

within

the area, it was permissible for the Government to

grant

exemption for a single industry within the prohibited

area?

(3) Whether in the light of the Reports of (a) the

National Environment Appellate Authority, New Delhi,

(b)

the University Department of Chemical Technology,

Bombay

and (c) the National Geophysical Research Institute,

Hyderabad, the 7th respondent industry could claim

exemption from the 10 KM. prohibition and whether

such

an exemption could have been granted?

(4) Whether in spite of the prohibition contained in

Section 25 of the Water (Prevention & Control of

Pollution ) Act, 1974 that industries should not be

established without consent of the appellant-Board,

the

seventh respondent could have proceeded with

establishing the industry and could plead equities or

rely on the principle of promissory estoppel?

(5) On the question of establishment of 'Environmental

Courts', to what extent, the States and Union

Territories have taken steps to have environmental

scientists/experts in the various environmental

tribunal

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or appellate bodies, as directed in the earlier

judgment?

(6) To what relief?

Points 1 and 2:

It is necessary first to refer to the following

provision of the Environment (Protection)Act, 1986.

Under Section 2(b), 'environmental pollution'

means any solid, liquid or gaseous substance present

in

such concentration may be, or tend to be, injurious to

environment. Section 2(e) defines 'hazardous

substance'

as any substance or preparation which, by reason of

its

chemical or physio-chemical properties or handling, is

liable to cause harm to human being, other living

creatures, plants, micro-organism, property or the

environment. Section 3 refers to the extensive

process

of the Central Government to take measures to protect

and improve environment. Sub-clause (2) permits

measures

to be taken ( see clause (v)) by imposing

"restriction of areas in which industries, operations

or processes or class of industries, operations or processes

shall not be carried out or shall be carried out subject to

certain safeguards."

Section 5 deals with the power of the Central

Government, to issue directions to any person, officer

or any authority and such person, officer or authority

shall be bound to comply with such conditions.

Explanation to Section 5 clarifies that the said power

to issue directions includes the power to direct:

"(a) the closure, prohibition or regulation of any

industry, operation or process; or

(b) stoppage or regulation of the supply of

electricity or water or any other service."

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The notification of the Central Government dated

27.9.1988 (Ministry of Forests and Environment) was

issued expressly in exercise of powers of the Central

Government under the Environment (Protection) Act,

1986

the Water (Prevention and Control of Pollution) Act,

1974 and the Air (Prevention and Control of Pollution)

Act, 1981. It stated that industries were being

classified in lists 'Red, Orange and Green' and that

"when an industry seeks consent from the Pollution

Control Board, as required by the above Acts, the

Board

which processing the consent application should

decide,

keeping in view the pollution causing potential of the

industry, as to which category, the 'environmental

safeguards' should be determined". This is a general

notification. Item 37 in the red list refers to an

industry producing 'vegetable oils including solvent

extracted oil'. No doubt, the subsequent notification

dated 1.2.1989 as pointed by the appellate authority

under Section 28 related to red category industries

for

the Doon Valley and was issued under Section 3(2)(v)

of

the Environment (Protection) Act, 1986 and Rule

5(3)(d)

of the Environment (Protection) Rules, 1986 for the

purpose of restricting industrial units in Doon

Valley.

Even assuming that notification dated 1.2.99 did not

apply to Andhra Pradesh, the notification dated

27.9.88

and the State Government's notification in GO 111

dated

8.3.96 are sufficient for the present purposes.

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As pointed out in para 2(c) of the Rejoinder

affidavit of the appellant-Board, the power to issue

directions under Section 5 of the Environment

(Protection) Act, 1986 and its Environment

(Protection)

Rules, 1986 were amended in 1988 (S.O. 152-E) were

delegated to the State of Andhra Pradesh in 1988 in

S.O.

152-E. The said notification reads as follows:

"S.O.No.152(E) dated 10.2.1988: In exercise of the

powers conferred by Section 23 of the Environment

(Protection) Act, 1986 the Central Government hereby

delegates the powers vested in it under Section 5 of the act

to the State Governments of Andhra Pradesh, Assam, Bihar,

Gujarat, Haryana, Himachal Pradesh, Karnataka, Kerala,

Madhya Pradesh, Mizoram, Orissa, Rajasthan, Sikkim and Tamil

Nadu subject to the condition that the Central Government

may revoke such delegation of powers in respect of all or

any one or more of the State Government or may itself invoke

the provisions of Section 5 of the Act, if in the opinion of

the Central Government such a course of action is necessary

in public interest."

The State of Andhra Pradesh could therefore issue

orders in GO 111 dated 8.3.96 prohibiting the location

of industries in specified areas.

In our view, GO 192 dated 31.3.1994 and GO 111

dated 8.3.1996 are therefore referable to the said

delegated authority permitting the State Government to

impose "total prohibition" of polluting industries to

be

located within 10 Kms. of the two reservoirs. The

notification dated 31.3.1994 prohibited any polluting

industries, Major Hotels, residential colonies or

other

establishments that generate pollution in the

catchment

areas of these two lakes within 10 Kms radius from the

full tank level. The appellant Board and the MD of

the

Hyderabad Water Supply and Sewage Board, the HUDA and

the Collector of three Districts, Mehboobnagar, Ranga

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Reddy and Hyderabad were directed to scrupulously

protect the water in the two lakes from imminent

danger

of pollution. GO 111 dated 8.3.1996 (Municipal

Administration and urban Development Department)

issued

in modification of GO 192 dated 31.3.1994 re-iterated

the same prohibition as follows in clause 3(f). It

stated:

"3(i): To prohibit polluting industries, major

hotels, residential colonies or other establishments that

generate pollution in the catchment of the lakes up to 10

Kms., from full tank level of the lakes as per list in

Annexure I.

3(e): To prohibit pollution industries within 10

Kms., radius (in both on upstream and down stream side of

the lakes to prevent acidification of lakes due to air

pollution.

3(f): There shall be total prohibition of location of

industries in the prohibited zone."

The above notification was issued after approval by

the

Chief Secretary or the Chief Minister. Item 38

thereof

refers to Peddashpur Village, which is within 10 KM of

these two reservoirs.

As stated earlier, on 3.7.1997, the State

Government (Industries and Commerce) Department issued

notification granting "exemption" from the 10 KM rule

mentioned in GO 111 dated 8.3.96 later amended by GO

181

dated 7.8.1997 as exempting para 3(f) of GO 111 and

directed A.P.Pollution Control Board:

" to prescribe conditions for treatment/ disposal of

aqueous/solid wastes."

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The result of exemption from the purview of para 3(f)

of GO.111 dated 8.3.96 was that the seventh respondent

industry could be located within 10 KM of the lakes.

The

question is whether this exemption can be valid ?

Under Section 3(2)(v) above extracted, the Central

Government or the State Government as its delegate,

could issue directions as permitted by Section 5. Now

Section 3(2)(v) permits restriction specifying "areas"

in which industrial operations or processes shall not

be

carried out or shall be carried out subject to certain

safeguards. The notification issued by the State

Government in GO 111 dated 8.3.96 falls within the

first

part i.e. where industries shall not be carried out.

This is a total prohibition within 10 KM of the two

reservoirs. When such a prohibition was in force, the

State Government could not obviously grant any

exemption

to a specified industry like the seventh respondent,

located within the 'area'. Nor was it permissible for

the State to direct the appellant-Board to prescribe

conditions for grant of NOC.

Coming to the provisions of the Water Act, 1974,

it is clear that in view of Sub-sections 2(e), 2(k)

read

with Sections 17 and 18 of the Water Act, the

fundamental objective of the statute is to provide

clean

drinking water to the citizens. Having laid down the

policy prohibiting location of any industries within

10

Kms under GO 111 dated 8.3.1996, the State could not

have granted exemption to the 7th respondent industry,

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nor to any other industry, from any part of the main

GO

111 dated 8.3.96. Section 19 permitted the State to

restrict the application of the Water Act, 1974 to

particular area, if need be, but it did not enable the

State to grant exemption to a particular industry

within

the area prohibited for location of polluting

industries. Exercise of such a power in favour of a

particular industry must be treated as arbitrary and

contrary to public interest and in violation of the

right to clean water under Article 21 of the

Constitution of India.

The above reasoning given by us does not mean

that exemption can be given to all industries within a

particular radius of the reservoirs unmindful of the

possible danger of pollution to the lakes. In fact,

exemption granted even to a single major hazardous

industry may itself be sufficient to make the water in

the reservoirs totally unsafe for drinking water

purposes. Government could not pass such orders of

exemption having dangerous potential, unmindful of the

fate of lakhs of citizens of the twin cities to whom

drinking water is supplied from these lakes. Such an

order of exemption carelessly passed, ignoring the

'precautionary principle', could be catastrophic.

Therefore, the GO 153 dated 3.7.97 granting

exemption must be held to be without statutory backing

and also wholly arbitrary and violative of Article 21.

Points 1 and 2 are decided against the 7th respondent.

Point 3:

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In our earlier judgment in A.P. Pollution Control

Board (I) Vs. Prof. M.V. Nayudu and Ors. ( 1999(2)

SCC

718), this Court had occasion to refer to the basis of

the precautionary principle and to explain the basis

and

content of the very principle. This Court also

explained

the new principle of burden of proof.

Therefore, it was for the 7th respondent industry

to establish that there would be no danger of

pollution

to the two reservoirs even if the industry was

established within 10 Km radius of the said

reservoirs.

In the present proceedings, the 7th respondent has

failed to discharge the said onus.

Before the State Government, the industry produced

no expert opinion except to say that it had got the

new

technology from the Indian Institute of Chemical

Technology, Hyderabad ( IICT) and it relied on a

statement of Dr. Siddhu, Chairman of the 7th

respondent

and formerly Director General of CSIR. The affidavit

of

Dr. Santappa was produced only before the appellate

authority under Section 28 of the Water Act, 1974.

But, in the light of the subsequent reports now

obtained by this Court, the position is quite clear.

We

shall now refer in some detail to the three exhaustive

reports furnished by the National Environmental

Appellate Authority, New Delhi (NEAA), Dr. Bhowmick

of

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Bombay and the NGRI.

(A) Report of National Environmental Appellate

Authority, New Delhi (NEAA):

The said authority was presided over by a retired

Judge of the Supreme Court of India, Sri Justice N.

Venkatachala.

The NEAA framed two points (a) and (b):

(a) (i) Is the respondent-industry a hazardous

industry or?

(ii) What is the pollution potentiality of the

respondent industry, taking into account, the nature of the

products, its effluents and its location?

(iii) Whether the operation of the industry is likely

to affect the sensitive catchment area resulting in

pollution of the Himayat Sagar and Osman Sagar lakes

supplying drinking water to the twin cities of Hyderabad and

Secunderabad?

On point (a)(i), it noticed that the industry is

to use, among 12 major items, - 70 Kgs. of nickel

based

catalyst ( Pellets) per day and that the raw material

is

to be stored atleast for 30 days. It observed that

according to Chapter 8.0 of NFPA, Hazard

classification,

the raw materials used by the industry are serious

health hazards, highly inflammable and re-active at

elevated temperatures and pressures. Four items,

Nickel,

Ammonia, Methanol and Hydrochloric Acid are used in

the

process. After referring to the various plants and

processes, the NEAA referred to the provisions of the

Factories Act ( as amended in 1987) and Section 2 (cb)

defining 'hazardous processes and Schedule I thereof

in

which item 25 refers to 'extraction of oils and fats

from vegetable and animal sources" as hazardous

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processes. It referred to Rule 2(h) of the

'Manufacture,

Storage and Import of Hazardous Chemicals Rules, 1989'

issued under the Environment (Protection) Act, 1986.

It

referred to the provisions in the Environment

(Protection) Act, Section 2(e), 2(f) and 2(d). It

agreed

that merely because an industry is hazardous does not

by

itself debar it but then Section 8 of that act would

come into play. It answered question (i) in the

affirmative that the industry is hazardous.

On point a(ii), it referred to the definition of

'pollution' in section 2(c) of the Water Act, section

2(f) which defines 'sewage effluent' and section 2(k)

which defines 'trade effluent' and observed that the

'pollution potential' of the industry was to be

assessed. After referring to the effluents -

Commercial

Castor oil, Bleaching earth, Activated carbon, Nickel

catalyst, Hyflo supercel, Sulphuric Acid, Caustic

Soda,

Methanol, Calcium Oxide, Alum - in all 1463 MTs per

month and noticed that the monthly requirement of 3

Hydrogen was 76 500 NM. As the industry is coal based,

large quantity coal is required. It would produce

huge

quantities of BSS, HCO, HSA, Methyl, Fatty acids,

Epoxidise, Glyceren etc. Hydroxy Stearic Acid, methyl

Hydroxy Stearic Acid and methanol are serious health

hazardous. Items in part II list of Schedule I to the

'Manufacture, Storage and Import of Hazardous

Chemicals

Rules, 1989' are the raw materials and RW2 ( Dr. G.S.

Siddhu) in his evidence agreed that these are

hazardous

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( toxic) chemicals. The solid effluents generated

every

day are (i) spent bleaching earth 1250 Kgs, (ii) spent

bleaching carbon 250 kgs, (iii) spent nickel catalyst

45

kgs. and (iv) sodium sulphate 3820 Kgs. (12-HSA) and

170

kgs. ( from CME). Monthly turn out of effluents will

be

400 MT. Every day 55 kgs. of nickel is consumed.

Every

day, 27,830 litres of water are to be used and

normally

the effluent will carry all these hazardous

substances,

including nickel. 'As it is said that the water used

could be re-used for cultivation of lands in the

premises of the industry, the toxic chemicals which

get

lodged in the surface layers of the soil will flow

down

in storm run offs or percolate into the ground water,

to

ultimately reach the water body of the two reservoirs.

The NEAA further stated that Dr.Santappa in his

evidence as RW-1 made admissions regarding gaseous

effluents - - fly ash, SO CO Oxides of Nitrogen,

Oxides of Sulphur and suspended particulate matter.

The

solid and liquid effluents could reach the lakes

through

seepage. The factory cannot be located in the

catchment

area because run-offs due to rain will carry hazardous

material along surface and through seepage. The NEAA

adverted to the 'Drainage Basic Analysis' by the

Central

Ground Water Board, to the effect that the Basin "has

moderate run-off and moderately high permeability of

the

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terrain. As such the amount of infiltration is

considerably high". The said Report shows that

rainfall

in 796 mm ( heaviest being 1326 mm) and there is every

likelihood of the solids being "transported down along

the gradient". The said Report of Central Ground

Water

Board, referred to "dolerite dykes" in the vicinity

and

the possibility of flow even more. Having regard to

the

location of the dyke and the speed and angle, the

polluted water could reach Himayat Sagar which is

hardly

2 m bgl. since the dam height is 1763.50 feet.

Satellite

maps of NSRA were also examined and relied for this

purpose. Among the substances stored are nickel,

sulphuric acid, HCA, which are well-known 'hazardous'

substances.

The NEAA pointed out that the 'Engineering

Package' provided by the IICT to the industry (

Ex.p.29)

as found in the agreement with the IICT, "does not

refer

at all to the nature of pollutants to be generated in

this industry or to the methods adopted to control

them,

as asserted by RW2". The NEAA pointed out that in

fact

clause 17(5) of Annexure IV to the agreement stated

that

'the scope of supply (engineering package) does not

include design of effluent treatment system'. On this

ground the article in IICT Bulletin ( Ex.R 1) was

rejected by the NEAA.

The NEAA also referred to the Report of the three

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man Technical Committee of the Andhra Pradesh

Pollution

Control Board consisting of Dr. J.M. Dave ( PW 3)

and

that "accidents and human failure are the most

probable

causes for spillage and it is unrealistic to give a

'zero spillage', and specially to their report on

'nickel' and held that the respondent industry has

high

pollution potentiality under issue a(ii).

The NEAA, then took up issue (b) as to the

likelihood of the industry affecting the sensitive

catchment area. It referred to the Expert Committee

Report of the HMWSSB and its recommendations which led

to the issuance of the GO 192 dated 31.3.94 and GO 111

date d8/.3.96. The NEAA concluded that the

"establishment of any chemical industry, carries with

it, the imminent dangers of the chemicals or chemical

effluents polluting the water of Himayat Sagar and

Osman

Sagar.

Thus, the exhaustive Report of the NEAA has gone

against the 7th respondent industry.

(B)Report of Bombay University Department of Chemical

Technology headed by Dr. Bhowmick:

The Department of Chemical Technology, Bombay

University, in its Report dated 16.8.2000 have gone

into

the other aspects as to what should be the safeguards

to

be taken by the industry if the appellant-Board's

letter dated 16.7.97 is to be applied. Dr. Bhowmick

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suggested that 'No nickel catalyst whether present in

any solid waste or in any solution be allowed to spill

on floor/ground. The process should not emit gaseous

harmful vapours. Adequate and ready safety measures

must

be made available for accidental leakage/spillage

situations. They then gave six suggestions - storage

tanks to be surrounded by bunds; that it is not

advisable to use hydrochloric acid but sulphuric acid

may be used. Again, accidental leakage of ammonia

will

be catastrophic. Alternately, hydrogen gas may be

brought in cylinders. He expressed doubts about plate

and frame filter press or of leaf filters. Quantity

of

methanol stored should not exceed more than a week's

requirement. The floor washing water should pass

through

oil traps and then properly treated in an effluent

treatment plant. If salt and ionic impurities are not

removed, it may produce ground water contamination.

(C)Report of National Geophysical Research Institute,

Hyderabad

Finally, the NGRI, Hyderabad has given a very

detailed and exhaustive report about "IMPACT OF DYKE".

They conducted (i) field investigations, (ii)

Hydrogeological studies, (iii) Geophysical

investigation, (iv) Electric Resistivity investigation

(v) Magnetic survey and (vi) Tracer studies. The

Report

is a voluminous one.

The final conclusion after an exhaustive analysis

of various types of data "from results of multi-

parameter investigations carried out in the area, is

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that hydraulic connectivity exists across the dolerite

dyke located between Chouderguda and Sirsilmuktha

facilitating the ground water movement.....In the post

monsoon scenario, the groundwater tabel will go up and

thereby may result in more groundwater flow across the

dyke.

Our conclusion on the basis of these Reports:

In the light of the above exhaustive scientific

Reports of the National Environmental Appellate

Authority, New Delhi the Department of Chemical

Technology, Bombay University and the National

Geophysical Research Institute, Hyderabad - it cannot

be

said that the two lakes will not be endangered. The

package of the IICT - which did not deal with the

elimination of effluent effects, the opinion of Dr.

Santappa, the view of Director of Industries, and the

view of the Government of Andhra Pradesh must be held

to

be base on insufficient data and not scientifically

accurate.

It is no doubt stated by the 7th respondent that

it is prepared to adopt the safety measures suggested

by

the appellant Board on 1.7.97 and also those suggested

by Dr. Bhowmick, by trying to see that during storage

of

raw materials and after release of the hazardous

liquids, they are put in containers and removed.

In respect of these drinking water -reservoirs

which cater to the needs of about 70 or 80 lakhs

population, we cannot rely upon a bare assurance that

care will be taken in the storage of serious hazardous

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materials. Nor can we rely on an assurance that these

hazardous substances would be effectively removed

without spillage. It is, in our view, not humanly

possible for any department to keep track whether the

pollutants are not spilled over. This is exactly

where

the 'precautionary principle' comes into play. The

chance of an accident, within such close proximity of

the reservoirs cannot be ruled out, as pointed out in

the Reports. Thus, we are led to the inference that

there is a very great risk that these highly hazardous

material could seep into the earth and reach the

tanks,

after passing through the dolerite dykes, as pointed

by

the National Geophysical Research Institute. Our

inference from facts and the reports is that of a

reasonable person, as pointed out in the main judgment

in A.P. Pollution Board Vs. Prof. M.V. Nayudu.

On the basis of the scientific material now

obtained by this Court from three highly reputed

sources, this is certainly not a fit case for

directing

grant of NOC by the Pollution Control Board. It is

not

also possible to hold that the safeguards suggested by

the appellant Board - pursuant to the direction of the

Government dated 3.7.97, will be adequate, in the

light

of the Reports. We therefore hold that in the facts

of

this case, the Board could not be directed to suggest

safeguards and there is every likelihood that

safeguards

could fail either due to accident, as stated in the

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report, or due to human error. We, therefore, hold on

point 3 against the 7th respondent-industry.

Point 4:

This point deals with the principle of promissory

estoppel applied by the appellate authority, on the

ground that once building permission and permission

for

change of land use were granted, the appellant Board

could not refuse NOC. The learned Additional

Solicitor

General, Sri R.N. Trivedi referred to the amendment

to

Section 25(1) in this connection.

Under Section 25 (1) of the Water (Prevention and

Control of Pollution) Act, 1974 as it original stood,

sub-section (1) thereof read as follows:

"Section 25(1): Subject to the provisions of this

section, no person shall, without the previous consent of

the State Board, bring into use any new or altered outlet

for the discharge of sewage or trade effluent into a stream

or well or begin to make any new discharge of sewage or

trade effluent into a stream or well".

By Central Act 53/1988, the sub-section was amended

and

reads as follows:

"Section 25(1): Subject to the provisions of this

section, no person shall, without the previous consent of

the State Board - (a) establish or take any steps to

establish any industry, operation or process, or any

treatment and disposal system or any extension or addition

thereto, which is likely to discharge sewage or trade

effluent into a stream or well or sewer or on land ( such

discharge being hereafter in this section referred to as

discharge of sewage) or (b) bring into use any new or

altered outlet for the discharge of sewage, or (c) bring to

make any new discharge or sewage....."

After the amendment, the prohibition now extends even

to 'establishment' of the industry of taking of steps

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for that process and therefore before consent of the

Pollution Board is obtained, neither can the industry

be

established nor any steps can be taken to establish

it.

The learned Additional Solicitor General of India,

Sri Trivedi is right in contending that the 7th

respondent industry ought not to have taken steps to

obtain approval of plans by the Gram Panchayat, nor

for

conversion of land use by the Collector, nor should it

have proceeded with civil work in a installation of

machinery. The action of the industry being contrary

to

the provisions of the Act, no equities can be claimed.

The learned Appellate Authority erred in thinking

that because of the approval of plan by the Panchayat,

or conversion of land use by the Collector or grant of

letter of intent by the Central Government, a case for

applying principle of "promissory estoppel" applied to

the facts of this case. There could be no estoppel

against the statute. The industry could not therefore

seek an NOC after violating the policy decision of the

Government. Point 4 is decided against the 7th

respondent accordingly.

Point 5:

In this Court's earlier judgment dated 27.1.99,

this Court referred to the need for constituting

environmental Courts, tribunals, or appellate bodies

comprising of environmental scientists/experts as

members. We had then referred to the need to

constitute

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Environmental Courts as done in New South Wales in

Australia. In this Court's earlier judgment,

responses

of various States and Universities were called for in

this behalf. Some States & Union Territories have

responded but several have not responded.

We may in this connection refer to the recent

report entitled 'Environmental Court Project'

published

on 18.2.2000 by a Research team at the Department of

Land Economy, University of Cambridge, UK, headed by

Prof. Malcoum Grant. (See Journal of Planning and

Environment, May, 2000 p.453 titled 'The use for

Environmental Courts'). The aim of the team was to

explore the concept of an Environmental Court in the

light of the experience in other jurisdictions and in

Australia and New Zealand in particular. The concepts

referred to in the Report are

(a) a specialist and exclusive jurisdiction;

(b) a power to determine merits appeals;

(c) vertical and horizontal integration, by this is

meant a wide environmental jurisdiction which integrates

both subject matter and different types of legal

proceedings;

(d) hall marks of a Court or tribunal;

(e) dispute resolution powers, it is pointed out that

this Court extend to disputes over the formu- lation of

policy as well as more traditional adjudication;

(f) expertise, the members would be specialist in

environmental matters;

(g) access, there would be broad rights of access to

the Court;

(h) informality of procedures - such as the use of

alternative dispute resolution procedures;

(i) costs - this is linked to the need for access and

involves means of overcoming the problem of high costs

crihibifing access; or

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(j) capacity for innovation.

The Report puts forward a proposal for a two-tier

Environmental Court. The Court would have

jurisdiction

and powers including judicial review and civil

procedure

powers while dealing with environmental matters.

Inasmuch as most of the statutes dealing with

Environment are by Parliament, we would think that the

Law Commission could kindly consider the question of

review of the environmental laws and the need for

constitution of Environmental Courts with experts in

environmental law, in addition to judicial members, in

the light of experience in other countries. Point 5

is

decided accordingly.

Point 6:

Learned counsel for the seventh respondent

referred to the existence of several other industries

within the 10 k.m. radius of the two reservoirs,

which

have been granted permission earlier. According to

him,

these industries are also polluting industries. In

our

view, the Environmental (Protection) Act, 1986 and the

Water Act, 1974 and the Air Act, 1981 have enough

provision applicable not only to new industries

proposed

to be established but also to existing industries.

The State of Andhra Pradesh is therefore directed

hereby to identify these industries located within 10

K.M. radius of these two lakes and to take action in

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consultation with the A.P.Pollution Control Board to

prevent pollution to the drinking water in these two

reservoirs. The State and the Board shall not permit

any polluting industries within the 10 k.m radius. A

report shall be submitted to this Court by the State

of

Andhra Pradesh in this behalf within four months from

today, in regard to the pollution or pollution

potential

of industries, if any, existing within 10 K.M. of the

lakes. After the Report is received, the matter may

be

listed. Point 6 is decided accordingly.

In the result, the appeal is allowed, the

judgment of the High Court and the order of the

appellate authority under section 28 of the Water Act,

1974 are set aside and the order of the appellant

Board

refusing permission to the seventh respondent under

section 25 of the Water Act is restored.

Before parting with the case, we acknowledge the

excellent Reports submitted to this Court by the three

expert bodies on the basis of scientific/technological

research of a very high order. The amount of hard

work

done by these three bodies is commendable. But for

these expert reports it would have been very difficult

for this Court to resolve the complicated scientific

issues involved in this case, with confidence. It

will

be open to the three expert bodies (1) National

Environmental Appellate Authority, New Delhi (2) The

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University Department of Chemical Technology

(Autonomous), Matunga, Bombay headed by Dr. Bhowmick

and

(3) The National Geophysical Research Institute,

Tarnaka, Hyderabad, to submit their list of expenses

or

fee, if any, to the State of Andhra Pradesh, through

the

appellant Board. If any claims for monies are made,

the

same shall be paid by the State of Andhra Pradesh.

Appeals are allowed as stated above. No costs.

List the matter after 4 months, after the Report

of the State of Andhra Pradesh as directed above, is

received.