2026 INSC 455

1

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 2881 OF 2021

NEETU SOLVENTS APPELLANT(S)

VERSUS

VINEET NAGAR & ORS. RESPONDENT(S)

WITH

CIVIL APPEAL NO. 4432 OF 2021

TOPNOTCH TRADING CORPORATIO N

PVT. LTD. APPELLANT(S)

VERSUS

VINEET NAGAR & ORS. RESPONDENT(S)

WITH

CIVIL APPEAL NO. 4431 OF 2021

D.C. INDUSTRIES APPELLANT(S)

VERSUS

VINEET NAGAR & ORS. RESPONDENT(S)

WITH

CIVIL APPEAL NO. 4654 OF 2021

BANKE BIHARI OVERSEAS

PVT. LTD. AND ORS. APPELLANT(S)

VERSUS

VINEET NAGAR & ORS. RESPONDENT(S)

REPORTABLE

2

WITH

CIVIL APPEAL NO. 4748 OF 2021

DEE BEE ORGANICS PVT. LTD APPELLANT(S)

VERSUS

VINEET NAGAR & ORS. RESPONDENT(S)

WITH

CIVIL APPEAL NOS. 4902 -4903 OF 2021

M/S GOYAL OVERSEAS AND ORS. APPELLANT(S)

VERSUS

DASTAK NGO AND ORS. RESPONDENT(S)

WITH

CIVIL APPEAL NO. 4908 OF 2021

GURUJI OVERSEAS AND ANR. APPELLANT(S)

VERSUS

VINEET NAGAR AND ORS. RESPONDENT(S)

J U D G M E N T

J.K. MAHESHWARI , J.

1) In all these appeals, the appellants are the industries, and

running the manufacturing units of Formaldehyde, its different resins

3

(including melamine formaldehyde, urea formaldehyde and phenol

formaldehyde) in the States of Rajasthan and Haryana. In Civil Appeal

No.2881 of 2021, Civil Appeal No.4432 of 2021, Civil Appeal No.4431

of 2021 and Civil Appeal No.4748 of 2021 the units are situated in State

of Rajasthan while in Civil Appeal No.4654 of 2021, Civil Appeal

No.4908 of 2021 and Civil Appeal No.4902-4903 of 2021 the units are

situated in State of Haryana.

2) Three Original Applications were preferred, being O.A. No.

298/2020 (Vineet Nagar v. CGWA), O.A. No. 287/2020 (Dastak N.G.O.

v. Synochem Organics Pvt. Ltd. & Ors.) and O.A. No. 840/2019 (Ayush

Garg v. Union of India) before the National Green Tribunal, Principal

Bench, New Delhi (for brevity ‘NGT’). In those original applications, it

was contended that the units of formaldehyde manufacturing have

been established and are operating without prior Environmental

Clearance (for brevity ‘EC’).

3) The NGT decided all the said original applications on 03.06.2021,

albeit by three different orders. The main order was passed in the case

of O.A. No. 287/2020 (Dastak N.G.O.) wherein it was directed that

formaldehyde manufacturing units cannot be allowed to operate

without prior EC. In O.A. No. 298/2020 (Vineet Nagar), the appellants-

units herein were arrayed as respondents, and it was decided on the

same date relying upon the directions issued in the case of Dastak

4

N.G.O by NGT.

4) The manufacturers of formaldehyde units, being aggrieved by the

order of the NGT, have filed the present appeals. On 30.07.2021, this

Court was pleased to issue notice and as an interim measure, stayed

the operation of the order impugned. It is pertinent to note that C.A.

No. 4795/2021 being Pahwa Plastics Private Limited and Anr. v.

Dastak NGO and Ors.

1

dealing with two units was filed against the

order dated 03.06.2021 passed by the NGT in O.A. No. 287/2020 of

Dastak N.G.O (for brevity ‘Dastak N.G.O’). Initially, the present appeals

were clubbed with Pahwa Plastics (supra), however later, only the

case of Pahwa Plastics (supra) was decided vide judgment dated

25.03.2022, allowing the appeals filed by the manufacturing units. In

the said judgement, this Court observed that the industrial units

therein was established and operating on the basis of a valid Consent

to Establish (for brevity ‘CTE’) and Consent to Operate (for brevity

‘CTO’) granted by the Pollution Control Board (for brevity ‘PCB’) of the

concerned States. It was further held that the unit cannot be closed

merely on account of technical irregularity for want of prior EC, when

the PCB itself was not aware of the applicability of EC for such units.

In consequence, the order of NGT was set aside with direction to

continue the operation of the units.

1

(2023) 12 SCC 774.

5

5) At this stage, it will not be out of place to refer to the judgement

of this Court dated 16.11.2025 in Vanashakti v. Union of India

2

(hereinafter ‘Vanashakti judgement’) where challenge was laid to two

Office Memorandums (for brevity ‘OM’) issued by the Ministry of

Environment, Forests and Climate Change (for brevity ‘MoEF&CC’) in

2017 and 2021. The OM dated 14.03.2017 was applicable to projects

or activities that had started work on site, expanded production beyond

the limit of the EC or changed the production mix without obtaining

EC, ex-post facto clearance could be granted. However, this OM was

only applicable to projects or activities that had commenced prior to

14.03.2017 and provided a limited window of six months for eligible

applicants, which was later extended to 13.04.2018. The OM dated

07.07.2021 came to be issued after the NGT directed the MoEF&CC

vide order dated 24.05.2021 to prepare a Standard Operating

Procedure for granting EC in cases of any violation. This Court in the

Vanashakti judgement, while relying on Common Cause v. Union of

India

3, Alembic Pharmaceuticals v. Rohit Prajapati

4 and

Elecctrosteel Steels Ltd. v. Union of India

5

held that ex-post facto EC

is alien to the Indian environmental jurisprudence and struck down

2

2025 SCC OnLine SC 1139.

3 (2017) 9 SCC 499.

4

(2020) 17 SCC 157.

5

(2023) 6 SCC 615.

6

the OMs dated 14.03.2017 and 07.07.2021 as being illegal. In doing

so, this Court concluded as follows: –

“20. Moreover, the 2017 notification is completely in violation of the

law laid down by this court in the case of Common Cause

2

and

Alembic Pharmaceuticals

3

. From the recitals of the 2017

notification, it is apparent that it was a one-time measure to protect

those who were in violation as on the date of the 2017 notification.

In view of the settled law, even a ‘one-time measure’ or ‘one-time

relaxation’ was illegal. The 2021 OM encourages the entities who

contributed to pollution by not obtaining prior EC. Whenever EC is

granted, it is always conditional. Certain conditions are imposed to

abate or reduce the pollution. Such one-time measures add to air

and/or water pollution. Such measures infringe the right to live in

a pollution free environment guaranteed by Article 21. Thus, the

2017 notification was completely illegal.

XXX

23. Apart from the fact that the very concept of grant of ex-post

facto EC is illegal, it is not possible to understand why the Central

Government made efforts to protect those who committed illegality

by not obtaining prior EC in terms of the EIA notification. As the EIA

notification was eleven years old when the 2017 notification was

issued, there was no equity in favour of those who committed such

gross illegality of not obtaining prior EC. The persons who acted

without prior EC were not illiterate persons. They were companies,

real estate developers, public sector undertakings, mining

industries, etc. They were the persons who knowingly committed

illegality. We, therefore, make it clear that hereafter, the Central

Government shall not come out with a new version of the 2017

notification which provides for the grant of ex-post facto EC in any

manner.

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29. …Therefore, what is done by the 2021 OM is something which

was completely prohibited by this Court in the cases of Common

Cause

2

and Alembic Pharmaceuticals

3

. It is an attempt to bring in

an ex-post facto or retrospective regime by craftily drafting the SOP.

The grant of EC under the 2021 OM in substance and in effect

amounts to ex post facto grant of EC. The Court must come down

very heavily on the attempt of the Central Government to do

something which is completely prohibited under the law. Cleverly,

the words ex post facto have not been used, but without using those

words, there is a provision to effectively grant ex post facto EC. The

2021 OM has been issued in violation of the decisions of this Court

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in the cases of Common Cause

2

and Alembic Pharmaceuticals

3

.

Therefore, we have no manner of doubt that the 2021 OM which

permits grant of EC is completely arbitrary and illegal. Moreover,

the 2021 OM does not refer to exercise of any power under the 1986

Act or the 1986 Rules.

XXX

31. The EIA notification is of 14th September 2006. When the 2021

OM was issued, it was nearly 15 years old. Therefore, all project

proponents were fully aware of the stringent requirements under

the EIA notification. The 2021 OM seeks to protect the violations of

the EIA notification which have taken place or continue to take place

15 years after the EIA notification came into force. Thus, the 2021

OM seeks to protect violators who have acted with full knowledge

of consequences of violating the EIA notification. Those who violate

the law regarding obtaining prior EC are not only committing gross

illegality, but they are acting against the society at large. The

violation of the condition of obtaining prior EC must be dealt with

heavy hands. In environmental matters, the Courts must take a

very strict view of the violations of the laws relating to the

environment. It is the duty of the Constitutional Courts to do so.”

6) The Vanashakti judgement was assailed seeking recall in Review

Petition (C) Diary No. 41929/2025 being Confederation of Real

Estate Developers of India (CREDAI) v. Vanashakti and Another

6

(hereinafter ‘Vanashakti Review judgement ’). The said Review Petition

was heard by a three-Judge Bench of this Court wherein Chief Justice

B.R. Gavai, as he then was, concluded as under: –

“95. Further, the judgments of this Court in the cases of D. Swamy

(supra) and Pahwa Plastics Private Limited (supra) were not

brought to the notice of this Court.

XXX

121. As already discussed hereinabove, the JUR though considers

some of the paragraphs of Common Cause (supra), Alembic

Pharmaceuticals Limited (supra) and Electrosteel Steels Limited

(supra), various relevant paragraphs of these judgments which

would have had a direct bearing on the JUR had not been brought

6

2025 SCC OnLine SC 2474.

8

to the notice of this Court and accordingly not considered by this

Court. Apart from that, the law laid down in JUR is totally in conflict

with the law laid down in D. Swamy (supra) and Pahwa Plastics

Private Limited (supra).

XXX

140. I am in complete agreement with the aforesaid observations

of this Court in the case of Bindu Kapurea (supra), to the effect that

demolition of the projects already completed would rather than

being in public interest would result in throwing the valuable public

resources in dustbin.”

In concurring opinion, Justice K. Vinod Chandran opined as follows: –

“8. The balanced approach, in the wake of admitted violations,

taken in Common Cause & Alembic, have been completely lost

sight of, by the judgment under review. The judgment under review,

with due respect did not look into the aspects of the power conferred

under the Environment Protection Act and the legal principles

regarding an undertaking given in derogation of the statutory

provisions. The judgment under review failed to notice the decision

in Electrosteel in its entirety and its attention was not drawn to

Pahwa and D. Swamy. It is one thing to find Electrosteel, Pahwa

and D. Swamy per-incuriam in the original proceeding, which

would have restrained a review on that ground; but quite another

to reject the prayer for review on the ground that though not noticed

or referred to, those decisions are per incuriam; which still is a valid

ground for review for not having been considered. I fully concur with

the opinion of the Learned Chief Justice of India and find the review

to be not only warranted, but imperative and expedient.”

7) Mr. Nidhesh Gupta, Learned Senior counsel for the appellant-

units claimed and urged that the units were set up on the basis of CTE

and CTO granted by the concerned PCB and started operations. At that

stage, the PCB itself was unaware of the requirement of prior EC to run

the manufacturing units of formaldehyde. However, when CTE and

CTO were granted, it would mean that the PCB was satisfied qua

establishment and operation of the units, and hence, the requirements

9

of law as sought by PCB were complied with. As such, the appellant-

units started their operations and continued manufacturing. They have

also claimed that the units are totally ‘non-polluting’ having ‘zero trade

discharge’, which is also incorporated in the CTE and CTO granted to

them.

8) After establishment and starting operations by the units of

formaldehyde, the PCB has considered the applicability of the

provisions of the Environment Impact Assessment notification dated

14.09.2006 (for brevity ‘EIA 2006 notification’) issued by the

Government of India. It was communicated vide Office Order dated

19.08.2019 issued by the Rajasthan PCB that CTE and CTO pending

for any unit in the State of Rajasthan shall be considered after

submission of EC under the EIA 2006 notification. It was also informed

that the units to which CTE and CTO were granted shall be asked to

apply for EC as soon as possible and submit proof of such application

within sixty days.

9) Similarly, with respect to the units situated in the State of

Haryana, the Haryana PCB issued an Office Order dated 10.11.2020

directing the operational units to apply for EC and submit proof within

sixty days.

10) The units of the appellants, either situated in Rajasthan or

Haryana, applied within the stipulated period and submitted the proof.

10

Thereafter, operation of such units was challenged by filing the three

original applications indicated above, wherein the impugned order was

passed by NGT in O.A. No. 287/2020 (Dastak N.G.O.) allowing the same

on account of not having prior EC. The other two original applications

wherein the appellant-units affected were decided by relying upon the

order in the case of Dastak N.G.O. The judgment of NGT in Dastak

N.G.O was assailed before this Court in Pahwa Plastics (supra) and

was set aside by this Court. Learned Senior counsel for the appellant-

units submits that the judgment of NGT in Dastak N.G.O. has been

relied upon by the appellants and on account of the same having been

set aside, therefore, similar directions may be issued in the present

appeals by applying the ratio of the judgement in Pahwa Plastics

(supra) delivered by this Court.

11) Learned Senior counsel explaining the parity in the case of the

appellant-units as well as of Pahwa Plastics (supra) contended that

the CTE and CTO were granted by the respective PCBs, since it was not

aware of the requirement of prior EC, and therefore, directed the units

to apply for the same within the stipulated time in order to continue

operation. As such, the factual situation being similar in the present

appeals, therefore, direction issued by NGT to close the appellant-units

by relying upon the judgment of Dastak N.G.O. is not justified.

11

12) In order to further advance such position, he has referred various

paragraphs of the judgment in Pahwa Plastics (supra) to submit that

this Court has considered all the aspects in detail while issuing

direction to obtain ex-post facto EC and in the meantime, continue

running the units. Reference was further made to OM dated

07.07.2021 issued by the MoEF&CC , which was challenged in the

Vanashakti judgement and on account o f order dated 02.01.2024

passed by this Court, the operation of the said OM has been stayed.

The said challenge was later allowed by the Vanashakti judgment dated

16.05.2025, thereby striking down the OM dated 07.07.2021. The

Review Petition filed against the said judgement was allowed by the

three-Judge Bench in the Vanashakti Review judgement on

18.11.2025, and so, the delay in grant of ex-post facto EC was due to

pendency of the above litigation.

13) At this stage, it was further contended that grant of EC involves

four steps viz. Screening, Scoping, Public Consultation and

Appraisal. Out of these, the first two steps i.e., Screening and Scoping

are already complete in the case of appellant-units. The Terms of

Reference (for brevity ‘TOR’) also stand granted and there is no

requirement of Public Consultation since most of the units are situated

in a Notified Industrial Estate, and so, step three is also over. It is only

the last stage i.e., Appraisal which is left, and the same was stalled

12

because of the above referred litigation. In addition, it is contended that

the judgment of Pahwa Plastics (supra) still holds the field and the

three-Judge Bench in the Vanashakti Review judgement has

acknowledged its ratio. Learned Senior counsel has urged that these

appeals be allowed on similar lines and permission to obtain ex-post

facto EC be granted, while allowing the units to run in the meantime.

Countering the arguments of the respondents’ counsel in respect of OM

dated 07.07.2021, he has contended that such argument is fallacious

in view of the judgment of Pahwa Plastics (supra) and the Vanashakti

Review judgement.

14) Per contra, Mr. Ankit Jain, learned Senior counsel appearing for

the Original Applicants submitted that while the judgment in Pahwa

Plastics (supra) was delivered, it impressed the mind of this Court on

the ground that due to closure of industry, approximately 8000 workers

would be affected, and so, the said judgement was pronounced to save

adverse impact on public employment and public purpose. It was

submitted that in the appellant-units, 10-15 workers are employed,

therefore, ratio of the said judgment cannot be made applicable.

Learned Senior counsel is unable to dispute the factual aspect of

granting CTE, CTO and TOR; but it is urged that in view of the OM

dated 07.07.2021, prior EC was essential, and the judgment in the case

of Pahwa Plastics (supra) may not apply as precedent as it was based

13

on incorrect information supplied to the Court.

15) Learned counsel representing the respective PCBs submit that

CTE and CTO has rightly been granted to the appellant-units. On

examining the issue as per EIA 2006 notification, the appellant-units

were directed to apply for EC for the earliest and submit proof within

sixty days. In compliance, the appellants-units have applied for grant

of EC within the time frame, but the same remained pending because

of the Vanashakti judgment. It is said that the delay in grant of EC has

occurred till decision in Vanashakti Review judgment which is at the

stage of appraisal, however, possibility to grant EC permission at the

earliest may not be ruled out.

16) Ms. Archana Pathak Dave, learned Additional Solicitor General

appearing for the Union of India has submitted that the issue herein

has been dealt with in the case of Pahwa Plastics (supra), and at

present, the said judgment holds the field. It is not disputed by her that

the judgment impugned in the present appeals has been passed solely

relying upon the judgment of NGT in Dastak N.G.O, which stands set

aside by judgement of this Court in Pahwa Plastics (supra). It is

further urged that looking at the peculiar facts of this case wherein the

EC was sought after establishment of the units, the present appeals

may be decided by issuing appropriate direction in the light of the

applicable precedent.

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17) After hearing learned counsel for the parties at length and in the

wake of arguments as advanced, it is necessary to examine whether the

judgment dated 03.06.2021 rendered by NGT in the case of Dastak

N.G.O. and challenged before this Court in Pahwa Plastics (supra),

and further relied upon to decide the other two original applications

wherein the appellant-units were arrayed as respondents, was without

independently appreciating the facts of each individual unit. The

answer to the said issue is clear as day as the said judgment of NGT

has been set aside in Pahwa Plastics (supra). With an intent to

appreciate the ratio of the judgment of Pahwa Plastics (supra), certain

paragraphs are relevant, hence, produced as under: –

“22. By Communication No. HSPCB/Consent/ : 2846616YAMCTE

3087415 dated 2-6-2016, the Haryana State Pollution Control

Board (HSPCB) granted consent to establish (CTE) to Appellant 1

M/s Pahwa Plastics Pvt. Ltd. in respect of its Yamuna Nagar Unit.

The CTE was to remain valid for 60 months from the date of its

issue, to be extended for another year at the discretion of the Board

or till the time the unit started its trial production, whichever was

earlier.

XXX

24. By another Communication No. HSPCB/Consent/ :

2846618YAMCTO3098246 dated 26 -3-2018, HSPCB granted

consent to Appellant 1 to operate its Yamuna Nagar unit from 8-2-

2018 to 31-3-2022.

XXX

28. It is the case of the appellants that at the time when CTE was

granted to the appellants, it was thought that EC was not required

for units which manufactured formaldehyde. Even HSPCB itself

was not sure of whether EC was required for such units.

XXX

15

37. The appellants duly applied for EC in respect of their

manufacturing units. After scrutinising their applications and after

finding the units suitable for grant of EC in terms of the prevailing

guidelines, the Expert Appraisal Committee constituted by the

MoEF&CC conducted a public hearing to finalise the cases of the

appellants for issuance of Terms of Reference (ToR).

XXX

40. The SOP formulated by the said Office Memorandum dated 7-

7-2021 refers to and gives effect to various judicial pronouncements

including the judgment of this Court in Alembic Pharmaceuticals

Ltd. v. Rohit Prajapati [Alembic Pharmaceuticals Ltd. v. Rohit

Prajapati, (2020) 17 SCC 157] .

XXX

49. The appellants have already applied for EC. The Expert

Appraisal Committee of the MoEF&CC has, after scrutinising the

application of the appellants and finding them eligible for grant of

EC, recommended their cases for grant of Terms of Reference (ToR).

ToR was granted to the appellants and a public hearing had also

been conducted. Only last procedural step of issuance of EC is left.”

From the above paras, it is clear that the PCB granted CTE to

Pahwa Plastics and thereafter, Haryana PCB granted CTO to the

Yamuna Nagar unit. When CTE & CTO were granted for manufacturing

of formaldehyde, even the PCB of Haryana was not firm that prior EC

was a requirement for such unit. In Pahwa Plastics (supra), the

appellant-units duly applied for EC, which remained pending. The

appellant-units have also applied for EC on asking and after

scrutinizing the applications, recommendations were made for TOR,

which came to be granted after conducting public hearing and only the

procedural step of issuance of prior EC after appraisal was left.

18) In view of the said factual findings, this Court concluded in

Pahwa Plastics (supra) as thus: –

16

“64. The question in this case is, whether a unit contributing to the

economy of the country and providing livelihood to hundreds of

people, which has been set up pursuant to requisite approvals from

the statutory authorities concerned, and has applied for ex post

facto EC, should be closed down for the technical irregularity of

want of prior environmental clearance, pending the issuance of EC,

even though it may not cause pollution and/or may be found to

comply with the required norms. The answer to the af oresaid

question has to be in the negative, more so when the HSPCB was

itself under the misconception that no environment clearance was

required for the units in question. HSPCB has in its counter-affidavit

before the NGT clearly stated that a decision was taken to

regularise units such as the Apcolite Yamuna Nagar and Pahwa

Yamuna Nagar Units, since requisite approvals had been granted

to those units, by the authorities concerned on the misconception

that no EC was required.

65. It is reiterated that the 1986 Act does not prohibit ex post facto

EC. Some relaxations and even grant of ex post facto EC in

accordance with law, in strict compliance with Rules, Regulations,

Notifications and/or applicable orders, in appropriate cases, where

the projects are in compliance with environment norms, is not

impermissible. As observed by this Court in Electrosteel Steels Ltd.

[Electrosteel Steels Ltd. v. Union of India, (2023) 6 SCC 615], this

Court cannot be oblivious to the economy or the need to protect the

livelihood of hundreds of employees and others employed in the

units and dependent on the units in their survival.

66. Ex post facto EC should not ordinarily be granted, and certainly

not for the asking. At the same time ex post facto clearances and/or

approvals cannot be declined with pedantic rigidity, regardless of

the consequences of stopping the operations. This Court is of the

view that the NGT erred in law in directing that the units cannot be

allowed to function till compliance of the statutory mandate.

67. Accordingly, the appeal is allowed. The impugned order

[Dastak N.G.O. v. Synochem Organics (P) Ltd., 2021 SCC OnLine

NGT 131] is set aside insofar as the same is applicable to the units

of the appellants established and operated pursuant to CTE and

CTO from the HSPCB in respect of which applications for ex post

facto EC have been filed. The respondent shall take a decision on

the applications of the appellants for EC in accordance with law

within one month from date. Pending decision, the operation of the

Pahwa Yamuna Nagar Unit and the Apcolite Yamuna Nagar Unit,

in respect of which consents have been granted and even public

hearing held in connection with grant of EC, shall not be interfered

with.

68. The appellants will be allowed to operate the units. Electricity,

17

if disconnected, shall be restored subject to payment of charges, if

any. If the application for EC is rejected on the ground of any

contravention on the part of the appellants, it will be open to the

respondents to disconnect the supply of electricity.

69. The Union of India had proceeded with the application for EC

and even public hearing had been held. Counsel appearing on

behalf of the Union of India contended that the appellant had not

submitted its final application for EC, after public hearing. It is not

clear what more was required of the appellants. Be that as it may,

the Union of India shall, within three working days from the date of

receipt of a copy of this judgment and order, inform the appellants

in writing of whether anything further is required to be done by the

appellants, and if so what is required to be done. The appellants

shall, within a week thereafter do the needful. The final decision on

the application of the appellants for EC shall be taken within three

weeks thereafter.”

19) Mr. Nidhesh Gupta, learned Senior counsel produced a

comparative chart indicating similarity in the case of appellant-units

with those involved in Pahwa Plastics (supra). In order to appreciate

the individual facts in each appeal, the detailed facts are referred below

for clear understanding in the succeeding sub-paragraphs: –

19.1) C.A.No.2881/21 (Neetu Solvents) – CTE was granted

on 17.06.2015 as being valid w.e.f. 30.04.2015 to 31.03.2018,

or commissioning of project whichever is earlier. As such, the

unit was established. CTO was granted on 05.05.2016, and

last renewed on 31.12.2023. Renewal for the same was applied

for on 16.08.2023. Referring various documents, it is

contended that such permission s are being granted on

subsequent date by applying retrospective operation.

18

Clarifying the status of EC, it was urged that the same was

applied for on 01.10.2019. After Screening and Scoping, TOR

was granted on 16.07.2021. In this case, Public Consultation

was exempted because the unit is situated in Industrial area.

19.2) C.A.No.4432/21 (Top Notch) – CTE was granted on

23.09.2014 having validity w.e.f. 09.09.2014 to 31.08.2017,

pursuant to which unit was established within the validity of

CTE. CTO was granted on 05.05.2016 and last renewed on

31.10.2023. Renewal for the same was applied for on

30.05.2023. Such renewal is being granted ex-post facto from

retrospective date. Similar is the position for EC, which was

applied for on 01.10.2019 after Screening and Scoping. TOR

was granted on 18 .03.2022 and Public Consultation is

exempted on account of the unit being in an industrial area.

19.3) C.A.No.4431/2021 (D.C. Industries) – CTE was

granted on 12.12.2014, having validity w.e.f. 09.09.2014 to

31.08.2017. Pursuant thereto, the unit was established within

the validity of CTE. Later, CTO was granted on 13.08.2015 and

last renewed till 30.09.2026, thus, the said CTO is valid till

now. With regard to EC, the same was applied for on

20.09,2019. After Screening and Scoping, TOR was granted on

19

22.07.2021. Public Consultation is exempted since the units

being run are in an industrial area.

19.4) C.A.No.4748/21 (Dee Bee Organics) – CTE was granted

on 26.11.1994 and the unit established within the validity

period. CTO was granted on 25.05.1996 and last renewed till

30.06.2026. EC was applied for on 04.10.2019. After

Screening and Scoping, TOR was granted on 18 .03.2022.

Public Consultation is exempted as the unit is situated in an

industrial area.

19.5) C.A.No.4654/21 consists of four units. Out of those, for

two units; CTE, CTO and EC have already been granted.

Details of the remaining two units are as under:

19.5.1) Gayatri Industries – CTE was granted on

11.12.2017, having validity from 11 .12.2017 to

10.12.2022. The unit was established within the validity of

CTE. Later, CTO was granted on 15.09.2018. last renewed

till 30.09.2030 and so, is presently in existence. The unit

applied for EC and after Screening and Scoping, TOR

granted on 08.04.2022. Public Consultation is exempted on

account of the unit being situated in an industrial area.

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19.5.2) Sanwaria Polymers – CTE was granted on

22.02.2009 and unit established within the validity. Later,

CTO was granted on 09.03.2017, last renewed till

30.09.2028 and is in existence at present. The unit applied

for EC on 13.05.2021 wherein after Screening and Scoping,

TOR was granted on 08.04.2022. Public Consultation for

the unit is exempted as it is situated in an industrial area.

19.6) C.A.No.4908/21 consists of two units:

19.6.1) Guruji Overseas – CTE was granted on

30.10.2018, with validity till 29.10.2023. The unit started

within the said period and later, CTO was granted on

05.07.2023. It was last renewed till 29.09.2026 and is

presently in existence. The unit applied for EC on

02.12.2020 and after Screening and Scoping, TOR was

granted on 15.03.2022. Public hearing was conducted on

11.07.2022 and only the Appraisal certificate remains to be

issued, which is pending due to the Vanashakti judgement.

19.6.2) Chemwood Industries – CTE was granted on

20.12.2018, with validity till 19.12.2023. The unit started

within the validity period and CTO was granted on

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05.07.2023. It was last renewed till 30.09.2026 and is in

existence at present. It applied for EC on 17.06.2021 and

after Screening and Scoping, TOR was granted on

20.07.2021. Public hearing was conducted on 02.02.2022

and only the Appraisal certificate remains to be issued,

which is pending because of the Vanashakti judgment.

20) Upon appraisal of the factual scenario with respect to the

appellants-units comparing with the case of Pahwa Plastics (supra)

we have no shadow of doubt in holding that the CTE and CTO were

granted to the appellants-units as well as those in Pahwa Plastics

(supra). In the said judgment, the judgment of NGT in Dastak N.G.O

was assailed, which has been set aside with direction as contained in

paragraphs 64 to 69 of Pahwa Plastics (supra). Since the judgment

assailed by the appellant-units in these appeals solely relies upon

Dastak N.G.O., in light of the same being set aside by this Court, the

inescapable conclusion which can be drawn is to apply the judgment

of Pahwa Plastics (supra) in the facts as discussed hereinabove.

21) Mr. Ankit Jain, learned Senior counsel for the original applicants,

relying on the contents of the affidavit filed by the appellant-units has

urged that though Section 25(7) of the Water (Prevention and Control

of Pollution) Act, 1974 (for brevity ‘Water Act’) provides for deemed

22

approval for CTO; in terms of Section 21(4) of the Air (Prevention and

Control of Pollution) Act, 1981 (for brevity ‘Air Act’) there is no

provision to grant deemed approval. He has made an attempt to

distinguish the language of the Air Act with Water Act to satisfy this

Court that in absence of deemed permission, CTO as indicated is

completely misplaced. It was also submitted that prior EC by complying

the OM dated 07.07.2021 the judgment of Pahwa Plastics (supra) is

necessary. At this stage, it is necessary to observe that the argument

of not receiving permission under the Air Act is for the purpose of

granting CTO. However, when CTO is not disputed by learned counsel

for the PCBs, being the relevant authority in this case, the issue of such

infraction is not germane and is hereby repelled.

22) Mr. Ankit Jain, learned Senior has laid much emphasis on

paragraphs 2 and 54 of the judgment in Pahwa Plastics (Supra) to

contend that the foundation of the said judgment was of affecting 8000

workers of the industry, therefore, the said judgment may not be

treated as precedent. In our view, the said argument is impressive at

first blush but not worthy of much credence for being relied on. While

it is true that in the unit of Pahwa Plastics, 10 to 15 employees were

working and is ascertainable from the counter-affidavit filed by the

Union of India, paragraphs 2 and 54 of the judgement in Pahwa

Plastics (supra), refer to 8000 employees. Since, one of us (Justice J.K.

23

Maheshwari) was a part of the said judgment, the intent of this Court

in Pahwa Plastic (supra) is required to be explained. While deciding

the said judgment, about 8000 employees were referred with respect to

all the manufacturing units of formaldehyde, including the appellant-

units, herein which had already started functioning after CTE and CTO,

and if closed, the employment of all those persons may be affected.

Therefore, the number 8000 referred in those paragraphs is not only

for Pahwa Plastics (supra), it includes employees of all manufacturing

units of formaldehyde running in the industrial area, and with the said

explanation, we repel his argument.

23) In view of the above, it is reiterated that after grant of CTE and

CTO by the respective PCB, the argument of not having valid

permission under Air Act is not germane and the infraction to grant

CTO based on such argument is not acceptable and has no

impediment. On assessing the cases of the appellant-units, on facts, it

is similar to that of the case of Pahwa Plastics (supra). The impugned

judgment in the other two original applications, passed by relying upon

the judgment of NGT in Dastak N.G.O. which has been set aside by this

Court in Pahwa Plastics (supra), therefore, having similarity of the

facts, the appellant-units deserve similar direction.

24) In the facts of the present case, it is necessary to emphasize that

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the units of the appellants are not at the stage of establishment or

starting operation. These are the units which, where established and

started operation based on CTE and CTO granted by the PCB of the

concerned State. Thereafter, the respective PCBs have examined the

EIA 2006 notification wherein it was found that formaldehyde

manufacturing units are covered under synthetic organic chemical

listed at Sr. No. 5(f) of the Schedule 1 of the notification and such being

the case, it was appropriate that the units which are in operation be

required to seek EC.

25) In this context notices were issued to the appellant-units by the

Rajasthan PCB and Haryana PCB vide Office Orders dated 19.08.2019

and 10.11.2020, respectively, to apply within for EC at the earliest and

submit proof of the same within 60 days. It is not disputed that the

appellant-units applied for EC within the stipulated time. After

submitting the application, the first two steps of Screening and Scoping

have been completed. TOR also stands granted. Since most of the units

are situated in industrial area, therefore, public consultation was not

found necessary. For two units , namely Guruji Overseas and

Chemwood Industries, public consultation is already complete and only

the fourth step of appraisal remains to be completed. It is also a fact

that two units i.e., Banke Bihari Overseas and G.B. Overseas Pvt. Ltd.,

which are appellants in this batch of appeals have been granted EC

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and are running their formaldehyde units. In such backdrop, it can

safely be concluded that ex-post facto EC is the right recourse taken on

the insistence of the respective PCB in order to rectify the mistake. In

terms of the said rectification, the appellants were duly noticed and

after all the necessary steps for grant of EC, only appraisal by the

MoEF&CC remains for consideration.

26) Therefore, the case in hand is not a one where the appellants

established the units of formaldehyde and started operation due to lack

of bona fide ignoring any requirement of law. On the contrary it is a

case where the PCBs were not aware that prior EC to establish and

operate such units is required in terms of EIA 2006 notification.

Accordingly, in terms of the notices issued by the PCBs, the appellants-

units have applied for grant of EC which remains pending. In our view,

the judgment of Pahwa Plastics (supra) squarely applies to the facts

of this case.

27) Accordingly, the direction of closure of the appellant-units by the

impugned orders of NGT stands set aside. The parties are directed to

apply the ratio of the judgment of Pahwa Plastics (supra) mutatis

mutandis and by allowing these appeals, following directions are

issued:-

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(i) The appellant-units, having been established and

operated pursuant to the CTE and CTO granted by the

PCB for the respective State, be allowed to function

and operate.

(ii) The respondent shall take a decision on the

applications of the appellant-units for EC in

accordance with law within one month, if not already

taken. Pending such decision, the operation of the

appellant-units shall not be interfered with, if not

otherwise required.

(iii) Electricity for the appellant-units, if disconnected,

shall be restored subject to payment of charges, if any.

If application for EC is rejected on grounds of any

contravention on part of the appellant-units, it will be

open to the respondents to disconnect the supply of

electricity and parties would be at liberty to take

recourse afresh.

(iv) The Union of India shall, within three working days

from the date of receipt of this judgement, inform the

appellant-units in writing whether anything further is

27

required to be done by them and if so, the required

steps be taken by the appellant-units within a week

thereafter and do the needful.

(v) Pending application(s), if any, shall stand disposed of.

….……….….…………………J.

[J.K. MAHESHWARI]

….……….….…………………J.

[ATUL S. CHANDURKAR ]

NEW DELHI;

MAY 06, 2026.