Environmental Clearance Violation: Supreme Court Imposes Fine on Builder for Unauthorized Expansion
The case of Keystone Realtors Pvt. Ltd. vs. Shri Anil V Tharthare & Ors. is a significant Supreme Court ruling on environmental regulations and compliance with the Environmental Impact Assessment (EIA) Notification, 2006. The case revolved around a builder’s failure to obtain proper environmental clearance before expanding a residential project in Mumbai. The Supreme Court upheld the National Green Tribunal’s (NGT) decision, imposing a fine and directing remedial measures.
Background of the Case
The case arose when Keystone Realtors Pvt. Ltd., a real estate developer, initiated a residential redevelopment project, known as the ‘Oriana Residential Project’ in Bandra East, Mumbai. The developer obtained an initial Commencement Certificate on June 8, 2010, to build a structure covering 8,720.32 square meters. However, the developer later expanded the construction area to 32,395.17 square meters, exceeding the 20,000 square meters threshold that required prior environmental clearance under the EIA Notification, 2006.
The developer subsequently applied for Environmental Clearance (EC), which was granted on May 2, 2013. Later, the construction area was again increased to 40,480.88 square meters. The builder sought an ‘amendment’ to the previous EC rather than applying for fresh environmental clearance.
Key Legal Issues
The Supreme Court had to decide:
- Whether the builder’s expansion constituted an ‘expansion’ under the EIA Notification, 2006.
- Whether the amendment granted to the EC without proper environmental assessment was valid.
- Whether a penalty of Rs. 1 crore imposed by the NGT was justified.
- Whether remedial measures should be enforced on the project.
Arguments by the Appellant (Keystone Realtors Pvt. Ltd.)
The developer contended:
- The increase in the construction area was only ‘marginal’ and did not constitute an ‘expansion’ requiring a new EC.
- The SEIAA (State Level Environment Impact Assessment Authority) correctly granted an amendment to the original EC.
- There was no significant environmental impact from the expansion.
- The fine imposed by the NGT was excessive and arbitrary.
Arguments by the Respondents (Residents and Environmental Activists)
The respondents argued:
- The expansion exceeded the 20,000 square meters threshold under the EIA Notification, requiring a new EC.
- The SEIAA should have followed proper environmental impact assessment procedures before approving the amendment.
- Failure to comply with environmental regulations could lead to severe ecological damage.
- The penalty imposed by the NGT was justified as the developer violated environmental laws.
Supreme Court’s Observations and Ruling
The Supreme Court bench, comprising Dr. Dhananjaya Y Chandrachud and Ajay Rastogi, ruled in favor of the environmental authorities and upheld the penalty.
1. Unauthorized Expansion Required Fresh Environmental Clearance
The Court emphasized that any increase in construction beyond 20,000 square meters required a fresh EC under the EIA Notification.
“The increase in construction area, even if termed as ‘marginal’ by the appellant, falls within the definition of an ‘expansion’ under paragraph 2 of the EIA Notification.”
2. Non-Compliance with EIA Procedures
The Court noted that the amendment to the EC was granted without the required assessment.
“The SEIAA failed to assess the environmental impact of the expanded project. Granting an amendment without following the prescribed process renders the clearance legally untenable.”
3. Upholding the Rs. 1 Crore Penalty
The Court upheld the NGT’s decision imposing a fine of Rs. 1 crore on the developer.
“The penalty serves as a deterrent against future violations of environmental laws. Developers must ensure compliance before undertaking construction.”
4. Remedial Measures Required
The Supreme Court also upheld the NGT’s direction for remedial measures to mitigate the environmental impact of the unauthorized expansion.
Final Judgment
The Supreme Court ruled:
“The appeal is dismissed. The penalty of Rs. 1 crore imposed by the NGT is upheld. The expert committee appointed by the NGT shall continue its assessment and ensure remedial measures are implemented.”
Implications of the Judgment
This ruling has significant implications for environmental regulation and real estate development:
- Strict Compliance with EIA Notification: Developers must secure proper environmental clearance before expanding projects.
- Penalties for Non-Compliance: The judgment sets a precedent for imposing fines on builders who violate environmental norms.
- Role of the NGT: The Court reaffirmed the role of the NGT in enforcing environmental compliance.
- Remedial Measures are Mandatory: Unauthorized projects must undertake corrective actions to mitigate environmental harm.
Conclusion
The Supreme Court’s ruling in Keystone Realtors Pvt. Ltd. vs. Shri Anil V Tharthare & Ors. strengthens the enforcement of environmental laws in India. By upholding the penalty and requiring remedial measures, the judgment sends a strong message that violations of environmental regulations will not be tolerated.
Petitioner Name: Keystone Realtors Pvt. Ltd..Respondent Name: Shri Anil V Tharthare & Ors..Judgment By: Justice Dhananjaya Y Chandrachud, Justice Ajay Rastogi.Place Of Incident: Mumbai, Maharashtra.Judgment Date: 03-12-2019.
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