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BEFORE THE NATIONAL GREEN TRIBUNAL, NEW DELHI, (PRINCIPAL BENCH) APPEAL No. 10 of 2011 Hindustan Cocacola Beverages Pvt. Ltd. Raninagar Industrial Growth Centre, P.O. Patkata, P.O. Jalpaiguri, District,Jalpaiguri-735153. Appellant/Petitioner Versus 1.West Bengal Pollution Control Board, Department of Environment of West Bengal) Paribesh Bhawan, 10-A, Block LA, Sector-III, Salt Lake, Kolkata-700098. 2.Chief Engineer, Operation and Execution Cell, West Bengal Pollution Control Board, Paribesh Bhawan, 10-A, Block-LA, Sector-III, Salt Lake, Kolkata-700098. 3. Senior environment Engineer, W.M.C. & Member and Convener-Technical Cell, West Bengal Pollution Control Board, Paribesh Bhawan, 10-A, Block-LA, Sector-III, Salt Lake,Kolkata-700098. 4. Assistant Environment Engineer – In-Charge, West Bengal Pollution control Board Regional Office, “Paribesh Bhawan”, Paribahan Nagar, P.O. Matigara, Darjeeling-734010
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Respondent/s Counsel for Appellant: Shri Amit Sibal, Advocate alongwith Shri Paras Choudhary, Advocate Counsel for Respondents: Shri Soumya Chakraborty, Adovcate JUDGMENT PRESENT: Justice A.S. Naidu (Acting Chairperson) Dr. G.K. Pandey (Expert Member) ................................................................................................... Dated 19th March, 2012 ….…………………………………………………………………… JUDGMENT BY THE BENCH
1.
Appellant is a company incorporated under the provisions of the Companies Act, 1956 and is engaged in the business of manufacturing and sale of carbonated soft drinks under the brand name of Coca-Cola Sprite, Limca, Mazza, Thmps Up etc. and has a plant at Raninagar Industrial Growth Centre, P.S. and District Jalpaiguri, West Bengal.
2.
The directions issued by West Bengal Pollution Control Board (WBPCB) to the Appellant Company by letter dated
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2nd May, 2011 is sought to be assailed in this Appeal. By the said letter, WBPCB directed the Appellant Company as follows:
“a) The industry shall ensure continuous and smooth functioning of the pollution abatement system in all its unit operations and comply with the environmental standards. b) The industry shall submit an action plan for compliance of liquid effluent discharge standard within a time period of fifteen (15) days. The industry shall also install suitable infrastructure for testing of the liquid effluent samples so as to assess the characteristics of the discharged effluent. c) The industry shall submit a Bank Guarantee (proforma enclosed) of Rs. 5,00,000/-(Rupees five lakhs) only, valid for twelve (12) months within fifteen (15) days from the date of issuance of this Direction as an assurance to comply with the above directions. ”
The directions are impugned mainly on the following grounds: “i) The WBPCB had no power / jurisdiction to impose pollution cost or direct the Appellant to furnish a Bank Guarantee as penal measure.
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ii) The Appellant’s right of hearing was denied before issuance of the said directions, thus there was violation of principle of natural justice and equity. iii) The order is an after thought, and the same has no nexus with the last analysis report of the discharged effluent. In the alternative it is contended that the procedure prescribed under the Air Act and Water Act and Rules made there under were not followed by the WBPCB before imposing the fine/penalty.
3.
To appreciate the inter-se controversy it would be just
and proper to refer to some of the facts. The Appellant was granted consent under Section 25 and 26 of the Water (Prevention and Control of Pollution) Act, 1974 (Water Act) and Section 21 of the Air (Prevention and Control of Pollution) Act, 1981 (Air Act) by the WBPCB, for operating, a manufacturing and bottling plant at Raninagar Industrial Growth Centre, Jalpaiguri, on 19th September, 2000. The said consent was extended time and again in consonance with the provisions of both Water and Air Act.
4.
On 5th August, 2010, the WBPCB issued a notice for collection of samples from the Appellant’s plant. In consonance with said notice samples were collected by the officials of WBPCB from the premises of the Appellant’s plant on 6th
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August, 2010.
According to the Appellant the specific
procedure stipulated under Section 21 of the Water Act for collection of the samples were not followed, in as much as neither the samples were divided into two parts in the presence of the occupier or his agent of the Appellant nor they were sealed, nor the signature of the occupier or his agent was taken by the officers of WBPCB while collecting the samples. Another set of samples were also collected from the premises of the Appellant on 9th December, 2010. It is alleged, the said samples were also collected without following the mandatory procedure laid down in Section 21 of the Water Act. 5.
On 16th December, 2010, WBPCB on the basis of the analysis report of the samples which were collected on 6th August, 2010, & 9th December, 2010, issued a show-cause notice alleging violation of the regulatory standards, and called upon the Appellant to show-cause, and to take necessary steps to comply with the prescribed standards. The Appellant was also asked to inform the office, the action taken in that regard.
It is averred that necessary cause was shown by the
Appellant, within the time prescribed indicating the measures taken for eradicating the deficiencies.
WBPCB, on 29th
December, 2010 once again took samples from the Appellant’s plant and got the same analyzed. The analysis report dated 11th February, 2011 revealed that the samples collected on 29th December, 2010 were within the prescribed parameters.
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6.
While matter stood thus, on 14th February, 2011 the WBPCB
issued
another
notice
and
directed
personal
appearance of the Appellant before the Board, at Kolkata. In compliance with the said notice the Factory Manager of the Appellant Company it is stated, appeared before the Board and advanced his submissions and contended that no violation of the specified standards are committed. The grievance of the Appellant is that without properly appreciating the fact that the effluents of the plant satisfy / meet the standards prescribed and that there is no violation, the WBPCB mechanically issued the impugned order dated 2nd May, 2011 in purported exercise of the power conferred upon it under Section 33 A of the Water Act, and as such the said order cannot be sustained in law. 7.
After receiving the notice from this Tribunal, the Respondents appeared and filed detailed counter affidavit repudiating the stand taken in different paragraphs of the memorandum of appeal.
It is contended that WBPCB is
authorized to monitor statutory compliances of Industries operating in the State of West Bengal, with regard to different pollution Control Laws including Water and Air Act, as well as the rules framed there under. In usual course of business, officers of WBPCB inspected the premises of the Appellant’s Industry, after serving prior notice on 6th August, 2010 and 9th December, 2010. In course of such inspections, the officials collected samples of trade effluent in presence of competent representatives of the Appellant Industry.
It is emphatically
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contended that the samples, which were collected on 6th August, 2010, and 5th October, 2010 were divided and kept in bottles as per law and they were duly sealed and signed in presence of the representatives of the Appellant concern. Analysis of the samples so collected revealed
that the
Appellant industry was manufacturing its products in gross violation of the standards prescribed in the letter of “Consent to Operate” and consequently the Appellant was called upon to show-cause. After considering the cause shown, and on being satisfied that it is a fit case where necessary stringent directions should be issued, WBPCB directed the Appellant to pay pollution cost of Rs. 5,00,000/- (five lakhs) and also to submit a bank guarantee of Rs. 5,00,000/- (five lakhs) as an assurance to comply with the directions issued vide order dated 2nd May, 2011 in future. The action of the WBPCB, it is contended, was strictly in consonance with the provisions of the Water and Air Act and the submissions to the contrary are unfounded.
8.
The Appellant filed a rejoinder to the reply filed by the Respondent more or less reiterating the stands taken in the Memorandum of Appeal.
The Respondents also filed a
counter to the Rejoinder, denying the allegations leveled therein and in the Memorandum of Appeal. 9.
Mr. Sibal, Learned Counsel appearing for the Appellants, in course of arguments, took the stand that WBPCB lacked the
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power to impose penalty in the form of substantial amounts or direct to submit Bank guarantee as an assurance to comply with the directions issued either, under Section 33A or any other provisions of the Water Act, 1974. According to Mr. Sibal a pecuniary liability for non-compliance with any legal obligations can be imposed only by clear, unambiguous and express provisions of an enactment. In the case in hand, as there is no such express and unambiguous provision in the Water Act, WBPCB was not authorized or empowered to impose any sort of penalty, thus the directions issued by the impugned order
are in excess of the jurisdiction conferred
upon it and it is a fit case where the said order may be set aside. 10.
In support of his contentions, Mr. Sibal relied upon the
decision of the Supreme Court in the case of M/s Khemka & Co. (Agencies) Pvt. Ltd. Vs. State of Maharashtra (1975) 2 SCC 22, and of High Court in the case of Splendor Landbase Ltd. Vs Delhi Pollution Control Committee (DPCC) reported in 173 (2010) Delhi Law Times-52, Referring to Section 25 of the Water Act, it is submitted that the said Section empowers the Board to impose binding conditions upon an Industry who seeks consent to operate. Section 44, according to Mr. Sibal stipulates that whoever contravenes the provisions of Section 25 or Section 26 shall be liable to be punished with imprisonment for a term which shall not be less than one year and six months but which may extend to 6 years
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and with fine.
Similarly, Section 41 stipulates the penalty
which can be imposed in the event of any failure to comply with the directions issued under Section 20(2) or Section 20 (3) or orders issued under Section 32 (1) (c) or directions issued under Section 33 (2) or Section 33A of the Water Act. Placing reliance on Section 49 of the Water Act, it is submitted that only a Court which is not inferior to that of Metropolitan Magistrate or a Judicial Magistrate is empowered to try any offence punishable under the Act on the basis of complaint made by the Board or any other person.
No doubt Section
33A empowers the Board to give directions, but then the said directions have to be subject to the provisions of the Act. A cumulative reading of the different provisions of the Water Act, it is contended, leads to an irresistible conclusion that only a Metropolitan Magistrate or a Judicial Magistrate, has the power to impose penalty if the directions issued by the Board are contravened or violated. In view of the said clear position, it cannot be presumed that Section 33A over rides the provisions stipulated under Section 41, 44 and 49 of the Act. In other words, the Powers under Section 33A is circumscribed by other Provisions of the Water Act
11.
The expression “any direction” in Section 33A according
to Mr. Sibal cannot be extended to a stage which would make the provisions under Section 49 and other Sections otiose. In support of his submissions Mr. Sibal relied upon the decision of the Hon’ble Supreme Court in the case of Institute of
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Chartered Accountants of India Vs. Price Waterhouse (1997) 6 SCC 312 and the decision in the case of Union of India Vs Azadi Bachao Andolan and another (2004) 10 SCC 1.
12.
Questioning the propriety of the WBPCB, with regard to
the directions to submit Bank guarantee of Rs. 5,00,000/- (five lakhs), it is contended that the settled principal of law being that a penalty cannot be construed as punishment or commission of crime, no such direction can be issued under Section 33A of the Act.
In support of his submissions the
decision in the case of N.K. Jain and Ors. Vs C.K. Shah and Ors. (1991) 2 SCC 495, was relied upon. 13.
By way of alternative argument, Mr. Sibal, submitted
that even if for the sake of argument it is held that the WBPCB had power under Section 33A of the Water Act, the said power can be exercised only in consonance with the provisions of the Act and Rules or not at all. Drawing our attention to Rule 34 of the Water (Prevention and Control of Pollution) Rules, 1975, it is submitted that the Authorities had not complied with the mandatory requirements of the said Rules, in as much as before issuance of the impugned directions, the nature of action proposed to be taken and the time within which it should be complied with, was not intimated nor any show cause was called for with regard to the proposed punishment. Placing reliance on Sub Rule 5 of Rule 34 it is further submitted, that
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as no opportunity was granted to the Appellant to file a show cause / objection, impugned directions cannot be sustained. 14.
Mr. Soumya Chakraborty, Learned Counsel appearing
for WBPCB and other Respondents, countenancing the arguments advanced on behalf of the Appellant, submitted that the powers conferred upon WBPCB under Section 33A are very wide. The Section itself empowers WBPCB to issue any directions in exercise of its power and performance of its functions.
The directions issued under Section 33A are
compensatory in nature. Causing pollution and or harm to the environment leading to violation of the norms prescribed under the Act and Rules. The same being tortious acts, un-liquidated damages in the form of imposition of pollution cost/damages can be directed.
The directions issued to furnish a Bank
Guarantee were aimed to secure future observance of environmental norms and the same should not be construed as a penalty. Thus, according to Mr. Chakraborty, WBPCB acted in consonance with law and the submission to the contrary were unfounded. 15.
In support of his submission, several decision of
Supreme Court dealing with the principles of sustainable development,
precautionary
principle
and
polluter
pays
principle were relied upon. The polluter pays principle, it is submitted
is
the
ethos
of
international
environmental
jurisprudence in the matter of correcting a civil norm by award of cost / damages on a polluting industry. The core of the
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principle, derives from the fundamental proposition, that the person who generate pollution should bear the cost of abatement.
In order to further fortify his submissions, Mr.
Chakraborty relied upon following decisions of the Hon’ble Supreme Court:i)
Indian Council for Enviro Legal Action and Ors. vs. Union of India & Ors. (1996) 3 SCC 212.
ii)
Vellore Citizens’ Welfare Forum vs. Union of India & Ors. (1996) 5 SCC 647.
iii)
M.C. Mehta vs. Kamal Nath & Ors. (2000) 6 SCC 213.
iv)
Research Foundation For Science (18) vs. Union of India & (2005) 13 SCC 185
v)
Karnatak Industrial Areas Development Board vs. C. Kenchappa & Ors. (2006) 6 SCC 371.
vi)
Tirupur Dying Factory Owners Association vs. Noyyal River Ayacutdars Protection Association & Or. (2009) 9 SCC 737.
16.
There
is
absolutely no
quarrel
with
the
legal
preposition advanced by Mr. Chakraborty. In the case of Tirupur Dying Factory Owners Association (Supra), the Hon’ble Supreme Court, referring to the all previous judgments, concluded that the concept of “Sustainable Development” covers the development that meets the needs of a person without compromising the ability of the future generation to meet their own needs. It means the development, that can take place, can be sustained by
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nature / ecology with or without mitigation. In such matters, the required standard is that the risk or harm to the environment or to human health is to be decided in public interest, according to a reasonable persons test.
The
development of the industries, irrigations sources and power projects are necessary to improve employment opportunity and generation of revenue, therefore, cannot be ignored. In such, eventuality, a balance has to be struck for the reasons that if the activity is allowed to go on, there may be irreparable damage to the environment and there may be irreparable damage to the economic interest.
17.
The precautionary principle and the principle of polluter
pays are the integral part and parcel of National environmental law. An Industry or a person who pollutes the
surrounding
area
or
environment
is
bound
to
compensate the persons who have suffered the loss because of the activity.
An industry or a person being
responsible for causing the pollution cannot escape the responsibility of not meeting the expenses of removing the damages caused and restoring the environment to its original position.
Section 20 of the National Green Tribunal (NGT) Act, 2010 clearly lays down the principle upon which this Tribunal should function. The said Section reads as follows:-
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“ 20. Tribunal to apply certain principles:- The Tribunal shall, while passing any order or decision or award, apply the principles of sustainable development, the precautionary principle and the polluter pays principle.”
Thus it is no more res-integra, with regard to the legal proposition that a polluter is bound to pay and eradicate the damage caused by him and restores the environment. He is also responsible to pay for the damages caused due to the pollution caused by him.
18.
In the case in hand, most of the facts are admitted
except the allegations that the samples were not collected from the Appellant’s plant following the prescribed norms of Section 21 of the Water Act and that no adequate opportunity of hearing was granted to the officers of the Appellant concern before issuing the impugned directions. The said allegations are stoutly denied by the Respondents. Be that as it may, the allegations and counter allegations being factual aspects, we do not propose to enter into such factual disputes at this stage, as the controversy can be decided on other broader issues.
19.
The most crucial issue which needs to be determined
is with regard to the power of the WBPCB to issue directions under Section 33A of the Water Act. According to Mr. Sibal , the power under the said Section cannot be
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construed to be an unbridled one and should always be subject to other provisions of Act and Rules.
Whereas
according to Mr. Chakraborty, exercising the powers under Section 33A , the WBPCB can issue any direction in writing and such powers cannot be restricted or curtailed.
Section 33A of the Water Act, stipulates that notwithstanding anything contend in any other law, but subject to the portions of the said Act, and to any direction issued by the Central Government, a Board may, in exercise of the powers and performance of its functions under the Act, issue any directions.
Law is well settled that a direction issued by an Authority should be not only fair, legitimate and above-board, but also should be without any affection or aversion (See AIR 1988 SC 157). An authority should not issue any direction which lacks bonafide and / or otherwise in justiciable. The rule of law warrants that a direction should be issued by application of due diligence and the same should be within the parameters of the known principles, rules and guidelines. A direction should have nexus to the facts and circumstances and should not be arbitrary.
It can
be, therefore, safely concluded that Section 33A of the Water Act does not vest an unbridled power upon the Board and the said power is always subject to reasonable restrictions prescribed by the provisions of Act and Rule.
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20.
In the case of
Splendor Landbase Ltd. Vs Delhi
Pollution Control Committee (Supra) Hon’ble Delhi High Court interpreting Section 33A of the Water Act, relying upon the judgment of the Supreme Court in the case of Khemka
&
Co.
(Agencies)
Pvt.
Ltd.
vs.
State
of
Maharashtra, observed as follows:“In the considered view of this Court, the power to levy a penalty on any party is in the nature of a penal power. It is settled law that unless there is a specific power in the Statute enabling the authority to do so. It cannot levy penalties or damages with reference to the general power under Section 31A of the Air Act or Section 33A of Water Act.” In paragraph 66 of the judgment the Hon’ble Delhi High Court further observed:“This Court has, therefore, no hesitation in coming to the conclusion that orders issued by the CMC or even the DPCC in the instant case levying penalty and requiring furnishing of bank guarantees and making the grant of consent to establish under the Water Act and consent
to
operate
under
the
Air
Act
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conditional upon payment of such penalties and furnishing of such bank guarantees are entirely without the authority of law and require to be set aside. Procedural violations by the DPCC.”
It is needless to say that the facts of the said case are more or less similar to the facts of the case in hand.
21.
According to Mr. Chakraborty, the decision of the
Hon’ble Delhi High Court being hit by the principles of subsilentio should not be taken as a precedent. It is submitted that the Hon’ble High Court has not taken into consideration the decisions of the Hon’ble Supreme Court with regard to applicability of the principle of the polluter should pay. Thus the decision is per incurium.
The said submission is
strongly repudiated by Mr. Sibal. According to him there is no dispute with regard to the principle that polluter should pay.
But then while applying the said principle the
authorities have to assess the damage caused to the environment and the amount which is required to restore the damage. Referring to the impugned order, Mr. Sibal submitted that the Board has neither followed the mandatory requirements of the Act and Rule in as much as the provisions of Rule 34 were given a complete go-bye nor assessed the damages if at all caused, thus the order suffers from arbitrariness and is not sustainable in law. We
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find some force in the submission of the Learned Counsel for the Appellant.
22.
It is admitted that a set of samples were collected by
the WBPCB from the plant of the Appellant on 5th October, 2010. The said samples were analyzed and the discharge effluent was found to be not in conformity with the prescribed parameters, as would be evident from AnnexureC-3. WBPCB on the basis of the said analysis report, called upon the Appellant to show cause and also directed it to rectify the violations. It appears that Appellant submitted a reply to the show cause notice, and also assured the WBPCB that necessary preventive steps shall be taken to rectify the violations. 23.
The WBPCB on 5th October, 2010 once again
collected some samples and got it analyzed.
The said
analysis also revealed that the effluents were not in consonance with the standards fixed by the Board. The Appellant was once again called upon to show cause. 24.
The Appellant, submitted a detailed show cause
enclosing all documents, and intimated the steps taken for eradicating the violations.
Thereafter the officers of the
WBPCB visited the Plant of the Appellant on 29th December, 2010 and collected samples. The said samples were duly analyzed and on such analysis, it was found that
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the discharge effluents satisfied the standard prescribed and there was no violation. 25.
The WBPCB on 2nd May, 2011, issued the impugned
directions relying upon the analysis report of the specimen which were collected on 6th August, 2010 and 5th October, 2010, and called upon the Appellant to deposit Rs. 5,00,000/0 (five lakhs) towards pollution cost and also submit a Bank Guarantee to the tune of 5,00,000/- (five lakhs). The said order is silent about the analysis report of the specimen collected on December, 2010, though the same was available with the WBPCB on the date when the direction was issued i.e. May, 2011. 26.
Several contentions of both law and facts were raised
by the Learned Counsel of both the parties. They have also relied upon number of decisions in support of respective contentions raised.
However, without entering into the
arena of controversy we feel, this Appeal can be disposed of only on the basis of a factual error.
Admittedly the
analysis of samples collected from the Appellant’s plant on 6th August, 2010 and 5th October, 2010 revealed that, the discharge effluent failed to comply with the standards prescribed. The WBPCB, on the basis of such reports, on each occasion had issued notice to the Appellant and not only called upon it to show cause but also directed them to take appropriate measures to maintain the standard with regard to the discharged effluent. The Appellant had not
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only shown cause but also assured the WBPCB that necessary steps are being taken to avoid any violation. Fact remains the WBPCB did not take any coercive action nor issued any direction to the Appellant at that stage and remained silent.
27.
WBPCB once again carried out inspection on 29th
December, 2010 and collected specimen from the Effluent Treatment (ET) plant of Appellant. It is not disputed that on analysis it was found that the discharge effluent satisfied the standards prescribed by the WBPCB and there was no violation worth the name. analysis
of
discharged
In spite of the fact that the effluent
collected
from
the
Appellant’s plant in the month of December, 2010, was found to be in order after analysis and within the standards prescribed, the WBPCB for the reasons best known issued the impugned direction in the month of May, 2011. In other words when the directions to deposit pollution cost of Rs. 5,00,000/- (five lakhs) and
as well to submit a bank
guarantee of Rs. 5,00,000/- (five lakhs) was issued, there was no material before the WBPCB leading to the conclusion that the Appellant was violating any of the terms embodied in the letter of consent or that the discharged effluent from the Appellant’s ET plant failed to comply with the standards prescribed.
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Apart from the aforesaid anomaly, even according to law, before applying the principle of “polluter should pay”, an authority has to first ascertain and determine the damage caused by the polluter and the amount which is necessary to rectify the damage.
Even otherwise the
amount so realized is required to be utilized for the purpose of restoring the environment and not otherwise.
On the
absence of such assessment, it would not be justified to arbitrarily direct a person to deposit a lump sum amount. The aforesaid facts and position of law were not kept in mind while passing the impugned order and as such the same cannot be sustained in the eye of law.
28.
Before parting we feel it proper to express our concern
with regard to presence of heavy metals such as lead (Pb) and cadmium (Cd.) in the discharged effluent. Presence of said substances in the effluent would finally contaminate the environment, and shall cause hazards to human life.
It
appears, no steps, howsoever has been taken by the WBPCB or by the Appellant to trace out the source of such heavy metals found in the effluent. It is quite possible that heavy metals / (Pb, Cd etc.) may also be present in the products. We, therefore, direct the WBPCB as well as the Appellant to conduct analysis of the water and raw materials used for the purpose, and not only detect the source but also take appropriate steps for eradicating the same so as to avoid any adverse health impacts.
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29.
In view of the discussions made above, we allow the
Appeal and set aside the direction dated 2nd May, 2011 issued by the WBPCB and call upon the said Respondent to proceed in accordance with law. We also direct the Central Pollution Control Board, New Delhi / Zonal office at Kolkata, West Bengal to collect the effluent discharged from the Appellant’s plant following the paraphernalia laid down under law, analyze the same in all aspects, particularly with regard to presence of heavy metals (Pb, Cd etc.) and prepare a report. It is needless to be said that the expenses for the said purpose shall be borne by the Appellant Company. The cost shall be assessed by the CPCB within two weeks from the date of service/production of certified copies of this judgment and same shall be deposited by the Appellant with the CPCB within two weeks, therefrom. The renewal of the consent to operate the plant would be dependent on the report of the Central Pollution Control Board. A copy of this direction be communicated to CPCB, at the cost of the Appellant.
Parties to bear their own cost.
Dr. G.K Pandey Expert Member Durga Malhotra 19th March, 2012
Justice A.S. Naidu Acting Chairperson
