K.T.V. HEALTH FOOD PVT. LTD. VERSUS UNION OF INDIA AND ORS.

K.T.V. HEALTH FOOD PVT. LTD. VERSUS UNION OF INDIA AND ORS.


Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले

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Reportable
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.3626 OF 2020
K.T.V. HEALTH FOOD PVT. LTD. …APPELLANT (S)
VERSUS
UNION OF INDIA AND ORS. …RESPONDENT(S)
With
CIVIL APPEAL NO. 3639 of 2020
K.T.V. OIL MILLS PRIVATE LIMITED …APPELLANT (S)
VERSUS
THE SECRETARY TO GOVERNMENT,
UNION OF INDIA & ORS. …RESPONDENT (S)
J U D G M E N T
K.M. JOSEPH, J.
1. The Appeals are lodged under Section 22 of the
National Green Tribunal Act, 2010.
C.A. NO. 3626 OF 2020 (THE FIRST APPEAL)
2. The appellant challenges the Order passed by the
National Green Tribunal (NGT), Southern Zone. By the
impugned Order, the NGT has allowed the appeal filed
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by Respondent No.5 and set aside proceedings dated
08.03.2019. By the said proceedings, Respondent No.1
had granted ex post facto clearance purporting to
invoke paragraph-4.3 of the Notification issued in the
year 2011 (hereinafter referred to as, ‘the 2011
Notification’) under the Environment Protection Act,
1986 (hereinafter referred to as, ‘the Act’). By the
said clearance, the appellant was given clearance for
the laying of pipeline for transfer of edible oil from
the Chennai Port to the storage terminal tank and for
the establishment of the storage transit terminal of
the appellant. The NGT has found that while the ex post
facto clearance could be granted under paragraph-4.3,
and that it would have prospective operation, however,
the activity of putting up a storage tank transit
terminal, being contrary to the 2011 Notification, the
same was illegal. It was found to be illegal in turn,
on the ground that the storage terminal was not located
‘in’ the Chennai Port, in which case alone, it would
have been permissible under the permitted activities
of Coastal Regulation Zone II (for short, ‘CRZ II’).
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THE FACTS
3. The appellant is in the business of processing and
refining edible oil. Towards the said business, the
appellant imports edible oil. The edible oil is
imported through the Chennai Port. On 05.11.2014, in
the public auction, the appellant purchased an existing
storage facility. It was located at Old Door No. 4061/A
and New Survey No. 4061/2 in the Ennore Expressway. The
appellant thereafter, according to it, started the
process to seek approvals for laying an underground
pipeline of 4.5 kilometres to the said storage
facility. On payment of Rs.5097921/-, the Chennai
Fishing Harbour Management Committee granted
permission to lay the underground pipeline. The NHAI
granted permission to lay the underground pipeline. On
03.03.2015, allegedly based on inspection of the
storage facility, and on payment of charges, including
service tax, the Chennai Port Trust granted permission
for laying the underground pipeline from the Chennai
Port to the storage facility. On 10.07.2015, purporting
to act under paragraph-4 of the 2011 Notification, the
appellant made a proposal to the District Coastal
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Management Authority, Chennai (hereinafter referred to
as ‘the DCZMA’). It would appear that the said Body
recommended the proposal. The third respondent, viz.,
the Tamil Nadu State Coastal Zonal Management Authority
(hereinafter referred to as, ‘the State Authority’)
considered the proposal and it forwarded the same
through the second respondent, viz., the State of Tamil
Nadu to the first respondent, viz., the Union of India,
in the Ministry of Environment and Forests and Climate
Change. Respondent No.4, viz., the Expert Appraisal
Committee, CRZ, sought two clarifications. On
24.08.2016, the Chennai Port Trust issued a Certificate
and permitted the laying of the pipeline, which,
according to the appellant, was based on the need to
avoid usage of tanker lorries and as it resulted in
better handling of vessels at the Port. While the
recommendation of the third respondent was pending
before the first respondent, appellant started laying
the pipeline with the prior permission of the NHAI, the
Chennai Fishing Harbour Committee and the Port Trust.
On 19.10.2016, Respondent No. 5 filed O.A. No. 238 of
2016 against the activities of the appellant in
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question. A Local Commissioner was appointed, who
inspected the Facility. We may, at this juncture,
notice the following physical features noticed during
the inspection.
“1) The premises of the 12th Respondent (in A.
No. 238 of 2016), M/s. KTV Health Foods Pvt.
Ltd., is situated at No.1,2,3, Suriyanarayana
Chetty Street, Tondiarpet, Chennai- 600 001,
facing the Bay of Bengal. In between the
premises of the 12th respondent and Bay of
Bengal, the State Highway (Ennore Express
Highway) runs North to South. The State Highway
measures about 120 Feet in width and from the
road, there is a space of about 40 Feet up to
the sea shore. Thus, the distance between the
entrance of the 12th respondent and the
seashore is about 160 Feet.”
[The appellant was the 12th Respondent]
4. The NGT disposed of the said O.A. noting that the
storage facility was closed and that till the first
respondent took a decision, no activity will be carried
out. It would appear that Respondent No. 4 recommended
the proposal for CRZ clearance, subject to certain
conditions. This was even after finding that there was
no provision in the 2011 Notification, but taking
inspiration from the provisions of the 2006
Notification. On 06.02.2018, the 2011 Notification was
amended by the insertion of paragraph-4.3. Based on the
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said amendment, the State Authorities recommendations
were called for. On 27.12.2018, the storage facility
was inspected by the DCZMA. The Tamil Nadu State
Pollution Control Board, it would appear, intimated the
third respondent that except for not obtaining prior
clearance, there was no other violation. Accordingly,
the State Authority recommended the proposal. It is on
this basis, the first respondent granted post facto
clearance by proceedings dated 08.03.2019. The
appellant obtained consent to operate from the
Pollution Control Board. On 08.04.2019, the fifth
respondent filed the appeal before the NGT and the NGT
has allowed application, as already noticed.
CIVIL APPEAL NO. 3639 OF 2020 (THE CONNECTED
APPEAL)
5. The appellant-company is a sister concern of the
appellant in the first Appeal. It has also constructed
a storage facility, being engaged in the business of
edible oil, for the purpose of storing the imported
edible oil at a distance of nearly 600 meters from the
location of the storage tank of the appellant in the
first Appeal. It has also drawn a pipeline from the
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storage tank to the facility it has put up for storing
edible oil, for transmission to its factory. We must
mention here that the idea was to import edible oil,
unload it at Chennai Port, take the edible oil by a
pipeline to the storage facility and from there,
transmit the same by tanker lorries to their factories,
wherein the manufacturing activities were being carried
out.
6. The issues arising in both the Appeals are common
and, hence, we discuss the issues with reference to the
first Appeal.
THE SALIENT FEATURES OF THE ORDER DATED
08.03.2019 BY THE FIRST RESPONDENT
7. The salient Features of the Order dated 08.03.2019
passed by the First Respondent:
i. The site falls in CRZ II.
ii. Five number of storage tanks have been
installed.
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iii. Permissions has been obtained from the Chennai
Port Trust, NHAI and the Harbour Management
Committee.
iv. The project will reduce traffic to the Chennai
Port Trust.
v. As per CRZ Notification, vide para 8, storage
of non-hazardous cargo such as edible oil,
fertilizers and food grain can be established
‘only in notified ports’.
8. There are other aspects and specific conditions,
apart from general conditions. It is also made clear
that the clearance is subject to the final Order of
this Court in the matter of Goa Foundation v. Union of
India in Writ Petition (Civil) No. 460 of 2004.
THE IMPUGNED ORDERS
9. The NGT found merit in the contention of the
appellants that the first respondent had the power to
grant ex post facto clearance. However, it would have
only prospective operation. The clearance could,
however, be supported, if the activity which was
permitted, was one, which was contemplated under the
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2011 Notification. The Tribunal went on to note that
the storage facilities were not located ‘in’ the
Chennai Port. In fact, it was on the basis that under
paragraph-8 of the 2011 Notification, storage of edible
oil, inter alia, was permissible ‘in’ the limits of a
notified port. The attempt of the appellants to support
the clearance with reference to the fact that under
permitted activities in CRZ I, storage of non-hazardous
cargo, including edible oil, was permitted ‘within’ the
limits of a port and a distinction, therefore, existed
between the words ‘within’ and ‘in’, did not find
favour with the NGT. It was the contention of the
appellants that being two different words and a
meaningful interpretation being warranted in the case
of CRZ I, the activity to be permitted had to be
strictly within the limits of the port. Both, taking
into account the difference in the words used, as also
the fact that CRZ II contemplated a less harsh regime,
the case of the appellants was that a purposeful
interpretation would warrant the view that the storing
of the edible oil in the CRZ II area, could be permitted
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even outside the limits of the port. It is this argument
that failed.
10. The NGT has found the impugned Order of the first
respondent illegal. The construction of the storage
facility and the pipeline were directed to be removed.
The appellant in the first appeal was directed to pay
environmental compensation in a sum of Rs.25 lakhs. We
may only elucidate that the appellant in the connected
appeal had initially succeeded before the Tribunal.
However, it was after allowing a Review Petition, which
decision was not challenged and, on hearing the Appeal
again, that the present impugned Order came to be
passed. Noting that the appellant in the connected case
was earlier visited with environmental compensation,
no compensation was imposed on it.
11. We heard Shri Ranjit Kumar, learned Senior Counsel
for the appellant in the first appeal and also Shri
Dhruv Mehta, learned Senior Counsel for the appellant
in the other appeal. We further heard Ms. Anitha
Shenoy, learned senior Counsel on behalf of respondent
No.5 and Shri Anand Tiwari, learned Counsel on behalf
of respondents 2 and 3. We also further heard Mr.
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Archana Pathak Dave, learned Counsel on behalf of Union
of India.
12. Shri Ranjit Kumar, learned Senior Counsel would
submit that the appellant was engaged in the
manufacture of edible oil. In order to avoid the
traffic snarls and the congestion it caused in the
Chennai Port, it was the Chennai Port itself which
suggested that the appellant may draw the pipeline from
the Port area so that the edible oil which was
downloaded on import could be taken to a storage
facility and from there carried to the factory of the
appellant. He would submit that the provisions of 2011
Notification would reveal that paragraph-3 declares
activities which are prohibited. The storage tank has
been put up in CRZ-II area. There are construction
activities permitted in CRZ-I area which is the most
fragile area. He would take us through the Notification
and point out that on a combined reading of paragraphs3, 4, 7 and 8, the following will be the upshot. In
regard to CRZ-II, it is less sensitive than CRZ-I. In
CRZ-I, the “storage of edible oil inter alia is
permitted within the notified ports”. In CRZ-II on the
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other hand, storage of non-hazardous cargo such as
edible oil, fertilizers and foodgrain is permitted ‘in
notified ports’. Since the word ‘within’ which is used
in CRZ-I is not employed in regard to the similar
activity in CRZ-II and instead the word ‘in’ is used,
the principal contention is that they must receive a
different meaning. He would further contend that this
Court may adopt purposive interpretation and, in this
regard, he drew our attention to the judgment of this
court in M. Nizamudeen v. Chemplast Sanmar Limited and
Others1. The words ‘in notified ports’, occurring in
pargraph-8(II)(vi) of the 2011 Notification must be
construed to mean “in or around the notified ports”.
He would submit that storage tanks have been
constructed not within the Chennai Port but on a
purposive interpretation, the storage tank must be
treated as “in” the Chennai Port though it is not in
its notified limits. The storage container was located
in the Customs Notified Area of the Chennai Port. He
would contend that CRZ-II even permits facility for the
storage of petroleum products and liquified natural
1
 (2010) 4 SCC 240
13
gas. If that is so, he poses the question that having
regard to the fact that CRZ-II generally provides for
a less harsh regulatory regime and CRZ-I, it may result
in an absurdity to not permit storage of non-hazardous
cargo which includes edible oil in CRZ II. He would
refer to the company that edible oil keeps in the
clause, namely, fertilizers and foodgrains. He would
point out that it may be absurd to disallow storage of
foodgrains, fertilizers and edible oil in CRZ-II. This
is all the more reason to place a wider meaning on the
word ‘in’ the notified port.
13. Shri Ranjit Kumar, learned Senior Counsel, drew
support from the decisions of this Court as indicated
herein. In Electrosteel Steels Limited v. Union of
India and Others2, this Court held that the Act does
not prohibit grant of ex post facto environmental
clearance. It also held that the Court cannot be
oblivious to the interest of the economy or need to
protect the livelihood of hundreds of employees and
others employed in the project, if such project
complies with environment norms.
2 (2021) SCC OnLine 1247
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14. The said view has been followed in the judgment in
Pahwa Plastics Pvt. Ltd. and Another v. Dastak NGO and
Others3 and Gajubha Jadeja Jesar v. Union of India and
Others4. It is, therefore, contended that there was no
occasion for the NGT to interfere.
15. Relying on the Judgment in Alembic Pharmaceuticals
Ltd. v. Rohit Prajapati and Others5, it is contended
that the impugned Order does not do justice to the
Principle of Proportionality. It is pointed out that
in the said case, on payment of environmental
compensation, the industry was permitted to continue.
16. Shri Dhruv Mehta, learned Senior Counsel in the
other case would adopt the arguments. He would further
contend that the principles of contemporaneous exposito
are attracted. In this regard, Shri Dhruv Mehta,
learned Senior Counsel sought to draw considerable
support from the decision of this Court in K.P.
Varghese v. Income Tax Officer, Ernakulam and Another6.
This is on the basis that the understanding of all the
3 (2022) SCC OnLine SC 362
4 (2022) SCC OnLine SC 993
5 (2020) 17 SCC 157
6 1981 (4) SCC 173
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authorities including respondent No.1 in the impugned
Order is that construction of the container for storage
facility is permissible under CRZ-II. The Tribunal
clearly erred in interfering with the views of all the
authorities.
17. Shri Dhruv Mehta, learned Senior Counsel, would
also contend that the matter may be viewed in the
context of Principles of Sustainable Development and
Polluter Pays Principle.
18. Shri Anand Tiwari, learned counsel appearing on
behalf of respondent 2 and 3 would also support the
appellants. He would contend that a purposive
interpretation is to be placed. Smt. Archana Pathak
Dave, learned Counsel for the Union of India equally
supported the stand of the Government of India.
19. Smt. Anitha Shenoy, learned Senior Counsel
appearing on behalf of respondent No.5 strongly
supported the order of the NGT and submits that the
matter relates to the defending of the environment. In
constructing outside the limits of the notified port,
a fact, which is not disputed by the appellant, there
is an indefensible violation of a law which subserves
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a salutary and sublime object. She would draw support
from the body of case law consisting essentially of the
views of this Court indicating that this Court has
firmly set its face against the trampling of law
relating to the environment [See Indian Council for
Enviro-Legal Action v. Union of India7, S. Jagannathan
v. Union of India and others8, Piedade Filomena
Gonsalves v. State of Goa9, Vaamika Island (Green Lagoon
Resort) v. Union of India10, Kapico Kerala Resorts (P)
Ltd. v. State of Kerala11, Kerala State Coastal Zone
Management Authority v. State of Kerala12]. She would
submit the word ‘in’ cannot mean ‘out’. In other words,
it certainly cannot countenance the storage facility
being located outside the notified port. In the facts
of this case, it is at quiet a long distance from the
Chennai Port and the laws relating to environment
should be strictly construed.
7 (1996) 5 SCC 281
8 (1997) 2 SCC 87
9 (2004) 3 SCC 445
10 (2013) 8 SCC 760
11 (2020) 3 SCC 18
12 (2019) 7 SCC 248
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ANALYSIS
20. The 2011 Notification has been issued under Section
3 of the Act. The first notification in regard to the
notification of Coastal Zone was issued in the year
1991. There were amendments. It is thereafter that the
notification was issued in the year 2011. The 2011
notification came to be published on 6th January, 2011.
We may indicate that, in fact, the notification which
holds the field today was issued in the year 2019.
THE SCHEME OF THE 2011 NOTIFICATION
21. The Central Government declared certain areas as
Coastal Regulation Zone (‘CRZ’, for short). The CRZ in
the First Clause consists of the land area from high
tide line to 500 meters on the land along the sea front.
The High Tide line is the line based on the highest
water mark during the spring tide. We may only further
notice that among the other 4 categories of CRZ, the
CRZ includes the water and the bed area between the LTL
(LOW TIDE LINE)(which line is based on the lowest
height of the water body during the spring tide) to the
territorial water limit (12 nautical miles) in the case
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of the sea and the water bed and area between the LTL
at the bank to the LTL on the opposite of the bank of
the tidal influenced water bodies. CRZ has been
classified under para 7 into CRZ I, CRZ II, CRZ III,
CRZ IV and CRZ V. Since, we are concerned with CRZ II
we may notice the elements which constitute the same.
“7. Classification of the CRZ – For the purpose
of conserving and protecting the coastal areas
and marine waters, the CRZ area shall be
classified as follows, namely:-
XXXX XXXX XXXX
(ii) CRZ-II,-
The areas that have been developed upto or
close to the shoreline.
Explanation.- For the purposes of the
expression “developed area” is referred to as
that area within the existing municipal limits
or in other existing legally designated urban
areas which are substantially built-up and has
been provided with drainage and approach roads
and other infrastructural facilities, such as
water supply and sewerage mains;”
22. Paragraph-3 provides for prohibited activities
within CRZ. We may notice that it is divided into 14
categories and the noticeable feature is that certain
exceptions to the prohibitions are also declared. Of
relevance to the cases before us, are certain Clauses
in paragraph-3. They are:
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“3. Prohibited activities within CRZ,- The
following are declared as prohibited
activities within the CRZ,-
(i) Setting up of new industries and expansion
of existing industries except,-
(a) those directly related to waterfront or
directly needing foreshore facilities;
Explanation: The expression "foreshore
facilities" means those activities permissible
under this notification and they require
waterfront for their operations such as ports
and harbours, jetties, quays, wharves, erosion
control measures, breakwaters, pipelines,
lighthouses, navigational safety facilities,
coastal police stations and the like.;”
23. Paragraph-3(i)(b) permits projects of department
of Atomic energy. Paragraph-3(i)(d) permits projects
of greenfield project already permitted at Navi Bombay.
3(i)(e) allows construction, repair work of dwelling
units of local community including fishermen in
accordance with Local Town and Country Planning
Regulation.
24. Paragraph 3(ii) deals with a prohibited category
which reads as follows:
“(ii) manufacture or handling oil storage or
disposal of hazardous substance as specified
in the notification of Ministry of Environment
and Forests, No. S.0.594 (E), dated the 28th
July, 1989, S.0. No. 966(E), elated the 27th
November, 1989 and GSR 1037 (E), dated the 5th
December, 1989 except,-“
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25. However, by way of exception to the prohibition
3(ii)(a) permits transfer of hazardous substances from
ships to ports terminals and refineries and vice versa.
Clause 3(ii)(a) reads as follows:
“(a) transfer of hazardous substances from
ships to ports, terminals and refineries and
vice versa;”
26. Paragraph-3(viii), enacts the following
prohibitions:
“(viii) Port and harbour projects in high
eroding stretches of the coast, except those
projects classified as strategic and defence
related in terms of EIA notification, 2006
identified by MoEF based on scientific studies
and in consultation with the State Government
or the Union territory Administration.”
(Emphasis supplied)
27. Paragraph-3(xi) provides for prohibition of
construction activity in CRZ1 except those specified
in para 8 of the notification. We need not be detained
with various others clauses. Regulation 4 deals with
permissible activities in CRZ area. It is declared that
activities which are enumerated under paragraph-4 shall
be regulated except those prohibited in paragraph-3.
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This means what is prohibited in paragraph-3 cannot
either be permitted or regulated within the meaning of
paragraph-4. Paragraph-4 reads as follows:
“4. Regulation of permissible activities in CRZ
area.- The following activities shall be
regulated except those prohibited in para 3
above,-
(i)(a) clearance shall be given for any
activity within the CRZ only if it requires
waterfront and foreshore facilities;
(b) for those projects which are listed under
this notification and also attract EIA
notification, 2006 (S.O.1533 (E), dated the
14th September, 2006), for such projects
clearance under EIA notification only shall be
required subject to being recommended by the
concerned State or Union territory Coastal Zone
Management Authority (hereinafter referred to
as the CZMA).
(c) Housing schemes in CRZ as specified in
paragraph 8 of this notification;
(d) Construction involving more than 20,000sq
mts built-up area in CRZ-!1 shall be considered
in accordance with EIA notification, 2006 and
in case of projects less than 20,000sq mts
built-up area shall be approved by the
concerned State or Union territory Planning
authorities in accordance with this
notification after obtaining recommendations
from the concerned CZMA and prior
recommendations of the concern CZMA shall be
essential for considering the grant of
environmental clearance under EIA
notification, 2006 or grant of approval by the
relevant planning authority.
(e) MoEF may under a specific or general order
specify projects which require prior public
hearing of project affected people.
(f) construction and operation for ports and
harbours, jetties, wharves, quays, slipways,
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ship construction yards, breakwaters, groynes,
erosion control measures;
(ii) the following activities shall require
clearance from MoEF, namely:-
(a) those activities not listed in the EIA
notification, 2006.
(b) construction activities relating to
projects of Department of Atomic Energy or
Defence requirements for which foreshore
facilities are essential such as, slipways,
jetties, wharves, quays; except for classified
operational component of defence projects.
Residential buildings, office buildings,
hospital complexes, workshops of strategic and
defence projects in terms of EIA notification,
2006.;
(c) construction, operation of lighthouses;
(d) laying of pipelines, conveying systems,
transmission line;
(e) exploration and extraction of oil and
natural gas and all associated activities and
facilities thereto;
(f) Foreshore requiring facilities for
transport of raw materials, facilities for
intake of cooling water and outfall for
discharge of treated wastewater or cooling
water from thermal power plants. MoEF may
specify for category of projects such as at
(f), (g) and (h) of para 4;
(g) Mining of rare minerals as listed by the
Department of Atomic Energy;
(h) Facilities for generating power by nonconventional energy resources, desalination
plants and weather radars;
(i) Demolition and reconstruction of (a)
buildings of archaeological and historical
importance, (ii) heritage buildings; and
buildings under public use which means
buildings such as for the purposes of worship,
education, medical care and cultural
activities;”
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28. Since Clause 2 of paragraph-4 provides that the
activities described thereunder would require
clearance from MoEF, the question would arise as to
whether for the other activities, which are
permissible, does it require clearance? Paragraph-4.2
provides the answer. It provides for the procedure for
clearance of permissible activities. Various
formalities have to be undergone. Originally, the 2011
notification did not provide for any ex post facto
approval. It is in the year 2018, i.e., on 09.03.2018
that paragraph-4.3 came to be inserted in the 2011
Notification. It read as follows:
"4.3 Post facto clearance for permissible
activities.-
(i) all activities, which are otherwise
permissible under the provisions of this
notification, but have commenced construction
without prior clearance, would be considered
for regularisation only in such cases wherein
the project applied for regularization in the
specified time and the projects which are in
violation of CRZ norms would not be
regularised;
(ii) the concerned Coastal Zone Management
Authority shall give specific recommendations
regarding regularisation of such proposals and
shall certify that there have been no
violations of the CRZ regulations, while making
such recommendations;
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(iii) such cases where the construction have
been commenced before the date of this
notification without the requisite CRZ
clearance, shall be considered only by Ministry
of Environment, Forest and Climate Change,
provided that the request for such
regularisation is received in the said Ministry
by 30th June, 2018.”
(Emphasis supplied)
29. It will at once be noticed that thereunder
violation of ‘norms’ would disentitle a person to post
facto clearance. The norms are laid down in Paragraph8. Paragraph-8 provided for regulation of activities
permissible under the 2011 Notification. It declares
that the development or construction activities in
different categories of CRZ shall be regulated by the
concerned CZMA in accordance with the following norms.
In CRZ-I, the norms were as follows:
“l. CRZ-1,-
(i) no new construction shall be permitted in
CRZ-1 except,-
(a) projects relating to Department of
Atomic Energy;
(b) pipelines, conveying systems including
transmission lines;
(c) facilities that are essential for
activities permissible under CRZ-l;
(d) installation of weather radar for
monitoring of cyclones movement and
prediction by Indian Meteorological
Department;
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(e) construction of trans harbour sea link
and without affecting the tidal flow of
water, between LTL and HTL.
(f) development of green field airport
already approved at only Navi Mumbai;
(ii) Areas between LTL and HTL which are not
ecologically sensitive, necessary safety
measures will be incorporated while permitting
the following, namely:-
(a) exploration and extraction of natural
gas;
(b) construction of dispensaries, schools,
public rainshelter, community toilets,
bridges, roads, jetties, water supply,
drainage, sewerage which are required for
traditional inhabitants living within the
biosphere reserves after obtaining approval
from concerned CZMA.
(c) necessary safety measure shall be
incorporated while permitting such
developmental activities in the area falling
in the hazard zone;
(d) salt harvesting by solar evaporation of
seawater;
(e) desalination plants;
(f) storage of non-hazardous cargo such as
edible oil, fertilizers and food grain
within notified plants;
(g) construction of trans harbour sea links,
roads on stilts or pillars without affecting
the tidal flow of water.”
30. In CRZ-II, the norms were as follows:
“II. CRZ-11,-
(i) buildings shall be permitted only on the
landward side of the existing road, or on
the landward side of existing authorized
structures;
(ii) buildings permitted on the landward
side of the existing and proposed roads or
26
existing authorized structures shall be
subject to the existing local town and
country planning regulations including the
'existing' norms of Floor Space Index or
Floor Area Ratio:
Provided that no permission for construction
of buildings shall be given on landward side
of any new roads which are constructed on
the seaward side of an existing road:
(iii) reconstruction of authorized building
to be permitted subject with the existing
Floor Space Index or Floor Area Ratio Norms
and without change in present use;
(iv) facilities for receipt and storage of
petroleum products and liquefied natural gas
as specified in Annexure-II appended to this
notification and facilities for
regasification of Liquefied Natural Gas
subject to the conditions as mentioned in
sub-paragraph (ii) of paragraph 3;
(v) desalination plants and associated
facilities;
(vi) storage of non-hazardous cargo, such as
edible oil, fertilizers and food grain in
notified ports;
(vii) facilities for generating power by
non-conventional power sources and
associated facilities;”
31. CRZ-III, comprised of area up to 200 meters from
HTL on the landward side in the case of sea front inter
alia. It is marked as the NDZ [or No Development Zone}.
It was, inter alia, provided that NDZ shall not apply
“in such area falling within any notified port”. There
are various restrictions therein. Certain activities
were shown as permitted activities in the NDZ. They
27
included in Clause (e) facilities for receipt and
storage of petroleum products and liquified gas as
specified in Annexure-II. Interestingly, in regard to
the area between 200 meters to 500 meters falling in
CRZ-III, paragraph-8 permitted storage of nonhazardous cargo such as edible oil, fertilizers,
foodgrains ‘in’ notified ports.
32. Having set out the relevant provisions of the 2011
notification, we may proceed to examine the contentions
of the parties.
33. The appellants would contend that CRZ-I provides
for the harshest regime having regard to the fact that
the areas are ecologically sensitive and the
geomorphological features play a role in the
maintaining the integrity of the coast. They included
mangroves. In case, the area of mangroves was more than
1000 sq.mts, a buffer of 50 mts. along the mangroves
was to be provided. Sand dunes came under CRZ-I, as did
corals and coral reefs and associated biodiversity.
34. It may be true that the appellant had secured
permission of the local authority. Shri Ranjit Kumar
may be correct in contending also that the laying of
28
the pipeline ensured that additional vehicle load was
not thrust on the Chennai port. There may be merit also
in the contention of the appellants that the no
objection certificate may indicate that the pipeline
would lead to increased evacuation of edible oil
through the pipeline, leading to increased port
efficiency. As found by the NGT and not disputed by the
fifth respondent also the power to grant post facto
approval flowed from paragraph-4.3 inserted in the 2011
Notification, though in the year 2018. The case of the
appellant that the storage facility is located in CRZ
II is beyond dispute. The storage facility being
located on the landward side may be correct. The
appellants assertion that between the storage facility
and the Bay of Bengal there exists the Ennore Express
Highway appears to be correct. We proceed on the basis
further that the distance between the entrance of the
storage facility and the sea shore is ‘160 feet’.
Laying of pipeline is permissible in CRZ I. Appellant’s
contention that there is no space at the Chennai port
is sought to be buttressed with reference to
29
certificate dated 24.08.2016. We may notice its
contents:
“The cargo through put and number of vehicles
moving in and out of Chennai Port has increased
manifold over the past years. In order to
reduce the road traffic and resultant
congestion, the port has been encouraging
alternate modes of cargo evacuation like Rail
evacuation and evacuation through pipeline.
Accordingly Chennai Port has permitted M/s.
KTV Health Food Private Limited to lay pipeline
from BD2 berth where the firm is laying a 10
inch pipeline for evacuation of the cargo.
This will result in increased evacuation of
edible oil through pipeline thus avoiding inter
carting using tanker lorries.
This will in turn result in better
turnaround of the vessels thereby enabling the
port to handle more and more volume of edible
oil cargo and vessels thus increasing the port
efficiency. This certificate is issued to
enable the firm to obtain the required
statutory clearances for laying the pipeline.”
35. It will be noticed that the Certificate is silent
as regards the storage facility and it being in the
port. The Certificate does not exactly declare that
there is no space at the Chennai port. Appellants may
be correct in contending that edible oil is not
hazardous and that edible oil imports may be necessary
to meet the requirement of a growing population. It may
30
be true that there is no manufacturing process which
may be involved in constructing or maintaining the
storage facility.
36. The contention of the appellants that by
decongesting the traffic and allowing the edible oil
to be transferred through pipelines for onward
transmission to the factories of the appellant, the
baneful impact flowing from tanker lorry traffic by way
of pollution is reduced, overlooks the true purport of
the 2011 notification. We must demystify the object of
the law as contained in the coastal regulation
notification. As far as pollution is concerned, it is
the subject matter of laws specifically relating to
regulation and prohibition of activities on the said
score. A perusal of the 2011 notification reveals the
following as the avowed objects: (i) ensuring
livelihood security to the fisher communities and other
communities living in the coastal areas, (ii)
conservation and protection of coastal stretches; (iii)
the protection of the unique environment of the coastal
stretches and its marine area; (iv) promotion or
development through sustainable manner based on
31
scientific principles taking into account the dangers
of natural hazards in the coastal areas; (v) the aspect
of sea level rise due to global warming. Therefore, we
are unable to agree with the appellants that as the
laying of the pipeline would result in greater
efficiency in the functioning of the port or for that
matter, it would reduce the traffic congestion, and
what is more, thereby there would be a reduction in the
pollution may not by itself be relevant or for
concluding the issue. It is the duty of the Court to
glean the true object of a law and give effect to it.
It is equally the duty of the Court to eschew from its
consideration matters which may not be strictly germane
to the object. Hence, we proceed on the basis that the
argument based on increased efficiency of the port and
avoidance of traffic congestion, and the decreased
pollution in the landward area, as it were, may not be
by themselves relevant.
37. The next argument is the argument based on the
difference between the words ‘within’ as found in CRZI as contrasted with the word ‘in’ in CRZ-II. We are
called upon to employ a purposeful interpretation
32
bearing in mind also the distinction in the words used.
Much reliance has been placed on the judgment reported
in M. Nizamudeen (supra). The said matter arose under
the coastal regulation notification issued in the year
1991. The MoEF granted permission to the respondent
therein for construction for setting up of a marine
terminal facility near the sea shore for receiving and
transferring VCM which was one of the raw materials for
manufacturing PVC. Under the terms of the 1991
notification, certain activities were prohibited under
paragraph-2. They included manufacturing or handling
or storage or disposal of hazardous substances as
provided therein except transfer of hazardous
substances from ships to ports, terminals and
refineries and vice versa ‘in the port areas’.
38. The question fell for consideration as to the
interpretation to be placed on the words ‘in the port
areas’. We feel advised to refer to the following
portions of the judgment reported in M. Nizamudeen
(supra):
“36. It was contended by the Senior Counsel for
the appellant-petitioner that transfer of VCM
in CRZ area is completely prohibited and VCM
33
cannot be carried through the CRZ except in the
port area. Their argument is that VCM can be
brought onshore by pipeline to the port area
but not in the CRZ area. The arguments of
learned Senior Counsel have put in issue the
scope of expression, “except transfer of
hazardous substances from ships to ports,
terminals and refineries and vice versa in the
port areas” which was added in Para 2(ii) on
9-7-1997. We are called upon to ascertain the
true meaning and intention of the executive in
bringing this exception.
37. In the original 1991 Notification there was
no exception clause. It appears to have been
added for the purpose of enabling transfer of
hazardous substances from ships to ports, ships
to terminals and ships to refineries and vice
versa. Is such transfer of hazardous substances
confined to terminals and refineries located
in the port areas? The answer in the
affirmative may make the said provision
unworkable and would also result in absurdity
inasmuch as the hazardous substance would be
brought into the port, refinery or terminal in
the port area from the ship and would remain
there and could not be taken beyond the port
area because of the prohibition. This surely
could not have been the intention of the
executive in adding the exception clause.
38. It is well settled that if exception has
been added to remedy the mischief or defect,
it should be so construed that it remedies the
mischief and not in a manner which frustrates
the very purpose. Purposive construction has
often been employed to avoid a lacuna and to
suppress the mischief and advance the remedy.
It is again a settled rule that if the language
used is capable of bearing more than one
construction and if construction is employed
that results in absurdity or anomaly, such
construction has to be rejected and preference
should be given to such a construction that
34
brings it into harmony with its purpose and
avoids absurdity or anomaly as it may always
be presumed that while employing a particular
language in the provision absurdity or anomaly
was never intended.
39. Notwithstanding imperfection of expression
and that exception clause is not happily
worded, we are of the view that by applying
purposive construction, the expression, “in
the port areas” should be read as “in or
through the port areas”. The exception in Para
2(ii) then would achieve its objective and
read, “except transfer of hazardous substances
from ships to ports, ships to terminals and
ships to refineries and vice versa, in or
through the port areas”. This construction will
be harmonious with Para 3(2)(ii) which permits
the activity of laying pipelines in the CRZ
area.”
39. On the one hand, the learned counsel for the
appellants would place considerable reliance on the
view taken by this Court. Per contra, Smt. Anitha
Shenoy, learned Senior Counsel, would submit that the
aforesaid decision turned on the facts obtaining
therein and, in particular, the expression ‘in the port
areas’, whereas the language used in paragraph8(II)(vi) and also the context should persuade this
Court to place an interpretation advancing the object
of a notification such as the 2011 Notification.
35
40. A perusal of paragraph-36 of the Judgment would
show that the contention of the appellant therein was
that the transfer of the raw material in the CRZ area
was completely prohibited and it could not be carried
through the zone except ‘in the port area’. This Court
understood the terms of the notification to be that it
permitted transfer of the hazardous substances from the
ships to the ports, ships to terminals and finally,
ships to the refineries. The vice versa was also found
to be within the contemplation of the notification as
permitted activities. The Court posed the question
whether the transfer was to be confined to refineries
and terminals which were located in the port area. In
other words, if the argument of the appellant therein
was accepted, it could have resulted in confining the
transfer of the raw material from the ship by pipeline
to the port area but it could not be taken to a refinery
located outside the port area. But the provision did
contemplate transporting of the material from the ship
to the refineries as also to terminals and vice versa.
It was in this context that the Court proceeded to hold
that a purposive construction was needed to avoid a
36
situation of absurdity. Much turned on the presence of
the words ‘in the port area’. Therefore, keeping in
mind the clear object of the Notification, which was
self-evident, the Court added the words ‘or through’
to the words ‘in the port area’. This facilitated the
transfer of the raw material from the ships to a
refinery or a terminal which need not have to be located
in the port area. We must understand the decision of
this Court in M. Nizamudeen (supra) in the aforesaid
context. The rationale and principle appear inapposite
to the cases before us.
41. Paragraph-8(I)(f) relating to CRZ-I, may be
recaptured:
“(8). Norms for regulation of activities
permissible under this notification,-
CRZ-I
(ii) Areas between LTL and IITL which are
not ecologically sensitive, necessary
safety measures will be incorporated while
permitting the following, namely:-
(f) storage of non-hazardous cargo such
as edible oil, fertilizers and food
grain within notified ports;”
42. We also do bear in mind that in paragraph8(I)(i)(b), construction of pipelines, inter alia, was
permitted. It is thereafter that in paragraph-8(II),
37
under CRZ-II, Clause VI contemplated permitting of
storage of non-hazardous cargo, such as edible oil,
fertilizers and food grain ‘in’ notified ports. We may
broaden our inquiry into the relevant contents of CRZIII. CRZ-III of the 2011 Notification was divided into
area ‘A’, which, inter alia, dealt with areas up to 200
meters from HTL on the landward side in the case of sea
front. The said Clause proclaimed further that the said
area would be a No Development Zone (NDZ). We notice
that in CRZ-III the NDZ was not to be applicable in
‘such areas’ within any port limits. Thus, the
expression ‘within’ made its appearance in relation to
notified port limits again. In the permitted activities
in the NDZ under area ‘A’, viz., up to 200 meters as
aforesaid, we find Clause (e), which permitted
facilities for receipt and storage of petroleum
products and liquified petroleum gas as specified in
Annexure-II. Area B of CRZ-III is described as the area
comprised from 200 meters to 500 meters. Since the CRZ
itself would terminate upon the 500 meters distance
being obtained, this constituted, in other words, the
residuary area, of CRZ-III. Under the same we notice
38
that again facilities for receipt and storage of
petroleum products and liquified natural gas as
specified in Annexure-II was permitted. We may bear in
mind that the very same activity had also been
contemplated in area A of CRZ-III, viz., the area
comprised to 200 meters of the high tide line of the
landward area in the case of the sea front, inter alia.
Interestingly, when it comes to storage of nonhazardous cargo, such as edible oils fertilizers and
food grain ‘in’ the notified ports, it was permitted
activity in area ‘B’ of CRZ-III under Clause 4 thereof,
that is, an area located between 200 metres to 500
metres. It must be noticed that CRZ-III had been
classified in paragraph-7 essentially as relatively
undisturbed area, which did not belong to either CRZ-I
or II, which included the coastal zone in rural areas,
both developed and undeveloped and also areas within
municipal limits or in other legally designated urban
areas, which were not substantially built up. We have
already noticed the classification of CRZ-II earlier,
as areas which had been developed up to or close to the
shore line. Can it then be said that storage of non-
39
hazardous cargo, such as edible oil, fertilizers food
grain, permitted in the notified ports in CRZ-III, Area
‘B’, be also permitted in CRZ-III Area ‘A’? Going by
the contents of CRZ-III under activities which were
permitted in the NDZ, we are unable to find any clause
which permitted such storage of non-hazardous cargo
including edible oil, inter alia. Therefore, in the NDZ
area falling under area ‘A’ of CRZ-III, it may have
been impermissible.
43. We have made this discussion only to remind
ourselves that in interpretation of the Notification
we are concerned with, a pursuit of a purposive
interpretation or a search for a rationale which the
Court finds fair may meet with limitations which flow
from the object of the maker of the notification being
confined to the plain meaning of the words used. No
doubt, a situation found in the facts of the case
reported in M. Nizamudeen (supra) may call for a
different approach.
44. Reverting back to the controversy, projected from
the difference between the words ‘within’ and ‘in’, we
may notice the following discussion of the NGT, which
40
is a specialised Body, consisting of a Judicial Member
and a Technical Member in a statutory appeal under the
Act.
“54. In compact Oxford English Dictionary, the
meaning of the word 'in' is defined as
follows:-
'in Preposition 1) so as to enclosed,
surrounded, or inside. 2) expressing a period
of time during which an event takes place. 3)
expressing the length of time before an event
is expected to happen. 4) expressing a state,
condition, or quality. 5) expressing inclusion
or involvement. 6) indicating the means of
expression used: put in writing. 7) indicating
a person's occupation or profession. 8)
expressing a value as a proportion of whole.
Adverb 1) expressing movement that results in
being inside or surrounded. 2) expressing the
state of being enclosed or surrounded. 3)
present at one's home or office. 4) expressing
arrival at a destination. 5) [of the tide]
rising or at its highest level. Adjective
informal fashionable. - Phrases be in for be
going to experience something, especially
something unpleasant. in on knowing a secret.
in that for the reason that. in with i11fo1mal
enjoying friendly relations with. the ins and
outs informal all the details. - Origin Old
English"
55. The word 'within' has been defined in the
same Dictionary as follows:-
"within Preposition 1) inside. 2) inside the
range or bounds of we were within sight of the
finish. 3) occurring inside a particular period
of time. 4) not further off than (used with
distances). Adverb: 1) inside; indoors.
2)internally or inwardly.”
41
56. Meaning of these words when compared, it
will be clear that what was intended by these
words is something will have to be done within
the area, if it relates to the area and in the
area if relates to the area and not beyond that
area.”
45. Going by the definition of the word ‘in’, it
includes ‘so as to be enclosed, surrounded or inside’.
One way of looking at the word ‘in’ the notified port
in para 8(II)(vi) would be that storage of nonhazardous material is permitted inside the notified
port. We notice that the definition of the word
‘within’ also includes the word meaning inside. No
doubt, Justice Oliver Wendell Holmes declared: “A word
is not a crystal, transparent and unchanged; it is the
skin of a living thought and may vary greatly in color
and content according to the circumstances and time in
which it is used.”
46. Smt. Anita Shenoy, learned Senior Counsel, would
assert that what is ‘out’ cannot be considered as being
‘in’. She expatiates by pointing out that the storage
facility of the appellants is located a few kilometres
away of the notified limits of the Chennai Port. She
poses the question that on such facts could this Court
42
be persuaded to still hold that it is inside the
notified port, viz., the Chennai Port. It would involve
doing violence to the clear words. The word ‘within’
and ‘in’ therefore, in the context of the Notification
must be given the same meaning. The Notification and
the policy is not under a shadow, by way of a challenge
to the Notification. It is the plain duty of the Court
to give effect to the law as it is found. No doubt, as
pointed out by Shri Dhruv Mehta, if it is found
otherwise acceptable, an interpretation which accords
with constitutional principles, may appeal to the
Court, even if there is no challenge mounted.
47. A detour may be apposite. Chennai Port is a Port,
which is, admittedly, a major port within the meaning
of Major Ports Act, 1964. Another enactment, which
deals with ports, is the Indian Ports Act, 1908. The
appellants would contend that, while the storage
facility may not be located within the Chennai Port,
it is licenced under Section 57 of the Customs Act as
a customs station. In the Major Ports Act, the word
‘port’ is defined in Section 2(q). It reads as follows:
43
“(q) “port” means any major port to which this
Act applies within such limits as may, from
time to time, be defined by the Central
Government for the purposes of this Act by
notification in the Official Gazette, and,
until a notification is so issued, within such
limits as may have been defined by the Central
Government under the provisions of the Indian
Ports Act.”
48. Section 57 of the Customs Act, 1962 reads as
follows: -
“57. Licensing of public warehouses. —The
Principal Commissioner of Customs or
Commissioner of Customs may, subject to such
conditions as may be prescribed, licence a
public warehouse wherein dutiable goods may be
deposited.”
49. It is not the case of the appellants that the
storage is located within the limits of the Chennai
Port as contemplated in Section 2(q). It is, therefore,
not inside the said Port. However, it is appellants
case that the storage facility is located in the
Customs notified area. This is based on the license
issued under Section 57 of the Customs Act. Under
Section 15 of the Customs Act, the date for
determination of the rate of duty and tariff valuation
of any imported goods in the case of goods cleared from
a warehouse, under Section 68, is declared to be the
44
date, on which, a bill for entry for home consumption,
in respect of such goods, is presented under Section
15. Goods, which are imported may be cleared
immediately with reference to their being entered for
home consumption under Section 46, and the relevant
date, would then be the date of presentation of the
bill of entry. An importer may wish to warehouse the
goods. It is in such cases that it is only upon the
bill for entry for home consumption is presented that
the crucial date emerges. It is in this context that
to regulate and control the collection of duty apart
from other aspects that a license is procured under
Section 57 of the Act. Section 2 sub-Section (11) of
the Customs Act, defines the words ‘customs area’. It
reads as follows:
“2(11) “customs area” means the area of a
customs station or a warehouse and includes any
area in which imported goods or export goods
are ordinarily kept before clearance by Customs
Authorities”
50. Section 2 sub-Section (12) defines ‘customs port’,
whereas, Section 2 sub-Section (13), defines ‘customs
station’:
45
“(12) “customs port” means any port appointed
under clause (a) of section 7 to be a customs
port, and includes a place appointed under
clause (aa) of that section to be an inland
container depot”
(13) “customs station” means any customs port,
customs airport, international courier
terminal, foreign post office or land customs
station”
51. Section 7(a), to which reference may be necessary
in view of the definition of the words ‘customs port’,
reads as follows:
“7. Appointment of customs ports, airports,
etc.-(1) The Board may, by notification in the
Official Gazette, appoint-
(a)The ports and airports which alone shall
be customs ports or customs airports for
the unloading of imported goods and the
loading of export goods or any class of
such goods;”
52. Thus, every port falling under the Indian Port Act
and the Major Port Act may not be on their own become
a customs port. A customs port under Section 2(12)
comes into being on a port being appointed as such
under Section 7(a). A customs station no doubt,
includes any customs port and a land customs station.
The case of the appellant based on the license under
Section 57 of the Customs Act may make it a customs
46
area as it includes a warehouse but it is inconceivable
as to how it would transform it into ‘in a notified
port’.
53. An argument, which is raised by the learned Senior
Counsel for the appellants is traceable to Clause (1)
of paragraph-8 falling under CRZ-II. It reads as
follows:
“CRZ-11, -
(i) buildings shall be permitted only on the
landward side of the existing road, or on the
landward side of existing authorized
structures;”
It is the contention of the appellants that even if
it is found that the storage facility cannot be treated
as permitted in the port, as it does not fall in the
port, both having regard to the fact that CRZ-II
constitutes an area where the regime is less harsh than
the one contemplated in CRZ-I and also bearing in mind
that edible oil is non-hazardous cargo and still, what
is more important, in CRZ-II, facilities for receipt
and storage of petroleum products and liquified natural
gas can be permitted, and lastly, as a storage facility
would constitute a building, which, in the facts of
47
this case, is located on the landward side of the
existing road, the NGT was wrong. The argument appears
to be that the Chennai metro development authority
which is a local body has granted permission for the
construction of the storage facility treating the area
as a general industrial use zone. This means that the
building was permissible under the Town planning law.
The argument is further sought to be buttressed with
reference to the definition of the word building which
encompasses a storage facility.
54. This argument is sought to be met by Smt. Anita
Shenoy, learned Senior Counsel, by pointing out that
it would be plainly incongruous with the use of the
words ‘storage facilities’ as contained in paragraph8(II)(vi), falling under permitted activities under
CRZ-II with the word ‘building’, which must make the
position clear that placed side-by-side, building
cannot include the storage facility, which has been
expressly articulated and permitted as long as it is
‘in’ a notified port.
55. We notice certain salient features. CRZ-II has been
classified in para 7 as areas that have been developed
48
up to or close to the shore line. The storage tank of
the appellant in the first case appears to be located
at a distance of 160 feet from the shore line. At the
same time, it is located a few kilometres away from the
Chennai port. We have already noticed that under CRZ
III, the facility of storage of non-hazardous materials
including edible oil is permitted only at a distance
between 200-500 meters. This is even though both
handling and storage of petroleum products is
permitted, both within a distance of up to 200 meters
from the high tide line as also between 200-500 meters
from the high tide line. It may defy logic. At least
at first blush. We have already set out the objects of
the notification. They include guarding against the
dangers of natural hazards in coastal areas and the sea
level rise due to global warming. This is no doubt also
to be balanced with the need for sustainable
development. The coastal regulation appears to be based
on considerations which appear to accommodate
conflicting interests premised on considerations of
what is felt as indispensably necessary and the nature
of the zone in question. Allowing storage facilities
49
for non-hazardous activities like edible oil, is,
apparently, considered as an indispensable part of the
operation of a port. The Port Authorities would have
full control over the storage facility located within
its limits. No doubt, Section 35 of the Major Port
Trust Act, 1964, inter alia, empowers the port to
execute works outside its limits for securing and
storing goods to be landed or to be shipped. The storage
tanks in question are not works executed by the port.
56. As far as the case that is sought to be built up
on the basis that since CRZ-II permitted buildings on
the landward side of the existing road, we must notice
that this is not the basis for the decision of the
first respondent which was successfully impugned before
the NGT. We, in fact, queried Smt. Archana Pathak Dave,
learned counsel for the first respondent as to whether
this was the basis. She did not appear to support the
decision on the basis that it forms the basis for the
decision. We may notice further, the following pleading
of the first respondent which has been adverted to by
the NGT in their reply affidavit before the NGT even:
50
“5. It is submitted that the said activity
under scrutiny is a permissible activity and
regulated under para No. 8(I)(i) (b), para No.
8(I)(ii)(f) and para No. 8.II.(vi) of the CRZ
Notification, 2011.”
57. Paragraph-8(I)(i)(b), undoubtedly, related to
permitting of pipelines being constructed in CRZ-I.
Paragraph-8(I)(ii) related to CRZ-I. The further
reference is only to paragraph 8(II)(vi) which permits
the activity in question ‘in’ notified ports. The
aspect relating to buildings being permitted on the
landward side of the existing road dealt with in
paragraph 8(II)(i) was not the basis for the decision
even according to the counter affidavit. This is apart
from the fact that impugned decision of the first
respondent does not proceed on the basis of paragraph
8 (II)(i). This is also apart from noticing the
contention of Respondent No.5 that storage facility
being specifically dealt with, ‘building’ under
paragraph-8(II)(i), would not include storage
facility. We would therefore, think that we must not
be persuaded to allow the appellants or allow them to
lean on paragraph 8(II)(i) of the 2011 Notification.
51
58. Another argument, which has been raised by Shri
Dhruv Mehta, appears to stem from the law relating to
contemporanea expositio. The authorities are experts.
They have applied their minds. Their understanding
should govern. At least, it should be given the weight
that is due to them. This forms the premise. Moreover,
he refers to the judgment of this Court in K. P.
Varghese v. ITO13. K.P. Varghese (supra) involved the
interpretation of Section 52 (2) of the Income Tax Act,
1961. This Court took the view inter alia that to invoke
Section 52(2), it was not enough only to show that the
fair market value of the capital asset as on the date
of the transfer exceeded the full value of the
consideration declared by the assessee by not less than
15 per cent of the value so declared. This Court
eschewed a purely literal interpretation on the basis
that it led to manifestly unreasonable and absurd
consequences. It was found that Parliament did not
intend to target bona fide transactions, where the
assessee had truthfully declared the actual
consideration. This Court drew upon the speech of the
13 (1981) 4 SCC 173
52
Finance Minister, the Heydon’s Rule or the Mischief
Rule and the importance of the word ‘declared’ figuring
in Section 52 (2) and the fact that soon after the
introduction of the provision, the Central Board of
Direct Taxes issued statutory circulars under Section
119 of the Income Tax Act explaining the scope of
central. It was specifically held that the circulars
would bind the Revenue even if they were not found to
be in accordance with the correct interpretation of the
provision. It is apart from all these that, no doubt,
this Court went on to hold as follows: -
“These two circulars of the Central Board of
Direct Taxes are, as we shall presently point
out, binding on the Tax Department in
administering or executing the provision
enacted in sub-section (2), but quite apart
from their binding character, they are clearly
in the nature of contemporanea
expositio furnishing legitimate aid in the
construction of sub-section (2). The rule of
construction by reference to contemporanea
expositio is a well-established rule for
interpreting a statute by reference to the
exposition it has received from contemporary
authority, though it must give way where the
language of the statute is plain and
unambiguous. This rule has been succinctly and
felicitously expressed in Crawford on
Statutory Construction, (1940 Edn.) where it
is stated in para 219 that “administrative
construction (i.e. contemporaneous
construction placed by administrative or
53
executive officers charged with executing a
statute) generally should be clearly wrong
before it is overturned; such a construction,
commonly referred to as practical
construction, although non-controlling, is
nevertheless entitled to considerable weight;
it is highly persuasive”.
The validity of this rule was also recognised
in Baleshwar Bagarti v. Bhagirathi Dass [ILR
35 Cal. 701] where Mookerjee, J., stated the
rule in these terms:
“It is a well-settled principle of
interpretation that courts in construing a
statute will give much weight to the
interpretation put upon it, at the time of its
enactment and since, by those whose duty it has
been to construe, execute and apply it.”
and this statement of the rule was quoted with
approval by this Court in Deshbandhu Gupta &
Co. v. Delhi Stock Exchange Association
Ltd. [(1979) 4 SCC 565] It is clear from these
two circulars that the Central Board of Direct
Taxes, which is the highest authority entrusted
with the execution of the provisions of the
Act, understood sub-section (2) as limited to
cases where the consideration for the transfer
has been understated by the assessee and this
must be regarded as a strong circumstance
supporting the construction which we are
placing on that sub-section.”
59. The principle is inapposite in the facts. That the
authorities have proceeded on a particular basis, may
as well betray their erroneous understanding. That such
views do not clinch the issue relating to the
54
construction of the law is elementary. We would think
that in the facts of this case and on a construction
of the statute or the law in question, viz., the 2011
notification, the understanding of the authorities if
that be the basis of the contention, cannot overwhelm
our understanding of the notification. We again
reiterate that the words ‘within’ and ‘in’ cannot
include what is outside the port. The maker of the
notification has not even contemplated the activities
in question in a ‘port area’. We must here elucidate
and observe that if the contention is to be upheld that
a storage tank can be permitted outside the port
limits, it will introduce chaos. The question would
arise as to up to what distance from the port area it
would be considered as the ‘in the port area’. The 2011
Notification cannot receive an interpretation which
would leave matters of moment to be afflicted with the
vice of uncertainty. This is apart from the importance
of avoiding an interpretation which seemingly allows
free play in the joints to the Administrator but, at
the same time, vest an arbitrary power in him.
55
60. As far as the pipeline is concerned, no doubt, it
is permitted in CRZ I and arguments were addressed
before us that even if the storage facility is to be
demolished, making use of the edible oil brought
through the pipelines, which are, no doubt, located
underground, the oil could be collected at the spot
from where it is currently located viz., where the
pipeline ends and transported therefrom to the factory.
There is no dispute that the pipeline is located in a
zone where it is permitted activity. There can be no
dispute that ex post facto permission can be given for
permitted activity as found by the NGT itself. No
doubt, the pipeline, may have meaning only as so far
as it is connected to the storage tank. As to whether
the pipeline can continue to be used if the storage
tanks are demolished is a matter which must engage the
attention of the authorities. We would think that in
regard to the pipelines, it would be the District
Coastal Zonal Management Authority, which could take a
decision.
56
61. The upshot of the above discussion is as follows:
As regards the pipelines which have been drawn,
the appellants may approach the relevant District
Coastal Zonal Management Authority within a period of
one month from today. The District Coastal Zonal
Management Authority will consider any application made
in regard to the continued use of the pipeline and take
a decision in accordance with law within a further
period of six weeks from the date of the receipt of the
application.
62. In view of the request made by the appellants that
they may be permitted to continue to use the pipeline
along with the storage facility for a period of one
year, we would think that the interest of justice do
require grant of some time. The appellants are
accordingly given a period of six months from today to
comply with the impugned order of the NGT. This is in
regard to the direction to demolish the storage tanks.
The appellant in the first appeal is given a month’s
time to pay the compensation ordered, if not already
paid.
57
63. As far as the direction to demolish the pipeline,
the matter will await the decision to be taken by the
District Coastal Zonal Management Authority.
64. The appeals are partly allowed. There will be no
order as to costs.
……………………………………………J.
[K.M. JOSEPH]
…………………………………………J.
[B.V. NAGARATHNA]
……………………………………………J.
[J.B. PARDIWALA]
NEW DELHI;
DATED: FEBRUARY 01, 2023.

Comments

  1. we just redefine Indonesia's constitution day. read more at https://unair.ac.id/redefining-indonesian-constitution-day/

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