National Green Tribunal
Balwinder Kaur vs Ankita Sinha on 19 March, 2025
BEFORE THE NATIONAL GREEN TRIBUNAL
PRINCIPAL BENCH
NEW DELHI
ORIGINAL APPLICATION NO. 40/2024
(I.A. NO. 384/2024)
IN THE MATTER OF:
BALWINDER KAUR
VPO Pathreri Jattan,
District-Ropar
State of Punjab
...Applicant
Verses
1. STATE OF PUNJAB
Through Additional Chief Secretary/Principal Secretary,
Department of Environment and Forest,
Government of Punjab,
Chandigarh-160001
2. MINISTRY OF ENVIRONMENT, FOREST AND CLIMATE CHANGE
Through its Secretary,
Bay's No.24-25, Sector 31 A,
Dakshin Marg, Chandigarh
3. NATIONAL HIGHWAY AUTHORITY OF INDIA
Through its Chairman,
G-5 & 6, Sector 10, Dwarka,
New Delhi-110075
4. M/S CEIGALL INDIA LIMITED
To be served through Project Director,
National Highway Authority of India,
Jammu-Katra Expressway Project.
District Rupnagar
Registered Office
CEIGALL INDIA LIMITED
A-898, Tagore Nagar Ludhiana
Punjab-141001
1
5. PUNJAB POLLUTION CONTROL BOARD
Through its Member Secretary,
Head Office, Vatavaran Bhawan. Nabha Road
Patiala-147001
...Respondent(s)
COUNSELS FOR APPLICANT:
Applicant in Person (through VC)
COUNSELS FOR RESPONDENT(S):
Mr. Sandeep Bajaj, AAG with Mr. Mayank Biyani Advocates for State of
Punjab (through VC)
Mr. Ankit Siwach, Advocate for PPCB (through VC)
Mr. Tarun Dua, Ms. Madhu Sweta, Mr. Yash Kapoor and Ms. Astha
Dhawan, Advocates for Respondent No. 3 - NHAI
Mr. Ayush Acharjee, Advocate for Respondent No. 4
CORAM:
HON'BLE MR. JUSTICE SUDHIR AGARWAL, JUDICIAL MEMBER
HON'BLE DR. AFROZ AHMAD, EXPERT MEMBER
RESERVED ON: SEPTEMBER 11, 2024
PRONOUNCED ON: MARCH 19, 2025
JUDGMENT
BY HON'BLE MR. JUSTICE SUDHIR AGARWAL, JUDICIAL MEMBER
1. On a letter petition dated 06.08.2023 received from Balwinder Kaur, this Original Application (hereinafter referred to as 'OA') was registered under Sections 14 and 15 of National Green Tribunal Act, 2010 (hereinafter referred to as 'NGT Act, 2010') in exercise of suo-moto jurisdiction in view of law laid down by Supreme Court in Municipal Corporation of Greater Mumbai vs. Ankita Sinha, (2022) 13 SCC 401.
2. The complainant raised a grievance of risk of thousands of trees felling due to likelihood of land sliding. It is said that illegal mining is 2 being carried out upto 15 to 20 feet in agricultural land adjacent to Forest Department land where thousands of trees are standing which are facing risk of land sliding on account of illegal mining which may result in tremendous loss to environment. The complaint was supported by the photographs showing deep mining near the land where large number of trees are standing.
3. Tribunal's Order dated 09.04.2024: Tribunal taking cognizance of complaint, found it appropriate to call for a factual Report by constituting Joint Committee comprising representatives of Punjab State Pollution Control Board (hereinafter referred to as 'PSPCB'), and District Magistrate, Ropar vide order dated 09.04.2024.
Report dated 20.05.2024 filed by PSPCB:
4. Pursuant to above order, Report dated 20.05.2024 has been filed by Joint Committee through Environmental Engineer, PSPCB. Joint Committee visited the site on 23.04.2024 and found that several violations in respect of mining conducted at site which included mining of much more material than permitted by M/s. Ceigall India Limited, a company employed by National Highway Authority of India (hereinafter referred to as 'NHAI') for construction of Jammu-Katra Expressway on part coming in district Rupnagar. Observations of Joint Committee are as under:
"It was observed that the site falls in the revenue estate of Village Pathreri Ranghran with coordinates (Latitude 30.912763 Longitude 76.520868). During visit, the complainant Smt. Balwinder kaur w/o Sh. Gurveer Singh and other farmers/ land owners Sh. Satwant Singh S/o Sh. Dharam Singh and Sh. Jaswant Singh S/o Sh. Dharam Singh village Pathreri Jattan were present. They raised the issue regarding adverse impact of mining onto their land holdings and informed that earth mining upto 15-20ft has been carried out in their adjoining land by M/s Ceigall India i.e. company hired by NHAI for extraction of minor minerals for construction of highway (Copy of the statement of Sh. Satwant Singh, Sh. Jaswant Singh, Sh. Najar Singh, 3 sons of Sh. Dharam Singh, Village Pathreri Jattan has been enclosed as (Annexure-2).The site was jointly inspected by the team and it was observed that the site is surrounded by Forest area (adjoining bhakra canal) on one side, Panchayati Land (Shamlat) on other side and land of private owners/farmers on other two sides. Further, the google image of site is given below:
Google Image omitted On North and West side of the site under complaint, there is private land of farmers, on the East side there is Bhakhra Canal and on the South side, there is panchayati land of Village Pathreri Rangran. The forest land is located along the bank of Bhakhra Canal.
5) The Executive Engineer, Mining, vide letter no. 5186 dated 23.04.2024 informed that the construction of Jammu- Katra Expressway is under construction by M/s Ceigall India Limited Company in District Rupnagar. In connection to which K-1 permits have been issued to the concerned company after payment of royalty to the government. For 03 number, K-1 Permits issued to the company in village Pathreri Rangran, the Company has extracted more material @1063562 cu ft. above the permissible quantity of 1816115 cu. Ft.
Following 03 number demand notices (S-Notice) have been issued to the company for excess quantity extracted: -
Sr K-1 Village Name Area S S- Date Amount
No Permit Name of (Sq. Notice Notice
ID Land ft.) issued No.
owner to
1. 99291 Pathreri Amanp 116438. M/s 8768 03.10.2023 3,43,492/-
Rangran reet 77 Celgall -69
Singh India
2. 99294 Satpal 130680 Limited 8770 03.10.2023 30,84,107/-
Singh -71
3. 99293 Rajinder 174240 8766 03.10.2023 28,47,417/-
Singh -67
62,75,016/
Total Amount 62,75,016/-
The amount of Rs. 62,75,016/- with respect to the aforesaid demand notices has been deposited by the company. Copy of letter no. 5186 dated 23.04.2024 as Annexure-3.
6) District Development & Panchayat Officer, Rupnagar vide letter no. 1617 dated 23.04.2024 has informed that:
"The undersigned as part of the said committee visited the mining site at village Pathreri Jattan Block Rupnagar today i.e. 23.04.2024. The allegations in the complaint did not mention anything about mining on 4 Panchayati land but in the interest of justice, it was decided that any adjoining Panchayat land may also be got demarcated during the demarcation of the mining site.
Thereafter, the officials of the office of the Block Development and Panchayat Officer, Rupnagar S.D.O (P.R.), A.E. (P.R.), Panchayat Secretary alongwith the officials of Revenue Department carried out the demarcation of the mining site. The Gram Panchayat has no land at village Pathreri Jattan near to the mining site but the adjoining Gram Panchayat of village Pathreri Ranghran has Panchayati land near to the mining site. So the relevant Khasra numbers of the panchayat land at Parthreri Ranghran were seen from the latha (Map) of the village by the Kanungo and were included in the demarcation done today" Copy of letter no. 1617 dated 23.04.2024 as Annexure-
4.
7) The Tehsildar, Rupnagar vide letter no. 227 dated 23.04.2024 has informed that: "On 23/04/2024, in the presence of the committee formed by Hon'ble Deputy Commissioner Rupnagar, the undersigned along with field staff as well as other respectable persons of the village, the site was checked. The demarcation procedure was conducted on the spot, in the presence of present persons there, from which it is found that land comprised in Khasra No. 18//22/2 (4-12) 21//2/2 (4-12) 21//9 (8-0) 10/1 (6-0) 11 (8-0) 22//15/2 (2-0), which is owned by Bachittar Singh, Amanpreet Singh Sons of Jeet Singh etc. and land comprised in Khasra No. 18//23 (8-0) 24 (8-0) 25 (4-2) 21//3 (8-0) 4 (6-8) 8 (8-16) 21/712 (8-0) 13 (3-4), which is owned by Rajinder Singh, Satpal Singh Sons of Ajain Singh etc. the Fard Jamabandi of ownership is enclosed herewith. Mining In the land comprised in above mentioned Khasra Numbers, is found as per the area informed by the department of mining,"
Copy of report of Tehsildar, Rupnagar received vide letter no. 227 dated 23.04.2024 is enclosed herewith as Annexure-5.
8) The Environmental Engineer, Punjab Pollution Control Board, Regional Office, Rupnagar, has informed that Extraction or Sourcing or Borrowing of ordinary earth for the linear projects such as roads, pipelines etc. is exempted from requirement of Environmental Clearance as per APPENDIX--IX of Environment Impact Assessment Notification dated 14.09.2006, subject to compliance Standard Operating Procedure and Environmental Safeguards issued in this regard from time to time.
9) Further, the Divisional Forest Officer, Rupnagar vide letter no. 868 dated 23.04.2024 has informed that during the visit of the joint committee on 23.04.2024, it has been found that the mining has been 5 carried out in land comprised in Khasra No. 18//22/2 (4-12) 21//2/2 (4-12) 21119 (8-0) 10/1 (6-0) 11 (8- 0) 22//15/2 (2-0), which is owned by Bachittar Singh, Amanpreet Singh Sons of Jeet Singh Etc. and land comprised in Khasra No. 18//23 (8-0) 24 (8-0) 25 (4-2) 21//3 (8-0) 4 (6- 8) 8 (8-16) 21//12 (8-0) 13 (3-4), which is owned by Rajinder Singh, Satpal Singh Sons of Ajain Singh etc. Along with this area, comes the forest department area, which is in perfect condition. There has been no damage to any kind of forest property/trees. Copy of the report is attached herewith as (Annexure -6).
From the above comments, it has been concluded that:
1. M/s Ceigall India Limited Company has grossly violated the permission given by the Mining Department by extracting more material against the permissible quantity. Accordingly, 03 no.
demand notices (S Notice) have been issued to the company for extracting more material @ 1063562 cu.ft. and an amount of Rs. 62.75 lacs has been got deposited from the company.
2. Considering the gross violations of aforesaid mining permission, the Mining Department is required to take exemplary / legal action against the company as well as the owners of lands, so that such violation is not repeated by them or any other, in the future.
3. As per DFO, Rupnagar report, there has been no damage to any kind of forest property/trees.
4. DFO, Rupnagar may be asked to the potential of land slide of the adjoining forest area and take remedial action accordingly.
5. Mining Department may be asked for redevelopment of the burrowed area in compliance to the standard operating procedures issued by the MoEF&CC in this regard. Burrow pits shall be back filled with rejected construction wastes including fly ash, compacted and shall be given a turfing or vegetative cover on the surface. If this is not possible, then excavation slope should be smoothened and depression should be filled in such a way that it looks more or less like the original ground surface."
Tribunal's Order dated 22.05.2024:
5. Tribunal considered the matter on 22.05.2024 and in the light of Joint Committee Report found it appropriate to implead following as respondents:6
(i) State of Punjab through its Additional Chief Secretary/Principal Secretary, Department of Environment and Forest, Government of Punjab, Chandigarh-160001;
(ii) Ministry of Environment, Forest and Climate Change through its Secretary, Bays No. 24-25, Sector 31 A, Dakshin Marg, Chandigarh;
(iii) National Highway Authority of India through its Chairman, G-5 & 6, Sector-10, Dwarka, New Delhi - 110075; and
(iv) M/s Ceigall India Limited, which is to be served through Project Director, National Highway Authority of India, Jammu-Katra Expressway Project, District Rupnagar who shall also file affidavit of service.
6. Notices were issued to respondents permitting them to file their objections to the Joint Committee Report/responses. Reply dated 22.07.2024 filed by PSPCB:
7. PSPCB through Environmental Engineer, Rupnagar has submitted its reply dated 22.07.2024 stating that NHAI, M/s. IRCON International Limited (hereinafter referred to as 'IRCON') and M/s. Ceigall India Limited (hereinafter referred to as 'respondent 4') are engaged in construction activities. NHAI awarded vide letter of award dated 22.12.2021 the work of construction of four/six lane green field Ludhiana-Rupnagar National Highway No. 205K from junction with NE-5 village near Mannewal (Ludhiana) to junction with NH-205 near Bheora village (Rupnagar) including spur to Kharar with Ludhiana Bypass under Bharatmala Pariyojana in State of Punjab on hybrid annuity mode: Package -3 of total length 43.26 km. Subsequently, M/s. IRCON entered into an agreement with respondent 4 on 04.08.2022 for construction of above project which 7 bears Bid Project Cost of Rs.1107 Crores excluding GST. Respondent 4 obtained Consent to Operate (hereinafter referred to as 'CTO') from PSPCB under Water (Prevention and Control of Pollution) Act, 1974 (hereinafter referred to as 'Water Act, 1974') which was granted vide letter dated 18.04.2023, CTO under Air (Prevention and Control of Pollution) Act, 1981 (hereinafter referred to as 'Air Act, 1981') was granted by PSPCB vide letter dated 18.04.2023. Both the above CTOs were valid upto 30.09.2024. The same were granted for Ready Mix Cement Concrete Plant with project cost of Rs.160 lakhs. The CTOs were granted with certain conditions motioned therein. Project Proponent did not obtain Consent to Establish (hereinafter referred to as 'CTE') and CTO from PSPCB from construction of National Highway which fall under 'Orange Category' at serial no. 2052-New Highway Construction Projects bearing project cost of Rs.1107 Crores.
8. Pursuant to order dated 09.04.2024 passed by Tribunal in the present matter, Joint Committee visited the site on 23.04.2024 and found several violations in respect of mining conducted at site which included mining of much more material than permitted by respondent 4, a company employed by NHAI for construction of Jammu-Katra Expressway on the part coming at district Rupnagar. Department of Mines and Geology has issued 3 demand notices against illegal mining to respondent 4 for excess material extracted and also imposed penalty. The project has been established and operating without CTE and CTO under Water Act, 1974 and Air Act, 1981 from PSPCB, hence it is in violation of environmental laws. The Competent Authority of PSPCB examined the matter and issued directions under Section 33A of Water Act, 1974 and 31A of Air Act, 1981 to NHAI, IRCON and M/s. Ceigall India Ltd. i.e., respondent 4 vide letter 8 dated 11.07.2024 affording them an opportunity to appear in person before Chairman of the Board at Patiala on 18.07.2024. The copy of the notice has been placed on record as annexure-A at page 56 of the paper book. PSPCB proposed to issue following directions:
"1) That the establishment/authority shall take all necessary steps to close down its operations.
2) That the establishment/authority shall stop forthwith discharging any effluent / emissions from its activity or through any mode.
3) That the establishment/authority shall immediately stop its activities and will not restart the same unless all necessary water and air pollution control measures are taken and obtains valid consents of the Board.
4) That Environmental Compensation shall be imposed on the establishment/authority for polluting the environment.
5) That the permission granted to the establishment/authority for lifting of fly ash /pond ash from GGSSTP, Rupnagar vide no.
2682 dated 19.04.2023 shall be cancelled.
6) That DG sets installed by the establishment/authority shall be sealed."
9. Regional Officer, PSPCB, Rupnagar vide letter dated 12.07.2024 (annexure-B at page 59) has revoked CTOs dated 18.04.2023 issued under Water Act, 1974 and Air Act, 1981.
10. Pursuant to notice dated 11.07.2024, giving opportunity of personal hearing to NHAI, IRCON and M/s. Ceigall India Ltd., their representatives attended the hearing before Chairman of PSPCB on 18.07.2024 and made following submissions:
"i) Sh. Pankaj Kumar, Resident Engineer o/o CGM (Tech) Punjab, NHAI informed that NHAI has obtained Environmental clearance under ΕΙΑ notification dated 14/09/2006 on 3/06/2022 from MoEF&CC, GoI for development of National Highway from Ludhiana to Rupnagar, starting from Delhi- Katra Expressway 9 (NE-5) near village Manewal and terminating on NH-205 at Rupnagar near village Bheora including development of its spur under the Bharatmala Pariyojna. The Highway will pass through three districts of Punjab viz. Ludhiana, Rupnagar and SAS Nagar. A copy of the Environmental clearance obtained by NHAI was submitted during the hearing. However, the representative of NHAI was unware regarding applying for consents to operate of the Board under the Water (Prevention & Control of Pollution) Act, 1974 and the Air (Prevention & Control of Pollution) Act, 1981 and informed that they have an agreement with M/s IRCON International Limited, C-4 District Centre, Saket, New Delhi to carry out the project.
ii) Sh. Jaswinder Singh, (JGM), M/s IRCON International Limited, Saket, New Delhi informed that they have entered into an agreement with M/s Ceigall India Limited, Civil Lines, Ludhiana to execute the project.
iii) Sh. Kanwaldeep Singh, Project Director, M/s Ceigall India Limited, Civil Lines, Ludhiana informed that they have started the project on 18/04/2023 after obtaining consents to operate of the Board under the Water (Prevention & Control of Pollution) Act, 1974 and the Air (Prevention & Control of Pollution) Act, 1981 for the ready-mix cement concrete plant and were unable to apply for consents for the whole project due to financial issue regarding fixation of total assets by NHAI. The representatives further informed that they have deposited the amount as demanded in the S-notices issued by the Mining department and has also taken measures for prevention of land slide in the area where the mining took place, including backfilling of the mined area."
11. Chairman of PSPCB after hearing the parties found that though penalty of Rs.62,75,016/- has been imposed by Department of Mining and Geology but for causing damage to environment, no compensation was imposed and the project has been commenced without requisite consent under Water Act, 1974 and Air Act, 1981 and thereby, environmental laws have been violated, hence Chairman, PSPCB decided as under:
"a) NHAI shall apply for consents to operate of the Board under the Water (Prevention & Control of Pollution) Act, 1974 and the Air (Prevention & Control of Pollution) Act, 1981 for the construction of the highway project, within two weeks.10
b) All the Project Proponents namely NHAI, IRCON and Ceigall India ltd. are jointly and severally liable to pay the damages, NHAI being the prime party. Therefore, Environmental compensation shall be deposited by the project proponents for the damage done to the environment as well as for not obtaining consents to operate of the Board since the date of start of operations of the project i.e. 18.04.2023 till date, within 07 days in the office of Environmental Engineer, Regional Office, Rupnagar. The orders in this regard shall be issued separately.
c) Environmental Engineer, Regional Office, Rupnagar shall verify the contentions of the project proponents made during the hearing and re-calculate the Environmental Compensation accordingly. He shall also get the Environmental Compensation verified from the Committee constituted by the Board for this purpose and get the orders issued from the Competent Authority in this regard, within two days."
12. The decision of Chairman, PSPCB was communicated to NHAI, IRCON and M/s. Ceigall India Ltd. i.e., respondent 4. Further, the issue of environmental compensation has been considered separately by the Committee constituted by PSPCB and after consideration, the Committee has computed environmental compensation of Rs.85,87,500/- liable to be imposed upon the project proponent for violation of environmental laws for the period of 18.04.2023 to 18.07.2024 and a separate order has been issued on 19.07.2024 requiring NHAI, M/s. IRCON and M/s. Ceigall India Ltd. to deposit the said amount within 15 days failing which proceedings for recovery shall be initiated.
Affidavit dated 17.07.2024 filed by respondent 1:
13. A short affidavit dated 17.07.2024 has been filed on behalf of State of Punjab i.e., respondent 1 by Divisional Forest Officer, Forest Division, Rupnagar. It is said in para 4 to 6 as under:
"4. That the land of village Pathreri Ranghran, HB No. 170, bearing Khasra No. 18//22/2(4-12), 21//2/2(4-12), 21//9(8-0), 10(8-0), 11(8-0), 22//15/2(2-0), owned and possessed by Bachitar Singh, 11 Amandeep Singh S/o Jeet Singh and Jamabandi is attached herewith regarding ownership and also land bearing Khasra No 18//23(8-0), 24(8-0), 21//3(8-0), 4(6-8), 8(8-16), 21//12(8-0), 13(3-4), owned and possessed by Rajinder Singh, Satpal Singh S/o Ajaib Singh etc and copy of Jamabandi is attached herewith regarding ownership. The mining has been done in the private area of the above said owners, according to the report of demarcation of the Revenue Department. The copy of Latha/Drawing of the above said Khasra Nos. of the area under mining is attached as (Annexure R-3).
5. That the deponent has taken the remedial action and has got strengthened the area adjoining to the Forest area through the land owner. The land owners had restored the soil upon the area adjoining to the Forest Area bank .i.e. B.M.L Canal RD 26 to 28 Right Side from where earth has been removed to prevent any kind of land slide due to heavy rain in future. A copy of photographs taken at the spot are attached as (Annexure R-4)
6. That after strengthening of the adjoining area to the Forest Land bank i.e. B.M.L Canal RD 26 to 28 Right Side situated in near village Pathreri Rangran (Rajputan) Tehsil Shri Chamkaur Sahib district Rupnagar now there is no risk of any kind of land slide in the Forest area and there is no damage to any kind of forest property/trees."
Reply dated 29.07.2024 filed by respondent 1:
14. On behalf of respondent 1, a further reply dated 29.07.2024 has been filed by Additional Secretary, Government of Punjab wherein virtually the facts stated in the reply of PSPCB have been reiterated. Reply dated 06.08.2024 filed by respondent 4 on 12.08.2024:
15. Respondent 4 has submitted its reply dated 06.08.2024 stating that a contract for construction of road was awarded by NHAI to IRCON, Ludhiana, Rupnagar Private Limited (hereinafter referred to as 'Concessionaire'). In turn, the concessionaire vide agreement dated 22.09.2022 awarded the construction of the project to IRCON International Limited (hereinafter referred to as 'Sub-Concessionaire'). In change, the Sub-Concessionaire executed an agreement dated 04.08.2022 12 with M/s. Ceigall India Ltd. i.e., respondent 4 and appointed date for the project was as 16.02.2023. For execution of the project, respondent 4 has taken certain private land on lease for excavation of ordinary earth from such land and has also obtained K-1 permit from District Mining Officer, Rupnagar. It has not trespassed into any other land except the land and has carried out the mining only on such land which has been taken on lease and there is no damage to any forest property/trees. Respondent 4 has also taken steps such as stone pitching for protection of adjoining areas including that of applicant who has expressed its satisfaction on the measures taken by respondent 4. Three demand notices were issued by Mining Department under the provisions of Punjab Minor Mineral Rules, 2013. The excess mining done by respondent 4 was not deliberate and it was due to confusion caused by issue of dual K-1 permits pertaining to same land. The amount of penalty has been deposited by respondent 4 and the issues have been closed. Against order dated 19.07.2024 issued by PSPCB imposing environmental compensation, respondent 5 has already submitted its reply. Respondent 4 thus has said that it has taken all remedial steps to restore broad burrowed area, complied with demand notice issued for excess extraction and there is no damage to forest land/trees which are in perfect condition, hence the grievance of the applicant stands redressed.
Reply dated 13.08.2024 filed by respondent 3:
16. Reply dated 13.08.2024 has been filed on behalf of respondent 3 i.e., NHAI which is also in response to the Joint Committee Report. It is said that NHAI has no direct role regarding illegal mining done by M/s. Ceigall India Ltd. who is the Sub-contractor engaged by Concessionaire namely M/s. IRCON International Limited with whom NHAI has entered to a 13 Concession Agreement for construction of project highway. Respondent 3 i.e., NHAI has referred to clauses of its agreement to show that the obligation if any is that of Concessionaire of contractor and not that of NHAI. The stand taken by it in para 6 to 9 of its reply is reproduced as under:
"6. As per the provision of Concession Agreement, it is the responsibility of Concessionaire to procure all the raw material for construction of Project Highway by applying all the applicable permits. The role of Answering Respondent is limited upto the supervision of the work being done in acquired Right of Way (ROW) through the Independent Engineer i.e. M/s Upham International Corporation. It is the Concessionaire who approaches the mining department for obtaining the permits and thereafter the mining department oversees the excavation being carried out. The role of Answering Respondent is limited to oversee the quality/consumption of the soil for ROW. It is relevant to mention that the excessive extraction of soil at borrow areas which was done by M/s Ceigall/Sub-contractor was far away from the ROW acquired by NHAI. Hence, NHAI has no direct role in the illegal mining activity.
7. It is, therefore, submitted that the Answering Respondent has been wrongly impleaded before this Hon'ble Tribunal as detailed in the following factual matrix-
7.1. On 22.12.2021, the Answering Respondent issued Letter of Award to the Concessionaire for construction of four/six lane green field Ludhiana -- Rupnagar National Highway No. 205K from junction with NE-5 Village near Mannewal (Ludhiana) to junction with NH-205 near Bheora Village (Rupnagar) including spur to Kharar with Ludhiana Bypass near under Bharatmala Pariyojana in the State of Punjab on hybrid annuity mode -- Package 3.
7.2. On 25.03.2022, CA was executed between the Answering Respondent and the Concessionaire. True copy of the relevant clauses of the CA is annexed herewith and marked as Annexure R3/1. As per the CA, the obligations of the Answering Respondent are as under-
i. Clause 4.1.2 (b) of CA casts an obligation upon the Answering Respondent to procure all Applicable Permits relating to environmental protection, and conservation in 14 respect of land forming part of the Right of Way under Clause 10.3.1 and 10.3.2 ii. Clause 4.1.2 (c) of CA casts an obligation upon the Answering Respondent to procure forest clearance for and in respect of land forming part of the Right of Way under Clause 10.3.1 and 10.3.2, save and except permission for cutting trees.
iii. Clause 6.1.2 of CA casts an obligation upon the Answering Respondent to only provide reasonable support and assistance to the Concessionaire in procuring the Applicable Permits.
7.3. As per Article 5 of CA, the obligation of the Concessionaire are specified as under-
i. As per Clause 5.1.2, the Concessionaire has to comply With all Applicable Laws and Applicable Permits (including renewals as required) in the performance of its obligations under the Agreement, as extracted below:
"5.1.2 The Concessionaire shall comply with all Applicable Laws and Applicable Permits (including renewals as required) in the performance of its obligations under this Agreement."
ii. Clause 5.1.4 of CA also casts obligation on the Concessionaire as stated below-
"5.1.4 The Concessionaire shall, at its own cost and expense, in addition to and not in derogation of its obligations elsewhere set out in this Agreement:
(a) make, or cause to be made, necessary applications to the relevant Government Instrumentalities with such particulars and details as may be required for obtaining Applicable Permits, other than those set forth in Clause 4.1.2, and obtain and keep in force and effect such Applicable Permits in conformity with Applicable Laws;
(b) procure, as required, the appropriate proprietary rights, licenses, agreements and permissions for materials, methods, processes, know-how and systems used or incorporated into the Project;
...
15
(f) ensure and procure that its Contractors comply with all Applicable Permits and Applicable Laws in the performance by them of any of the Concessionaire's obligations under this Agreement,"
7.4. On 06,06.2022, the Answering Respondent obtained the Environmental Clearance and subsequently, on 27.01.2023, the Answering Respondent obtained the Diversion of Forest Land as per its obligations under the CA.
7.5. Thereafter, the Concessionaire appointed M/s Ceigall India Limited as its Subcontractor and executed another Agreement dated 04.08.2022 with the Subcontractor. It is pertinent to mention that the Answering Respondent is not a party to the Agreement executed between the Concessionaire and the Subcontractor.
7.6. It is submitted that since the Subcontractor extracted material above the permissible quantity, the Drainage-Cum-Mining and Geology Division, issued 3 Demand Notices dated 03.10.2023 upon the Subcontractor and directed them to pay a sum of Rs.62,75,016/-. The Answering Respondent learnt that the said amount has been deposited by the Subcontractor as also noted in the Report of the Joint Committee.
7.7. Clause 36.2 of CA also states that NHAI is indemnified against any illegal act or non-compliance of any applicable Law or Permit by the Concessionaire or its Sub-Contractor.
8. It is, therefore, submitted that the Answering Respondent cannot be made liable for any violation by the Subcontractor. Moreover, it is the obligation of the Concessionaire as per CA to obtain the applicable permits, for which the Concessionaire executed another Agreement with the Subcontractor. Hence, the Answering Respondent is not responsible in any manner for the violation committed by the Subcontractor in extracting excess material than the permissible limit in the area outside the ROW of the project.
9. That the Joint Committee in its Report dated 20.05.2024 has also concluded that M/s Ceigall India has grossly violated the permission given by the Mining Department by extracting more material against the permissible quantity. The report does not even state or suggest any default by the Answering Respondent which has caused damage to the environment. The default is only on the part of the Subcontractor for which fine has already 16 been imposed by the Mining Department on the Subcontractor, and that the Answering Respondent has no role or any liability towards the same."
Reply dated 09.09.2024 filed by MoEF&CC:
17. Respondent 2 i.e., Ministry of Environment, Forest and Climate Change (hereinafter referred to as 'MoEF&CC') has also submitted its reply dated 09.09.2024 and the stand taken by it is that for enforcement of environmental laws, it is the authorities in the State concerned for empower to take action. The stand taken by respondent 2 in para 7 to 13 reads as under:
"7. It is humbly submitted that, the State Department of Mines and Geology is the Nodal Authority in the State for dealing with the allotment of mining leases under the Mines and Minerals (Development and Regulation) Act (MMDR Act) and is entrusted with the enforcement and regulation of mining operations in a State including illegal mining. Further, the State Government is empowered under Section 23 C of the Mines and Minerals (Development and Regulation) Act 1957(MMDR Act) to make rules for prevention of illegal mining, transportation and storage of minerals and the State Department of Mines & Geology is the nodal authority in the State for dealing with the allotment of mining leases under the MMDR Act and is entrusted with the enforcement and regulation of mining operations in a state.
8. That, the Ministry issued Environmental Impact Assessment (herein after referred as "EIA") Notification dated 14th September, 2006 which requires certain projects to obtain prior Environmental Clearance ("EC") before any construction work in case of new projects or expansion and modernization of existing projects or activities. The Schedule to the Notification details the categories or projects or activities which require prior environmental clearance.
9. It is further submitted that all projects and activities are broadly categorized into two categories - Category "A" and Category "B", based on the spatial extent of potential impacts and potential impacts on human health and natural and manmade resources. All projects or activities included as Category 'A' in the Schedule, including expansion and modernization of existing projects or activities and change in product mix, require prior environmental clearance from the Central Government in the Ministry of 17 Environment, Forest and Climate Change (MoEF&CC) and all projects or activities included as Category 'B' in the Schedule require prior environmental clearance from the State/Union territory Environment Impact Assessment Authority (SEIAA).
10. It is submitted that, in exercise of the powers conferred upon the Central Government under sub section (3) of section 3 of the Environment (Protection) Act, 1986 and in accordance with the procedures specified in the EIA Notification, 2006, SEIAAs have been constituted in different States/UTs to discharge the functions of the regulatory authorities for the respective States/UTs.
11. That, the Ministry vide notification S.O. 1886 (E) dated 20.04.2022 has delegated the power to the State Level Environment Impact Assessment Authority (SEIAA) to grant Environmental Clearances to all minor mineral mining leases, irrespective of mine lease area and ≤ 250 ha mining lease area in respect of major mineral mining lease other than coal. Further, any site specific Environmental Clearance Conditions may be stipulated by SEIAA after deliberations/appraisal by State Expert Appraisal Committee (SEAC). A true copy of the Notification S.O. 1886 (E) dated 20.04.2022 is marked and annexed herein as ANNEXURE R2/1.
12. That, the Ministry vide notification no. S.O. 637 (E) dated 28.02.2014 delegated the power to SEIAA to issue show cause notice to project proponents in case of violation of the conditions of the Environmental Clearances (EC) issued by the said Authorities to projects or activities within their jurisdiction and to issue directions to the said project proponents for keeping such EC in abeyance or withdrawing them, if required, for violations. A true copy of the notification S.O. 637 (E) dated 28.02.2014 are marked and annexed herein as ANNEXURE R2/2.
13. It is humbly submitted that, the State Pollution Control Board is the Nodal Authority in the State for dealing with cases related to pollution or environment management coming under the purview of the Water (Prevention and Control of Pollution) Act, 1974, the Air (Prevention and Control of Pollution) Act, 1981 and the Environment (Protection) Act 1986."
18. With consent of the parties, final hearing of the matter commenced on 10.09.2024 and concluded on 11.09.2024. Besides oral submissions, 18 NHAI (respondent 3) has also filed written submissions and we propose to reproduce the same as under:
"C. Concession Agreement and role of NHAI
6. The Government of India had entrusted to NHAI the development, maintenance and management of National Highway No. 205K including the section from km 66+440 to 90+500 and Spur to Kharar from km 0+000 to km 19+200. NHAI had resolved to Construct Greenfield Ludhiana -- Rupnagar National Highway no. NH-205K from junction with NE-5 village near to Manewal (Ludhiana) to junction with NH-205 near Bheora Village (Rupnagar) including spur to Kharar with Ludhiana bypass under Bharatmala Pariyojana: Package-3 (Design Ch. 66.440 to Design Ch. 90.500 and spur to kharar Design Ch. 0.000 to Design Ch. 19.200, total length 43.26 km) in the State of Punjab by Four/Six-Laning thereof (the "Project") on design, build, operate and transfer (the "DBOT Annuity" or "Hybrid Annuity") basis, which shall be partly financed by the Concessionaire who shall recover its investment and costs through payments to be made by NHAI, in accordance with the terms and conditions to be set forth in the concession agreement mentioned hereinafter.
7. Bids were invited, and after evaluation of the bids received, NHAI had technically qualified certain bidders including the selected bidder comprising IRCON International Limited and accepted its financial bid and issued Letter of Award dated 22.12.2021 ("LOA") to the selected bidder requiring the execution of Concession Agreement within 45 (forty five) days of the date of issue thereof.
8. The selected bidder, thereafter, promoted and incorporated M/s IRCON Ludhiana Rupnagar Highway Limited ("the Concessionaire") as a limited liability company under the Companies Act 2013, and a Concession Agreement dated 25.03.2022 ("CA") was executed between NHAI and the Concessionaire containing inter alia terms and conditions.
a. Clause 4.1.3(d) of CA casts an obligation of the Concessionaire to procure all the Applicable Permits unconditionally or if subject to conditions, then all such conditions required to be fulfilled by the date specified therein shall have been satisfied in full and such applicable Permits have to be in full force and effect within 150 days from CA;
b. As per the Clause 5.1.1 of CA, it is the responsibility of Concessionaire to procure all the raw material for 19 construction of Project Highway by applying all the applicable permits.
"5.1.1 Subject to and on the terms and conditions of this Agreement, the Concessionaire shall, at its own cost and expense, procure finance for and undertake the design, engineering, procurement, construction, operation and maintenance of the Project and observe, fulfill, comply with and perform all its obligations set out in this Agreement or arising hereunder."
c. As per Clause 5.1.2, the Concessionaire has to comply with all Applicable Laws and Applicable Permits (including renewals as required) in the performance of its obligations under the CA, as extracted below:
"5.1.2 The Concessionaire shall comply with all Applicable Laws and Applicable Permits (including renewals as required) in the performance of its obligations under this Agreement."
d. Clause 5.1.4 of CA also casts obligation on the Concessionaire as stated below-
"5.1.4 The Concessionaire shall, at its own cost and expense, in addition to and not in derogation of its obligations elsewhere set out in this Agreement:
a. make, or cause to be made, necessary applications to the relevant Government Instrumentalities with such particulars and details as may be required for obtaining Applicable Permits, other than those set forth in Clause 4.1.2, and obtain and keep in force and effect such Applicable Permits in conformity with Applicable Laws;
b. procure, as required, the appropriate proprietary rights, licenses, agreements and permissions for materials, methods, processes, know-how and systems used or incorporated into the Project;
...
f. ensure and procure that its Contractors comply with all Applicable Permits and Applicable Laws in the performance by them of any of the Concessionaire's obligations under this Agreement;"
e. The role of Answering Respondent is limited upto the supervision of the work being done in acquired Right of Way (ROW) through the Independent Engineer i.e. M/s Upham 20 International Corporation. It is the Concessionaire who approaches the mining department for obtaining the permits and thereafter the mining department oversees the excavation being carried out.
f. Clause 41.11 of the CA provides that the CA is not to be considered as creating any relationship of association, partnership, joint venture or agency between NHAI and the Concessionaire.
"41.11 No partnership This Agreement shall not be interpreted or construed to create an association, joint venture or partnership between the Parties, or to impose any partnership obligation or liability upon either Party, and neither Party shall have any right, power or authority to enter into any agreement or undertaking for, or act on behalf of, or to act as or be an agent or representative of, or to otherwise bind, the other Party."
NHAI has no role/ involvement in excess extraction of material by violations by Ceigall, and cannot be subjected to any action In response to the notice issued to NHAI, the following submissions are addressed by NHAI, which are without prejudice to each other.
(i) Joint Committee report dated 20.05.2024 has observed that demands under the notices issued to Ceigall have been complied and no damage has been caused to forest property/ trees
9. It is submitted that after execution of the CA, the Concessionaire appointed Ceigall as its Subcontractor. It is pertinent to mention that NHAI is not a party to the agreement executed between the Concessionaire and the Ceigall. As such, no approval was sought from NHAI for appointment of Ceigall.
10. For the excess extraction of material by Ceigall, notices have been issued to it which have been complied by Ceigall. In addition, the Joint Committee report dated 20.05.2024 has observed that there has been no damage to the forest property/ trees (Refer Para 9 on Page no. 10 and Page nos. 46 and 47 of the file). Since the notices issued to Ceigall for excess extraction of material have been complied with and no damage has been reported to the forest property/trees, NHAI cannot be subjected to any action.
(ii) Activity of excess extraction of material has not been carried out on the site of construction of the Project of NHAI 21
11. The Joint Committee report dated 20.05.2024 refers to the letter by Divisional Forest Officer, Rupnagar and states that it has been found that the mining had been carried out on the land owned by Rajinder Singh, Satpal Singh, etc. (Refer Para 9 on Page no. 10 and Page nos. 46 and 47 of the file). Thus, no such activity of excess extraction of material has been carried out on the site of construction of the Project of NHAI, and hence, NHAI cannot be subjected to any action.
(iii) Concessionaire and its Contractors have to comply with all Applicable Permits and Applicable Laws in performance of the obligations under the CA
12. In terms of Clause 5.1.1 of CA, it is the responsibility of Concessionaire to procure all the raw material for construction of Project Highway by applying all the applicable permits.
13. As per Clause 5.1.2, the Concessionaire has to comply with all Applicable Laws and Applicable Permits (including renewals as required) in the performance of its obligations under the CA.
14. Under Clause 5.1.4(f) of the CA, the Concessionaire has to ensure and procure that its Contractors comply with all Applicable Permits and Applicable Laws in the performance by them of any of the Concessionaire's obligations under this Agreement.
15. Further, the permits for mining were granted by the Mining Department and it was the role of the Mining Department to check with the irregularities as per State Mining Regulations, if any, being done by the sub-contractor.
16. Neither did NHAI authorize Ceigall to carry out any extraction of material beyond what was permitted to it under permits obtained by it, nor was NHAI party to such acts of Ceigall. Hence, NHAI cannot be subjected to any action for the acts of Ceigall.
(iv) The relationship between NHAI and Ceigall cannot be presumed to be that of principal and agent Ceigall has not acted and obtained the permits or extracted the said material as an agent of NHAI
17. Sections 4 and 5 of the National Highways Act, 1956 (reproduced below) provide that all national highways shall vest in the Union and it is the responsibility of the Central Government to develop and maintain in proper repair all national highways. 22
"4. National highways to vest in the Union.--All national highways shall vest in the Union, and for the purposes of this Act "highways" include--
(i) all lands appurtenant thereto, whether demarcated or not;
(ii) all bridges, culverts, tunnels, causeways, carriageways and other structures constructed on or across such highways;
and
(iii) all fences, trees, posts and boundary, furlong and milestones of such highways or any land appurtenant to such highways.
5. Responsibility for development and maintenance of national highways.--It shall be the responsibility of the Central Government to develop and maintain in proper repair all national highways; but the Central Government may, by notification in the Official Gazette, direct that any function in relation to the development or maintenance of any national highway shall, subject to such conditions, if any, as may be specified in the notification, also be exercisable by the Government of the State within which the national highway is situated or by any officer or authority subordinate to the Central Government or to the State Government."
18. NHAI has been entrusted the task of development, maintenance and management for the Project by the Government of India. After following the process of bidding, the said work has been awarded to the Concessionaire on Hybrid Annuity basis, which is to be partly financed by the Concessionaire who shall recover its investment and costs through payments to be made by NHAI, in accordance with the terms and conditions to be set forth in the CA. In terms of Clause 23.1, the payment to the Concessionaire is inclusive of the cost of construction, interest during construction, working capital, physical contingencies and all other costs, expenses and charges for and in respect of construction of the Project, save and except any additional costs arising on account of variation in Price Index, Change of Scope, Change in Law, Force Majeure or breach of this Agreement, which costs are to be due and payable to the Concessionaire in accordance with the provisions of the Agreement. Thus, the relationship between NHAI and the Concessionaire cannot be regarded as that of a principal and agent.
19. The CA sets forth the obligations of the Parties. The CA also categorically mentions in Clause 41.11 that the CA is not to be 23 considered as creating any relationship of association, partnership, joint venture or agency between NHAI and the Concessionaire.
20. During the course of arguments on 10.09.2024, the Hon'ble Tribunal has referred to Section 182 of the Indian Contract Act, 1872 ("Contract Act") and sought an explanation as to why the relationship between NHAI and the Concessionaire be not regarded as that of a principal and agent, since NHAI has employed the Concessionaire to do the work of road construction. For ready reference, Section 182 of the Contract Act is reproduced below:
"182."Agent" and "principal" defined.--An "agent" is a person employed to do any act for another, or to represent another in dealings with third persons. The person for whom such act is done, or who is so represented, is called the "principal"."
21. Testing the above proposition by way of an example, if Mr. X needs conveyance from his residence to airport, he employs a taxi. Under this proposition, since the taxi driver has been employed by X to do the work of conveyance, he becomes the agent of X. So if any accident occurs on road, only X will be responsible as he is the principal. This is not the intent of legislature. What has to be read in Section 182 is that person so employed is to not merely to do any work but do any act for X in dealings with third persons. Hence, dealings with third parties is the crux of Section 182 of the Contract Act.
22. If 'dealing with third parties' is not considered in interpreting Section 182 of the Contract Act, every agreement would involve the relationship of principal and agent, eg. taking ticket in a flight for conveyance, employing an electrician for repair of an appliance, actor being employed a producer to act in a film.
23. NHAI has entered into CA with the Concessionaire for construction of road and not for:
a. acting in dealings with third parties or b. representing it in dealing with third parties.
24. From the terms of CA, and also the conduct/ acts of the Parties and the documents on record and the applicable law, it can be established beyond doubt that the relationship between NHAI and the Concessionaire cannot be regarded as that of a principal and agent.
24
25. Firstly, Ceigall has not been employed by NHAI. He is a sub-sub- contractor employed by a sub-contractor. As such, no approval was sought from NHAI for appointment of Ceigall.
26. Reference at this stage may be invited to the Joint Committee's report dated 20.05.2024 wherein the Joint Committee was informed by the Executive Engineer, Mining, vide letter no. 5186 dated 23.04.2024 that K-1 permits have been obtained by Ceigall after payment of royalty to the government. The report further mentioned that for 03 number, K-1 Permits issued to Ceigall in village Pathreri Rangran, Ceigall has extracted more material @1063562 cu ft. above the permissible quantity of 1816115 cu. Ft. pursuant to which 03 number demand notices had been issued to Ceigall for excess quantity extracted demanding additional royalty of Rs.62,75, 016/- (Refer Para 5 on Page no. 8 and 9 and Page nos. 15 to 18 of the file). The said amount was deposited by Ceigall.
27. Thus, the record no where suggests that Ceigall has acted and obtained the permits or extracted the said material as an agent of NHAI. Ceigall has only acted in its individual capacity. Thus, any act of the Concessionaire or its subcontractors, much so any illegal acts, cannot bind NHAI.
(v) Ceigall was not authorized by NHAI to extract the said material and violate the permits
28. As per the Clause 5.1.1 of CA, it is the responsibility of Concessionaire to procure all the raw material for construction of Project Highway by applying all the applicable permits.
29. As per Clause 5.1.2, the Concessionaire has to comply with all Applicable Laws and Applicable Permits (including renewals as required) in the performance of its obligations under the CA.
30. Under Clause 5.1.4(f) of the CA, the Concessionaire has to ensure that its Contractors comply with all Applicable Permits and Applicable Laws in the performance by them of any of the Concessionaire's obligations under this Agreement.
31. Under the CA, the Concessionaire or its Contractors are not, and cannot be authorized to violate any law or act in violation of any Permit.
32. Assuming though not admitting that Ceigall acted as an agent for NHAI in obtaining permits and extracting the material, by 25 extracting excess material beyond the quantity allowed under the Permits, Ceigall has exceeded the authority vested in it by NHAI. In terms of Section 227 of the Contract Act, the agent cannot be held responsible for the acts of the agent performed without authority of the principal.
33. In terms of Section 188 of the Contract Act, the agent only has the authority to do the lawful thing which is necessary in order to do that act. Even otherwise, under Section 200 of the Contract Act, an authorized act of the agent which has the effect of subjecting a third person to damages cannot be affirmed by ratification. Further, under Section 238 of the Contract Act, acts of misrepresentations and frauds by agents in matters which do not fall within their authority do not affect the principal.
34. Reference in this context is invited to the decision of Patna High Court titled as B. Stocking Vs Tata Iron and Steel Co. and another reported in 1917 SCC Online Pat 70- at paras 9 to 12, and Madras High Court titled as Malaipermal Chettiar Vs Arunachala Chettiar in Appeal No. 139 and 275 of 1916- second para at page no. 420.
35. Thus, NHAI cannot be responsible for the illegal acts of Ceigall since NHAI did not authorize the Concessionaire or its Contractors to violate any law or to extract more quantity than what was allowed as per the Permits.
(vi) Any action against for the alleged acts shall be violative of Article 20(2) of the Constitution of India.
36. As has been recorded by this Hon'ble Tribunal in the order dated 22.05.2024, the counsel for Punjab Pollution Control Board (at Page No.5) has stated that for the said violation appropriate action including imposition of environmental compensation upon violators shall be taken in course of time.
37. Without prejudice, any additional action apart from the above stated action mentioned by Punjab Pollution Control Board would result in a party being punished twice for the same offence, and thus, would be violative of Article 20(2) of the Constitution of India.
38. NHAI, is thus, neither a proper nor a necessary party in the present proceedings."
19. ARGUMENTS: Applicant in person submits that in the light of Joint Committee Report and the stand taken by respondents particularly, 26 respondents 3, 4 and 5, it is evident that there is violation of environmental laws and norms on the part of the project proponents in execution of the project in question and, therefore, Tribunal must stop further construction and apply principle of 'Polluter Pays' and impose environmental compensation. Appropriate criminal and penal action should also be taken against the violators.
20. On behalf of respondent 3, it is contended that for violation, if any, in execution of the project with regard to the environmental laws, the responsibility is not that of NHAI i.e., respondent 3 but the Contractor/Sub-Contractor who is actually executing the project i.e., respondent 4 and NHAI has not violated any environmental laws.
21. On behalf of respondent 4, it is said that it is only a Sub-Contractor and executing the project in terms of agreement, it has executed with IRCON International Limited (Sub-Concessionaire) who is executing the project of NHAI and there is no violation of environmental laws on its part. If any violation is there, the responsibility would lie upon the Principal to whom the project belongs and who is the responsible authority for the project i.e., NHAI.
22. On behalf of PSPCB (respondent 5), it is contended that for violation of environmental laws in carrying out illegal mining, it has already issued an order on 19.07.2024 computing environmental compensation of Rs.85,87,500/- for the period of 18.04.2023 to 18.07.2024.
23. In the light of the above submissions, we find that following substantial questions relating to environment have arisen which require adjudication by this Tribunal:
27
(I) Whether there is violation of environmental laws and norms in execution of the project in question by the respective authorities and executing agencies?
(II) Who are the violators liable to be proceeded against in respect of penal and other action including payment of environmental compensation in case Issue I is answered in affirmance?
24. It is not disputed before us that for execution of the project in question, provisions of Environment Impact Assessment Notification dated 14.09.2006 as amended from time to time (hereinafter referred to as 'EIA 2006') are applicable and it was incumbent upon the Project Executor to obtain Environmental Clearance (hereinafter referred to as 'EC').
25. NHAI obtained EC under EIA 2006 for development of National Highway from Ludhiana to Rupnagar, starting from Delhi-Katra Expressway (NE-5) near village Manewal and terminating on NH-205 at Rupnagar near village Bheora including development of its spur under the Bharatmala Pariyojna from MoEF&CC on 06.06.2022. However, before commencement of the project, neither Consents to Establish (hereinafter referred to as 'CTEs') under Water Act, 1974 and Air Act, 1981 were obtained nor Consents to Operate (hereinafter referred to as 'CTOs') were obtained under the aforesaid Statutes by NHAI at any point of time.
26. The defence of NHAI is that it let out execution work by entering into construction work contract with Concessionaire i.e., IRCON, Ludhiana, Rupnagar Private Limited. The Concessionaire further sub-let the construction work for execution of the project to Sub-Concessionaire i.e., IRCON International Limited vide agreement dated 22.09.2022. A third 28 outsourcing agreement of the execution of work came into existence on 04.08.2022 whereby Sub-Concessionaire executed an agreement with Sub-sub-Concessionaire i.e., M/s. Ceigall India Limited (respondent 4).
27. It is not in dispute that for construction work of NHAI in question, the actual construction work has been carried out by Sub-sub- Concessionaire i.e., respondent 4. It is also evident from record that as per agreement dated 04.08.2022, executed between Sub-Concessionaire and Sub-sub-Concessionaire, the appointed date for the project was 16.02.2023.
28. Sub-sub-Concessionaire carried out mining activities of excavation of ordinary soil from the land belong to some private parties after obtaining mining K-1 permit from District Mining Officer, Rupnagar but for such mining no EC was obtained from the Competent Authority i.e., State Environment Impact Assessment Authority, Punjab (hereinafter referred to as 'SEIAA Punjab') under the provisions of EIA 2006 though it was necessary in view of the law laid down by Supreme Court in Deepak Kumar vs. State of Haryana, (2012) 4 SCC 629. The applicability of EIA 2006 for excavation of minor mineral i.e., ordinary earth from the land of private parties for which mining permits were obtained by Sub-sub- Concessionaire, is not disputed before us by the respondents.
29. It is also not disputed that the mining has been carried beyond the quantity permitted by District Mining Officer, Rupnagar for which mining authorities have imposed penalty of Rs.62,75,016/- which has been paid to the mining authorities by the Executor of the construction work i.e., Sub-sub-Concessionaire.
29
30. Joint Committee Report shows that excess quantity of minor mineral extracted by the Executor of construction work is approximately 1063562 cubic feet. It is also admitted on the part of respondent 4 that though it has obtained CTOs under Water Act, 1974 and Air Act, 1981 vide letters dated 18.04.2023, valid upto 30.09.2024, but both were confined only for "Ready Mix Cement Concrete Plant" with project cost of Rs.160 lakhs. It has not obtained consents under the aforesaid Statutes for construction of National Highway which comes under 'Orange Category' at serial no. 2052-New Highway Construction Projects having project cost of Rs.1107 Crores.
31. Further for carrying out mining activity also, consents under Water Act, 1974 and Air Act, 1981 have also not been obtained either by the Principal or by Concessionaire, Sub-Concessionaire or Sub-Sub- Concessionaire at any point of time and mining activities have been carried out without such consents.
32. It has also come on record that noticing violations on the part of respondent 4, CTOs dated 18.04.2023 issued under Water Act, 1974 and Air Act, 1981 for Ready Mix Cement Concrete Plant were revoked by PSPCB vide letter dated 12.07.2024. However, construction activities have not been/were not stopped, and therefore, it is obvious that in violation of provisions of Water Act, 1974 and Air Act, 1981 and despite revocation of CTOs, construction activities are/were going on illegally.
33. In view of the above findings, we are clearly of the view that there is utter violations on the part of concerned proponents in respect of environmental laws and Issue I is answered accordingly. 30 ISSUE II:
34. It is not disputed that construction work in the case in hand relates to the construction of 4/6 lane Ludhiana Rupnagar NH-205K.
35. A National Highway is such which is so declared under Section 2 of National Highways Act, 1956 (hereinafter referred to as 'NH Act, 1956'). Section 2 of NH Act, 1956 reads as under:
"2. Declaration of certain highways to be national highways.--(1) Each of the highways specified in the Schedule 2 is hereby declared to be a national highway.
(2) The Central Government may, by notification in the Official Gazette, declare any other highway to be a national highway and on the publication of such notification such highway shall be deemed to be specified in the Schedule.
(3) The Central Government may, by like notification, omit any highway from the Schedule and on the publication of such notification, the highway so omitted shall cease to be a national highway."
36. It is not disputed before us that NH-205K is a "National Highway"
under Section 2 of NH Act, 1956.
37. Section 4 of NH Act, 1956 provides that all National Highways shall vest in the Union, and for the purposes of the said Act, Highways include lands appurtenant thereto, all bridges, culverts, tunnels, causeways, carriageways and other structures constructed on or across such highways and all fences, trees, posts and boundary, furlong and milestones of such highways or any land appurtenant to such highways. Section 4 is reproduced as under:
"4. National highways to vest in the Union.--All national highways shall vest in the Union, and for the purposes of this Act "highways" include--
"(i) all lands appurtenant thereto, whether demarcated or not;31
(ii) all bridges, culverts, tunnels, causeways, carriageways and other structures constructed on or across such highways; and
(iii) all fences, trees, posts and boundary, furlong and milestones of such highways or any land appurtenant to such highways."
38. Section 5 provides the responsibility for development and maintenance of National Highways placing prime responsibility upon Central Government but also making provision that by notification in the official Gazette any function relating to development and maintenance of National Highways may be allowed to be exercised by Government of a State within which National Highway is situated or by any officer or authority sub-ordinate to the Central Government or State Government.
39. For carrying out developmental activities and maintenance of National Highways, Section 8A of NH Act, 1956 confers powers upon Central Government to enter into an agreement with any person and it reads as under:
"[8A. Power of Central Government to enter into agreements for development and maintenance of national highways.--(1) Notwithstanding anything contained in this Act, the Central Government may enter into an agreement with any person in relation to the development and maintenance of the whole or any part of a national highway.
(2) Notwithstanding anything contained in section 7, the person referred to in sub-section (1) is entitled to collect and retain fees at such rate, for services or benefits rendered by him as the Central Government may, by notification in the Official Gazette, specify having regard to the expenditure involved in building, maintenance, management and operation of the whole or part of such national highway, interest on the capital invested, reasonable return, the volume of traffic and the period of such agreement.
(3) A person referred to in sub-section (1) shall have powers to regulate and control the traffic in accordance with the provisions contained in Chapter VIII of the Motor Vehicles Act, 1988 (59 of 1988) 32 on the national highway forming subject-matter of such agreement, for proper management thereof."
40. Central legislature subsequently enacted National Highways Authority of India Act, 1988 (hereinafter referred to as 'NHAI Act, 1988') with an objective to provide for constitution of an authority for development, maintenance of National Highways and for matters connected therewith or incidental thereto.
41. "National Highway" is defined in Section 2(e) of NHAI Act, 1988 and it refers to "a National Highway declared under Section 2 of NH Act, 1956".
42. The constitution of NHAI is provided in Section 3 which says that it shall comprise of a Chairman; and not more than six full-time members; and not more than six part-time members; to be appointed by Central Government by notification in Official Gazette.
43. Section 10 provides that in discharge of its functions under NHAI Act, 1988, NHAI shall act so far as may be, on business principles.
44. Since under Section 4 of NH Act, 1956, all National Highways vest in the Union Government, hence a provision has been made in NHAI Act, 1988 vide Section 11 empowering Central Government, by notification in the Official Gazette, to vest in or entrust to the authority, such National Highway or any stretch thereof as may be specified in such Notification.
45. Before us, it is not disputed by NHAI that NH-205K is being developed and to be maintained and managed by NHAI.
46. For undergoing the project in question and acquisition of land under Section 3A of NH Act, 1956, intention to acquire land was initiated and 33 notified vide notification dated 21.06.2021 issued by Ministry of Road, Transport and Highways and published in Gazette of India (Extraordinary) dated 22.06.2021.
47. Section 14 of NHAI Act, 1988 empowers NHAI to enter into and perform any contract necessary for discharge of its functions under the Act. Section 14 reads as under:
"14. Contracts by the Authority.--Subject to the provisions of section 15, the Authority shall be competent to enter into and perform any contract necessary for the discharge of its functions under this Act."
48. Functions of NHAI are detailed in Section 16 as under:
"16. Functions of the Authority.-- (1) Subject to the rules made by the Central Government in this behalf, it shall be the function of the Authority to develop, maintain and manage the national highways and any other highways vested in, or entrusted to, it by the Government.
(2) Without prejudice to the generality of the provisions contained in sub-section (1), the Authority may, for the discharge of its functions--
(a) survey, develop, maintain and manage highways vested in, or entrusted to, it;
(b) construct offices or workshops and establish and maintain hotels, motels, restaurants and rest-rooms at or near the highways vested in, or entrusted to, it;
(c) construct residential buildings and townships for its employees;
(d) regulate and control the plying of vehicles on the highways vested in, or entrusted to, it for the proper management thereof;
(e) develop and provide consultancy and construction services in India and abroad and carry on research activities in relation to the development, maintenance and management of highways or any facilities thereat;
(f) provide such facilities and amenities for the users of the highways vested in, or entrusted to, it as are, in the opinion of 34 the Authority, necessary for the smooth flow of traffic on such highways;
(g) form one or more companies under the Companies Act, 1956 (1 of 1956) to further the efficient discharge of the functions imposed on it by this Act;
(h) engage, or entrust any of its functions to, any person on such terms and conditions as may be prescribed;
(i) advise the Central Government on matters relating to highways;
(j) assist, on such terms and conditions as may be mutually agreed upon, any State Government in the formulation and implementation of schemes for highway development;
(k) collect fees on behalf of the Central Government for services or benefits rendered under section 7 of the National Highways Act, 1956 (48 of 1956), as amended from time to time, and such other fees on behalf of the State Governments on such terms and conditions as may be specified by such State Governments; and
(l) take all such steps as may be necessary or convenient for, or may be incidental to, the exercise of any power or the discharge of any function conferred or imposed on it by this Act.
(3) Nothing contained in this section shall be construed as--
(a) authorising the disregard by the Authority of any law for the time being in force; or
(b) authorising any person to institute any proceeding in respect of a duty or liability to which the Authority or its officers or other employees would not otherwise be subject under this Act."
49. Section 16 sub-section (1) clearly says that subject to the rules made by Central Government, function of the Authority is to develop, maintain and manage National Highways and any other highways vested in, or entrusted to it by the Government.
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50. Besides other provisions, Section 16(2)(h) provides that the authority for discharge of its functions, may engage or entrust any of its functions to any person on such terms and conditions as may be prescribed.
51. Section 14 read with Section 16(1)(h) empowers NHAI to enter into contract for carrying out its functions under the Act and/or engage or entrust any of its functions to any person on such terms and conditions as may be prescribed.
52. In view thereof, it had initially entered into a contract for execution of the work of NH-205K. NHAI entered into a work contract with the Concessionaire and the same outsourcing continued for further two stages with Sub-Concessionaire and Sub-Sub-Concessionaire. However, the fact remains that the work of construction of NH-205K belong to NHAI and it has the prime responsibility of its development, maintenance etc. which is continuing.
53. Therefore, for all purposes, NHAI is the Principal body for carrying out the work of the said National Highway and if any Sub-Concessionaire or executing agency i.e., outsourced agency has committed violation of law, the liability is joint and several and the Principal cannot claim that it is only the outsourced agency which should be saddled with responsibility of violation of laws particularly the environmental laws.
54. Under the Contract Act, 1872, the terms "principal" and "agent" are defined in Section 182 and it reads as under:
"182. "Agent" and "principal" defined.-An "agent" is a person employed to do any act for another, or to represent another in dealings 36 with third persons. The person for whom such act is done, or who is so represented, is called the "principal"."
55. A sub-agent is also defined in Section 191 which is as under:
"191. "Sub-agent" defined.-A "sub-agent" is a person employed by, and acting under the control of, the original agent in the business of the agency."
56. The representation of principal by sub-agent is covered under Section 192 and it reads as under:
"192. Representation of principal by sub-agent properly appointed.-Where a sub-agent is properly appointed, the principal is, so far as regards third persons, represented by the sub-agent and is bound by and responsible for his acts, as if he were an agent originally appointed by the principal."
57. NHAI has pleaded that the Concessionaire outsourced the work without its permission but there is nothing on record to show that the work executed by the Sub-Concessionaire or Sub-Sub-Concessionaire with regard to construction work of NH-205K, at any point of time, was/has been disowned by NHAI as work done without any authority. Hence, it is an afterthought. NHAI cannot be permitted to take a stand where on the one hand, it is owning the work carried out by the Sub- Concessionaire and Sub-Sub-concessionaire but simultaneously disowning the liability caused due to the fault, if any, on the part of such executing agencies in discharge of the construction work particularly with regard to violation of environmental laws.
58. Even otherwise, it is always open to NHAI to rectify the work of Sub- Concessionaire or Sub-Sub-Concessionaire and such rectification may be express or applied as contemplated in Section 191 of Contract Act, 1872. In the present case, by accepting the construction work carried out by 37 such agencies, NHAI, in law, has rectified their appointment and work and therefore, if there is any violation of law, for the same also, the Principal is liable to face the consequences.
59. Now the question is what action must be taken against the violators in the present case.
60. Admittedly, the work has been carried out without requisite Statutory consents and permissions and also mining has also been carried out illegally. For illegal mining, PSPCB has computed environmental compensation vide order dated 19.07.2024 for the period of 18.04.2023 to 18.07.2024 as Rs.85,87,500/-. However, for carrying out construction work of NH-205K in violation of Statutory permission/ clearances/ consents also, respondents, in causing damage to environment, are liable to pay environmental compensation. Cost of the project is admittedly more than Rs.1100 Crores. In respect of construction of the projects, Supreme Court in Goel Ganga Developers vs. Union of India and Others, (2018) 18 SCC 257 has held that in general law is that upto 10% of the project cost, environmental compensation may be assessed though generally, it may be 5% of the project cost. The relevant observations are as under:
"64. Having held so we are definitely of the view that the project proponent who has violated law with impunity cannot be allowed to go scot-free. This Court has in a number of cases awarded 5% of the project cost as damages. This is the general law. However, in the present case we feel that damages should be higher keeping in view the totally intransigent and unapologetic behaviour of the project proponent. He has maneuvered and manipulated officials and authorities. Instead of 12 buildings, he has constructed 18; from 552 flats the number of flats has gone upto 807 and now two more buildings having 454 flats are proposed. The project proponent contends that he has made smaller flats and, therefore, the number of flats has increased. He could not have done this without getting fresh EC. With the increase in the number of flats the number of persons, residing therein is bound to increase. This will impact the amount of water 38 requirement, the amount of parking space, the amount of open area etc. Therefore, in the present case, we are clearly of the view that the project proponent should be and is directed to pay damages of Rs.100 crores or 10% of the project cost whichever is more. We also make it clear that while calculating the project cost the entire cost of the land based on the circle rate of the area in the year 2014 shall be added. The cost of construction shall be calculated on the basis of the schedule of rates approved by the Public Works Department (PWD) of the State of Maharashtra for the year 2014. In case the PWD of Maharashtra has not approved any such rates then the Central Public Works Department rates for similar construction shall be applicable. We have fixed the base year as 2014 since the original EC expired in 2014 and most of the illegal construction took place after 2014. In addition thereto, if the project proponent has taken advantage of Transfer of Development Rights (for short 'TDR') with reference to this project or is entitled to any TDR, the benefit of the same shall be forfeited and if he has already taken the benefit then the same shall either be recovered from him or be adjusted against its future projects. The project proponent shall also pay a sum of Rs. 5 crores as damages, in addition to the above for contravening mandatory provisions of environmental laws."
(Emphasis added)
61. In the light of discussion made above, we are of the view that even if we take 1% of the project cost as environmental compensation for carrying out illegal construction activities, it will come to Rs.11 Crores (round off). Besides, NHAI (respondent 3) is also liable to pay environmental compensation of Rs.85,87,500/- which has been computed by respondent 5 i.e., PSPCB for the period of 18.04.2023 to 18.07.2024. For further carrying out illegal activities in violation of environmental laws for the period from 19.07.2024 and onwards, PSPCB shall determine environmental compensation after giving opportunity of hearing to NHAI within two months. The entire amount of environmental compensation as directed above shall be payable by respondent 3 without further delay and in any case within three months.
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62. We also make it clear that the payment/recovery of environmental compensation from NHAI i.e., respondent 3 under this order shall not preclude respondent 3 from getting the said amount reimbursed/claimed/recovered from the concerned Concessionaire/Sub- Concessionaire/Sub-Sub-Concessionaire, as the case may be, in terms of its agreements or any other law, if it is so permissible.
63. We also direct that respondents 3 and 4 shall obtain necessary consents/clearances/permissions under environmental laws from the concerned authorities within two months and if they failed to do so, no construction work shall be carried out thereafter without obtaining Statutory permissions etc. and complying the provisions of environmental laws.
64. Respondent 5 i.e., PSPCB and respondent 1 shall ensure compliance of this order in words and spirit.
65. The amount of environmental compensation realized/recovered under this order shall be utilized for remediation of the damaged environment in accordance with Environment Remediation Plan which shall be prepared by a Joint Committee comprising CPCB, PSPCB and a representative of respondent 2 wherein CPCB shall be the nodal authority. This Plan shall be prepared within 3 months and executed in the next 3 months.
66. OA is accordingly disposed of with the above directions.
67. Copy of this judgment be forwarded to CPCB; PSPCB; MoEF&CC; NHAI; and Additional Chief Secretaries/Principal Secretary, Ministry of 40 Environment and Forest, Government of Punjab, Chandigarh by e-mail for information and compliance.
SUDHIR AGARWAL, JUDICIAL MEMBER DR. AFROZ AHMAD, EXPERT MEMBER March 19, 2025 Original Application No. 40/2024 R 41