Public Hearing Mandatory For Expansion: Supreme Court 2016 in Electrotherm vs
Patel Sets Aside EC Without Public Consultation. The Supreme Court in M/s
Electrotherm (India) Ltd. vs Patel Vipulkumar Ramjibhai & Ors dealt with validity of
Environmental Clearance granted for expansion of steel plant without public hearing.
The Court on 02.08.2016 set aside Gujarat High Court order of closure but held that
exemption from public consultation under EIA Notification 2006 was illegal. The Court
ordered post-decisional public hearing. The Court relied on Lafarge and principles of
sustainable development. This blog explains Electrotherm on EC, public hearing, and
expansion under EPA 1986.
Facts: Expansion Of Steel Plant; EC Granted Without Fresh Public Hearing. Appellant
set up Steel Plant at Samakhiyali, Kutch, Gujarat. NOC from GPCB dated 25.02.2005.
The Supreme Court in Electrotherm para 5: First EC granted on 20.02.2008 for Pig Iron
Plant expansion 150 to 350 TPD, 24 MW Power Plant. Public hearing held on
12.06.2007. Water requirement 650 M³/day.The Supreme Court in Electrotherm para 6-
8: Appellant applied for further expansion in 2009. Capacity increased 3 times. Total
project cost Rs.274 Crores. Water requirement increased to 2165 M³/day. EC granted on
27.01.2010.The Supreme Court in Electrotherm para 8: "Public hearing for the existing
plant was held on 12th June, 2007 and is exempted for the proposed exemption as per
Section-7(ii) of EIA Notification, 2006."Gujarat High Court in SC Application 5986/2010
set aside EC dated 27.01.2010 for lack of public hearing and ordered closure.A common
mistake is treating old public hearing as sufficient for major expansion. Electrotherm
says pollution load and water use increased 3x, so fresh hearing needed.
EIA Notification 2006 & Mandatory Public Consultation. The Supreme Court in
Electrotherm para 3: Under EIA Notification 2006, Environmental Clearance process has
4 stages: Screening, Scoping, Public Consultation, Appraisal.The Supreme Court in
Electrotherm para 17: Draft amendment dated 09.01.2009 proposed exemption for
expansion <50%. But final Notification dated 01.12.2009 rejected it. Hence no
exemption available in Jan 2010.The Supreme Court in Electrotherm para 18: Cited
Lafarge Umiam Mining vs UOI. "Public consultation or public hearing...is a mandatory
requirement of the Environment Clearance process".The Supreme Court in Electrotherm
para 19: "Decision making process in doing away with...public consultation/public
hearing, was not based on correct principles and as such the decision was invalid and
improper."Key reason: Water requirement and pollution load increased substantially.
"People were not made aware of this proposal" - High Court para 19.In our experience, if
capacity increases >50% or pollution load changes, fresh public hearing is mandatory
under 2006 Notification.
Post-Decisional Public Hearing: Balancing Sustainable Development And Business.
The Supreme Court in Electrotherm para 20: Did not order closure despite illegal EC.
Reason: "Expansion has been undertaken and industry has been functioning".The
Supreme Court in Electrotherm para 20: "Interest of justice would be sub-served
if...matter is relegated back...to effectuate public consultation/public hearing". Changed
requirement from pre-decisional to post-decisional.The Supreme Court in Electrotherm
para 20: "If public consultation results in negative mandate...direct scaling down to level
permitted by EC dated 20.02.2008. If in favour, EC dated 27.01.2010 would hold
good".The Supreme Court in Electrotherm para 19: Cited Lafarge para 119: Decision
must be "fair and fully informed, based on correct principles, and free from bias". Must
balance "sustainable development and intergenerational equity".Lesson for Industry:
Don't start expansion without EC. For MoEF: Cannot waive public hearing for major
expansion. For Courts: Can use post-decisional hearing to avoid hardship.
Conclusion
Electrotherm (India) Ltd. vs Patel establishes that environmental clearance public
hearing supreme court 2016 jurisprudence makes public consultation mandatory for
major expansion. Supreme Court 02.08.2016 set aside EC dated 27.01.2010 but
allowed continued operation subject to post-decisional public hearing within 3 months.
Court followed Lafarge and EIA Notification 2006. As the law stands, 3x capacity
increase + 3x water use requires fresh public hearing. For steel/industry projects, this
judgment is key on EC compliance. The Supreme Court’s ruling in Electrotherm
balances environmental democracy with industrial continuity..
