Delhi Pollution Control Committee v. Divine Infracon Private Ltd.

1. This intra-court appeal lays a challenge to the order dated 12.04.2012, whereby the writ petition filed by the respondent was allowed by the learned Single Judge of this Court by stating in paragraphs 8 and 9 as under:

2. Suffice to state the learned Single Judge has allowed the petition only on the ground that the appellant herein does not have the jurisdiction to levy the penalty or impose conditions even if the respondent had violated the environmental norms. Learned Single Judge passed the impugned order by relying upon judgment of a learned Single Judge in W.P.(C) 465/2011, Bharti Realty Ltd. v. Delhi Pollution Committee decided on 12.07.2011 and also the judgment of the Division Bench in the case of Delhi Pollution Control Committee v. Splendor Landbase Ltd. in LPA No.895/2010 decided on 23.01.2012. The judgment of the Division Bench in the case of Delhi Pollution Control Committee v. Splendor Landbase Ltd. became a subject matter of an appeal before the Supreme Court, being C.A. No. 757- 760/2013. The civil appeals have since been decided vide judgment dated 04.08.2025 and the judgment of the Division Bench has been set aside.

3. In the said judgment dated 04.08.2025, the Supreme Court has held that the Pollution Control Board can impose and collect as restitutionary and compensatory damages fixed sums of monies or require furnishing of bank guarantee(s) as an ex-ante measure towards the potential environmental DABAS 18:41 damage in exercise of powers under Sections 33A and 31A of the Water and Air Acts. The Supreme Court has also, in paragraph 39 of this judgment, stated as under:

4. The present appeal was adjourned from time to time to await the decision in C.A. No. 757-760/2013.

5. We have heard the learned counsel for the parties at length. It was put to the learned counsel for the respondent that whether the respondent would be satisfied if the Court directs the appellant herein to return the bank guarantee and retain the amount of Rs. 23 lakhs with itself, and accordingly, modify the directions issued by the learned Single Judge in paragraph 9 of the impugned order.

6. Learned counsel for the respondent on instructions is agreeable to the suggestion of the Court.

7. Having noted the directions which have been given by the Supreme Court, more specifically at paragraph nos. 35 and 36, for framing of Rules and Regulations before imposing penalty, we note that admittedly no regulatory framework existed at the relevant time in 2010-11, when the show cause notice dated 26.05.2010 was issued. As per the Supreme Court judgment, the procedure for imposing penalty for environmental damage and the quantification thereof requires the Pollution Control Board to follow a procedure incorporating basic principles of natural justice in the subordinate legislation. The learned Single Judge in the impugned order has decided the issue only on the aspect of the powers of the Pollution Control Board to impose damages, which has been now answered by the Supreme Court in its judgment. However, we find that no purpose would be solved if we remand the matter back to the learned Single Judge as admittedly, no regulatory framework existed at the relevant time in 2010-11, when the show cause notice dated 26.05.2010 was issued and therefore, the notice may be vulnerable to challenge. Therefore, the direction of the learned Single Judge for return of bank guarantee is upheld.

8. We however, find that the sum of Rs. 23 lakhs was paid by the respondent on 10.09.2008 in pursuance to the order passed by the appellant on 28.08.2008 and the said issue, had thus, attained finality in the year 2008 and could not have been reopened by the respondent subsequently, when a fresh show cause notice dated 26.05.2010 was issued for subsequent acts and omissions of the respondent. Learned Single Judge could have only examined the issue of encashment of bank guarantee, which was the subject matter of the said show cause notice dated 26.05.2010. However, the DABAS 18:41 proceedings initiated by appellant pursuant to notice in 2008 had already attained finality. The appellant is therefore, not required to refund any part of the amount of Rs. 23 lakhs already received by it on 28.08.2008 and accordingly, the direction in the impugned judgment for refund of monies is hereby set aside.