The court affirmed that environmental compensation must be proportionate to project size, asserting that the 'polluter pays' principle justifies significant fines for regulatory violations, despite the absence of specific legislative guidelines.

JUDGMENT :

DIPANKAR DATTA, J.

THE APPEALS

1. The present civil appeals arise out of disposal of two separate original applications by the National Green Tribunal, Western Zone Bench, Pune¹[NGT] , involving similar facts and circumstances. The orders of disposal are of varying dates. We propose to decide these appeals by this common judgment and order.

2. The lead appeal has been filed by the project proponent, i.e., M/s. Rhythm County²[RHYTHM], challenging the order dated 22.08.2022 passed by the NGT in Original Application No. 14 of 2021 (WZ). Vide the impugned order, the NGT held that RHYTHM had violated the environmental norms and carried out construction without obtaining Environmental Clearance³[EC], for which it was liable in a sum of Rs. 5,00,00,000/- as compensation. Appellant was, accordingly, directed to pay such compensation within two months to the Maharashtra Pollution Control Board⁴[MPCB].

3. The connected appeal is filed by another project proponent, i.e., M/s. Key Stone Properties⁵[KEYSTONE]. It challenges the order dated 01.09.2022 passed by the NGT on Original Application No. 13/2021. Vide the impugned order, the NGT held that KEYSTONE had violated the environmental norms, including raising construction without obtaining requisite permissions. Like RHYTHM, KEYSTONE was directed to pay compensation in a sum of Rs. 4,47,42,188/- within two months to the MPCB.

FACTUAL MATRIX

4. The facts, which would be germane for the disposal of the present appeals, are adumbrated as follows:

LEAD APPEAL

a. Appellant RHYTHM, a partnership firm, undertook a residential and commercial construction project titled “Rhythm County” at Autade Handewadi, Pune, within the jurisdiction of the Pune Metropolitan Regional Development Authority⁶[PMRDA]. The project was granted EC on 27.11.2017 under the Environmental Impact Assessment⁷[EIA] Notification, 2006⁸[Notification], permitting a total built-up area of 1,45,682.28 square metres. Upon issuance of requisite certificates, the construction commenced in 2018.

b. RHYTHM asserts that construction initially proceeded in conformity with the EC and the sanctioned plans. On 31.01.2020, however, Maharashtra Pollution Control Board⁹[MPCB] issued a show-cause notice alleging that construction had commenced without securing valid statutory consents. This was followed by an order dated 06.07.2020 whereby the MPCB refused Consent-to-Establish¹⁰[CTE] under the Water (Prevention and Control of Pollution) Act, 1974¹¹[Water Act] and the Air (Prevention and Control of Pollution) Act, 1981¹²[Air Act], citing excess construction beyond the sanctioned area and the absence of revalidated consent. A stop-work direction was also issued on the same date.

c. Disputing these allegations, on 18.07.2020, RHYTHM applied for modification of the EC before the State Level Environment Impact Assessment Authority¹³[SEIAA], Maharashtra. While that application remained pending for consideration, the first respondent, a local resident of the area, approached the NGT by instituting O.A. No. 14 of 2021 (WZ), alleging that RHYTHM had undertaken substantial construction activity without valid EC and in disregard of statutory safeguards under the environmental laws.

d. In the proceedings before the NGT on 08.06.2021, a Joint Committee was constituted t