Fourth respondent, a private limited company, proposed to set up an Artificial Granite and Sand Manufacturing Unit with quarrying operation in Elanji Grama Panchayat and purchased 22.31 acres of land within the area of the appellant panchayat and a portion of the above land is to be used for the above unit. It approached various statutory authorities, namely, Geologist, District Industries Centre, Revenue Authorities, District Medical Officer, District Officer of the Ground Water Department, Chief Controller of Explosives, Director of Mining and Geology and various authorities for permission. All of them granted permits and licences. Pollution Control Board also granted quarrying permit subject to certain conditions for initial setting up of the plant. They have also stated that they will give the final consent only after the trial run. The then President of the appellant panchayat committee granted permission for construction of the factory building. Appeal against the above decision was

filed before the Tribunal for Local Self Government Institutions by the local people. The tribunal remanded the matter after considering the reconsideration of the matter on recommendation from the Grama Sabha. After obtaining expert opinion, Panchayat decided not to grant permission to the fourth respondent for the establishment of Rock Crusher and Artificial Granite Sand Manufacturing Unit at Koorumala by Ext.P7 letter dated 25.1.2006. Against Ext.P7 order, statutory appeal was filed before the Tribunal for Local Self Government Institutions, Thiruvananthapuram. By Ext.P9 order, Tribunal by an interim order allowed the fourth respondent to complete the building and also to construct the road through his property on condition that he undertakes before the Panchayat to remove the building if the ultimate finding went against him. Thereafter, by Ext.P10 order dated 27.5.2006 after hearing all the interested parties and after considering the various contentions and documents, it was held that impugned decision of the Panchayat is unsustainable and liable to be set aside in view of the consent granted by the Pollution Control Board and the District Medical Officer and the suggestions of the District Officer of the Ground Water Department and the appellate authority directed the Panchayat to issue licence to the fourth respondent for the establishment of the factory incorporating a condition prohibiting extraction of ground water from its area except for drinking purposes and subject to complying with the conditions imposed by the Pollution Control Board and District Medical Officer. This order was challenged by the Grama Panchayat in the writ appeal. Third respondent in the writ petition who is stated to be the convenor of Koorumala Samrakshana Action Council filed W.A. No.172 of 2007 has not challenged the order of the tribunal before this court in Writ Petition. Even though objections were raised about the maintainability of the appeal filed by the third respondent in the writ petition, subsequently, Grama Panchayat filed W.A. No.208 of 2007.

2. Preliminary ground taken by the Grama Panchayat was that the appellate tribunal has no power to set aside the order of the tribunal considering rule 18 of the Tribunal for the Kerala Local Self Government Institutions Rules, 1999 (herein after referred to as 'the Rules') read with section 271 (5) of the Kerala Panchayat Raj Act, 1994 (hereinafter referred to as 'the Act').

3. It is the contention of the appellants that only procedural defects can be cured by the tribunal and, at the maximum, it can remand the matter and the tribunal has no power to decide the matter on merits. Sub-section (1) of section 271-S of the Act reads as follows:

"271S. Constitution of Tribunal for local Self Government Institutions:- (1) The Government shall constitute a Tribunal for every district or for more than one district, to consider and dispose of the appeal or revision filed against the decisions of the Loc