1. Challenge to GCZMA order directing deposit of Environmental Damage Compensation under the Environment Protection Act. (Para 1 )
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2025 Supreme(Online)(NGT) 1755
NATIONAL GREEN TRIBUNAL PUNE (WESTERN ZONE BENCH)
Dinesh Kumar Singh, Judicial Member, Vijay Kulkarni, Expert Member
Ludovico Goveia – Appellant
Versus
GCZMA – Respondent
Appeal No.18 of 2025 (WZ) | I.A. No.35 of 2025 (WZ)
Advocates:
For the Appellants/Petitioners: Parag S. Rao, Shivshankar Swaminathan
For the Respondents: Shubham S. Priolkar, Ameya Kakodkar, Pratik Rajopadhye, Ameya Ranade, Maithili Rane
For the Appellants/Petitioners: Parag S. Rao, Shivshankar Swaminathan
For the Respondents: Shubham S. Priolkar, Ameya Kakodkar, Pratik Rajopadhye, Ameya Ranade, Maithili Rane
The Tribunal held that an order for Environmental Damage Compensation must be set aside and remanded if the assessing authority admits to errors in the calculation of the area used to determine the penalty, ensuring compliance with the statutory framework of the Environment (Protection) Act, 1986.
Headnote:(A) Environment (Protection) Act, 1986 - Sections 15, 15A, 15B and 15C - National Green Tribunal Act, 2010 - Sections 15 and 17 - Environmental Damage Compensation (EDC) - Power to impose penalty - Determination of penalty by Adjudicating Officer under Section 15C - Validity of formula for calculating compensation - Territorial jurisdiction over Coastal Regulation Zone (CRZ).
(B) Administrative Law - Power of delegated authorities - A formula for calculating environmental compensation must have a statutory basis or be backed by an executive order and approved by the competent authority (MoEF&CC) to be legally enforceable. (Paras 3 and 4)
Facts of the case:
An appeal was filed challenging an order directing the payment of Rs. 39,47,16,000 as Environmental Damage Compensation (EDC). The appellant contended that the order violated the Environment (Protection) Act, 1986, as penalties should be determined by an Adjudicating Officer rather than the GCZMA. Furthermore, it was argued that the formula used for calculation lacked statutory approval and was applied retrospectively to a period before its effective date. Additionally, the appellant claimed the affected area was outside the CRZ. The respondent authority subsequently admitted in its reply affidavit that there might have been an error in calculating the subject area used for the compensation amount.
Findings of Court:
The Tribunal noted that the respondent authority admitted a potential error in the calculation of the area, which formed the basis for the EDC amount. Consequently, the original order was found to be unsustainable in its current form.
Issues: Whether the GCZMA had the authority to determine the penalty instead of an Adjudicating Officer under Section 15C of the Environment (Protection) Act, 1986; whether the formula used for calculating EDC was legally valid and applicable to the date of the alleged violation; and whether the area calculation used for compensation was accurate.
Ratio Decidendi: When a regulatory body admits to a probable error in the factual calculation of the area used to determine environmental compensation, the order must be set aside and the matter remanded for a fresh, accurate determination to ensure the principles of natural justice and statutory compliance are upheld.
Result: Appeal allowed; order set aside and remanded.
Legal Category Hierarchy
- environmental law
- practice and procedure
Table of Contents
2. Appellant: GCZMA lacks power to determine penalty; formula invalid; area miscalculated. Respondent: High Court judgment upheld direction to assess environmental damages. (Para 2 , 3 , 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11 )
3. The court noted Respondent's admission of error in calculating area for Environmental Compensation. (Para 12 )
4. Admission of error in calculating area warrants remand for fresh assessment of compensation. (Para 12 )
5. Appeal allowed; impugned order set aside; matter remanded for fresh decision within two months. (Para 12 , 13 , 14 )
6. Does the GCZMA have authority to impose penalty under the Environment Protection Act after the introduction of Section 15C?
The court did not decide this issue. It set aside the order on the ground of admitted error in area calculation and remanded the matter. (Para 12 )
7. Can a formula for calculating environmental compensation be applied without approval from the MoEF&CC?
The court did not decide this issue. It remanded the matter due to an admitted calculation error, leaving all contentions open. (Para 12 )
8. Is an admission of error in calculation by the authority sufficient to set aside its order?
Yes, the court held that the authority's admission of an error in calculating the area justified setting aside the order and remanding for fresh assessment. (Para 12 )
ORDER
1. This appeal has been filed by the appellant, seeking quashing of the order dated 18.12.2024 passed by Respondent No.1- GCZMA, whereby a sum of Rs.39,47,16,000/- (Rupees Thirty Nine Crores Forty Seven Lakhs Sixteen Thousand Only), by way of an EDC amount, has been directed to be deposited, on the grounds that the said order is passed by Respondent No.1 in contravention to the provisions of the Environment (Protection) Act, 1986, which provides as below:-
“15. Penalty for contravention of provisions of Act, rules, orders and directions.—(1) Where any person contravenes or does not comply with any of the provisions of this Act or the rules made or orders or directions issued thereunder for which no penalty is provided, he shall be liable to penalty in respect of each such contravention which shall not be less than ten thousand rupees but which may extend to fifteen lakh rupees.
(2) Where any person continues contravention under sub-section (1), he shall be liable to additional penalty of ten thousand rupees for every day during which such contravention continues.
15A. Penalty for contravention by companies.—(1) Where any company contravenes any of the provisions of this Act, the company shall be liable to penalty for each such contravention which shall not be less than one lakh rupees but which may extend to fifteen lakh rupees.
(2) Where any company continues contravention under sub-section (1), the company shall be liable to additional penalty of one lakh rupees for every day during which such contravention continues.
15B. Penalty for contravention by Government Department.—(1) Where contravention of any of the provision of this Act has been committed by any Department of the Central Government or the State Government, the Head of the Department shall be liable to penalty equal to one month of his basic salary:
Provided that he shall not be liable for such contravention, if he proves that the contravention was committed without his knowledge or instructions or that he exercised all due diligence to prevent such contravention.
(2) Where any contravention under sub-section (1) is attributable to any neglect on the part of, any officer, other than the Head of the Department, the officer shall be liable to penalty equal to one month of his basic salary:
Provided that he shall not be liable for the contravention, if he proves that he exercised all due diligence to avoid such contravention.
15C. Adjudicating officer.—(1) The Central Government, for the purposes of determining the penalties under this Act, may appoint an officer not below the rank of Joint Secretary to the Government of India or a Secretary to the State Government to be the adjudicating officer, to hold an inquiry and to impose penalty in the manner, as may be prescribed:
Provided that the Central Government may appoint as many adjudicating officers as may be required.
(2) The adjudicating officer may—
(a) call upon any person alleged to have contravened or not complied with the provisions of this Act and the rules made thereunder or having the knowledge of the facts and circumstances of the case;
(b) require such person to produce any record, register or other document in his possession or any other document, which in the opinion of the adjudicating officer may be relevant to the subject-matter.
(3) The adjudicating officer shall, after giving the person a reasonable opportunity of being heard in the matter, and if, on such inquiry, he is satisfied that the person concerned has contravened or has not complied with the provisions of this Act or the rules made thereunder, he may impose such penalty as he thinks fit in accordance with the provisions of sections 14A, 14B, 15, 15A or section 15B, as the case may be.
(4) The adjudicating officer, while adjudicating the quantum of penalty under sub-section (3), shall have due regard to the following, namely:—
(a) the population and the area impacted or affected due to such contravention or non-compliance;
(b) the
