NGT Upholds Vesting Order: Jindal Power Retains Environmental Clearance for Coal Washery Amidst Regulatory Dispute - 2025-04-10

NGT Orders Compliance: Jindal Power's Coal Washery Operations Valid Under Vesting Order

Bhopal, India – In a significant ruling, the National Green Tribunal (NGT), Central Zone Bench, Bhopal, has directed the Ministry of Environment, Forest & Climate Change ( MoEFCC ) and the Chhattisgarh Environment Conservation Board (CECB) to adhere to the vesting order issued by the Ministry of Coal, affirming Jindal Power Limited 's (JPL) right to operate its coal washery under the original environmental clearance (EC) granted in 2012. The judgment, delivered on April 8th, 2025, addresses a dispute arising from the re-auction of a coal mine and subsequent challenges to the operational validity of JPL’s existing coal washery.

Background of the Case

The case originates from the cancellation of coal block allocations by the Supreme Court in 2014. Following this, the subject coal mine, initially allocated to JPL, was re-auctioned, and JPL emerged as the successful bidder once again in 2023. A vesting order was issued by the Ministry of Coal transferring all rights, titles, interests, and statutory clearances associated with the mine to JPL, as per the Coal Mines Special Provision Act, 2015.

However, a dispute arose when the MoEFCC , in a letter dated November 14, 2023, transferred the EC to JPL but notably excluded the coal washery, directing JPL to obtain a separate EC for it, treating its current operation as a violation. Subsequently, CECB refused to renew the Consent to Operate (CTO) for the coal washery, citing the MoEFCC 's directive. JPL challenged these actions before the NGT, arguing that the vesting order encompassed the original EC of 2012, which explicitly included the coal washery.

Arguments Presented

Jindal Power Limited (Applicant) , represented by Senior Advocate Mr. Gopal Jain, contended that:

The vesting order mandated the transfer of all statutory clearances, including the original EC of 2012, which covered both the coal mine and the washery.

The coal washery is not part of the “mine infrastructure” under the CMSP Act and was never part of the auction process. JPL retained control and operation of the washery throughout the custodian period of South Eastern Coalfields Limited (SECL).

CECB had consistently renewed CTOs for the washery based on the 2012 EC, affirming its validity.

MoEFCC ’s demand for a separate EC and CECB’s refusal to renew CTO were arbitrary, illegal, and violated principles of natural justice by not providing a hearing before effectively halting washery operations.

Shutting down the coal washery would be environmentally detrimental as it plays a crucial role in reducing pollution and improving the efficiency of JPL’s 3400 MW power plant, which relies on washed coal. They cited precedents like Electro Steel Ltd vs. UOI & Ors and Pahwa Plastics v. Dastak NGO emphasizing that operational units should not be shut down for technical irregularities if compliant with environmental norms and contributing to the economy.

Ministry of Environment, Forest & Climate Change (Respondent No. 1) , represented by Ms. Suhasini Sen , argued that:

The EC transferred to JPL was based on the modified EC of April 16, 2015, which was issued to SECL (during its custodianship) and specifically excluded the coal washery.

Under the EIA Notification, 2006, a separate EC is mandatory for coal washeries, and JPL must obtain a fresh EC as per the SOP for violation cases.

The interim arrangement with SECL in 2015, exempting washery conditions, effectively split the original EC, and only the mine-related EC was transferred.

Chhattisgarh Environment Conservation Board (Respondent No. 2) , represented by Mr. Abhinay Sharma , submitted that:

CECB acted in compliance with MoEFCC ’s directive and cannot grant CTO for the washery without a valid EC.

The CTO was initially granted without prejudice to any pending illegal proceedings, highlighting the board's stance on the necessity of a separate EC.

NGT's Analysis and Decision

The NGT bench, comprising Hon’ble Mr. Justice Sheo Kumar Singh (Judicial Member) and Hon’ble Dr. Afroz Ahmad (Expert Member), meticulously examined the documents, vesting order, and arguments presented. The Tribunal emphasized the binding nature of the vesting order issued by the Ministry of Coal, which explicitly included the transfer of the 2012 EC with its terms and conditions, encompassing the coal washery.

The NGT highlighted key excerpts from the vesting order, particularly Annexure-03, which clearly listed the "Environmental Clearance with coal washery" and referenced the EC dated 12.06.2012. The Tribunal noted that:

Annexure-03

Sl. No.	Particulars of Statutory Licences/ Permits/ Permissions/ Approvals/ Consents	Issuing Authority	Date of Issue	Validity	Remarks
1	Environmental Clearance with Coal Washery	MoEF	12.06.2012	Valid	Annexure-I

The NGT firmly stated that the MoEFCC and CECB's actions contravened the vesting order and the provisions of the Coal Mines (Special Provisions) Act, 2015. Referring to the principle established in Electro Steel Ltd vs. UOI & Ors , the NGT underscored that establishments contributing to the economy and providing livelihoods should not be shut down for technical irregularities if they are environmentally compliant or can be made so.

The Tribunal concluded that:

The additional conditions imposed by MoEFCC in its letter dated November 14, 2023, to the extent they contradicted the EC dated 12.06.2012 and the vesting order, were void ab initio and illegal.

CECB's order dated January 21, 2025, refusing CTO renewal was also not in accordance with the EC dated 12.06.2012 and the vesting order, rendering it void.

Final Order and Implications

The NGT issued the following directives:

Respondents are directed to comply with the Ministry of Coal’s vesting order in letter and spirit, including the environmental clearance for combined production and coal washery as per Annexure-A/23.

All statutory licenses, permits, permissions, approvals, or consents mentioned in Annexure-A/23, including for the coal washery, are deemed transferred to JPL, and the conditions of EC dated 12.06.2012 must be strictly complied with.

Additional conditions in MoEFCC ’s letter dated 14-11-2023, contravening the EC dated 12.06.2012 and the vesting order, are void and must be reconsidered and rectified in consonance with the original EC and vesting order.

CECB is directed to reconsider the renewal of CTO for the coal washery in accordance with the EC dated 12.06.2012 and the vesting order.

Previous orders from the Delhi High Court and Supreme Court, allowing JPL to retain control over the coal washery, CHP, and CCPC, must be enforced.

This judgment provides significant relief to Jindal Power Limited , ensuring the continued operation of its coal washery under the existing environmental clearance. It also reinforces the legal validity and binding nature of vesting orders in the context of coal mine allocations and statutory clearances, emphasizing the importance of environmental benefits associated with coal washery operations.