Introduction:

The Karnataka High Court, in a significant ruling, has set aside an order issued by the National Green Tribunal (NGT), which directed the Madras Engineering Group (MEG), a training unit of the Indian Army, to pay an environmental compensation of Rs. 2,94,63,000 for polluting the Ulsoor Lake in Bengaluru. The division bench, consisting of Chief Justice N.V. Anjaria and Justice K.V. Aravind, concluded that the order was passed without adhering to the principles of natural justice, as the petitioners were not allowed to be heard before the imposition of such a significant liability. This case, which stemmed from suo-motu proceedings initiated by the NGT, addresses critical issues surrounding environmental governance, the importance of a fair hearing in legal proceedings, and the scope of judicial review under Article 226 of the Constitution.

Case Background:

The Union of India approached the Karnataka High Court in response to an order passed by the NGT on September 23, 2021. The NGT had directed the payment of Rs. 2,94,63,000 as environmental compensation after taking suo-motu cognizance of a report published by ‘The Hindu in 2016, titled “Lake in the heart of Bengaluru City turns graveyard for fish.” This report highlighted the deteriorating condition of Ulsoor Lake, which was allegedly caused by pollution from various sources, including the Madras Engineering Group (MEG) and its facilities.

The MEG, part of the Indian Army, houses around 5,000 employees and their families, along with soldier trainees. The pollution issue was traced back to an open stormwater drain of the Bangalore Water Supply and Sewerage Board (BWSSB), which flows through the MEG and culminates in Ulsoor Lake. In 2019, a 100 KLD (kilolitre per day) sewage treatment plant (STP) was commissioned, but it was allegedly operated without the necessary consent from the authorities, and the treated water did not meet the required discharge standards.

The NGT’s suo-motu proceedings culminated in the imposition of environmental compensation, despite the petitioners, including the Union of India and its defence establishment, not being given a chance to be heard during the investigation. The Union argued that they were not part of the suo-motu proceedings and only learned about the NGT’s actions when the Joint Committee appointed by the NGT visited for an inspection in August 2020. The committee’s report recommended the imposition of compensation but did not allow the petitioners a chance to present their defence.

Arguments of Both Sides:

Petitioner’s Arguments:

The petitioners, represented by the Union of India, contended that the NGT had violated the principles of natural justice by not allowing them to be heard. They argued that the NGT’s decision was based on a suo-motu proceeding, which was initiated without any prior notice to the affected parties. The petitioners further emphasized that the Joint Committee’s report, which formed the basis for the NGT’s order, did not consider their defence or allow them to present their case.

Moreover, the petitioners highlighted that the imposition of such a large environmental compensation, without a proper hearing, was unlawful and unjust. They also pointed out that they were unaware of the ongoing proceedings until the Joint Committee’s inspection, and had no opportunity to address the claims made against them. They argued that the compensation amount was arbitrary and did not account for the actual liability, nor was it based on a proper assessment of the environmental impact caused by their activities.

Respondent’s Arguments:

The Karnataka State Pollution Control Board (KSPCB), which was a respondent in the case, argued that the petitioners should have approached the Supreme Court, rather than the High Court, to challenge the NGT’s order. They contended that the NGT had the jurisdiction to impose the environmental compensation under its statutory powers and that the High Court should not entertain the writ petition in light of the availability of an alternative remedy. The KSPCB maintained that the NGT’s decision was valid and that the petitioners were liable to pay compensation for the pollution caused by their activities.

The State Pollution Control Board also argued that the actions of the petitioners, specifically the discharge of untreated or inadequately treated sewage into the stormwater drain leading to Ulsoor Lake, had contributed significantly to the pollution of the water body. According to the respondents, the Union and the MEG should bear the responsibility for the environmental damage caused by their operations and the failure to properly maintain their treatment facilities.

Court’s Judgment:

The Karnataka High Court, after reviewing the case, concluded that the NGT’s order was flawed due to a lack of adherence to the principles of natural justice. The Court held that the petitioners, who were not parties to the suo-motu proceedings, had not been allowed to present their case before the NGT. This was a violation of the basic tenets of fairness and justice, which are essential in any legal process. The Court emphasized that the NGT had passed interim orders and confirmed findings against the petitioners without hearing their side, which could not be justified under the law.

The bench made it clear that the failure to give the petitioners a chance to be heard in the proceedings was a crucial lapse, and such a decision could not stand. The Court relied on the principle that non-compliance with natural justice is one of the exceptions to the general rule that a High Court should not entertain writ petitions when an alternative remedy is available. The Court cited the Apex Court’s decision in the case of Madhya Pradesh High Court Advocates Bar Association vs. Union of India, where it was held that the power of judicial review could be exercised when there was a breach of natural justice.

The Karnataka High Court further pointed out that the imposition of the environmental compensation amount was not based on an adequate assessment of the liability. The Court found that the NGT had acted without allowing the petitioners to present relevant documents or evidence in their defence. Therefore, the Court remitted the matter back to the NGT to reconsider the imposition of the environmental compensation, ensuring that the petitioners would be given a fair opportunity to be heard.

The Court also directed the petitioners to deposit Rs. 1,00,00,000 with the Karnataka State Pollution Control Board but clarified that this amount would remain subject to the outcome of the NGT’s fresh decision on the matter.

Conclusion:

The Karnataka High Court’s decision to set aside the NGT’s order on environmental compensation for pollution at Ulsoor Lake reinforces the importance of adhering to the principles of natural justice in environmental governance. By remitting the matter back to the NGT and requiring it to reconsider the imposition of compensation after providing the petitioners with a chance to present their defence, the Court has ensured that fairness and transparency are maintained in the process. This ruling serves as a reminder that even in environmental matters, all parties must be allowed to be heard before significant penalties or liabilities are imposed. It also emphasizes that judicial review is an essential check on the powers of regulatory bodies like the NGT to prevent any arbitraryor unjust decisions.