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Karnataka High Court dismisses PIL against use of Kali river water for industrial units

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The Karnataka High Court has held that the utilization of natural resources has to be in a way which is consistent with the principles of sustainable development. A balance has to be struck between development and ecology. In case, a commercial venture brings in results which are more beneficial for people, the benefit to a larger section of the people has to get primacy over comparatively lesser hardship. It is trite law that parameters of judicial review are limited to malafide, bias and arbitrariness.

The Division Bench of Acting Chief Justice Alok Aradhe and Justice S. Vishwajith Shetty dismissed a Public Interest Litigation (PIL) questioning the action of the State Government to part with water resources of Kali river for commercial use by a company.

As per averments made in the petition, Western Ghats are home to several endangered and listed plant species. Kali river flows through the thick and dense rain forest of Western Ghats. The State High Level Clearance Committee (SHLCC), constituted under the Karnataka Industries Facilitation Act, 2002, has been enacted with an objective to facilitate industrial development in Karnataka. Section 5 of the Act provides that approvals granted by SHLCC shall be binding on all the authorities.

The company intended to establish a sugar mill at Haliyal Taluk. It therefore, approached the SHLCC for approval of the project. The SHLCC after conducting a detailed study and after consultation with various organs of the State, granted permission on 10.10.2005 to the company to set up a sugar mill comprising 5000 ECD of sugar unit and 28 MW Power Generation Plant as well as a 45 KLPD Distillery unit. The SHLCC also permitted the Company to draw 4545 KLD water from Kali river.

The State Government by a notification allocated sugarcane area to the Company and fixed the crushing capacity of the Company at 2500 TCD and the requirement of sugarcane was fixed at 4.525 Lakh Metric tonnes. Thereafter on 14.03.2006, a Corrigendum was issued modifying the crushing capacity to 3,500 TCD and sugarcane requirement of the Company was fixed to 6 to 7 Lakh per metric tonne. The State Government, thereafter, by an order dated 15.04.2006 permitted the Company to set up 3,500 TCD sugar units and 28 MW generation plant and 45 KLPD Distillery unit.

The consent was granted on 05.07.2006 for establishment of Sugar Mill by Karnataka State Pollution Control Board, in pursuance of which, an agreement was executed between the Company and Public Works Department of Government of Karnataka for laying the pipeline for supply of water from Kali River. The Public Works Department by a communication dated 22.11.2006 authorized the Company to lay down the pipeline from Kali River to its Factory.

The Karnataka Industrial Area Development Board allotted land measuring 226 acres and 17 guntas in favour of the Company for setting up of a Sugar Mill and the possession of the same was handed over to the Company. A lease-cum-sale agreement in respect of land was executed on 08.01.2007. The Department of Labour, Government of Karnataka issued a Certificate of Registration under Contract Labour (Regulation and Abolition) Act, 1970. The Secretary, Water Resources Department by an order dated 23.03.2007 permitted the Company to lift water from Kali River subject to conditions mentioned therein.

In compliance of the permissions granted to the Company, it has set up a Sugar Mill with crushing capacity of 6000 MT per day at Hullatti Village and the same became operational in October, 2007. The Company has also set up a distillery unit and a power generation plant, which is generating 31.5 MegaWatts of power.

A suit seeking the relief of permanent injunction was filed by the members of the petitioner association restraining the Company from withdrawing water from Kali River. In the aforesaid civil suit, an ex-parte order of injunction was granted which was vacated after hearing the Company on 16.06.2007.

The Ministry of Environment and Forest, Government of India by an order dated 02.08.2007 accorded permission to the Company for laying of the pipeline. The State Government by an order passed under Section 2 of the Forest Conservation Act, 1980 dated 09.08.2007 accorded approval for diversion for 1.28 hectares of forest land for laying water supply pipeline and construction of pump house. On 18.08.2007, an environmental clearance was issued by the Forest, Ecology and Environment Department for setting up of the Factory. The Ministry of Environment and Forest also issued an environmental clearance on 18.10.2007 for setting up the distillery.

On or about 15.10.2007, the petitioners filed challenging permission granted for use of Kali River.

The Bench while considering the PIL observed that in the instant case, the decision has been taken in larger public interest. The sugar factory which has been already set up and functional provides assistance to 50,000 farmers in the backward area of the State who sell sugarcane crops to the factory. The water supply needs of Dandeli Town and Haliyal Taluk have also been taken into consideration and the company has been permitted to use water from the river subject to conditions. It does not have an unfettered right to draw water from the River.

It is noted by the Bench that during pendency of the petition, several other industries namely Dandeli Fero Alloys, West Coast Paper Mills, Haliyal Water Supply Jack Well and Shreyas Paper Mills, have been permitted to draw water from the River. No material has been brought before the Court that on account of drawal of water by the sugar factory, there is any shortage of water supply to residents of Dandeli and Haliyal Taluk.

The Court does not have the expertise to correct an administrative decision and cannot substitute its decision. The Court does not have any expertise to lay down the policy of distribution of water. The decision taken by the State Government is neither shown to be malafide or arbitrary. Therefore, in exercise of powers of judicial review, no interference with the decision of the Government in permitting the Company to set up the industry and to draw water from Kali River is called for,” the Court observed.

“It is settled in law that the doctrine of delay and latches applies to a public interest litigation. In the instant case, the State Government granted approval to establish a sugar factory by a Government Order dated 15.04.2006. Thereafter, the grievance of the stakeholders was taken into account by the Secretary, Commerce and Industries Department, who inspected the Hullatti, Haliyal, Kersoalli and Dandeli on 01.03.2007 and held extensive deliberations with various stakeholders and submitted a report in March 2007. The Company thereafter has made an investment of approximately more than Rs 300 crore and the plant has been operational since October 2007. The petition was filed on 15.10.2007. Thus, on the facts of the case, on account of delay and latches on the part of the petitioners, they are not entitled to any relief,” the order reads.

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