Full Judgment Text
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOS. OF 2023
(Arising out of Special Leave Petition (C) Nos.1333-1335 of 2022)
JOLLY GEORGE & ANR. …APPELLANTS
VERSUS
GEORGE ELIAS AND ASSOCIATES
& ORS. …RESPONDENTS
WITH
CIVIL APPEAL NO. OF 2023
(Arising out of Special Leave Petition (C) No.4822 of 2022)
J U D G M E N T
V. Ramasubramanian, J.
Leave granted.
2. George Elias and Associates, which is respondent No.1 in
the first set of three appeals and which is the appellant in the
fourth appeal, filed two writ petitions in WP (C) Nos.10381 and
17920 of 2020 on the file of the High Court of Kerala at
Signature Not Verified
Digitally signed by
POOJA SHARMA
Date: 2023.04.12
16:42:52 IST
Reason:
Ernakulam praying respectively for (i) setting aside an Order of
the Committee of the Kalloorkad Gram Panchayat refusing to
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grant license to them for establishing a Hot Mix Plant; and (ii) for
a declaration that by virtue of the certificate granted under the
Kerala Micro Small and Medium Enterprises Facilitation Act,
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2019 , all licenses and approvals including the license of the
Panchayat should be deemed to have been obtained.
3. By a common order dated 18.03.2021, the learned Judge of
the High Court of Kerala disposed of both the writ petitions
permitting the writ petitioners to prefer an application for
permission under Rule 68 of the Kerala Panchayat Building
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Rules, 2019 within two weeks and further directing the
Secretary of the Panchayat to grant necessary permission subject
to the conditions, if any, that may be imposed by the Panchayat.
The learned Judge held that inasmuch as the writ petitioners had
obtained consent from the State Pollution Control Board, the
Secretary of the Panchayat cannot refuse permission under Rule
68 of the Rules, 2019, though he can impose general conditions.
4. Challenging the said order of the learned Judge, three intra-
court appeals came to be filed. One of the intra-court appeals
was filed by the writ petitioners themselves, as they were not
1 For short, “Kerala MSME Act”
2 For short, “Rules of 2019”
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satisfied with the outcome. The other writ appeals were filed by
some people in the locality, who objected to the establishment of
the Hot Mix Plant.
5. By a common order dated 09.12.2021, the Division Bench of
the Kerala High Court dismissed the appeals. Therefore, people of
the locality have come up with the first three appeals challenging
the common order passed by the Division Bench of the Kerala
High Court in the three intra-court appeals. The writ petitioners
have also come up with one appeal, which is the fourth one, as
they are aggrieved by not getting full relief from the High Court.
6. We have heard the learned counsel appearing for all the
parties.
7. The controversy to be resolved in these appeals can be
better understood if we take a glance at the brief facts leading to
this litigation. These brief facts are as follows:
(i) George Elias and Associates, whom we shall describe as
the writ petitioners, are engaged in undertaking road
works in different parts of the State of Kerala. They
purchased Hot Mix Plants for carrying out the road
works for which they bagged contracts.
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(ii) By an Agreement dated 06.03.2019, the writ petitioners
were awarded the contract for road work in Cherthala
Aroorkutty. Within a few months, the Kerala MSME Act
came into force and hence the writ petitioners obtained
what is known as an Acknowledgement Certificate
under Section 5 of the said Act.
(iii) The writ petitioners also submitted an application to
the Kalloorkad Panchayat for the grant of a license, for
installation of the Hot Mix Plant. The application was
made on 05.02.2020.
(iv) On 04.03.2020 the Kerala State Pollution Control
Board granted “ Consent to Establish ”.
(v) Since there was no response from the Panchayat, to the
application for license, the writ petitioners claimed the
benefit of the deeming provision under Rule 12(3) of the
Kerala Panchayat Raj (Issue of License to Factories,
Trades, Entrepreneurship Activities and Other Services)
Rules, 1996. Accordingly, the writ petitioners
transported the equipments for installing the Hot Mix
Plant, to the property from which they proposed to
operate it.
(vi) Objections were raised by some members of the locality
owing allegiance to some political parties which led to a
meeting of conciliation. However, the Gram Panchayat
rejected the application by an Order dated 12.05.2020.
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(vii) Therefore, challenging the said order dated 12.05.2020
the writ petitioners filed the first writ petition bearing
WP (C) No.10381 of 2020. The writ petitions were
admitted and an interim stay of operation of the order
of the Gram Panchayat was also granted.
(viii) Subsequently, a few writ petitions came to be filed, the
details of which may not be necessary to be recorded
here. Suffice it to say that in one of the writ petitions,
the High Court granted police protection to the writ
petitioners to set up the Plant, after getting consent
from the Pollution Control Board.
(ix) Eventually, the writ petitioners filed the second writ
petition seeking a declaration that by virtue of the
Acknowledgement Certificate obtained under the Kerala
MSME Act, a license under the Kerala Panchayat Raj
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Act, 1994 was not necessary.
(x) The learned Single Judge, without actually getting into
the question relating to the overriding effect of Kerala
MSME Act, held that the Hot Mix Plant of the writ
petitioners was a portable equipment and that it does
not fall within the definition of the word “ building ”
under the Rules of 2019. The learned Single Judge also
held that after the grant of “ Consent to Establish ” by the
Pollution Control Board, permission of the Panchayat
was only formal. This view was also confirmed by the
3 For short, “Act of 1994”
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Division Bench. This is why the parties have landed up
before this Court.
8. A bare reading of the order of the learned Single Judge and
the Division Bench would show that the most vital aspect has
been lost sight of. Admittedly, the writ petitioners have obtained
consent to establish, from the Kerala State Pollution Control
Board. It is also admitted that the writ petitioners have obtained
an Acknowledgment Certificate under Section 5(3) of the Kerala
MSME Act. Section 6 of the Kerala MSME Act reads as follows:
“6. Effect of the Acknowledgement Certificate .—(1) An
acknowledgment certificate issued under section 5 shall,
for all purposes, have effect as if it is an approval as
defined in clause (c) of section 2, for a period of three
years from the date of its issuance and after the expiry of
the said period of three years, such enterprise shall have
to obtain required approvals as defined in clause(c) of
section 2, within six months from the date of such expiry:
Provided that the acknowledgement certificate shall not
entitle a person to use a land contrary to the provisions
contained in the Kerala Conservation of Paddy Land and
Wetland Act, 2008 (28 of 2008) and it shall also not
entitle a person to use the land in deviation to the land
use specified in the master plan notified under the Kerala
Town and Country Planning Act, 2016 (9 of 2016),
wherever such plan is in force.
(2) During the period of three years specified in sub-
section (1), no competent authority shall undertake any
inspection for the purpose of, or in connection with, any
approval as defined in clause (c) of section 2.”
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9. It is seen from Section 6(1) extracted above that an
Acknowledgement Certificate shall have effect as if it is an
approval as defined in Section 2(c). Section 2(c) reads as follows:-
“2.(c) “approval” means licenses, permissions, approvals,
clearances, registration, consents, no objection certificate
and the like, required under any State law in connection
with the establishment or operation of micro small and
medium enterprise in the State;”
10. What is held against the writ petitioners today is the
requirement of a permission under the Act of 1994. But Section
10 of the Kerala MSME Act not only confers overriding effect to
the Act on other laws, but also makes a specific reference to the
Act of 1994. Section 10 of the Kerala MSME Act reads as follows:
“10. Overriding effect of this Act on other laws .— (1) The
provisions of this Act shall have overriding effect,
notwithstanding anything inconsistent therewith contained in
any other law, for the time being in force.
(2) In particular and without prejudice to the generality of
the foregoing provisions of this Act, such provisions shall have
effect notwithstanding anything inconsistent therewith
contained in the following enactments and the provisions of
these enactments shall be read as amended in conformity with
the provisions of this Act, namely:—
1. The Kerala Panchayat Raj Act, 1994 (13 of 1994)
2. The Kerala Municipality Act, 1994 (20 of 1994)
3. The Kerala Shops and Commercial Establishments
Act, 1960 (34 of 1960)
4. The Kerala Lift and Escalators Act, 2013 (18 of 2013)
5. Travancore - Cochin Public Health Act, 1955 (XVI of
1955)
6. Madras Public Health Act, 1939 (3 of 1939)”
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11. Therefore, the prayer made by the writ petitioners in their
second writ petition, deserved to be granted, clearly in the light of
the statutory prescription. But unfortunately, both the learned
Single Judge and the Division Bench completely overlooked this
most vital aspect.
12. However, Shri K. Parameshwar, learned counsel appearing
for the objectors contended that two issues arise for
consideration namely (i) whether a self-certification obtained by
respondent No.1 under the Kerala MSME Act is sufficient in itself
to set up a Hot Mix Plant; and (ii) whether in the light of such
self-certification, no permission from the Panchayat is required
under the Act of 1994 and Rules of 2019.
13. According to the learned counsel for the objectors, Rule 3 of
the Kerala Micro Small Medium Enterprises Facilitation Rules,
2020, requires all persons seeking Acknowledgment Certificate
under Section 5(3) to furnish a duly filled self-certification in
Form-I. This form contains an undertaking from the applicant to
comply with the Kerala Panchayat Building Rules, 2019 and
hence it is contended that the writ petitioners cannot avoid the
requirement of permission from the local Panchayat.
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14. But the said argument cannot be sustained for the simple
reason that the Rules framed under the Act cannot annul the
effect of the statutory provisions. Section 10(2) of the Kerala
MSME Act makes it clear that the provisions of the Act of 1994,
shall be read as amended to be in conformity with the provisions
of the Kerala MSME Act. Therefore, the objectors cannot fall back
upon the Rules to nullify the effect of the provisions of the Act.
15. It is contended by Shri K. Parameshwar, learned counsel
that though his clients have not challenged the constitutional
validity of Section 10 of the Kerala MSME Act, this Court can
read down the overriding and absolute clauses in public interest.
According to the learned counsel, the Panchayat has a public
duty to safeguard the areas and persons within its jurisdiction
against environmental pollution and that the precautionary
principle requires to be applied. The learned counsel relied upon
Municipal Corporation of Greater
the decisions of this Court in
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Mumbai (MCGM) vs. Abhilash Lal & Ors. A.P. Pollution
and
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Control Board vs. Prof. M.V. Nayudu (Retd.) and Ors.
4 (2020) 13 SCC 234
5 (1999) 2 SCC 718
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16. But the above argument is completely misconceived.
Section 10 of the Kerala MSME Act does not override the
provisions of any of the pollution control laws such as
Environment (Protection) Act, 1986, Air (Prevention and Control
of Pollution) Act, 1981, Water (Prevention and Control of
Pollution) Act, 1974. The Kerala MSME Act overrides the 1994
Act and a few other local enactments. This is why the writ
petitioners have taken “consent” from the Pollution Control
Board. Once consent is taken from the Pollution Control Board,
the necessity for reading down Section 10 of the Kerala MSME
Act, for the purpose of protecting the environment, does not
arise.
17. The argument that Panchayat being the grassroot
institution, has the right of participation in decision making, is
again misconceived. All Panchayats want motorable roads. But
if they do not want road construction materials to be
manufactured within their Panchayat, we do not know where
from these materials can be imported. Therefore, the reliance
placed by the learned counsel for the objectors on the decision of
this Court in Lafarge Umiam Mining Private Limited in T.N.
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Godavarman Thirumulpad vs. Union of India and Ors . , is
also misplaced.
18. In fact, arguments were advanced also on the question
whether the Hot Mix Plant is portable or whether it is a
temporary or permanent structure etc. But we do not think that
it is necessary to go into the said question, because the
Acknowledgement Certificate obtained under the Kerala MSME
Act, alone is sufficient to clinch the issue in favour of the writ
petitioner.
19. In view of the above, the writ petitioner who is respondent
No.1 in three of these appeals and the appellant in one of these
appeals is entitled to the reliefs sought in both the writ petitions.
Accordingly, the appeal filed by the writ petitioner George Elias
and Associates is allowed, the impugned orders are set aside and
the writ petitions filed by George Elias and Associates are
allowed. The appeals filed by the objectors, namely, the people of
the locality are dismissed. There will be no order as to costs.
……………………………….. J.
(V. RAMASUBRAMANIAN)
6 (2011) 7 SCC 338
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……………………………….. J.
(PANKAJ MITHAL)
New Delhi;
April 12, 2023
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