*IN THE HIGH COURT OF DELHI AT NEW DELHI Date of decision: 12th July, 2011 + [CASE NUMBER] BHARTI REALTY LTD. Petitioner Through: Mr. [ENTITY] & Mr. [ENTITY], Adv. Versus DELHI POLLUTION CONTROL COMMITTEE Respondents Through: [ENTITY], Mr. [ENTITY], Adv. along with Mr. [ENTITY], Law Officer, [ENTITY]. AND [CASE NUMBER] LODHI PROPERTY CO. LTD. Petitioner Through: Mr. [ENTITY] with [ENTITY] & Mr. [ENTITY], Adv. Versus DELHI POLLUTION CONTROL COMMITTEE Respondents Through: [ENTITY], Mr. [ENTITY], Adv. along with Mr. [ENTITY], Law Officer, [ENTITY]. [CASE NUMBER] & [CASE NUMBER] Page 1 of 16 CORAM :- HON'BLE MR. JUSTICE [ENTITY] 1. Whether reporters of Local papers may Not necessary be allowed to see the judgment? 2. To be referred to the reporter or not? Not necessary 3. Whether the judgment should be reported Not necessary in the Digest? [ENTITY], J.
1. The petitioner in [CASE NUMBER] acquired Plot No.1 Shopping Mall, Vasant Kunj, New Delhi from the DDA and after obtaining inter alia Environment Clearance dated 28 th November, 2006 from the Ministry of Environment & Forests has raised construction of its corporate office thereon. The writ petition has been filed impugning the order dated 31 st October, 2008 of the respondent [ENTITY] ([ENTITY]) directing the petitioner to pay Environmental Damages of 0.5% of the total project cost of `90 crores and to furnish a Bank Guarantee, also of 0.5% of the total project cost of `90 crores, valid for three years. Though the petitioner had in compliance of the said order paid the damages of `45 lacs and furnished the Bank Guarantee for `45 lacs but this [CASE NUMBER] & [CASE NUMBER] petition has been filed seeking refund of the said `45 lacs and return of the Bank Guarantee, owing to this Court in Splendor Landbase Ltd. v. [ENTITY] 173 (2010) DLT 52 having held that the respondent [ENTITY] is not empowered to levy such damages and/or to demand such Bank Guarantee.
2. The petitioner in [CASE NUMBER] is a Developer of a hotel at Plot No.27, Lodhi Road, New Delhi and similar damages of `2 crores were levied on it also vide order dated 6 th February, 2008 which were paid. Buoyed by the judgment of this Court in Splendor (supra), the writ petition claiming refund of `2 crores has been filed. Though the Bank Guarantee was also obtained from the said petitioner but the same has since been returned.
3. Notices of both the petitions were issued. Pleadings were completed in [CASE NUMBER]. The counsel for the respondent [ENTITY] has in the course of hearing filed the counter affidavit in [CASE NUMBER] also. [CASE NUMBER] & [CASE NUMBER]
4. The counsels for the petitioners have contended that they are similarly situated as the petitioner in Splendor and other connected petitions and the same order ought to follow.
5. The counsel for the respondent [ENTITY] has at the outset stated that the respondent [ENTITY] has preferred an intra court appeal against the judgment of the Single Judge in Splendor and other connected petitions and which is listed next before the Division Bench on 24 th August, 2011. It was argued that the present petitions be adjourned till the decision of the appeal aforesaid.
6. However the aforesaid contention of the counsel for the respondent [ENTITY] was not accepted. I am of the view that no purpose would be served by keeping these petitions pending. It is deemed expedient that the Division Bench considers all matters, from all facets and hears all counsels in one go rather than in stages. The same is also necessary to avoid multiplicity of litigation on the same issues. It was thus put to the counsel for the respondent [ENTITY] as to why not the present petitions be also allowed and the respondent [ENTITY] prefers intra court appeals in these cases [CASE NUMBER] & [CASE NUMBER] also so that the same can be heard on 24 th August, 2011 along with appeals in Splendor and in other connected writ petitions.
7. The counsel for the respondent [ENTITY] has then argued:-
a. that the judgment in Splendor would not bind the present cases as the same is per incuriam for not considering [PRECEDENT]. Attention is invited to para 60 of the said judgment laying down that the Central Govt. is empowered under the [ACT] to take all measures as it deems necessary or expedient to protect and improve the quality of environment, including imposition of costs, remedial measures on the offending industry. It is contended that the provisions of the [ACT] and [ACT] damages subject matter of these petitions were imposed are in pari materia to the provisions of [ACT] and thus the [CASE NUMBER] & [CASE NUMBER] power to levy damages and demand Bank Guarantee is to be read under [ACT] also. It is contended that all the judgments of the Apex Court relied upon in Splendor relate to taxation and are not applicable to matters as concerned. It is further contended that [SECTION] of the [ACT] does not apply to levy of damages for violation of statutory provisions. It is argued that thus this Bench should re-look into the matter; b. It is contended that in Splendor and other connected petitions, the challenge was to the show cause notice and in none of those cases any payments had been made or Bank Guarantee furnished. It is argued that in both these petitions the petitioners have already complied with the demand of the respondent [ENTITY] and cannot be permitted to challenge the same now or to seek refund. It is further argued that while the petitioner in [CASE NUMBER] had made payment without prejudice to its rights and contentions, the petitioner in [CASE NUMBER] volunteered to deposit the amounts to [CASE NUMBER] & [CASE NUMBER] avoid closure and cannot now seek refund. It is urged that both the petitioners as businessmen took a business decision to make the payment instead of facing prosecution and closure and cannot be now permitted to reprobate;
c. It is contended that no refund can be claimed by way of writ petition, especially when the judgment on the basis of which the claim for refund is stated to have arisen has not attained finality as yet;
d. Attention is invited to a judgment dated 6 th July, 2011 in [CASE NUMBER], titled Lafarge Umiam Mining Pvt. Ltd. v.
T.N. Godavarman Thirumulpad of the Apex Court observing that penalty can be imposed on polluters; e. Principles of waiver, acquiescence and estoppel are invoked to contend that the same deprive the petitioners from any relief. Attention is also invited to judgment dated 16 th January, 2009 of this Court in [CASE NUMBER] titled [PRECEDENT] and other connected [CASE NUMBER] & [CASE NUMBER] petitions observing that in a given case the Commissioner in exercise of powers under the [ACT] may not deem it appropriate to take the extreme steps of closing down the unit but may issue specific directions and as a measure to ensure compliance, require furnishing of a Bank Guarantee;
f. It is contended that the damages levied in both cases are fair and the petitioners having taken advantage thereof by warding off any other action against themselves, are now not entitled to maintain this petition.
8. Per contra, the counsels for the petitioners have contended:-
(i) That the respondent [ENTITY] cannot withhold the monies which the judgment in Splendor holds the respondent [ENTITY] to be not entitled to;
(ii) That the property of the petitioner in [CASE NUMBER] is situated in the close vicinity of the property subject matter of Splendor;
[CASE NUMBER] & [CASE NUMBER]
(iii) Reliance is placed on [PRECEDENT] on the aspect of powers of this Court to direct refund of the amounts wrongly collected;
(iv) That the judgment in [PRECEDENT] (supra) has been considered in Splendor;
(v) That the amounts collected from the petitioners have not been taken as Environmental Damage but as condition of grant of operating licence;
(vi) That the aforesaid amounts were demanded when the construction was complete and as such the petitioners were left with no option but to pay the amount;
(vii) That the Supreme Court in [PRECEDENT] (supra) was concerned with [SECTION] of the [ACT] and of which there is no equivalent under the [ACT];
[CASE NUMBER] & [CASE NUMBER]
(viii) That in Splendor and other connected writ petitions the question of refund did not arise because of the interim protection afforded by this Court in those cases against similar demand as impugned in the present cases;
(ix) That Supreme Court in [PRECEDENT] had returned a finding of damage to environment having been caused whereas there is no such finding in the present cases. Reference is made to [PRECEDENT] to contend that the damage has to be ascertained and which has not been ascertained in the present cases and to [PRECEDENT] to contend that there is no basis for levy of damages at 0.5% of the project cost;
(x) Reliance is placed on [PRECEDENT] to contend that refund under [SECTION] can be directed in matters other than tax also;
[CASE NUMBER] & [CASE NUMBER]
(xi) It is contended that the payments being under coercion and protest and being in pursuance to an illegal order, no question of estoppel arises.
9. Propriety demands that all the aforesaid contentions be considered by the Division Bench which is seized of the matter and not by this Bench. The contentions of the counsels have been noticed only to make a record thereof; else, Co-ordinate Benches cannot consider the matter when the same is pending consideration in appeal.
10. However it falls for consideration by this Bench, whether owing to the petitioners having already made the payments and furnished the Bank Guarantee demanded and having not considered the need to challenge the same and having preferred these petitions only after the judgment in Splendor, disentitles the petitioners from maintaining these petitions.
11. The conduct of the petitioners does show that the petitioners at the contemporaneous time were satisfied with the demand and readily complied with the same. Even though the petitioner [ENTITY] made payment without prejudice, it did not immediately thereafter also [CASE NUMBER] & [CASE NUMBER] make any challenge. However one cannot also lose sight of the fact that the said law is still at its nascent stage; there are no precedents, no past practices. The petitioners thus could not be expected to know whether the respondent [ENTITY] was entitled to levy such damages or demand Bank Guarantee. For a person to relinquish a right or claim, he must know the same; a person cannot relinquish what he does not know he has. This is not a case of ignorance of law. Even the Courts are still grappling with as to what is the law in this regard. I am thus unable to hold that the petitioners are disentitled from preferring these petitions or from claiming the reliefs claimed for the reason of having accepted the demand. It cannot also be lost sight of that the projects of the petitioners were at crucial stage then with the petitioners having sunk in money and efforts in development also besides the cost of the land. The Apex Court in [PRECEDENT] has held that whether a case of coercion is made out is a question of fact and dependent upon several factors. The present, for the reasons aforesaid, is a case of petitioners being coerced into making the payments and furnishing the [CASE NUMBER] & [CASE NUMBER] Bank Guarantee, which this Court has held the respondent [ENTITY] to be not entitled to seek.
12. The respondent [ENTITY] cannot also be so allowed to illegally enrich itself, if not entitled in law to the monies. The orders/demands impugned in this petition, as per judgment in Splendor were beyond the jurisdiction of respondent [ENTITY] and thus non est. No benefit of such a void demand/order can be retained by the respondent [ENTITY] which is "State" within the meaning of [SECTION] of the [ACT].
13. I am otherwise also of the opinion that if the petitioners have violated the [ACT], then they ought to face the consequences thereof as follow in law and cannot buy their way out of the said consequences. To hold, the respondent [ENTITY] entitled to retain the monies, tantamounts to holding that the respondent [ENTITY] would not be entitled to take any other action which it may be entitled in law to take against the petitioners for violations if any committed by the petitioners. The same cannot be permitted.
[CASE NUMBER] & [CASE NUMBER]
14. The next question which arises is, of the relief to be granted. This Court in Splendor and in other connected writ petitions was not concerned with the question of refund. The question of entitlement of the petitioners to interest also arises.
15. I am of the view that the petitioners cannot be held entitled to any interest. The petitioners even though without prejudice, chose to comply with the demand rather than challenge the same at the contemporaneous/relevant time. These petitions have also been filed after considerable time (though within three years of the payment); in such situation, the petitioners cannot be entitled to any interest.
16. If the petitioners are to be held entitled to refund of the amounts paid, liberty has to be necessarily granted to the respondent [ENTITY] to proceed afresh against the petitioners for the violations if any committed by the petitioners. This Court in Splendor and other connected petitions also left it open to the respondent [ENTITY] to take action in accordance with law.
[CASE NUMBER] & [CASE NUMBER]
17. The petitions are therefore allowed with the following directions:-
A. The respondent [ENTITY] to within six weeks of today refund to each of the petitioners the amounts aforesaid collected from them and to also within the said time release the Bank Guarantee obtained from the petitioner in [CASE NUMBER]; B. Upon failure to refund/release within the time aforesaid, the respondent [ENTITY] shall be liable for interest at 10% per annum on the amounts and on the value of Bank Guarantee, from the expiry of six weeks herefrom and till the date of refund/discharge;
C. The respondent [ENTITY] is also granted liberty to proceed in accordance with law for the violations/breaches if any committed by the petitioners. It is made clear that such actions to be taken by the respondent [ENTITY] shall not be defeated for the reason of delay in initiating the same since the respondent [ENTITY] had withheld the said actions owing to [CASE NUMBER] & [CASE NUMBER] the petitioners at the contemporaneous time having made the payment/given the Bank Guarantee.
No order as to costs.
[ENTITY] (JUDGE) JULY 12, 2011 pp
(corrected and released on 28th July, 2011).
[CASE NUMBER] & [CASE NUMBER]