M/S. Nayampadam Granites represented by its Proprietor Dr. Abraham Sebastian v. The Secretary, Keralassery Grama Panchayat, Palakkad District

``` WP(C) NO. 20823 OF 2023 ``` 1 # **`IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT`** ## **`THE HONOURABLE MR. JUSTICE BECHU KURIAN THOMAS WEDNESDAY, THE 18[TH] DAY OF OCTOBER 2023 / 26TH ASWINA, 1945 WP(C) NO. 20823 OF 2023`** ## **`PETITIONER/S:`** ``` M/S.NAYAMPADAM GRANITES REPRESENTED BY ITS PROPRIETOR DR.ABRAHAM SEBASTIAN AGED 60 YEARS MUNDUR POST, MUNDUR, PALAKKAD, KERALA, PIN - 678592 BY ADVS. PHILIP J.VETTICKATTU SAJITHA GEORGE NEENU BERNATH ``` ## **`RESPONDENT/S:`** ``` THE SECRETARY ``` ``` KERALASSERY GRAMA PANCHAYAT, KERALASSERY, PALAKKAD DISTRICT, PIN - 678641 BY ADV BALAGANGADGARAN UNIKKAT ``` ``` THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 18.10.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ``` ``` WP(C) NO. 20823 OF 2023 ``` 2 **BECHU KURIAN THOMAS, J.** CR **============================= WP(C). No. 20823 of 2023 ============================= Dated this the 18[th] day of October, 2023** ## **JUDGMENT** Petitioner prays for a declaration that he is entitled to have his license renewed by the Panchayat under Rule 10 of the Kerala Panchayat Raj (Issue of Licence to Factories, Trades, Entrepreneurship Activities and Other Services) Rules, 1996. Petitioner also seeks a direction to the respondent to issue a certificate of renewal of license. 2. With the intention of commencing quarrying operations, petitioner initiated steps to obtain licenses and permissions from various statutory authorities. The Geologist issued a letter of intent on 10.05.2018 expressing that a quarrying permit can be issued to the Petitioner to extract granite building stones from an area of 99.41 ares in resurvey No. 85/2, 86/1 and 86/2 of Keralasseri Village of Palakkad Taluk, provided he obtains various licenses and permissions mentioned therein. Pursuant thereto, petitioner obtained an Environmental Clearance, followed by a license under the Explosives Act, apart from consent to operate the quarry from the Kerala State Pollution ``` WP(C) NO. 20823 OF 2023 ``` 3 Control Board. Later, the Panchayat also issued a license to the petitioners for the period from 11.01.2023 to 31.03.2023 to conduct the quarry. 3. On obtaining all the licenses, petitioner deposited the royalty payable, and thus, steps for issuing the quarrying permit also reached its final stages. On noticing that license already issued by the Panchayat was expiring, petitioner applied for its renewal on 15.03.2023. Though the respondent Panchayat was bound to take a decision within 30 days, until 30.5.2023, there was no communication from the respondents. Petitioner hence proceeded on the assumption that he had obtained a deemed license under section 236(3) of the Kerala Panchayat Raj Act 1994, (for short ‘the Act’). In the meantime, a communication dated 30.5.2023 was served on the petitioner stating that Panchayat had held a meeting with the petitioner and the locals to allay the fears of the public. The communication further stated that despite the meeting, the local people remained disquieted, and hence, it was decided to conduct a joint inspection with the Pollution Control Board and the Mining and Geology Department. It was also informed that the application for license would be considered only after the report of joint inspection. According to the petitioner, renewal of the license is ``` WP(C) NO. 20823 OF 2023 ``` 4 a right under Rule 10 of the Rules, and hence, the joint inspection proposed cannot be a means to delay the issuance of the renewed license. 4. A counter affidavit has been filed by the first respondent, pointing out that though petitioner has obtained all the licenses and permissions from various statutory authorities since there are complaints from the local residents, the Panchayat cannot ignore those grievances. It was further stated that the joint inspection is required to ward off the apprehensions of the local residents and to recommend remedial measures and that an appropriate decision would be taken by the Panchayat after the joint inspection is conducted. The respondent has also pointed out that the nearest residence from the quarrying site is only 50 meters away, and therefore, the distance of 200 meters specified by the National Green Tribunal in O.A No. 304/2019 will apply. 5. I have heard Sri. Philip J. Vettickattu learned counsel for the petitioner as well as Sri. U. Balagangadharan, the learned counsel for the respondent. 6. Admittedly, the petitioner was granted a license to conduct a quarry for the period from 11.01.2023 to 31.3.2023. Before the expiry of the license, petitioner had applied for its ``` WP(C) NO. 20823 OF 2023 ``` 5 renewal on 15.03.2023, as evident from Exhibit P7, and even remitted the fee. The respondents were bound to take a decision on the said application within 30 days, but, such a decision was not taken. Neither has any communication been issued rejecting the application, nor did the Panchayat point out any defect in the application for renewal. The failure to respond within 30 days of the application has conferred a right to the petitioner under Section 236(3) of the Act for a deemed renewed license. 7. The Kerala Panchayat Raj (Issue of License to Dangerous and Offensive Trades and Factories) Rules 1996 (for short, the ‘D&O Rules’) was amended on 20-10-2017 by Amendment Rules 2017, which included a change in the Long Title of the Rules itself. After the amendment, the Long Title of the D&O Rules became the Kerala Panchayat Raj (Issue of Licence to Factories, Trades, Entrepreneurship Activities and Other Services) Rules, 1996 (for short ‘the Trade Rules’). Apart from the above, Rule 10 of the Trade Rules was also amended, stipulating that an application for renewal of a license shall be renewed on payment of the fee specified under Schedule II. Prior to the amendment, Rule 10 of D&O Rules merely stipulated that “an application for renewal of licence shall be ``` WP(C) NO. 20823 OF 2023 ``` 6 submitted thirty days before the end of an year and an application for license for fresh openings shall be submitted thirty days before the openings thereof.” After the amendment of 2017, Rule 10 of the Trade Rules reads as below. “Rule 10. Renewal of Licence. - A license issued under these rules shall be renewed on payment of the fee specified under Schedule II along with a self-certificate from the applicant within thirty days before the end of an year.” 8. The amendment of Rule 10 is brought in with a specific purpose. The Explanatory Note to the amendment of 2017 states that “The Kerala Investment Promotion and Facilitation Ordinance 2017 has been promulgated by Governor on 20th October 2017 amending seven Acts including the Kerala Panchayat Raj Act 1994 to avoid delay in granting various licenses, permissions, approvals and clearances required under various enactments.” The note further stated that it was decided to amend the D&O Rules suitably. 9. The purpose of incorporating a provision as Rule 10 of the Trade Rules, conferring a right of renewal in contradistinction to a discretion to renew the license, is undoubtedly with a purpose. The intention behind the said Rule is selfevident. If a business establishment is granted a license, its continuance and renewal of the license must be the rule and ``` WP(C) NO. 20823 OF 2023 ``` 7 non-renewal an exception. An entrepreneur must have the confidence that he will be able to continue his business in the coming years, especially in the absence of any conduct that impairs the grant or continuance of the license. 10. Industrial or commercial establishments require investment and upgradation of their facilities regularly. In the absence of any assurance that the licenses granted will continue uninterruptedly, no prudent businessman will make any substantial investment. If each year the cumbersome licensing process has to be undergone, it can lead to harassment of the licensee. To avert the said unwanted and winding procedure, the Legislature introduced, through the amendment of 2017, a concept of automatic renewal of licenses. The said process of automatic renewal enables the licenses to be renewed with ease, rather than leaving it to the whims and fancies of statutory authorities. As can be understood from the explanatory note to the amendment, the change has been introduced to avoid delays in the grant and renewal of licenses. The said legislative intention cannot be ignored. 11. Every businessman, while commencing or continuing his business, must have the confidence that as long ``` WP(C) NO. 20823 OF 2023 ``` 8 as he does not indulge in any activity contrary to the conditions of the license, his business will be unaffected, and license renewals will only be a formality. The provision for renewal is incorporated only as a measure of regulation and as a source of revenue for the local authorities. The amendment to Rule 10 of the Trade Rules has been brought in to facilitate the conduct of business in the State. From a harrowing experience of uncertainty over the renewal of licenses, the Legislature intended to create an atmosphere of doing business in Kerala with ease. 12. A learned Single Judge of this Court had, while dealing with an application for renewal of license in **Anish Abraham vs. Elappara Grama Panchayat and Another** [WP(C) No.20739/2023], observed that “the purpose of the amendment seems to be to simplify the procedure of renewal of license “. I fully endorse the said view and further elaborate that the said simplified procedure will be achieved only if the renewal is automatic. Of course, there can be exceptional circumstances where, on the basis of materials on record, the local authority can direct compliance with certain conditions while renewing the license. 13. In this context, reference has to be made to the ``` WP(C) NO. 20823 OF 2023 ``` 9 decision in **Malabar Granites v. Secretary Koppam Grama Panchayat** [(2019) 1 KLT 422], wherein a learned Single Judge struck a different note by observing that there cannot be a hard and fast rule imposed on a statutory authority to overlook the welfare of the people and renew the license. The Court read down Rule 10 to mean ‘on submission of application with required documents under law due to any changed circumstances’. However, on appeal, the Division Bench of this Court in **Malabar Granites v. Secretary Koppam Grama Panchayat** [(2019) 1 KLT 620] modified the judgment of the learned Single Judge and observed that while considering the renewal application, the Panchayat can seek corrective measures to be adopted if in case there are any negative inputs. The Division Bench held that the Panchayat cannot insist on the production of NOC as a precondition for renewing the license but that it can call for reports, and if any negative inputs are received, corrective measures can be directed to be put in place. 14. In view of the Judgement of the Division Bench in the **Malabar Granites Case** (supra) and having regard to the provision of Rule 10 of Trade Rules, it has to be clarified that the renewal of a license under the Rules is automatic unless ``` WP(C) NO. 20823 OF 2023 ``` 10 there are exceptional circumstances requiring compliance of mandatory conditions, which can be directed to be complied with while renewing the license. 15. Thus, in the light of the Division Bench judgment in the Malabar Granites case (supra) and in the absence of any negative report, the license ought to be renewed without any objection. The renewal of a license should only be a formality, that too, for fiscal purposes. However, in case any violation of mandatory requirements is noticed, the licensing authority will be entitled to initiate proceedings for revocation or suspension of the license, even after the license is renewed. However, in such a situation, the parameters differ. 16. In the instant case, Panchayat has not alleged that any of the conditions of the license issued to the petitioner earlier have been violated or that any other condition under which the statutory authorities have granted permission to the petitioner has been infringed. The distance rule mentioned in the counter affidavit is no longer in force in view of the decision of the Supreme Court in **Municipal Corporation of Greater Mumbai v. Ankita Sinha and others** (AIR 2021 SC 5147), which has set aside the order of the National Green Tribunal and remanded it. This has been mentioned in the decision in ``` WP(C) NO. 20823 OF 2023 ``` 11 **Madhulal M.G. v. The Director of Mining and Geology, Thiruvnananthapuram and Others** ( **2021 (6) KHC 332).** In such circumstances, the petitioner is entitled for renewal of his license as applied for in Exhibit P7. Therefore, it is declared that the petitioner is entitled to have his license renewed in terms of Rule 10 of the Rules. Respondent is directed to issue the physical copy of the renewed license for the period applied for in Exhibit P7, as expeditiously as possible, at any rate, within a period of 15 days from the date of receipt of a copy of this judgment. ## **BECHU KURIAN THOMAS** **JUDGE** jm/ ``` WP(C) NO. 20823 OF 2023 ``` 12 ## **`APPENDIX OF WP(C) 20823/2023`** |`PETITIONER EXHIBITS`|| |---|---| |`Exhibit P1`|`TRUE COPY OF THE LETTER OF INTENT ISSUED BY`| ||`THE COMPETENT AUTHORITY UNDER THE PROVISIONS`| ||`OF RULES, 2015`| |`Exhibit P2`|`TRUE COPY OF THE RELEVANT PAGES OF THE`| ||`ENVIRONMENTAL CLEARANCE ISSUED BY THE`| ||`COMPETENT AUTHORITY, DATED 23-8-2022 VALID`| ||`UP TO 22-08-2027`| |`Exhibit P3`|`TRUE COPY OF THE RELEVANT PAGES OF THE`| ||`EXPLOSIVE LICENSE ISSUED BY THE COMPETENT`| ||`AUTHORITY DATED 6-9-2022, WITH VALIDITY UPTO`| ||`31-3-2024`| |`Exhibit P4`|`TRUE COPY OF THE CONSENT TO OPERATE ISSUED`| ||`BY THE POLLUTION CONTROL BOARD, DATED 23-11-`| ||`2022, WITH VALIDITY UPTO 23-8-2026`| |`Exhibit P5`|`TRUE COPY OF THE LICENSE ISSUED BY THE`| ||`RESPONDENT DATED 11-1-2023, FOR CONDUCTING`| ||`QUARRYING OPERATION FOR THE PERIOD 11-1-2023`| ||`TO 31-3-2023`| |`Exhibit P6`|`TRUE COPY OF THE E-PAYMENT TRANSACTION SLIP`| ||`DOWNLOADED FROM THE PORTAL OF THE DEPARTMENT`| ||`OF MINING & GEOLOGY, DATED 15-6-2023`| |`Exhibit P7`|`TRUE COPY OF THE ACKNOWLEDGEMENT RECEIPT`| ||`ISSUED FROM THE OFFICE OF THE 1 ST`| ||`RESPONDENT`| |`Exhibit P8`|`TRUE COPY OF THE RECEIPT DATED 22-3-2023`| |`Exhibit P9`|`TRUE COPY OF THE COMMUNICATION DATED 30-5-`| ||`2023 ISSUED BY THE 1 ST RESPONDENT`| |`RESPONDENT EXHIBITS`|| |`Exhibit R 1 [a]`|`A true copy of the complainant signed by 54`| ||`persons residing in the locality dated`| ||`11..4..2023`| |`Exhibit R 1 [ b ]`|`A true copy of the minutes of the meeting`| ||`held on 26..4..2023`| |`Exhibit R 1 [ c ]`|`A true copy of the letter dated 5..5..2023`| ||`issued to the Geologist Mining and Geology`| ||`Department, Palakkad`| |`Exhibit R 1 [ d ]`|`A true copy of the letter dated 5..5..2023`| ||`issued to the Pollution Control Board ,`| ||`Palakkad`| |`Exhibit R 1 [e ]`|`A true copy of the consent to operate [ full`| ``` WP(C) NO. 20823 OF 2023 ``` 13 ``` text ] dated 23..11..2022 issued by Kerala State Pollution Control Board Exhibit R 1 [ f ]A true copy of the order of the National Green Tribunal dated 21..7..2020 in O.A 304/2019 Exhibit R 1 [ g ]A true copy of the full text of Exhibit P 2 ```