High Court of KeralaSingle JudgeWrit petitions allowed; Ext.P10 and Ext.P11 set...

Unity Construction & Rajeev P.K. v. Vengola Grama Panchayat; M/S. Hira Constructions v. Vengola Grama Panchayat, Environmental Engineer, Kerala State Pollution Control Board, and District Industries Centre

Case / Petition Number:WP(C) Nos. 9247 & 10173 of 2021

Case Details & Bench

Court
High Court of Kerala
Hon'ble Judges
  • N. Nagareesh
Judgment Date
2021-07-08
Court Decision / Holding
Writ petitions allowed. Ext.P10 (Panchayat’s 23.03.2021 decision) and Ext.P11 (notices) are set aside. The court held that the Panchayat failed to demonstrate an independent, material finding on pollution or any study conducted to establish pollution from the petitioners’ units. The Acknowledgment Certificates issued under the MSME Act are not, by themselves, sufficient to override statutory environmental and licensing requirements without due process. The matter is disposed of accordingly.
Final Disposition
Writ petitions allowed; Ext.P10 and Ext.P11 set aside; matter disposed of accordingly.

Parties to the Case

Appellants / Petitioners

  • Unity Construction, Methala P.O., Perumbavoor, Ernakulam District
  • Rajeev P.K., S/O Krishnankutty
  • M/S. Hira Constructions, 13/2, Peringala, Kumarapuram – 683 565, represented by its Managing Partner K.S. Muhammad

Respondents

  • Vengola Grama Panchayat, represented by its Secretary
  • Vengola Grama Panchayat Committee, represented by its President
  • Environmental Engineer, Kerala State Pollution Control Board, District Office-2
  • District Industries Centre, Ernakulam, General Manager

Legal Representation & Advocates

Counsels for Petitioners

  • • Babu Joseph Kuruvathazha
  • • M.G. Sreejith
  • • Paul K. Varghese
  • • A.A. Geetha

Counsels for Respondents

  • • C.A. Navas
  • • T. Naveen
  • • Manu Raj

Case Synopsis & Summary

The two writ petitions, WP(C) Nos. 9247/2021 and 10173/2021, were heard together before a Single Judge of the Kerala High Court. The petitioners are two partnership firms operating Bitumen Hot Mix Plants in the Vengola Grama Panchayat area: Unity Construction (represented by Rajeev P.K.) and M/S. Hira Constructions (represented by K.S. Muhammad). They sought to obtain licences and permissions via the MSME Facilitation Act, 2019, relying on Acknowledgment Certificates issued under Section 5, read with Sections 6 and 2(c), which they argued function as licenses/clearances for three years. The Grama Panchayat Committee, on 23.03.2021, issued Ext.P11 notices and decided to stop the functioning of all establishments causing pollution, despite objections from the Panchayat Secretary. Respondents contend the units generate pollution and that consent to establish/operate has not been conclusively granted, with PCB having not issued consent to operate. The court, relying on Lizy Aby v. State of Kerala (2021 (1) KHC 255), held that a Panchayat cannot issue Stop Memos solely on complaints of pollution without a proper finding based on material. The court found no material demonstrating any independent study or finding on pollution by the Panchayat. Consequently, Ext.P10 (the Panchayat’s decision) and Ext.P11 (the notices) were set aside, and the petitions were allowed. The matter was disposed of accordingly.

Provisions of Law Cited

Section 5 of The Kerala Micro, Small and Medium Enterprises Facilitation Act, 2019Section 6 read with Section 2(c) of The Kerala Micro, Small and Medium Enterprises Facilitation Act, 2019Section 166 of The Kerala Panchayat Raj Act

Submissions & Arguments

Contentions of Appellants / Petitioners

The petitioners argued that issuance of Acknowledgment Certificates under the MSME Facilitation Act, 2019 constitutes a de facto grant of licences/permissions necessary for establishment/operation, valid for three years under Section 6 read with Section 2(c). They submitted that a Panchayat cannot issue Stop Memos to industrial units on complaints of pollution without a material finding, citing Lizy Aby v. State of Kerala (2021 (1) KHC 255). They contended that the Board’s later directions do not extinguish the effect of the Acknowledgment Certificate and that the Panchayat’s 23.03.2021 decision to stop operations was ultra vires and unauthorised absent substantial material. Respondents: The respondents maintained that the Panchayat has a statutory duty under Section 166 of the Kerala Panchayat Raj Act to ensure environmental hygiene, that the units create pollution and require established consent to operate, and that the single-window process cannot circumvent local regulatory checks. They relied on established judgments (including a Division Bench decision) to uphold the need for proper establishment permits and environmental compliance.

Contentions of Respondents

The respondents argued that environmental pollution is a ground to halt operations until compliance is verified; they asserted that the Pollution Control Board had not granted consent to operate and that the Panchayat acted within its powers to stop the establishments from functioning pending legal/operational clearances.

Cited Precedents (3)

Case NameCitationTreatmentExplanation
Lizy Aby v. State of Kerala and Others2021 (1) KHC 255PositiveCited and applied by the court to restrain Panchayat Stop Memos absent material findings on pollution.
George Joseph and others v. Bose Well John and others2021 (1) KHC 609Mentioned OnlyCited by respondents as a contrary proposition about industrial establishment permits, but not adopted in the court’s reasoning.
Decision of this Hon'ble Court reported in 2021(1) KHC 3372021(1) KHC 337Mentioned OnlyReferenced in exhibits/arguments but not used as a controlling authority in the decision.

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Extracted Judgment Text

Exact text extracted from official judgment records.

# **IN THE HIGH COURT OF KERALA AT ERNAKULAM** # **PRESENT** **THE HONOURABLE MR.JUSTICE N.NAGARESH** **THURSDAY, THE 8[TH] DAY OF JULY 2021/17TH ASHADHA, 1943 WP(C) NO. 9247 OF 2021** ## **PETITIONERS:** - **1 UNITY CONSTRUCTION, METHALA P.O., PERUMBAVOOR, ERNAKULAM DISTRICT, PIN-683 545, REPRESENTED ITS MANAGING PARTNER RAJEEV P.K.** - **2 RAJEEV P.K.,S/O. KRISHNANKUTTY, AGED 42 YEARS, PULICKAKUDY HOUSE, METHALA P.O., PERUMBAVOOR, ERNAKULAM DISTRICT, PIN-683 545.** **BY ADVS. BABU JOSEPH KURUVATHAZHA SRI.M.G.SREEJITH** ## **RESPONDENTS:** - **1 VENGOLA GRAMA PANCHAYAT, VENGOLA P.O., ERNAKULAM DISTRICT, PIN-683 556, REPRESENTED BY ITS SECRETARY.** - **2 VENGOLA GRAMA PANCHAYAT COMMITTEE, VENGOLA GRAMA PANCHAYAT, VENGOLA P.O., ERNAKULAM DISTRICT, PIN-683 556, REPRESENTED BY ITS PRESIDENT.** - **3 ENVIRONMENTAL ENGINEER, KERALA STATE POLLUTION CONROL BOARD, DISTRICT OFFICE-2, NEAR KALLUNGAL AUDITORIUM, PERUMBAVOOR, ERNAKULAM DISTRICT, PIN-683 545.** WP(C) Nos.9247 & 10173 of 2021 : 2 : **4 DISTRICT INDUSTRIES CENTRE, ERNAKULAM, KUNNUMPURAM-CIVIL STATION ROAD, ECHAMUKKU, THRIKKAKARA, VAZHAKKALA, KAKKANAD, KOCHI-682 030, REPRESENTED BY ITS GENERAL MANAGER.** **R1-R2 BY ADV SHRI.C.A.NAVAS, SC R3 BY SRI. T. NAVEEN, SC R4 BY GOVT. PLEADER SRI MANU RAJ** **THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 08.07.2021, ALONG WITH WP(C).10173/2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** WP(C) Nos.9247 & 10173 of 2021 : 3 : # **IN THE HIGH COURT OF KERALA AT ERNAKULAM** **PRESENT** **THE HONOURABLE MR.JUSTICE N.NAGARESH THURSDAY, THE 8[TH] DAY OF JULY 2021/17TH ASHADHA, 1943 WP(C) NO. 10173 OF 2021** ## **PETITIONER:** **M/S.HIRA CONSTRUCTIONS, 13/2, PERINGALA, KUMARAPURAM – 683 565, REPRESENTED BY ITS MANAGING PARTNER, K.S. MUHAMMAD, S/O. SULAIMAN, AGED 62 YEARS, RESIDING AT KALLUNGAL HOUSE, PERINGALA P.O., ERNAKULAM DISTRICT – 683565.** **BY ADVS. PAUL K.VARGHESE SMT.A.A.GEETHA** ## **RESPONDENTS:** - **1 THE VENGOLA GRAMA PANCHAYAT VENGOLA, NEAR PERUMBAVOOR, ERNAKULAM DISTRICT – 683 556, REPRESENTED BY ITS SECRETARY.** - **2 SECRETARY, VENGOLA GRAMA PANCHAYATH, VENGOLA, NEAR PERUMBAVOOR, ERNAKULAM DISTRICT – 683 556.** - **3 THE COMMITTEE, VENGOLA GRAMA PANCHAYATH, VENGOLA, NEAR PERUMBAVOOR, ERNAKULAM DISTRICT – 683 556, REPRESENTED BY ITS PRESIDENT.** WP(C) Nos.9247 & 10173 of 2021 : 4 : *** 4 ROBERT RAISON CORREYA, AGED 34 YEARS, S/O SAMSON CORREYA, AMBATTU HOUSE, ANGLO INDIAN COLONY, CHUNDAMALAPPURAM, VENGOLA, ERNAKULAM-683 556.** **(SUPPLEMENTAL R4 IS IMPLEADED AS PER ORDER DATED 23/04/2021 IN I. A. NO. 1/2021 IN WP(C) 10173/2021.** *** 5 BINOY, AGED 40 YEARS, S/O VARGHESE, MULLAMANGALAM HOUSE, WARD NO. 23, ARAKKAPADY VILLAGE, VENGOLA, ERNAKULAM DISTRICT.** **(SUPPLEMENTAL R5 IS IMPLEADED AS PER ORDER DATED 23/04/2021 IN I. A. NO. 1/2021 IN WP(C) 10173/2021.** **BY ADVS. SHRI.C.A.NAVAS, SC, VENGOLA GRAMA PANCHAYAT R4, R5 - SMT. VIDYA KURIAKOSE SRI.V.SREEJITH (K/1398/2000)** **THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 08.07.2021, ALONG WITH WP(C).9247/2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** WP(C) Nos.9247 & 10173 of 2021 : 5 : ## **J U D G M E N T** ~ ~ ~ ~ ~ ~ ~ ~ ~ ## _**Dated this the 8[th] day of July, 2021**_ [WP(C) Nos.9247 & 10173 of 2021] Both these writ petitions are filed by partnership firms running Bitumen Hot Mix Plant in Vengola Grama Panchayat and the writ petitioners are aggrieved by the decision taken by the Grama Panchayat Committee on 23.03.2021. Hence, they are heard together and being disposed of by a common judgment. 2. The petitioners in WP(C) No.9247/2021 submitted an application for getting licences of all statutory authorities to run a Bitumen Hot Mix Plant, through the Single Window Clearance Board. The Board issued Ext.P2 Acknowledgment Certificate. Ext.P3 proceedings were also issued by the Board permitting the 1[st] petitioner to operate the Plant. The petitioner in WP(C) No.10173/2021 also submitted similar application to the Board and Ext.P2 Acknowledgment WP(C) Nos.9247 & 10173 of 2021 : 6 : Certificate was issued to the petitioner in WP(C) No.10173/2021 also. 3. According to the petitioners, once the Single Window Clearance Board issues an Acknowledgment Certificate under Section 5 of the Kerala Micro, Small and Medium Enterprises Facilitation Act, 2019, it has the effect as if it is a grant of licences, permission, approvals, clearances, registration, consents, no objection certificates and the like, required under any State law in connection with the establishment or operation of MSME in the State. 4. However, the Committee of the Vengola Grama Panchayat which met on 23.03.2021 decided to stop the functioning of all establishments causing pollution and to issue notice to Firms having Bitumen Hot Mixing Plants functioning in the Panchayat. In spite of the objection raised by the Secretary to the Grama Panchayat based on the provisions of the MSME Facilitation Act, 2019, the Committee directed the Secretary to issue notice to the Firms running Bitumen Hot Mix Plants. WP(C) Nos.9247 & 10173 of 2021 : 7 : 5. Pursuant to the said decision taken by the Panchayat Committee on 23.03.2021, the petitioners were served with Ext.P11 notice. The petitioners contended that in view of Section 6 of the MSME Facilitation Act, 2019, the petitioners are entitled to run their units based on the Acknowledgment Certificates issued to them. This Court has held in the judgment in _**Lizy Aby v. State of Kerala** [2021 (1) KHC 255]_ that a Panchayat cannot issue Stop Memos to industrial units on the basis of complaints of pollution, without first arriving at a conclusion on pollution based on materials. 6. The supplemental respondents 4 and 5 in WP(C) No.10173/2021 filed a counter affidavit in the writ petition and contested the case. Respondents 4 and 5 stated that the Hot Mix Plants run by the petitioners result in serious pollution issues. When the Pollution Control Board issued consent to establish, the local residents submitted a mass petition before the Pollution Control Board. Thereupon, the Environmental Engineer sent a letter dated 05.01.2021 to the units directing them to comply with all the directions issued by the Pollution WP(C) Nos.9247 & 10173 of 2021 : 8 : Control Board. According to respondents 4 and 5, the Pollution Control Board has not so far issued consent to operate. 7. Respondents 4 and 5 contended that as per Section 166 of the Kerala Panchayat Raj Act, it is the duty of the Panchayat to meet the requirements of the Village Panchayat area in respect of matters enumerated it in the third schedule. Maintenance of environmental hygiene is one of the mandatory functions of the Panchayat. 8. The learned counsel for respondents 4 and 5 relied on a Division Bench judgment of this Court in _**George Joseph and others v. Bose Well John and others** [2021 (1) KHC 609]_ in which it has been held that a contractor has to secure necessary establishment permit in order to install Hot Mix Plant and only after establishment of unit, the contractor can seek for trade licence. In the facts and circumstances of the case, the writ petition is liable to be dismissed, contended respondents 4 and 5. 9. Heard the learned counsel for the petitioners, the WP(C) Nos.9247 & 10173 of 2021 : 9 : learned Standing Counsel for the Panchayat, the learned Government Pleader representing respondents 3 and 4 in WP(C) No.9247/2021 and the learned counsel appearing for additional respondents 4 and 5 in WP(C) No.10173/2021. 10. The petitioners have started their units and are running Bitumen Hot Mix Plant, after obtaining Acknowledgment Certificates from the Board. Issuance of Acknowledgment Certificate will have the effect of the petitioners having licences, permissions, approvals, clearances, registration, consents, no objection certificates and the like, required under any State law in connection with the establishment or operation of Micro, Small and Medium Enterprise in the State for a period of three years, in view of Section 6 read with Section 2(c) of the Kerala of Micro, Small and Medium Enterprises Facilitation Act, 2019. 11. The Grama Panchayat has decided to stop the functioning of the Hot Mix Plants based on complaints received from various quarters with regard to environmental pollution resulting from such plants. The impugned decision WP(C) Nos.9247 & 10173 of 2021 : 10 : of the Grama Panchayat dated 23.03.2021 does not disclose that the Panchayat has arrived at any finding on the alleged pollution resulting from the units of the petitioners. This Court has held in the judgment in _**Lizy Aby v. State of Kerala** [2021 (1) KHC 255]_ that a Panchayat cannot issue Stop Memos to industrial units on the basis of complaints of pollution, without first arriving at a conclusion on pollution, based on materials. No material has been placed before this Court to show that the Panchayat has conducted any study in the matter either by itself or through a competent body. 12. For the said reason, the writ petitioners should succeed. The impugned Ext.P10 decision dated 23.03.2021 of the 1[st] respondent Panchayat and Ext.P11 notices issued pursuant thereto are hence set aside. Writ petitions are disposed of as above. Sd/- **N. NAGARESH, JUDGE** aks/27.07.2021 WP(C) Nos.9247 & 10173 of 2021 : 11 : ## **APPENDIX OF WP(C) 9247/2021** ## **PETITIONER'S EXHIBITS:** **EXHIBIT P1 TRUE COPY OF THE CONSENT TO PERATE BEARING CONSENT NO.O19ERNA-CTO-673915 DATED 17.1.2020, VALID UP TO 29.9.2025, ISSUED BY THE 3RD RESPONDENT. EXHIBIT P2 TRUE COPY OF THE ACKNOWLEDGEMENT CERTIFICATE DATED 31.12.2020 VALID UP TO 31.12.2023, ISSUED BY THE 4TH RESPONDENT. EXHIBIT P3 TRUE COPY OF THE PROCEEDING DATED 15.1.2021 ISSUED BY THE 4TH RESPONDENT. EXHIBIT P4 TRUE COPY OF THE CERTIFICATE DATED 15.1.2021 ISSUED BY THE 4TH RESPONDENT. EXHIBIT P5 TRUE COPY OF THE NO OBJECTION CERTIFICATE (FINAL) NO.G-3034/20 DATED 22.7.2020 ISSUED BY THE DISTRICT FIRE OFFICER, FIRE & RESCUE SERVICES, ERNAKULAM. EXHIBIT P6 TRUE COPY OF THE CERTIFICATE DATED 8.12.2020, ISSUED FIREFLY ENTERPRISES, PERTAINING TO THE ESTABLISHMENT OF FIRE EXTINGUISHERS BY THE PETITIONERS EXHIBIT P7 TRUE COPY OF THE GST REGISTRATION NO.32AAGFU0520PIZ7 ENJOYS THE 1ST PETITIONER WITH EFFECT FROM 5.8.2019. EXHIBIT P8 TRUE COPY OF THE LETTER BEARING NO.A2/2150/2021 DATED 1.3.2021 ISSUED BY TEH IST RESPONDENT. EXHIBIT P9 TRUE COPY OF THE RECEIPT NO.7699288 DATED 16.3.2021 ISSUED FROM THE OFFICE OF THE IST RESPONDENT. EXHIBIT P10 TRUE COPY OF THE RESOLUTION NO.1(1) DATED 23.3.2021 PASSED BY THE 2ND RESPONDENT. EXHIBIT P11 TRUE COPY OF THE NOTICE NO.A2 2777/2021 DATED 29.3.2021 ISSUED BY THE IST RESPONDENT.** WP(C) Nos.9247 & 10173 of 2021 : 12 : ## **APPENDIX OF WP(C) 10173/2021** ## **PETITIONER'S EXHIBITS:** **EXHIBIT P1 A TRUE COPY OF THE CONSENT ORDER ISSUED BY THE POLLUTION CONTROL BOARD, PERUMBAVOOR TO THE PETITIONER DATED 16.11.2020.** **EXHIBIT P2 A TRUE COPY OF THE ACKNOWLEDGEMENT CERTIFICATE ISSUED BY THE GENERAL MANAGER, DISTRICT INDUSTRIES CENTRE, ERNAKULAM DATED 2.2.2021. EXHIBIT P3 A TRUE COPY OF THE STOP MEMO ISSUED BY THE RESPONDENT TO THE PETITIONER DATED 5.1.2021.** **EXHIBIT P4 A TRUE COPY OF THE JUDGMENT REPORTED IN 2021(H) KHC 255(LIZY ABY V.STATE OF KERALA AND OTHERS)** **EXHIBIT P5 A TRUE COPY OF THE DECISION OF THIS HON'BLE COURT REPORTED IN 2021(1) KHC 337. EXHIBIT P6 A TRUE COPY OF THE PROCEEDINGS OF THE SECRETARY, IKKARANADU GRAMA PANCHAYATH DATED 21.01.2021.** - **EXHIBIT P7 A TRUE COPY OF THE JUDGMENT IN WP(C) NO. 28283/2020 OF THIS HON'BLE COURT DATED 21.12.2020.** - **EXHIBIT P8 A TRUE COPY OF THE JUDGMENT IN WP(C) NO. 4997/2021 OF THIS HON'BLE COURT DATED 25.02.2021.** - **EXHIBIT P9 A TRUE COPY OF THE STOP A2-38/2021 OF THE SECRETARY VENGOLA GRAMA PANCHAYATH DATED 15.03.2021.** **EXHIBIT P10 A TRUE COPY OF THE DECISION NO.1/1 OF THE VENGOLA GRAMA PANCHAYATH DATED 23.3.2021. EXHIBIT P11 A TRUE COPY OF THE NOTICE ISSUED BY THE SECRETARY, THE VENGOLA GRAMA PANCHAYATH TO THE PETITIONER DATED 29.03.2021. EXHIBIT P12 A TRUE COPY OF THE COMPLAINT BY THE PETITIONER BEFORE THE REVENUE DIVISIONAL OFFICER, MUVATTUPUZHA DATED 17.04.2021. EXHIBIT P13 A PHOTOGRAPH OF THE BITUMEN MIXING PLANT PUT UP BY THE PETITIONER** **ncd**