ON WEDNESDAY, as the Supreme Court reserved its verdict on the legal regime on grant of ex-post facto environmental clearance (‘EC’), the fundamental query before it stands to be this – is ex post facto clearance absolutely opposed to India’s environmental jurisprudence, or is it actually in furtherance of its environmental interests?
Before the Court reserved its judgment, Additional Solicitor General (‘ASG’) Aishwarya Bhati, for the Union government, extensively questioned the correctness of the Court’s May 2025 decision, authored by Justice A.S. Oka, which had struck down a 2017 notification and a 2021 Office Memorandum that granted post facto environmental clearance to projects. Bhati argued that the May judgment not only incorrectly interpreted five precedents of the Supreme Court, but also misunderstood the scope of Section 15 of the Environment (Protection) Act, 1986. She argued that the government was only seeking to relax the prior EC regime, and was not imposing a post facto regime at all.
A bench of Chief Justice Surya Kant and Justices Joymalya Bagchi and V.M. Pancholi has been hearing the matter afresh, after the Court’s November 2025 review judgement, authored by then CJI Gavai, recalled the May 2025 judgment that had prohibited retrospective environmental approvals.
ASG Bhati argued that the May judgment not only incorrectly interpreted five precedents of the Supreme Court, but also misunderstood the scope of Section 15 of the Environment (Protection) Act, 1986.
Did the May 2025 judgment misinterpret the Supreme Court’s own prior findings?
ASG Bhati took the Court through each of the prior judgments that are in contest in the present hearings: Common Cause v. Union of India (2017), Alembic Pharmaceuticals v. Rohit Prajapati (2020), Electrosteel Steels v. Union of India (2021), D. Swamy v. Karnataka State Pollution Control Board (2022), and Pahwa Plastics v. Dastak NGO (2022). The May 2025 judgment, authored by Justice Oka, had observed that both the 2017 notification and 2021 OM were bringing in a regime “completely prohibited” by Common Cause and Alembic Pharmaceuticals.
Bhati tried to highlight the effective portions of these judgments. In Common Cause, she noted, although the Court directed mining leaseholders who did not have EC initially to suspend mining operations, it eventually permitted them to restart mining operations once statutory compliances were made and dues were paid. She pointed out that over a 100 mining leases were allowed to be continued this way.
In Alembic, she noted that a manufacturing drug factory that began operation in 1992 applied for EC only in 2001. The Court quashed a 2002 notification of the Ministry of Environment, Forest and Climate Change (‘MoEFCC’) permitting ex post facto clearance, but allowed the factory to continue operation on payment of compensation.
In Electrosteel, a steel plant began operations in 2010 but applied for ex post facto clearance in 2018 after a 2017 Office Memorandum (‘OM’) was issued. She noted that the Court allowed the plant to operate subject to MoEFCC granting them EC.
In Pahwa Plastics, the industry was manufacturing chemicals, and while it started operation in 2014, it applied for EC in 2020, admitting that the delay was their own fault. Here again, the industry was allowed to operate. “Your lordships directed that they should take an EC from the MoEFCC,” she said.
In D. Swamy, a biomedical based treatment facility started operation in 2012 without any EC. Subsequently, in 2015, the provision for EC for a biomedical based treatment facility was stipulated. “When EC is made mandatory, the environmental jurisprudence regime that applies is anyone who is operating prior to [the mandating] also has to fall in the regime and…apply for EC for continuing operations,” she noted. The Court in D. Swamy noted that the facility could not be just closed because it did not have a prior EC, and was allowed to operate.
Bhati noted that although Justice Oka’s judgment relied on Common Cause to note that prior EC was mandatory even for renewal of mining leases and that the concept of retrospective EC was “completely alien to environmental jurisprudence”, it had missed to take note of certain portions of Common Cause. These portions show that although mining activities were halted after the CEC’s report, the Court had permitted leaseholders to restart mining operations only after compliance with statutory requirements and full payment of compensation and other deeds. She noted that in D. Swami and Pahwa Plastics, the Court had considered all precedents to uphold the 2017 notification and 2021 OM.
Bhati highlighted the downsides of the Court potentially striking down the 2017 notification and the 2021 OM. She pointed out that Rs 8,293 crore worth of central government projects and Rs 11,168 crore worth of state government projects were at stake.
“I am of the considered opinion that [the May judgment] is per-incuriam to the decisions of D. Swami and Pahwa Plastics,” she argued.
What does Section 15 of the Environment (Protection) Act say?
Section 15 of the EPA lays down the penalty for contravention of provisions of the EPA and its rules, orders and directions.
The May 2025 judgement had noted that, “Perusal of the provisions of Section 15 shows that even if the penalty is paid by the project proponent, it will not regularise the project.” It had observed that even after the payment of penalty, if a project was under construction or that operation had already commenced, the same had to be stopped and demolished.
Bhati argued that this was a misreading. She noted that Section 15 only dealt with the aspect of penalty. “Neither does it permit nor prohibit the regularization of the underlying project,” she argued. Therefore, the May 2025 judgment had not correctly interpreted the provisions of Section 15.
Projects worth Rs 20,000 crores and environmental well being at stake
Bhati highlighted the downsides of the Court potentially striking down the 2017 notification and the 2021 OM. She pointed out that Rs 8,293 crore worth of central government projects and Rs 11,168 crore worth of state government projects were at stake. In most of these projects, requisite formalities, including Environmental Impact Assessment (‘EIA’) were complete, and were only awaiting final EC.
“If [May 2025 judgment] is not recalled, it will have devastating effects in as much as various completed, near completion projects will have to be demolished,” she argued, suggesting it would cost the public exchequer Rs 20,000 crores.
Bhati pointed out that it would even lead to environmental degradation. One of the projects at risk, for instance, was a common effluent treatment plant which treated and purified polluted water before releasing it into water streams.
“I, therefore, ask the question to myself as to whether it would be in public interest to demolish all such projects and permit the money spent from the pocket of the public exchequer to go into the dustbin?,” she asked.
Should the matter be referred to a five-judge Constitution Bench?
In its hearing in February 2026, Senior Advocate Gopal Sankaranarayanan, appearing for Vanashakti had proposed that the matter be referred to a five judge Constitution Bench as it touched upon Article 21.
Addressing that, Bhati referred to a 2004 judgment by Justice R.C. Lahoti in the Dawoodi Bohra Excommunication case, where it was laid down that a larger bench decision is binding on a subsequent smaller or coordinate bench. “A bench of lesser quorum cannot disagree or dissent from a view of law taken by a bench of larger quorum,” she argued. Only if the coordinate bench doubts the correctness of the view taken by a bench of similar strength could it bring the attention of the CJI to the matter, who, then, can refer the issue to a Constitution Bench. This meant that if the present bench led by CJI Surya Kant expressed doubt upon the November judgement, specifying the reasons for the doubt, only then the matter could be referred to a five-judge bench.
Why is the Union saying this is not post-facto EC at all?
In the previous hearing, Bhati had put forward a new way to look at the case – this was not about post-facto EC at all. Yesterday, she built on it further, noting that this was, instead, about relaxing the prior EC requirement.
She argued that the prior EC requirement was brought in through an EIA notification under the EPA. If the State has the power to regulate, does it not equally have the power to relax that regulation?
She noted that the 2017 notification and the 2021 OM were brought in to reckon with ground realities. “The regulatory regime falters often-er than ever, for multiple reasons,” she argued, “not possible of compartmentalization as due to one or the other malady, all of which an evolving society would attempt to rectify in the long run.”
She also referred to the judgment in Navtej Johar (2018), which had noted that for the progressive realisation of economic, cultural and social rights, the courts, the legislature and executive had to “reckon [with] the changing times, stark realities and gross consequences of a strict straitjacket implementation of a regulatory regime which could also turn counterproductive.”
Justice Bagchi enquired whether the Union was essentially arguing that the relaxed regime was a “standalone exercise” to stop the continued violation of the laws. Bhati agreed, noting that the point was to create a deterrence regime that also brings violators into the fold of regulation.
“Even if it is impermissible, it has to still be sustainable. For that, it has to be either modified or if it cannot be modified, then it has to be struck down again,” she concluded.
The bench reserved judgement in the matter, and has permitted parties to file brief written submissions within a week.
Vanashakti v. Union of India, W.P.(C) No. 1394/2023 Diary No. 50009/2023
Read our previous hearing reports from February and March 2026.
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