Mehta Versus Vs. Union of India & Ors  INSC 310 (31 August 1999)
Ahmad, M Jagannadha Rao D E R M.JAGANNADHA RAO,J.
application has been filed by the Gas Authority of India Limited (for short
`GAIL') for the following reliefs:
extend the schedule for supply of gas to industries in Zone-I of Agra City,
laid down vide the order dated 3/04/98 passed by this Hon'ble court in such a
manner that in respect of cupola based industries supply of gas by GAIL
coincides with the readiness of the consumer industries to draw gas;
non-cupola based industries in Zone-I of Agra
to draw gas latest by September, 1999;
direct the Secretary, PWD, Government of Uttar Pradesh, and Secretary/Director
General, Government of India, Ministry of Surface Transport to grant the
permission for underpinning the gas pipeline to the Yamuna Road Bridge within
four weeks so that GAIL may be able to the schedule for supply of gas to
Zone-II and III laid down by this Hon'ble Court vide its order dated 3/04/98."
The first relief concerns Zone-I and the second relief concerns Zone-II and III
in the city of Agra. We shall first deal with Zone-I
and thereafter with Zone II and III.
On 3.4.1998, this Court directed the GAIL that it should start supply of
Natural Gas to the Industries in Zone-I from July, 1998 so as to make available
gas to the specified industries by December, 1998. It is now stated by GAIL
that till December, 1998, 115 consumers out of 168 (referred to the order of
this Court dated 30.12.96) alone had contacted GAIL for supply of natural gas.
Other industries in Zone-I did not contact GAIL. It was stated that GAIL had
made gas available in April, 1998 to its first consumer in May, 1998 and that
by September, 1998, GAIL had completed gas pipeline network to supply gas to
all the 115 consumers with whom it had entered into a contract in Zone- I. The
complaint is that 79 out of these 115 consumers are not coming forward in
Zone-I and are cupola based iron foundries. The rest are non cupola. All these
115 had given an undertaking earlier to receive natural gas from GAIL. These 79
industries have been awaiting the technology to be developed by the National
Metallurgical Laboratory (hereinafter called the `NML') for conversion to
natural gas. GAIL feels that there is likelihood of delay in the drawal of gas
by the 79 cupola based iron foundries in Zone-I by the target dated 31.12.1998.
Only 4 cupola based - customers are likely to draw Gas by December, 1998.
12.4.1999, this Court issued notice to 79 industries in Zone-I requiring them
to show cause why they were not availing of the gas facility to be supplied by
GAIL. They were also asked to state why they did not want to draw the gas and
why their industries should not be allowed to be closed down.
5.4.1999, an affidavit of the Agra Iron Founding Association has been filed
stating that 78 (and not 79) were cupola based (item 74 Diwan Chand Suraj Prakash
Jain is not cupola based). The affidavit is filed on behalf of 78 cupola based
industries. They admit that on 30.12.1996, in M.C.Mehta vs. Union of India 1997
(2) SCC 353, orders have been passed recording the undertaking on behalf of
these industries for receiving gas as industrial fuel. They then refer to the
chronology of the steps taken by them bonafide for conversion by approaching
NML and Tata-Korf and their spending huge sums of money in that connection.
They state that the problem is that fool-proof technology for these 78
industries to use natural gas is not yet ready, though now it is in the last
stages of completion, -through the efforts of NML of Tata-Korf who have been
working on a project. As soon as the technology is available, the 78 industries
will switch-over to natural gas. They rely on the extension granted to GAIL
earlier upto December, 1998 as the cause for delay in switching over. NML has
conducted 10 trials on its new technology but these tests have not been
initially successful. The 78 industries have entered into agreement with GAIL
agreeing to switch over to natural gas and have paid Rs.2 lakhs as security and
given Rs.6 lakhs guarantee/indemnity. They have paid Rs.14 lakhs to Tata Korf
in January, 1998. On 6.2.1998 NML and Tata Korf visited Agra and on 10.2.78, the Association placed orders with Tata
Korf for supply of the technology. On 19.3.1998, the Association has entered
into agreement with Tata Korf under which Rs.20 lakhs have been paid as advance
out of Rs.40 lakhs. Know how has been agreed to be provided by 31.7.1999 but
the trial runs have failed. A chart is filed in this behalf. In all, 32 lakhs
have been paid to Tata Korf. On 22.4.1999, there has been a meeting with Tata- Korf.
All these steps have been taken during 1997, 1998 upto 22.4.1999.
26.4.1999, Tata Korf has written to the Association that the commissioning of
the cupola and stabilizing the same will take place in 1st part of July, 1999
and they expect "to receive the orders" from the Association in July,
1999 after the cupola is successfully worked to the satisfaction of the
Association. The schedule of supply of cupola is:
cupolas in 4 months (b) in each month 5-6 cupolas can be completed.
installation, those cupolas require fine tuning.
3.8.1999, Tata Korf has written to the Association that they had installed the
new instrumentation successfully on 15.6.1999. Some more heats have to be
developed. The demonstration unit will be established fully by end of
September, 1999. Same schedule of supply as stated earlier is given.
have heard learned senior counsel Sri V.R.Reddy for GAIL and Sri Sanjay Parikh
for the Association. We have also heard Sri Krishan Mahajan and Sri Vijay Panjwani.
counsel Sri Krishan Mahajan has suggested that these 78 industries have been
dodging and procrastinating in shifting to natural gas and that as per the
orders of this Court dated 30.12.1996 in M.C.Mehta vs. Union of India 1997 (2)
SCC 353, direction No. 5 requires that once the GAIL is ready, the industries,
if they did not convert to natural gas, they have to close down. Now GAIL has
been ready for supply of natural gas in September 1999 and at any rate by
December, 1999 in respect of all the 115 industries who have agreed to convert
to gas. Inasmuch as these 78 industries have not become ready to convert, they
are liable to be closed down forthwith.
other hand, learned counsel for the Association Sri Sanjay Parikh has contended
that in view of the above steps taken by the industries during 1997, 1998 and
1999 as narrated earlier, the stage is now set for switch over and that it will
create great hardship if the industries are to be directed to be closed down
now. Summarising the position, it is as follows. The correspondence between the
Association and NML and Tata Korf, it shows that by end of September, 1999, the
demonstration unit will be established.
cupola will be supplied - 10 in 4 months and then in each month, 5 or 6 cupolas
will be supplied. Now, going by the date September, 1999, it looks as if 10
cupola units will be supplied by January, 2000 ( i.e. in 4 months ) and by the
time all these 78 cupola industries change over to gas, ( as per the time
schedule given by Tata Korf) it will be another 17 months - which will take us
to July, 2001. This will be the time span on the assumption that conversion to
natural gas will be started by these 78 industries after September, 1999.
the orders of this Court dated 30.12.1996, the directions (4) and (5) read as
follows: (at p.304):
Those industries which neither apply for gas connection nor for alternative
industrial plot shall stop functioning with the aid of coke/coal in the TTZ w.e.f.
April 30, 1997. supply of coke/coal to these
industries shall be stopped forthwith. The District Magistrate and the
Superintendent of Police shall have this order complied with.
The GAIL shall commence supply of gas to the industries by June 30, 1997. As soon as the gas supply to an
industry commences, the supply of coke/coal to the said industry shall be
stopped with immediate effect." In the above background, the question is
whether these 78 cupola industries are to be allowed to function on coal/coke
without receiving natural gas. So far as the remaining non-cupola industries
which are 37 (out of 115) who have contracted to draw, there is no reason why
they have not accepted the supply of natural gas. Out of these, we are told
only 8 industries were drawing natural gas. The rest 29 have been obviously
taking it easy. We can divide the discussion into the various categories as
follows: (1) The overall total was 168 and only 115 have entered into agreement
with GAIL. Therefore, so far as the remaining (168-115) = 53 iron foundries are
concerned, there is no justification for them to function - unless they have
shifted out - and under clause 4 of the order dated 30.12.1996 of this Court,
the said 53 iron foundries are already liable to be closed. If they have not
shifted, these 53 industries must stop forthwith as they have acted in breach
of direction No.4. (2) So far as the 29 non-cupola industries out of 115
(excluding 8 which have switched over to gas), there can be no difficulty in
applying clause 5 of the order of this Court. If by 15.9.1999, these 29
industries do not accept gas, clause 5 of the order dated 30.12.1996 shall
apply forthwith to them.
far as the 78 cupola based industries are concerned, the question is what order
is to be passed? We have shown that even if the conversion starts from October,
1999, the time frame for all the 78 industries will be easily 21 months - which
will take us to July 2001. This Court has given enough time to these industries
right from 31.12.1996. We do not mean to say that they have not taken some
steps for conversion but if the Tata Korf time-schedule can give the conversion
technology to all the 78 of them at the earliest only by July 2001, the
question is whether these 78 coke/coal based industries which are continuously
using coke/coal can be allowed to pollute the air in and around the Taj
Trapezium and also whether they are to be allowed such a long period upto July
2001. We cannot lose sight of the fact that GAIL has completed its obligation
to be ready, even by September, 1998. No doubt, even now, as stated by counsel,
these 78 industries are prepared to stand by the undertaking given by them to to
this Court to receive natural gas. In our view, having regard to the fact that
the conversion of all these 78 cupola based industries is likely to be not
completed till July, 2001 - it will be a matter of grave concern if the
atmospheric pollution(as noted in the Neeri and Dr. Varadarajan reports and our
earlier orders) is allowed to continue. Question is not strictly whether the 78
industries have or have not acted bonafide in making some efforts for
conversion to natural gas but assuming they have taken some steps, the question
is whether the danger to the environment does not require urgent action. The
data already collected shows high levels of pollution in Agra in this area affecting the environment in the TTZ
circumstances, we are of the view that there is no other way to deal with the
situation than to apply clause (5) of the order of this Court dated 30.12.1996
set out above, strictly to these 78 cupola based industries. We are conscious
that any order to stop supply of coke/coal to the 78 coke/coal based iron
foundries will result in the closing down of these 78 industries for some time,
before they are able to switch on to natural gas. Obviously, the closure will
have not be permanent one but of a temporary nature.
will be no difficulty in permitting them to re-open as soon as they have the
cupola conversion technology installed in their respective industries. We are,
therefore, compelled to put clause (5) of the order of this Court into full
effect in respect of these 78 industries w.e.f. 15.9.1999. In the result, we
direct as follows:- (1) Out of 168, 53 iron foundries which have not agreed to
accept gas have to be closed forthwith, if not already closed as per orders of
this Court dated 30.12.1996 unless they have shifted. The District Magistrate
and Superintendent of Police, Agra shall
take action accordingly. (2)(i) Out of 115 which have opted and entered into
agreements with GAIL, 37 are non-cupola based and among the 8 have converted to
natural gas while in respect of the remaining 29 non-cupola industries. Clause
(5) of the order of this Court dated 30.12.96 shall come into operation w.e.f.
15.9.1999, for they have no excuse for not accepting the natural gas from GAIL.
The District Magistrate and Superintendent of Police, Agra will take steps to close down these industries by
15.9.1999. (ii) However, as and when these 29 non-cupola industries take steps
to receive gas, they shall be allowed to function. (3)(i) In respect of the
remaining 78, which are cupola based, in view of the reasons given above,
clause (5) of the order dated 30.12.96 of this Court will come into operation w.e.f.
15.9.1999. That will mean that in respect of these 78 iron founding industries,
the District Magistrate, Agra and the Superintendent of Police, Agra will have to see to it that no coal/coke is supplied
to them after 15.9.1999.
Out of the 78 cupola based iron foundries, as and when any of them gets
converted to natural gas and takes steps to receive gas from GAIL, they will be
allowed to function. We dispose of the IA in respect of Zone-I accordingly. Copy
to be communicated to District Magistrate and Superintendent of Police, Agra.
and Sri Krishan Mahajan are requested to furnish a list of the respective
industries to the above officials in a week. ZONE II & ZONE III So far as
Zone II and Zone III are concerned, a number of affidavits have been filed by
the GAIL and one by the Government of India. As the matter is to be adjourned,
we do not propose to give a detailed order. Sri V.R.Reddy, learned senior
counsel for GAIL has placed before us the correspondence and contended that, by
its affidavit, the Union of India appears to have in principle, accepted that a
pipeline can be allowed to be laid along the Old Yamuna Bridge but that the
Union of India want to put GAIL on notice that, inasmuch as the old Bridge may
require to be dismantled by Government, - GAIL must be prepared to go ahead
with laying down the pipeline with that possibility of the Old Bridge being
dismantled. Sri Reddy however points out that there are reports of some
technical experts that the old Bridge need not be dismantled in the near
contends that, unfortunately, the Government of India has not so far applied
its mind to these reports and therefore it has to take a final decision in the
matter of dismantling of the Old Yamuna Bridge, after considering these reports.
senior counsel contends that appropriate directions be given to the Union of
India in this behalf. In view of the above contention, we direct the Union of
India to examine the expert reports given in connection with the dismantling of
the old Bridge and take a final decision in regard to the same and give its
response to this Court by way of affidavit so that GAIL can take a decision as
to the laying of its pipeline for supply of natural gas to Zones II and III. Response
of Union of India to be filed within four weeks. Thus, we dispose of this I.A.
so far as Zone I is concerned. The I.A. now remains pending in respect of Zone
II and III. List I.A. after four weeks.