Deals & Matter

Krishan Chander vs. Union of India & Ors.

Environmental Law

NGT Case

Mining Violations

Krishan Chander vs. Union of India & Ors.
  • O.M.P. (I) (COMM.) 349/2022
  • 29 November 2022
  • Delhi High Court

This case concerns environmental violations arising from illegal sand mining carried out by Respondent No. 10 (M/s DSP Associates) in Sonipat, Haryana. The applicant, Krishan Chander, filed the Original Application (OA) before the National Green Tribunal (NGT) alleging that the respondent had diverted a natural river, created artificial structures to alter its flow, and engaged in sand mining activities that violated Environmental Clearance (EC) conditions.
The matter has had a long procedural history, including investigations by joint committees, multiple reports of environmental damage, a substantial penalty assessment, and finally, partial setting aside by the Supreme Court on procedural fairness grounds. The NGT reheard the matter in May 2024, limited to reassessment of compensation, per the Supreme Court’s order.

Issue Before the Court

The core issue was whether Respondent No. 10, a mining leaseholder, had engaged in illegal instream sand mining by diverting river flow, thereby violating specific environmental clearance conditions, and what quantum of environmental compensation should be imposed under the “polluter pays” principle.
A secondary issue arose after the Supreme Court set aside clause (ii) of paragraph 13 of the NGT’s 14.07.2021 order on the grounds of violation of natural justice (i.e., the respondent not being heard adequately). The NGT had to now revisit that compensation assessment process while retaining the other directions intact.

Background Facts

The OA was filed in 2020 by Krishan Chander, alleging illegal sand mining by M/s DSP Associates in Sonipat. Specifically, the unit allegedly:

  • Created a 20-foot-deep, 1-kilometer-long pit.
  • Erected a bund across the river to divert its natural flow.
  • Conducted in-stream mining in violation of environmental norms.

NGT Investigation

The NGT, through its order dated 16.06.2020, formed a Joint Committee comprising the District Collector, HSPCB, and later added members from CPCB, the Irrigation and Mining Departments, and a MoEF&CC representative.

Key Finding from 30.03.2021 Report

  • A sand bund was erected and demolished by the Irrigation Department on 23.10.2020
  • A show cause notice was issued by the Mining Department on the same day.
  • Mining was resumed on 28.10.2020, despite continued environment violations.
  • The unit had violated Condition No. 17 of the EC dated 22.03.2016, which prohibited diversion of river stream.

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Environmental Compensation Assessment

Calculation Methodology

The Joint Committee calculated the Environmental Compensation (EC) based on:

Parameters Used

Pollution Index (PI): 80

Violation Days: 824 (18.05.2018 to 26.01.2021)

Rate Factor (R): ₹250

Scale & Location Factors: 1.0 each

Formula Applied

EC = PI × N × R × S × LF

= 80 × 824 × 250

= ₹1,64,80,000

This amount was recommended for recovery from the unit, along with the cost of restoration to be determined by a qualified environmental institute.

Committee Recommendations
  • No resumption of mining unless EC was paid in full.
  • Compliance with all EC, mining lease, and CTO conditions.

Tribunal's Findings (July 2021 Order)

In its earlier 14.07.2021 order, the Tribunal noted:

  • The illegal bund was built and later demolished.
  • Despite this, mining was restarted in just 5 days (28.10.2020).
  • Violations continued unchecked for 824 days, showing systemic failure.
  • The initial report from the State PCB falsely claimed there was no violation indicating possible collusion or dereliction of duty by officials.

“Citing its earlier jurisprudence, the NGT emphasized that compensation must reflect not just loss of royalty, but also damage to ecological services and environmental restoration costs.”

The Tribunal approved Approach 2 (Net Present Value method) for calculating compensation, which adjusted for long-term ecological costs. Based on CPCB methodology, this amount was estimated at over ₹66 lakhs using a 5% discount rate over 5 years, although the Tribunal had endorsed the higher estimate of ₹1.64 crore earlier. The Tribunal issued six comprehensive directions including compensation reassessment, review of officer conduct, blacklisting of the polluter, and execution of a restoration plan.

Supreme Court Intervention

Respondent No. 10 challenged the July 2021 NGT order before the Supreme Court (Civil Appeals 6437-6438 of 2021), arguing:

  • They were not given a copy of the report relied upon.
  • Technical glitches during video conferencing prevented their counsel from making submissions.
Supreme Court Order (20.02.2023)
  • The procedural rights of Respondent No. 10 were violated.
  • Only direction (ii) of paragraph 13 in the NGT’s July 2021 order (regarding compensation review) was set aside.
  • All other directions were upheld.

The matter was remitted back to NGT for limited reconsideration of compensation assessment after giving the respondent a fair hearing.

Tribunal's Final Decision (May 2024)

In compliance with the Supreme Court’s directive, the NGT reheard the case on 09.05.2024:

Proceedings
  • Respondent No. 10, now represented by counsel, did not raise further objections. Agreed to a reassessment of compensation by the Joint Committee provided they were heard in the process.
  • The counsel for HSPCB had no objection to this.
New Directive

The Joint Committee (as previously constituted and modified) shall reassess the environmental compensation after hearing Respondent No. 10. The final report shall be submitted to the Member Secretary, HSPCB, who will then issue the final EC order, subject to legal challenge if desired.

The Tribunal further noted that:
  • ₹1.64 crore had already been adjusted against the performance security.
  • HSPCB should deduct this amount from the final compensation if it overlaps with the same violation period.

The entire exercise is to be completed within four months, and all other prior directions from July 2021 remain in force.

Significance of the Case

Procedural Fairness

The importance of procedural fairness even in environmental matters—ensuring both accountability and due process.

Polluter pays Principle

The judicial emphasis on the “polluter pays” principle, mandating restoration of ecological damage rather than just
punishing wrongdoers.

Scientific Approach

The NGT’s proactive approach in quantifying environmental harm using scientific models, going beyond mere financial penalties.

Institutional Oversight

Institutional oversight failures and the need for administrative accountability when environmental degradation continues unchecked for years.

Deals and Matter

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