The Hon’ble Supreme Court in the case of The State of Uttar Pradesh v. Uday Education and Welfare Trust & Anr. in a judgement dated 21.10.2022 set aside the order dated 18.03.2020 passed by the National Green Tribunal (“NGT”) and upheld the decision of the UP Government to grant licenses to new wood-based industries (“WBIs”) and the provisional licenses given in pursuance thereof under the Notice dated 01.03.2019 (“the Notice”). 

Background of the Dispute  

The Ministry of Environment and Forest and Climate Change (“MOEFCC”) had issued Wood Based Industries (Establishment and Regulation) Guidelines 2016 (hereinafter as “2016 Guidelines”) in pursuance of the order dated 05.10.2015 passed by the Supreme Court of India in the case of T.N. Godavarman Thirumulpad v. Union of India1 wherein the State Level Committees (“SLCs”) for WBIs were authorised to grant license/permission to wood based industries. 

Prior to the 05.10.2015 order, the Supreme Court, while dealing with the issue of unlicensed saw mills, veneer and plywood mills had directed for Constitution of a Central Empowered Committee (“CEC”) to oversee the compliance of its previous directions and also assess the availability of timber in the State, basis which the SLCs were permitted to grant fresh licenses.

In pursuance of the 2016 Guidelines and the orders of the Court in the T.N. Godavarman case, an SLC was constituted by the State of UP for compilation of information about closed WBIs. Further, a timber assessment for Trees Outside Forest (“TOF”) was conducted in the State of UP between FebruaryDecember 2017. After taking into consideration the availability of timber in the State, an E-lottery for grant of licenses to new WBIs was conducted and provisional licenses to 1215 successful applicants in 8 categories were issued and the same was communicated by the Notice dated 01.03.2019.

Aggrieved by the grant of the said provisional licenses and against the said Notice, an Original Application before the Ld. NGT was filed by the Respondents. By the order dated 06.08.2019, the NGT directed the State Govt. to review the Notice and grant of licenses in terms of the judgement of the Supreme Court in the case of T.N. Godavarman v. Union of India and directed the status quo to be maintained. Subsequently, vide order dated 18.02.2020, the Tribunal quashed and set aside the Notice issued by the State for establishing new WBIs.

The NGT set aside the notice of the State of UP on the grounds that a) the WBIs can be allowed to operate only after ensuring timber and raw material availability to sustain such industries which has to be determined in actual terms and not mere assumptions; b) Out of 22 species that supply Timber, 10 Species are prohibited from felling and thus, excluded from the data recorded by State; c) the major contribution is from Eucalyptus and Poplar species, which is only 43 lakh cubic metres; d) the total availability of timber for consumption would not be more that 40-45 lakh cubic meters per year and the potential availability of 77.74 lakh cubic meters from TOF has been overestimated.

The Review Applications filed before the Ld. NGT were also rejected. Hence, the present appeal was filed against the orders passed by the Tribunal in the Original Applications and Review Petitions.

Analysis and Decision of the Court

A. Grant of Licenses to new WBIs 

It is pertinent to note that in pursuant to the orders passed by the Hon’ble Supreme Court in the T.N. Godavaraman case, an SLC was constituted by the State of UP for compilation of information about the closed WBIs. In a report dated 03.04.2007, the Forest Survey of India (“FSI”) assessed the availability of wood from TOF to be 55.61 lakh cubic metres. On the basis of the said report, the CEC assessed the annual availability of timber at 45.70 lakh cubic metres which included 17.77 lakh cubic metres of timber from prohibited species. On the basis of the recommendation by the CEC and the availability of timber, the Court, by an order dated 18.05.2007 allowed for licenses to be granted to saw mills, plywood and veneer units by the respective SLCs. By another order dated 30.04.2010, the Court also permitted granting of additional licenses if additional timber was found to be available. 

The matter with regards to WBIs was specifically dealt by the Court under order dated 05.10.2015, by way of which the Court authorized SLCs to take decisions regarding the grant of license/permission to the WBIs. Therefore, the SLC was duty bound to assess the availability of timber in the State by commissioning studies, in collaboration with Institutes/Universities, once in five years and grant licenses to new WBIs on the basis of the said studies. 

B. Non-Interference in Expert Body Reports 

On the issue of overestimation of data, the Hon’ble Supreme Court held that the FSI had come to the finding of 77.74 lakh cubic meters of available timber using satellite data and proper scientific methodology was applied while carrying out an independent assessment of the inventoried districts of UP, which were divided into 9 Agro-climatic zones to generate the estimate of growing stock and annual potential production. Therefore, the contention of the Respondents that the rotation method of estimation was not applied is incorrect and hence, the finding of the Tribunal that the figure was arrived by mere estimation is liable to be set aside.

With regards to the finding of the NGT that the survey takes into consideration prohibited trees which are not permissible for felling, the Court held that under unavoidable circumstances such as when felling is necessary for executing development, such trees can be felled, and tree owners are required to maintain 10 trees in place of 1. Thus, there is no absolute prohibition on the felling of such trees.

Further, the Court while remarking on the advantages of new WBIs that the NGT ignored in its orders, noted that in pursuance of the NGT orders, a committee of experts had submitted a report basis which the State of UP submitted a detailed affidavit on the availability of timber highlighting that eucalyptus and poplar, the main species of TOF generate 80% of the wood, for which the farmers did not receive adequate remuneration and are forced to sell their produce at a very cheap rate to middlemen. The Court also noted that the establishment of new WBIs would bring an expected investment of Rs. 3000 Crores into the State which would employ more than 8000 people. The establishment of new WBIs would also reduce dependence on traditional/cash crops and reduce migration of people to urban areas. It would also reduce the import of WBIs produce.

On the contention raised by the Respondents that the State first decided to get the assessment done by IPIRTI and then changed its mind to do so, the Court held that the minutes of the meeting made it clear that the IPIRTI had not made any new assessment of the consumption of timber and when the 2016 Guidelines were themselves based on the IRPTI Report, there was no need to get a re-assessment and that the Court should only interfere in the decision making process when it is vitiated on account of illegality, irrationality or procedural impropriety.

The Supreme Court was thus of the opinion that Courts should not enter into an area that is the domain of the experts and the NGT could not have sat in appeal over the opinion of an expert body such as FSI which arrived at its estimations using scientific methods. 

C. Locus of Litigant before the NGT

A serious issue with regards to the credentials and bona fides of the original applicants was raised before the NGT. The Hon’ble Supreme Court, in this regard, held that although the NGT has the power to take suo motu cognizance, when the credentials and bona fides of a litigant approaching the NGT are raised, the same cannot be ignored. 

The Court held that in the present case, there was scope to infer that the litigation could have been at the behest of the existing WBIs who wanted to avoid competition and continue to get raw material at a cheaper rate. It could also have been at the behest of the WBIs in the adjoining districts of Haryana where lakhs of tons of timber is exported from the State of UP. Further, it could also have been at the behest of middlemen who are engaged in exporting timber from UP to Haryana. 

Hence, the Court directed the NGT to ensure the bona fides and credentials of such litigants as they can adversely affect the rights of many. 

Conclusion

The Court allowed the Appeal against the NGT orders based on the reasoning that the Tribunal failed to consider the concerns of the Appellant and the multiple advantages that the new WBIs could bring for the State. The NGT erred in ignoring a host of scientific data, experts’ reports and the stand taken by the MOEFCC to support the stand of the State.

Through the instant case, the Court set an example of non-interference in areas where expert bodies such as the FSI arrive at findings using scientific methodology. It also reiterated that a balance has to be struck between environmental conservation and sustainable development while dealing with environmental cases.