Gujarat High Court halts construction work at MPSEZ

In a major blow to Adani group's Mundra Port Special Economic Zone (MPSEZ), a bench of the Gujarat high court, on Wednesday, said that no construction or development activity can be carried out there without the necessary environmental clearance from the Union ministry of environment and forest (MoEF).

This means that any unit which is operating in the MPSEZ can't undertake construction work till it secures permission of the MoEF. The bench also asked Alstom-Bharat Forge Limited and Kalyani-Alstom Power Limited to halt development work on the leased space in the economic zone. 

"The high court has said that no construction or development activity can be undertaken without environment clearance by any unit which has leased plots in the MPSEZ," said Anand Yagnik, counsel for the petitioners who belong to Navinal village of Kutch. The village is situated close to the industrial hub.

Ranubha Rajmalji Jadeja and five others have challenged the validity of construction activity undertaken by Alstom-Bharat Forge Limited. Their main contention was that environmental clearance had not been given to the MPSEZ and, hence, no activities can be undertaken.

"Considering the mandatory nature of the environmental clearance, the procedure has to be meticulously followed. Only after environmental clearance, any construction - preliminary or otherwise, relating to setting up of the project - can be undertaken. There is an express prohibition that "no construction work, preliminary or otherwise, relating to the setting up of the project, may be undertaken till the environmental and/or site clearance is obtained," said the bench of acting chief justice Bhaskar Bhattacharya and justice JB Pardiwala. "In any case, the allottee of a plot cannot proceed ahead with the construction of the unit without the MPSEZ obtaining environmental clearance from the ministry of environment and forests," the bench added. 

The bench also said that the government had allotted approximately 18,000 hectares of land to develop a port.

"If the MPSEZ itself is not accorded environmental clearance, then the question will be as to who will develop the port and whether the port can be developed by the allottees who have been allotted land by the MPSEZ. This area of 18,000 hectares includes 14 villages of Mundra taluka and the MPSEZ has to provide for infrastructure facilities on a large scale," the court said. The bench came down heavily on the MPSEZ authorities saying that if the economic zone has already allotted plots to different companies for setting up of industrial plants and if such allottees have proceeded with construction of their individual plants in the absence of any infrastructure facilities at the port, then that by itself will lead to a very disastrous situation.

Petitioners' lawyer contended that it was necessary for a new project or for any expansion activity to seek clearance of the MoEF. The ministry after studying the likely environmental impact, gives the go-ahead for a particular project, the lawyer said.

In a statement, Adani Group said that the order had no bearing on its activities in the zone. "The order has no impact on ongoing port operations and port development activities at Mundra for which the company has requisite environmental clearance," the group said.