Legal ambiguities stymie redress of environmental harm

In November 2017, the Gujarat High Court passed a judgment in a case involving land acquired for the purpose of setting up a Special Economic Zone (SEZ) over an area of 4,494 hectares in the state by one of India’s largest companies. The matter was regarding the applicability of Section 24 (2) of the 2013 land acquisition law for this project. This law replaced the 1894 legislation to address “heightening public concern of land acquisition issues.”The clause states that in cases where land has been “acquired” under the 1894 law, but compensation is yet to be paid and the land is still in possession of the original landowners for five years or more, the acquisition proceedings would lapse. If the government desires, then it could reinitiate the process under the new 2013 law including requirements of consent and social impacts assessments.  

The company in question challenged this clause and wanted it struck down as “unconstitutional, violative of fundamental rights and ultra vires” and also prayed that the clause does not apply to this company. The court did not strike down the said clause. But it concluded in favour of the company with a decision-that the clause ought to be “read down” when it was about land acquired for private companies. The reasoning of the court was simply that the liability of the delay rests with the government. It is government agencies and not private companies who can finalise the acquisition process of issuing notices, distributing compensations and taking possession of the owners’ lands. Therefore private companies should not be penalized if the government cannot meet its obligation within the given time frame.

The case hearings may have concluded in the High Court. But the conflict on the ground between the company and landowners who have refused to give up their lands may continue to affect the SEZ operations that have already begun over one part of the project area. A group of landowners have legally challenged this judgment to hold on to their fertile lands on which they grow two crops a year. Also the exclusion of private companies from Section 24 (2) is contestable.

This case is symptomatic of the problem of legal liability that seems to have caught up with the model of regulation based development. Typically, the model requires governments to grant approvals to project operations and access to public natural resources such as land, water and forests. While the government makes access to these resources possible, private companies with expertise in such operations as mining, production of energy or building infrastructure are responsible for implementing the project. All seems well until things go wrong. In the case of conditional forest approvals given to companies, compensatory afforestation is to be taken up on an agreed area of land. This task is handed to the forest department with “expertise” in afforestation while the company is expected to pay for it. However, as pointed out by the CAG, compensatory afforestation is lagging in many states begging the question as to who is legally liable for the loss of forests. Is it the faulty processes of regulation or the lack of responsibility of the project that has secured the conditional approval?

A similar issue also came up in the context of those who successfully won the right to mine through coal auctions after the allocations made under the earlier government were cancelled. While the Coal Mines (Special Provisions) Act, 2015 specifically mentioned that the liabilities of ongoing projects would lie with the old allottees, problems related to land acquisition, forest loss and labour on site challenge the new mining companies. In the instance of projects that harm the environment and put at risk the lives of nearby residents and workers, as in the case of the thermometer factory in Kodaikanal, the legal liability may fall on both environmental regulators as well as the company.

Like in all the above cases, private corporations may seek to take advantage of legal ambiguities and exclude themselves from liability. But they are unlikely to get very far if they don’t deal with this as their problem too. Today, natural resource conflicts have pulled government regulators, private companies and affected communities in a triangular contest. Close to 900 approved but stalled investments are waiting for some “special” action from the Prime Minister’s Monitoring Group (PMG). The PM may have captured the attention of potential investors at the recently concluded World Economic Forum (WEF). But without making both regulatory processes and corporate investments legally answerable and liable for environmental, labour and human rights harms, the present kind of unaccountable development will implode under its own weight.

The authors are with the CPR Namati Environment Justice Programme