Supreme Court Rules on Environmental Clearances, Restoring EC Proposal for OMDC’s Belkundi Mines

Supreme Court Rules on Environmental Clearances, Restoring EC Proposal for OMDC’s Belkundi Mines​

The Supreme Court has delivered a significant ruling concerning environmental clearances (EC), addressing the validity of two key regulatory instruments—the 2017 Notification and the 2021 Office Memorandum (OM)—issued by the Ministry of Environment, Forest, and Climate Change. The judgment establishes that while a narrowly tailored amnesty scheme provided under the 2017 Notification is valid, the subsequent 2021 OM is rendered invalid, leading to specific consequences for project proponents.

The court considered the validity of both instruments in light of ongoing legal disputes relating to environmental regulations and their implications on industrial projects. The ruling clarified the regulatory standing of these documents within India’s existing environmental jurisprudence, providing direction on how companies who commenced activities without prior clearance should be dealt with.

Validation of the 2017 Notification​

The Supreme Court confirmed that the 2017 Notification holds a position as valid delegated legislation. This notification provided a mechanism to address projects operating in violation of the earlier 2006 Notification, carving an exception into the mandatory prior EC regime. The court found that this measure is a narrow, time-bound violation management scheme, designed to bring non-compliant entities within the regulatory framework rather than allowing them to operate unchecked.

The court emphasized that while the initial requirement for prior EC was mandatory under the 2006 Notification, the subsequent notification constitutes a narrowly tailored and time-bound measure, subjecting violation cases to centralized appraisal, ecological damage assessment, remediation, and compensatory liability. This process is required to be exceptional and must not supplant the foundation of the precautionary principle inherent in the original legislation.

2021 OM Quashed with Prospective Effect​

In contrast to the 2017 Notification, the Court determined that the 2021 Office Memorandum (OM) was an administrative instruction that attempted to grant a perpetual regime for ECs to projects undertaken without prior clearance. The court held that such an executive instruction could not alter or supersede a statutory notification.

Therefore, the 2021 OM is quashed with prospective effect. The ruling states that the OM substantially alters the nature of enquiry and the criteria for granting EC under the earlier mandatory framework. This decision overrules previous findings in related judgments which had treated the 2021 OM as valid and traceable to the 2017 Notification.

Operational Impact on Mining Projects​

In response to the court's determination, the proposal for grant of EC in favour of Belkundi Iron and Mn. Mines of The Orissa Minerals Development Company Limited (OMDC) has been restored to its prior stage of delisting on May 31, 2025, for reconsideration by the relevant authority.

The Supreme Court established several clear directives regarding the state of environmental clearance:

• ECs granted under the 2017 Notification or the 2021 OM remain valid, provided they are not challenged on merit.
• All pending applications made under either instrument must be taken to their logical conclusion in accordance with law.
• The authority is restricted from entertaining any fresh application for EC under the 2017 Notification or the 2021 OM.
• The Central Government is restrained from issuing administrative orders in the future granting ex post facto ECs for projects that commenced while violating the prior EC regime, unless such a measure is conveyed through a valid notification issued under Section 3 of the relevant Act.

ORISSAMINE Stock Price Movement​

Today, The Orissa Minerals Development Company Limited shares slipped by 1.87% to settle at ₹4009 after a session marked by selling pressure. The stock saw a traded volume of 6,514 shares during the trading period.