AI Structured Summary
Not yet generated for this judgment
Judgment
The Appellant company has invoked the jurisdiction of this Tribunal under Section 14 & 16 read with Section 18 of the National Green Tribunal Act, 2010 to challenge the impugned directions passed by the respondent for inclusion of malting industry into entry 19 of the red list drawn up for the purpose of regulating the consent to establish and consent to operate, granted by the Haryana State Pollution Control Board on 7th March, 2014. Further, the appellant company which is a malting industry has prayed for quashing the inclusion of its name at entry 45 of the list of the industries required to install online monitoring devices for the effluents under the category of seriously polluting industry, as appellant company does not form part of any category in list of 33 categories. The appellant has also challenged the order dated 1st May, 2015 passed under Section 33 A of the Water (Prevention and Control of Pollution) Act, 1974 and (thereafter referred Water Act) under Section 31 A of the Air (Prevention and Control of Pollution) Act, 1981 (thereafter referred as Air Act) and has prayed for quashing of the same.
On passing of the impugned orders the appellant company has filed this appeal before the Tribunal as it faces the threat of revocation of its consent to operate and closure of its plant. Further, after passing of the impugned orders, the appellant company has now been tagged as a seriously polluting industry and has been included in the red list. Accordingly, the appellant has challenged the impugned directions passed by the respondent for its inclusion, as a malting industry, into entry 19 of the red list drawn up for the purpose of regulating the consent to establish and consent to operate granted by Haryana State Pollution Control Board on 07.03.2014. The appellant company which is a malting industry, is also aggrieved by its inclusion in entry 45 of the list of industries required to install online monitoring devices for the effluents under the category of seriously polluting industry, as the appellant company does not form part of any of the 33 categories. The appellant has also sought redress against the order dated 01.05.2015, passed under Section 33 A of the Water Act and under Section 31 A of the Air Act.
Brief Facts
The appellant is a private limited company and has been incorporated under the Companies Act, 1956, in the year 1970. It manufactures malt and malt extracts. Malt is a germinated and dried form of barley and has diverse uses. It is sold to various manufacturers of nutritional drinks, powder, distilleries making beer and whiskey, companies making breakfast items, cereals, etc. Malt extract is also sold to manufacturers of biscuits, ice cream, non-alcoholic drink manufacturers, confectioners, pharmaceutical companies, food and beverage industries etc. The appellant sources barley for its plant from thousands of farmers. The barley grain when received is unloaded in hoppers, then screened and graded. The graded barley is thereafter taken into the tank where it is soaked in water. Such a process is known as steeping. It permits the grain to soak water which starts germination. Subsequently, the grain is transported to germination boxes, where they are kept in temperature and humidity controlled environment. Due to the natural germination process, the barley undergoes a change in its flavour and texture.
When the green seed is germinated to a certain degree, further germination of the grain has to be stopped. At this stage the grain is known as green malt. It is then heated at a low temperature to wither it and reduce the moisture content with of the grain. Subsequently, the grains are cured by drying them at a high temperature. During this process there is imparting of labour and grain, therefore a proper control of temperature is required to ensure that the desired flavour and colour is achieved.
At the next stage, the dried and cured grain passes through the screener, which causes the dried rootlets to break and fall out to separate the grain and the rootlet. Such a de-rooted grain malt is collected into bags and sold to the customers, in accordance to their requirements. The de-rooted malt is then crushed through a meshing process whereby it is soaked in a temperature-modulated bath. This causes the enzymes of the seed to start breaking down into their constituted sugars, mainly maltose. This liquid is known as wart. The wart is then dried under vacuum to form liquid malt extracts.
The case of the appellant is that, it only produces malt and malt extracts and is not involved in manufacturing of any product which is either based or derived from malt whatsoever. Therefore, the appellant is purely an agro-processing unit which supplies the processed malt grain to various customers which are distilleries, pharmaceutical companies, food and beverage industries etc. According to the appellant, malt or malt extract cannot by itself be characterized as food or beverage, it constitutes ingredients of many food and beverages. However, to convert the base malt into a food or beverage several other steps like germination, distillation, baking, blending, roasting etc. have to be undertaken. There is no distillation or fermentation process involved in the products manufactured in the present case. Therefore, according to the appellant, it is only a manufacturer of raw material and is in no way concerned with the end use of its product. It merely grades, packs and sells the malt/malt extracts to the end use industries.
The Petitioner company is registered with the Excise Authorities and pays excise, which is the sole determinant of the products being manufactured by the appellant and is registered under the following category:-
CETSH
Description
Activity
11072000
Barley Malt
Manufactured
19019010
Malt Extract Liquid
Manufactured
11029000
Barley Flour
Manufactured
It is pertinent to mention that distillation/manufacture of alcohol or beverage is covered by the Central Excise Tariff Harmonised System Code (HS) code No. 2201. Whereas the products of the Appellant are covered by Chapter 11 and 19 under Central Excise Tariff Harmonised System Code (HS) code No 1101/1102 or 1901, as the case may be.
That in pursuance of the public interest litigation being WP(C) No. 3727/1985 titled M.C. Mehta v. Union of India, relating to the question of pollution of the River Ganga, the Hon'ble Supreme Court of India passed a series of orders. During the course of hearing of the aforementioned case, the Hon'ble Supreme Court had directed the authorities to classify various industries, on the basis of their discharge of effluent. Thus, accordingly a list of 17 "highly polluting industries" was drawn up. The Petitioner's process found no mention in the said list.
However, in the year 1975-76, malt was understood as a composite part of the fermentation industry and was therefore included in the red list. But in the year 1985 and particularly by the year 1996, with the introduction of stand-alone malt plants, the understanding that the malt was a composite part of the fermentation industry underwent a change and was acknowledged to be a separate category by itself.
Thereafter, malt manufacturing industry as a whole, through the aegis of the Chamber of Commerce requested the CPCB to clarify whether the process of the appellant would amount to distillation or not. The CPCB directed that the process of germination and drying of the barley do not amount to distillation or fermentation and thus, the standards applicable to those industries would not apply to the instant process and only general rules are applicable.
On 01.04.2012 the respondent no. 1 noticed, under S. 33A of the Water Act and S. 25 of the Air Act and the rules governing the grant of consent to operate and hence, divided the industries into various "colour codes" like red, orange and green. It is pertinent to note that the Petitioner's process was specifically included at Sl. No. 83 of the "GREEN List" and was known as "steeping and processing of grains". Significantly, this notification dated 2012 did not include "malt" in the red list, along with the category of "fermentation industry"
On 04.06.2012, the CPCB communicated to all the State Pollution Control Boards including the Respondents herein the directions under S. 18 of the Water Act, highlighting the need to categorise various industries into different "colour codes" for the purpose of grant of consent under various Acts. It was specifically stated that the list was being formulated to maintain uniformity in the standards. Hence, a direction under Section 18 of the Water Act of 1974 was issued by the CPCB to the Respondents to adopt the criteria forwarded by them for the purposes of "consent to operate". It is pertinent to mention that at Sl. No. 15 "distillery including fermentation industry" was mentioned and at Sl. No. 19 "fermentation industry including manufacture of yeast, beer, and distillation of alcohol (ENA)" was included. Therefore, even according to the CPCB itself the Petitioner was not a "RED" list industry.
On 05.02.2014, the CPCB communicated to all the State Pollution Control Boards, including the Respondents herein, a letter mandating the installation of an online monitoring system for 17 categories of highly polluting industries. Once again, even under this letter the process of the Petitioner never figured in the category of highly polluting industries, as mentioned in Annexure II of that notification.
On 31.03.2014, the respondent no. 1, granted consent to operate till 31.03.2016 and by this consent the maximum domestic effluent was capped at 6.0 KLD whereas the Trade Effluent was capped at 155 KLD.
In the meantime, the Hon'ble Supreme Court of India was pleased to transfer the WP No. 3727/1985, in so far as the question of industrial effluent was concerned, to this Hon'ble Tribunal. This order of the Hon'ble Supreme Court succinctly sets out the history of the issue, i.e responsible for the pollution of River Ganga. It specifically sets out the methodology for categorisation of industries into highly polluting or grossly polluting, based on their volumetric discharges and not based on whether they were included in the "red list". Thus, the ipso facto inclusion of an industry or a sector in the "red list" does not de facto determine whether a particular plant belonging to the industry is grossly or a seriously polluting industry.
On the same day i.e. 29.10.2014 this Tribunal was in session of OA No. 196/2014 titled Krishan Kant v. NGRBA in which it directed that the Central Pollution Control Board to put in the public domain, the criteria for terming the industries as "seriously polluting" or "not seriously polluting" and for categorising them in red, green or orange, as the case may be. Most importantly, this Tribunal directed that the classification would follow the same principles as were adopted by the Hon'ble Supreme Court, i.e. volumetric analysis.
Thereafter, the CPCB had uploaded on its website, stating that the criteria to determine a seriously polluting industry would be any industry discharging a pollution load of BOD 100 Kg. per day. Thus, the criteria to determine whether a unit/ plant is "seriously polluting" or not, is not on whether it is in red, green or orange list but rather it is dependent upon the volumetric discharge from the plant at the outlet.
Subsequently, this Tribunal vide its order dated 17.11.2014, directed the formation of various committees, including the Principal Committee, the Implementation Committee and the State Level Committee. The Tribunal also directed that the Principal Committee would formulate criteria to identify seriously water-polluting industries and further that this need not be quantity wise but quality based, especially in light of the fact that even a small plant could discharge more effluent than a large plant, which had installed an ETP. This Tribunal directed the committees to see whether the installation of online monitoring systems was required.
Further on 15.12.2014, this Tribunal also directed the CPCB to formulate the criteria to classify the industries as Red, Orange or Green or as Seriously Polluting.
The State Level Committee of the State of Haryana along with the Implementation Committee presented a list of industries "sector wise" to be classified as "Seriously Polluting Industries". Thus, a list of 33 sectors of industries were categorised as "seriously polluting industries" and it was uploaded on the website by Respondent No. 1.
Thereafter, the name of the Petitioner was included at Sl. No. 42 under the heading "food and beverage", a sector which is found at Sl. 31 in the "sector wise list of seriously polluting industries". Thus the petitioner was brought within the ambit of those seriously polluting industries that require the installation of online monitoring.
Finally on 01.05.2015, the Petitioner was served with orders under S. 33-A of the Water Act and S. 31-A of the Air Act, directing the petitioner that unless it installs the online effluent monitoring system, its plant would be closed forthwith.This communication further directed for submission of a 100% bank guarantee to ensure compliance, failing which the consent of the Petitioner would be withdrawn.
The Respondent No. 1 and 2 have averred that the Appellant industry is engaged in manufacturing of barley malt and malt extract through the process of raw material cleaning, stepping, germination, kilning, screening, evaporation, storage packing and during the process, some of the starch is also converted into fermentable sugar by diastatic system which involve the action of the natural A- and B- amylases. Consequently, the Appellant unit falls in red category at serial no. 19 fermentation industry including manufacture of yeast, bear malt distillation of alcohol. In terms of the order issued by HPCB and published in Gazette notification dated 15.04.2014, they have denied that the unit can be classified under the 'food and beverage industry' under serial no. 13 and since the industry is classified under serial no. 19 it has to follow standards of fermentation industry which include distilleries, maltries and breweries.
The respondent no. 1 and 2 have also, in their reply, submitted that the unit is consuming 3600000 ltrs. (3600 KLD) of water per day and discharging 155000 ltrs. of effluent into public sewer which ultimately reaches Yamuna river through Najafgarh Drain. According to the spot inspection report drawn up after inspection by the HPCB on 30.10.2015 which has been signed by the authorised signatory of the Appellant company also, the trade effluent of the industry is approximately 155 KLD. In addition, the spot inspection report points out that the boiler capacity installed in the premises is 12 tonnes per hour of steam generation. Further, the BoD load of the unit is more than 100 Kg per day i.e., 178 kg per day and, therefore, the Appellants unit falls within the category of a "seriously polluting industry".
The Board has also averred that by circular dated no. 16.11.2011, the HPCB has included malt industry in the red category and that the representation received from Gurgaon Chamber of Commerce & Industries regarding the malt industry was discussed in the Technical Advisory Committee of the Board. Upon examination it was decided that the malt industry has a high pollution load and should be kept under the red category. A notification to this effect was issued on 15.04.2014. They have further disputed the contention of the Appellant that malt processing unit was, at any time, covered under 'green category' and that the categorisation of steeping and processing of grains as mentioned at serial no. 76 in the list of green category is for the units having no discharge of trade effluent. However, in the case of appellant industry, the quantity of discharge is high and load of BoD is more than 100 kg per day. Consequently, the contention of the Appellant is wrong, false and misconceived.
In the rejoinder filed by the Appellant, it has been pointed out that the respondents have misread the figure of 3.6 KLD as 360 KLD. They have also disputed the figures of effluent discharged which in terms of their consent application is only 1.55 KLD and not 155 KLD. The appellant have also averred that BoD load, at the outlet of the industry, is only 26 mg per ltrs. and therefore the BoD load is only 4.62 kg per day and not 178 kg per day, as arrived at by respondent no. 1 and 2 on the basis of BoD load of 1150 mg per ltrs. for a quantity of 155 KLD of discharge.
The appellant has challenged the inclusion of the industry, firstly, on the ground that the appellant's industry manufactures only malt and malt extract which is an activity falling under the category of 'food and beverage industry' at Sl. No. 31 in the sector wise list of seriously polluting industries (SPI) drawn up by the Implementation Committee and approved by the Principal Committee constituted under the orders of the Hon'ble National Green Tribunal. Therefore, the requirement of online effluent and emission monitoring do not apply to them. The appellant has contended that they are manufacturing malt and malt extract from barely after processing of raw material receipt, screening, steeping, germination, kilning, malt screening, de-rooting and packing in terms of flow chart given at page no. 45 of the Appeal. The malt so manufactured is sold to many manufacturers of Nutritional Drinks Powder, Distilleries making beer, whiskey, companies involved in making of breakfast cereals etc. The malt extract is sold to manufactures of biscuits, ice creams, non-alcoholic drink makers, confectionaries, pharmaceuticals, etc.
Further, the appellant is at no stage involved in the manufacturing of any product, either based on or derived from malt whatsoever. It is purely an agro-processing unit, which supplies the processed malt grain to its various customers who are distillers, pharmaceutical companies, food and beverage industries, etc. He further submits that malt and malt extract itself cannot be characterised as a food or a beverage by itself. It constitutes an ingredient of many food and beverages and in order to convert the base malt into a food or beverage, further steps like fermentation, distillation, baking, blending roasting etc. have to be undertaken which the appellant industry is not involved in.
As regards the malt extract, one of the products which the appellant is manufacturing, the de-rooted malt is crushed and processed through a mashing process and thereafter soaked in a temperature modulated bath. This causes the enzymes of the seed to start breaking down into their constituent sugars, mainly maltose. The liquid so formed, known as wart and it is then dried under vacuum to form liquid malt extract. At no stage the appellant is involved in the process of fermentation or distillation for packing.
Secondly, the appellant industry has argued that as per the MoEF and CPCB criteria for an industry to be categorised as a seriously polluting industry, the industry should be discharging BOD in excess of 100 kg per day. However, the unit is discharging an effluent of only 1.55 KLD per day and with a BOD load of 24 mg per litre. The total BOD load per day is only 3.9 kg which is much below the prescribed per day limit set by CPCB for GPI. Consequently, the industry cannot be categorised as a grossly polluting industries in terms of the criteria created by the Implementation Committee and approved by the Principal Committee.
The appellant has also taken the stand that in terms of the classification of the industries for various sectors under 'Red', 'Orange' and 'Green' categories, the petitioner's industries is falling within the category of the "food and beverage". The list has classified the industry as a green industry and that right from 1996, the respondent's industry has been so accepted as being involved only in "steeping and processing of grains".
However, the Haryana Pollution Control Board by including the malting industry in the red list has defeated the very purpose for which the CPCB had at first instance drawn up the list of Red, Orange and Green categories of industries, by way of harmonisation exercise for consent management. The appellant has also alleged that under the red category, the respondent no. 1 has urged that inclusion of the appellate industry under the red category is without any basis and/ or any objective criteria but on the criteria created by respondent no.1 itself and, therefore, baseless.
In support of their contention about discharge of effluent, the appellant has also drawn the attention to the consent application filed before the HPCB at page no. 95 wherein the consumption of waste is shown as 3.6 KLD and the generation of trade effluent at 1.55 KLD plus and the domestic effluent at 0.06 KLD.
We have gone through the averments made and contentions raised by the appellant as well as the State Pollution Control Board and the Central Pollution Control Board. The Central Pollution Control Board and MoEF have defined the polluting industry as under:
"GPIs- Industries discharging effluents into a water course and
(a) Handling hazardous substances, or
(b) Effluent having BOD Load of 100 Kg per day or more, or
(c) A combination of (a) and (b)."
While applying for Consent to Establish, it is stated that values of BOD in untreated effluent would be 1150 mg/L.
Assuming the BOD load of 1150 mg/L., the BOD works out 178 kg per day. Clearly on the basis of the BOD load of the industry at the influent of the ETP, the industry falls within the category of GPI. The contention of the appellant, however, is that BOD load is 26 mg/L. This BOD load, as per the Appellant, is at the outlet of the ETP and that it is the BOD load that is discharged into the environment, either on the land or the water body, which is relevant for calculating it. This aspect has been disputed by Respondent No. 1, the Haryana Pollution Control Board. In order to assess pollution potential of industry, what is relevant is the total pollution load generated by the industry by its operations, and not merely what is released into the environment after providing necessary treatment at the CETP. It stands to reason that even the CETP generates sludge and waste water, which sometimes is even hazardous, depending upon the process involved.
In the instant case, BOD load of 1150 mg/L with an effluent discharge of 155 KLD per day, according to the consent order, would be resulting in large quantity of sludge with the result that the total potential of the industry would have to be assessed not only in terms of the effluent load at the outlet point but also the total effluent generated by the industry because of its operation. In light of this, we do not agree with the contention of the industry that the BOD load produced by it is only of the order of 4.6 kg per day. In fact, the BOD load should be assessed with reference to the inlet point and reckoning that BOD of 1150 mg/L is being produced by the industry, the total BOD generated is 178 kg per day. Consequently, the industry falls under the category of GPI. We, therefore, hold on the basis of BOD load of the industry that it has been rightly categorised as GPI.
Further, the CPCB in their affidavit at page no. 243 have laid down as additional criteria for industry to be categorised under "green category". It is stated that the unit can be described as "green category" provided it does not:
" a. Carry out further processes, especially 'Fermentation and Distillation' from the manufacturing malt.
b. Have installed any coal boiler with steam generation capacity of 5.0 tones/hr. and above.
c. Have diesel generator sets having total capacity more than 1.0 MVA"
In terms of criteria (b) in the aforesaid para also, the spot inspection report drawn by the HPCB on 30.10.2015, reveals that the unit has boiler with 12 TPH capacity of steam generation. This inspection report, which is signed by the representative of the company is an admission of the fact that the unit has boiler of capacity of 12 TPH. On the basis of this criteria too, the industry does not fall in the category of green industry. Even the capacity of the generators is 1470 KVA (i.e 1.470 MVA) which also is in excess of the capacity of 1 MVA, a condition mandatory for green categorization.
In terms of discharge being in excess of 100 KLD per day, thereby the industry qualifying to be a GPI and additionally in view of criteria at (b) and (c) of para 32 laid down by CPCB, the industry does not qualify to be a green industry. The inescapable conclusion is that the industry is a grossly polluting industry in terms of the pollution load notwithstanding the contention of the applicant that it is not involved in the process of fermentation and distillation. In fact the industry is also found to be using pet coke in its boiler, which is a highly polluting fuel The industry will have to comply with the conditions laid down by HPCB.
The Haryana State Pollution Control Board vide circular dated 16.11.2011 included the Malt Industry in 'Red Category' of industries. A representation was received from Gurgaon Chamber of Commerce & Industries, Gurgaon regarding the Malt Industry and the matter was discussed by the Technical Advisory Committee (TAC) and upon examination it was decided by the committee that as Malt Industry have high pollution load, therefore, Malt industry was kept under 'Red Category'.
Subsequent thereto, the order of the HSPCB was issued and published in Gazette notification dated 15.4.2014, exercising the powers given by the Central Pollution Control Board (CPCB), to add any other industry in the category of industries already classified by the CPCB for 'consent management criterion' only if the criteria fixed by CPCB are fulfilled.
Ministry of Environment & Forest (MoEF) has prescribed standards for fermentation industry which include Distilleries, Maltries and Breweries.
In view of the above, the inclusion of the appellant industry in Entry 19 of the Red list for the purpose of the consent to establish and operate as granted by Haryana State Pollution Control Board, is just and proper. Further the name of the appellant industry has been rightly included at Entry 45 in the list of industries which are required to install online monitoring devices for the effluent. The appellant industry does fall under the category of seriously polluting industry on the basis of the BOD load. In the circumstance it is essential to install online monitoring device for the effluents in case of the present industry. The unit also has boiler of the capacity of 12 TPH steam generation. The capacity of generator is 1470 KVA (1.470 MVA) which is in excess of 1 MVA. For these reasons the industry does not fall in the category of green industry. Therefore the challenge made by the appellant in respect of orders/directions passed by the respondent including the on 1st May, 2015 under Section 33 A of the Water (Prevention and Control of Pollution) Act, 1974 and under Section 31 A of the Air (Prevention and Control of Pollution) Act, 1981 is not sustainable.
Consequently, the appeal has no merit and deserves to be rejected. Accordingly, the appeal is dismissed, without any order as to cost.