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TMI Blog2005 (9) TMI 591X X X X Extracts X X X X X X X X Extracts X X X X ..... from them, this Court would further examine the matter and issue appropriate directions. However, prima facie we feel that revenue earning projects do not deserve similar treatment as non-revenue earning public welfare projects. We are clear that if let loose, the benefits achieved as indicated in the State Forest Report of 2001 would be lost and we may be again where we were in 1990’s or 1980’s and earlier period during which there was immense depletion of forest and insignificant regeneration. The work of regeneration and also of compulsory afforestation requires special, specific and expert attention and we see no illegality in establishment of Special Purpose Vehicle (SPV) in terms of clause 6.6 above quoted except that for present till further orders it would be necessary to monitor the establishment of SPV. Thus, in respect of clause 6.6 in relation to establishment of SPV, we hold that before establishing SPV, its format shall be filed in Court and SPV shall not be established without permission of the Court. Further in our view the constitution of authority (CAMPA) is necessary to fully and effectively implement recommendation dated 9th August, 2002 made by CEC for protecti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red to compensate for the diversion. If so, should not the user Agency be required to make payment of Net Present Value (NPV) of such diverted land so as to utilize the amounts so received for getting back in long run the benefits which are lost by such diversion? What guidelines should be issued for determination of NPV? Should guidelines apply uniformly to all? How to calculate NPV? Should some projects be exempted from payment of NPV? These are the main aspects which require examination and determination in the backdrop of various legislations which we would presently notice. The legislature to provide for conservation of forest and for matters connected therewith or ancillary or incidental thereto enacted the Forest (Conservation) Act, 1980 (for short, the FC Act ). It postulates that no State Government or other authority shall make, except with the prior approval of the Central Government, any order directing that any forest land or any portion thereof may be used for any non-forest purpose. The Central Government under the FC Act has been empowered to constitute a Committee to advice it with regard to grant of approval. Under Section 2 of the Act the question of use of any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the EP Act empowers the Central Government, in exercise of its powers and performance of its function under the Act, to issue directions in writing to any person, officer or any authority and such person, officer or authority shall be bound to comply with such directions. The Central Government has the power to direct the closure, prohibition or regulation of any industry, operation or process or stoppage of regulation of the supply of electricity or water or any other service. Parliament has also enacted enactments to prevent and control water pollution and air pollution [The Water (Prevention and Control of Pollution) Act, 1974 and the Air (Prevention and Control of Pollution) Act, 1981]. A statement was placed before this Court by the Central Government showing the position as on 20th March, 2000 of the cases approved for diverting forest lands, stipulation for compensatory afforestation under the FC Act and the compensatory afforestation done, funds to be utilized and actually utilized. The Court noted the dismal situation as there was a shortfall to the extent of 36% of total afforestation compensatory or otherwise afforestation. It further noted that though funds had be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... agency for compensatory afforestation, made the following recommendations : (a) in addition to the funds realized for compensatory afforestation, net present value of the forest land diverted for nonforestry purposes shall also be recovered from the user agencies, while according approval under the Forest (Conservation) Act, 1980; (b) a Compensatory Afforestation Fund shall be created in which all the monies received from the user-agencies towards compensatory afforestation, additional compensatory afforestation, penal compensatory afforestation, net present value of forest land, Catchment Area Treatment Plan funds, etc., shall be deposited. The rules, procedure and composition of the body for management of the Compensatory Afforestation Fund shall be finalized by the Ministry of Environment Forests with the concurrence of Central Empowered Committee within one month; (c) the funds received from the user-agencies in cases where forest land diverted falls within Protected Areas i.e. area notified under Section 18, 26A or 35 of the Wild Life (Protection) Act, 1972, for undertaking activities related to protection of biodiversity, wildlife, etc., shall also be deposited in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has been diverted for non-forest use, the NPV of such land is being recovered from the user agency in the States of Madhya Pradesh, Chhattisgarh and Bihar. In the states of Madhya Pradesh and Chhattisgarh, the NPV is being recovered at the rate of Rs.5.80 lac per hectare to Rs.9.20 lac per hectare of the forest land depending upon the quality and density of the forest land diverted for non-forestry use. The underlying principle for recovery of NPV was that the plantations raised under the compensatory afforestation scheme could never adequately compensate for the loss of natural forests as the plantations require more time to mature and even then they are a poor substitute to natural forest. It noted that States/Union Territories as well as MOEF are of the view that in addition to the funds realized for compensatory afforestation, the NPV of the forest land being directed for non-forestry purposes should also be recovered from the user-agencies. The MOEF, in principle, accepted the aforesaid recommendations of CEC. The order dated 29th October, 2002 notices this fact. Further noticing that no other State had filed any response to the report of CEC, the Court presumed that the St ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er hectare basis will, therefore, not be rational. The application states that in case of mining, NPV should be calculated at the rate of 10% for the major minerals and 5% for the minor minerals to be levied on the annual royalty. An application (IA 1047) has also been filed by the Ministry of Mines, Government of India taking similar pleas as are taken in IA 1046 seeking directions that in mining NPV may be calculated at the rate of 10% and 5% as above noted. Now, we may refer to Notification dated 23rd April, 2004 issued by MOEF in exercise of the powers conferred by sub-section (3) of Section 3 of the EP Act constituting an authority known as Compensatory Afforestation Fund management and Planning Authority (hereinafter referred to as CAMPA ) for the purpose of management of money towards compensatory afforestation, NPV and any other money recoverable in pursuance of this Court s order and in compliance of the conditions stipulated by the Central Government while according approval under the FC Act for non-forestry uses of the forest land. The Executive Body of the Authority comprises of the following: "(i) Director General of Forests and - Chairperson Special Secretary, Mi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orestation may be used as per the site specific schemes received from the States and Union Territories along with the proposals for diversion of forest land under the Forest (Conservation) Act, 1980. (ii) The money received towards Net Present Value (NPV) shall be used for natural assisted regeneration, forest management, protection, infrastructure dev elopement, wildlife protection and management, supply of wood and other forest produce saving devices and other allied activities. (iii) Monies realized from the user agencies in pursuance of the Hon ble Supreme Court s order or decision taken by the National Board for Wildlife involving cases of diversion of forest land in protected areas shall form the corpus and the income therefrom shall be used exclusively for undertaking protection and conservation activities in protected areas of the States and the Union Territories and in exceptional circumstances, a part of the corpus may also be used subject to prior approval of the CAMPA. (iv) CAMPA shall release monies to concerned State and Union Territory in predetermined installments through the State Level Management Committee as per the Annual Plan of Operation (APO) finalized ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... use (v) in 6.4 provides that the monies received in CAMPA shall be used only in that particular State or Union Territory. The clause seems to be too rigid. Many a times, the effect of degradation of environment or depletion of forest can be felt more in the adjoining area which may be in a different State or Union Territory. The effect of environmental degradation cannot be restricted to a particular area. The impact cannot be limited to the place of origin. Therefore, we direct that a suitable modification of the clause shall be made so as to provide that ordinarily expenditure shall be incurred in the particular State or Union Territory but leaving it to the discretion of the CAMPA to also incur expenditure in the State or Union Territory other than the one mentioned in clause 6.2 if it considers it necessary. Clause 6.6 which by use of the word may leaves it to the discretion of the CAMPA to establish Special Performance Vehicle (SPV) for undertaking compensatory afforestation deserves to be amended so as to substitute the word may by the word shall so that the regeneration is done by some SPV in specified areas. Now, we come to the question of the guiding principle to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncurred today. Time value of the cash inflow/outflow is important in investment appraisal. NPV is a method by which future expenditures (costs) and benefit are levelised in order to account for the time value of money. The object behind NPV is to levelise costs. What is the value of Rupee today would not be the value of Rupee say 50 years later. For example, let us have the starting point of value of Rupee in India in the year 2005 and analyse it with the value of Rupee that may be in the year 2050. Cost incurred or to be incurred in 2050 have to be discounted by using appropriate parameters like rate of discount, gestation period, ratio of deflators to GDP. Therefore, expenses incurred in each year between say 2005 and 2050 have to be brought down to their present values by using appropriate discount rate in the NPV. The project like forestry has long gestation period of 40-50 years. It goes through cost cycles each year depending upon inflation, rate of interest, internal rate of return etc. Therefore, costs for the year 2005 will differ from the cost of 2006 and cost of 2006 will differ from that of the year 2007 and so on and so forth. However, this constitutes what is calle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... z, opportunity cost, replacement cost, travel cost, contingent value method (CVM) and social benefit cost analysis (SBCA). SBCA can be applied to the evaluation of environmental impacts of forestry projects. Here, one must appreciate that the environmental outputs from forests appear as public goods for which there is no market. Various environmental outputs can be classified into this category, namely, Flood Control Benefits Water Production Soil Conservation Outdoor Recreation Biodiversity Conservation Habitat Air Purification The problem in valuation of the above outputs is: allocation of fixed costs according to the contribution of each product in total revenue. This is because except contribution of timber product, contribution of the other above-noted outputs is not known, especially intangible outputs. However, under SBCA, benefits from each of the above environmental outputs are identifiable. For example, flood control benefits arise because of the role of forests as stream regulator. Similarly, valuation method for each of the above outputs differs. In valuing biodiversity, CVM is useful. SBCA is helpful in placing monetary value on carbon storage on air purification. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Yet another viewpoint recognizes the pragmatic reality faced by the governments and the administrative, namely, trees don t vote while people do. Some of the criteria reflecting key elements of ecological, economic and social sustainability are: 1. Conservation of biological diversity. 2. Maintenance of productive capacity of forest ecosystems. 3. Maintenance of forest ecosystem health and vitality. 4. Conservation and maintenance of soil and water resources. 5. Maintenance of forest contribution to global carbon cycles. 6. Maintenance and enhancement of long-term multiple socioeconomic benefits to meet the needs of societies. 7. Legal, institutional and economic framework for forest conservation and sustainable management. An expert dealing with principles and applications of forest valuation, on the aspect of value of inputs and outcomes and conditions, says : "Decision making in forest management requires that we understand the relative values of inputs, outcomes, and conditions. Cost values for inputs such as labour, capital, interest, supplies, legal advice, trades, and other management activities as well as the market value of existing timber stands are relat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h are required to examine these issues. Dealing with co-relation between economics and environmental management, in Environmental Economics in practice edited by Mr. Gopal K. Kadekodi in his write up through case studies, answers the question as to what has economics got to do with environmental management. The author says that economics is the science of explaining the behaviour of different agents who take part in production, consumption and distribution activities in the economy and make decisions regarding the use of resources. That, environmental economics focuses on market and non-market behaviour of different agents in the society regarding natural and environmental resources, viewed from intergenerational, intertemporal and different institutional frameworks. (Emphasis supplied by us) It is further stated that one of the major branches of economic theory is the theory of value . Economic theory always makes a distinction between value and price. Answering the question as to why value natural resources specifically, it is stated that one reason is that there is no market for ecosystem services such as nutritional cycle, carbon sequestration, watershed functions, tempera ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... resent without compromising with the ability of future generations to meet their own needs. Despite various elaborations, definition of sustainable development, though very old, still is widely accepted world over and has been reiterated by this Court in catena of cases. Regarding the parameters for valuation of loss of forest, we may only note as to what is stated by Ministry of Environment and Forests, Government in its handbook laying down guidelines and clarifications upto June 2004 while considering the grant of approval under Section 2 of the FC Act. Dealing with environmental losses (soil erosion, effect on hydrological cycle, wildlife habitat, microclimate upsetting of ecological balance), the guidelines provide that though technical judgment would be primarily applied in determining the losses, as a thumb rule, the environmental value of one hectare of fully stocked forest (density 1.0) would be taken as Rs.126.74 lakhs to accrue over a period of 50 years. The value will reduce with density, for example, if density is 0.4, the value will work out at Rs.50.696 lakhs. So, if a project which requires deforestation of 1 hectare of forest of density 0.4 gives monetary returns ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imultaneously, in the context of a developing country, it is important to evolve methods of management that enable self-financing mechanisms of conservation. This implies that biodiversity value for which a market exists must be taken note of, while simultaneously making sure that the natural capital inherent in biodiversity rich areas is preserved and values which are crucial for some stakeholders but cannot be expressed in the market are reflected in societal decision making. A focus on both the above aspects is necessary. It is important to take note of the nature of market demand for aspects of biodiversity that stakeholders, such as tourists, express a revealed preference for by way of paying a price for it. Simultaneously, it is important to examine the extent to which a convergence or divergence exists between value perceptions of this and other categories of stakeholders. It is in this spirit that two alternative methodologies are used here to arrive at an economic valuation of biodiversity in Keoladeo National Park. The travel-cost methodology captures the market-linked values of tourism and recreation. It throws up the following policy implications : 1. Keeping in mind ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and rural development and project evaluation. The matter deserves to be referred to a committee of experts in respect whereof we will in latter part of the judgment issue appropriate directions. Next, we will deal with the contention of Mr. Venugopal who, appearing for State of Kerala, submitted that the State has no objection to the levy of NPV but the amount so received should come to the State. Referring to Notification dated 23rd April, 2004 constituting CAMPA, learned counsel contended that clause 6.4 of the said Notification, which deals with disbursement of the funds, does not envisage the amount being disbursed to the State Government. Learned senior counsel also challenged the constitutional validity of the Notification. The contention put forth is that the Notification does not have any Parliamentary or Legislative control. Referring to various clauses of the notification, it was contended that fund sought to be created under CAMPA lacks accountability and puts aside financial control. There is a total lack of financial discipline which, learned counsel contends, is against the constitutional framework. It was further contended that the forests vest in the Government; t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d of India and of the States. Article 283 deals with custody of the consolidated funds, contingency funds and the moneys credited to the public accounts. Article 284 deals with other monies received by public servants in courts and postulates the same shall be paid into the public account of India or the public account of the State, as the case may be. Article 266(1) deals with all revenues received by the Government of India, all loans raised by that Government by the issue of treasury bills, loans or ways and means advances and all moneys received by that Government in repayment of loans shall form one consolidated fund to be entitled "the Consolidated Fund of India", and likewise the sum received by Government of State shall form one consolidated fund to be entitled "the Consolidated Fund of the State". Article 266(2) stipulates that all other public moneys received by or on behalf of the Government of India or the Government of a State shall be credited to the public account of India or the public account of the State, as the case may be. Third category of receipt is in terms of Article 284 which is required to be paid into the public account of India or the public account ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... law or on request made for the audit in the manner provided under Section 20. Relying on aforesaid constitutional provisions and also of CAG Act, it was contended that the notification constituting CAMPA is unconstitutional as it does not stipulate that the amounts collected on behalf of Government shall go to the relevant consolidation fund or to public fund. Further, no provision has been made for audit under the CAT Act. To examine this contention, it is necessary to determine the nature of Fund dealt with by CAMPA. The background under which the fund came to be created has already been noted. Noticing fast depletion of forests, the fund was ordered to be utilized for protection of forests and environments. The environments are not the State property and are national asset. It is the obligation of all to conserve the environments and for its utilization, it is necessary to have regard to the principles of sustainable development and inter-generational equity. Reverting now specifically to forests, if it becomes necessary for economic development to use the same for non-forest purpose, then before grant of permission for diversion of forest land, there should be some schem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Under Section 57 Special Fund vested in the Charity Commissioner. That Fund was set up from the charges levied on various Trusts in the State. The Fund was to be managed by the Charity Commissioner. All investments were to be made by the Charity Commissioner. All disbursements were to be made by him in the manner prescribed by the rules. The collections of these charges, deployed in the Special Fund, were not merged in the general revenue, but these collections were earmarked and set apart for the purposes of the Act. This Court further noticed that the Charity Commissioner and the servants appointed under the Act drew their salary from the Consolidated Fund of the State. However, this Court observed that Section 57 was enacted to facilitate the Administration and not with a view to mix up the Fund with the general revenue collected for government purposes. Therefore, this Court held that Public Trusts Administration Fund was set up to meet all expenses of the administration of Trust property within the scheme of the Act and it is to meet such expenses that they levy was made and collections were effected. Therefore, this Court held that such payments were levied for rendering se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the economic and social sides of planning often just as complex as the ecological sides. Table 1.1 gives examples of decisions needed in the management of forest as under : "Table 1.1 Examples of decisions needed in the management of forests Type of decision Example Extent and distribution of reserves Wilderness Management emphases for areas where active management will occur Big game emphasis, highintensity timber production, scenic areas Types of activities allowed Timber harvest, prescribed fire Aggregate harvest level over time Evenflow, nondeclining yield Silvicultural system Even-aged, uneven-aged Age structure of forest Areas by 10-year age classes Size and shape of treatment units Small units versus large units Spatial pattern of treatment units Concentrated or dispersed cutting blocks Protection strategy Wildfire suppression policy Vertical and horizontal diversity/stand density Approach to partial cutting and prescribed burning Regeneration harvest timing Rotation age (even-aged), cutting cycle (uneven-aged) Regeneration method Clearcutting, clearcutting with leave trees, shelterwood, selection, prescribed fire, natural disturbance." When permission is granted by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ses. It was held that our legal system based on English common law includes the public trust doctrine as part of its jurisprudence. The State is the trustee of all natural resources which are by nature meant for public use and enjoyment. Public at large is the beneficiary of these resources. The State as a trustee is under a legal duty to protect these natural resources. Summing up the Court said : "We are fully aware that the issues presented in this case illustrate the classic struggle between those members of the public who would preserve our rivers, forests, parks and open lands in their pristine purity and those charged with administrative responsibilities who, under the pressures of the changing needs of an increasingly complex society, find it necessary to encroach to some extent upon open lands heretofore considered inviolate to change. The resolution of this conflict in any given case is for the legislature and not the courts. If there is a law made by Parliament or the State Legislatures the courts can serve as an instrument of determining legislative intent in the exercise of its powers of judicial review under the Constitution. But in the absence of any legislation, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting the Indian Forest Act, 1878 which was amended from time to time. By passage of time, it was found that the provisions of the said Act were not adequate and, thus, in order to consolidate the law relating to forest, the transit of forest produce and the duty leviable for timber and other forest produce, the Indian Forest Act, 1927 was enacted. To further tighten the management and regulation, the FC Act of 1980 was enacted. It became necessary for conservation of forest on realizing that there has been large scale of deforestation which is causing ecological imbalance leading to environmental deterioration. This led to enactment of the FC Act providing for prohibition for use of forest land for non-forest purpose by anyone including the State Government or other authorities except with the prior approval of the Central Government. This legislature was enacted, as already noted, after Forest and Wildlife were taken out from the State list and placed in the Concurrent list. At the same time, Article 48A was inserted in the Constitution of India for protection and improvement of environments and safeguarding forest and wildlife in the year 1977. The basis objectives leading to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m substitution of wood. -- Creating a massive people s movement with the involvement of women, for achieving these objectives and to minimize pressure on existing forests. 2.2 The principal aim of Forest Policy must be to ensure environmental stability and maintenance of ecological balance including atmospheric equilibrium which are vital for sustenance of all life forms, human, animal and plant. The derivation of direct economic benefit must be subordinated to this principal aim." It has been recognized that one of the essentials for forest management is the conservation of total biological diversity, the network of national parks, sanctuaries, biosphere reserves and other protected areas to be strengthened and extended adequately. The strategy under the Forest Policy is to have a minimum of onethird of the total land area of the country under forest or tree-cover. In the hills and in mountainous regions, the aim should be to maintain two-third of the area under such cover in order to prevent erosion and land degradation and to ensure the stability of the fragile ecosystem. Clause 4.3 lays down the aspects of management of State forests. It would be instructive to reprod ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rding the customary rights and interests of such people, forestry programmes should pay special attention to the following -- One of the major cause for degradation of forest is illegal cutting and removal by contractors and their labour. In order to put an end to this practice, contractors should be replaced by institutions such as tribal cooperatives, labour cooperatives, government corporations, etc. as early as possible; -- Protection, regeneration and optimum collection of minor forest produce along with institutional arrangements for the marketing of such produce; -- Development of forest villages on par with revenue villages; -- Family-oriented schemes for improving the status of the tribal beneficiaries; and, -- Undertaking integrated area development programmes to meet the needs of the tribal economy in the around the forest areas, including the provision of alternative sources of domestic energy on a subsidized basis, to reduce pressure on the existing forest areas. XXX XXX XXX 4.8.1. Encroachment on forest lands has been on the increase. This trend has to be arrested and effective action taken to prevent its continuance. There should be no regularization of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able natural resource. They are a national asset to be protected and enhanced for the well being of the people and the Nation." It is clearly a constitutional imperative to preserve and enhance forest cover as a natural gene pool reserve. As opposed to the above, the ground reality has been depletion of forest. The shift in the approach of the legislation is evident from the FC Act of 1980 when compared with the scheme underlying the Indian Forest Act, 1927 which was State oriented for conserving the Forest Policy of 1952. Further, in 1977, Forest and Wildlife were taken out from the State list and incorporated in Concurrent list. Considering compulsions of States and large depletion of forest, these legislative measures have shifted the responsibility from States to Centre. Moreover, any threat to the ecology can lead to violation of right of enjoyment of healthy life guaranteed under Article 21 which is required to be protected. The Constitution of India enjoins upon this Court a duty to protect environments. The aforesaid background has been given to demonstrate that the object of amount of NPV is to utilize the fund to conserve the ecology without in any manner affectin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th reference to regeneration, and the main cause is non-availability of sufficient funds. It also notices that even with regard to the felling of trees as per working plans in the last three years, the corresponding prescription for regeneration has not been implemented. It further notices that there cannot be any felling without regeneration because that will, over a period of time, only result in forest vanishing. Further, the order says that the shortfall of regeneration which has resulted in depletion of forest cover has to be made up. The court took note of the suggestion that for regeneration there should be a joint venture between State of Madhya Pradesh a State having a large forest area, and the Central Government whereby the working capital, in whole or substantially the whole, can be provided by the Central Government and the regeneration of degraded forests carried out. Taking an overall view, it is important for the nation that in certain areas where natural forest exists, the same should be preserved and at the same time the Central Government should consider whether the deficient States should not be asked to contribute towards the preservation of the existing forest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an ecological crisis affecting livelihood options for development and over all deterioration in quality of life. From the above report, it follows that the deterioration and consequently preservation of eco-systems cannot be area or state specific and that utmost attention is required to be accorded to conservation of natural resources and for improvement of the status of our environments. The report notices the need to tackle the environmental degradation in a holistic manner in order to ensure both economic and environmental sustainability. Forests play an important role in environmental and economic sustainability. It takes note of the forests being consistently and seriously undervalued in economic and social terms. It recognizes that the economic value of the eco-system services of the forests is vast though it is extremely difficult to quantify. It takes note of the fact that generally much of the land-use decision that presently drives forest change takes relatively little account of these values. The country s forest resource is under tremendous pressure. Note has been taken of the fact that India s biological diversity is reflected in the heterogeneity of its forest cover. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich a society cares or does not care for its dirt its land reflects the degree to which it cares or does not care for its own long-term future. We may also briefly refer to Public Trust doctrine and its applicability to the matters under consideration. The Public Trust Doctrine looks beyond the need of the present generation and also suggests that certain resources are invested with a special nature. It would be instructive to make a note of a story given in by Timothy Patrick Brady in Boston College Environmental Affairs Law Review, Spring 1990 under the title But most of it belongs to those yet to be born . The story relates to digging of well at the time of drought. When a Frenchman told villagers of a prudent African solution of digging well, many villagers agreed but others argued that it will bring people from other villages and they would bring their cattle and that would increase the pressure on the already precious water. The Frenchman told the villagers that why not explain to them that the well is only for your own village and they can dig their own. It was then said that water is not only ours, but is gift of nature from God and must be shared. Ultimately, they con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... een placed on observations made in Hindustan Motors Ltd. Anr. v. N.Siva Kumar Anr. [(2000) 10 SCC 664] to contend that such a project is not a pollution industry. This decision is not relevant for determining the question about levy and payment of NPV. The question is not only about these and projects referred by the Solicitor General not creating pollution but is about diversion of forest land for non-forest purpose, thereby depleting forest so as to utilize land area in setting up these projects. A distinction has to be maintained between a project set up for providing public utility but which is revenue earning, the category to which the project of NHPC falls and the government projects of the nature above referred like hospitals, schools etc., non-revenue earning projects. A balance is required to be maintained in the development and protection of environments. As already noted, the development has to be based on sustainability. If NHPC uses the forest land for non forest purposes, the payment of NPV is to protect the ecological and bio-diversity having regard to the doctrines above referred. Generally speaking, projects like NHPC are commercial ventures. What we have sta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e by CEC for protection of environment In view of the aforesaid discussion, our conclusions are: 1. Except for government projects like hospitals, dispensaries and schools referred to in the body of the judgment, all other projects shall be required to pay NPV though final decision on this matter will be taken after receipt of Expert Committee Report. 2. The payment to CAMPA under notification dated 23rd April, 2004 is constitutional and valid. 3. The amounts are required to be used for achieving ecological plans and for protecting the environment and for the regeneration of forest and maintenance of ecological balance and eco-systems. The payment of NPV is for protection of environment and not in relation to any propriety rights. 4. Fund has been created having regard to the principles of intergenerational justice and to undertake short term and long-term measures. 5. The NPV has to be worked out on economic principles. In view of the above, we issue following directions: A. An expert committee comprising of three experts including Ms.Kanchan to be appointed within a period of one month by the Institution of Economic Growth (North Campus). B. The committee of exper ..... X X X X Extracts X X X X X X X X Extracts X X X X
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