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TMI Blog2023 (1) TMI 600X X X X Extracts X X X X X X X X Extracts X X X X ..... production capacity, the same was rejected by the competent authority. This Public Notice has to be read in consonance with the Judgment of the Apex Court and cannot be permitted to do violence with the Orders of the Apex Court in M.C. MEHTA VERSUS UNION OF INDIA ORS. [ 2018 (11) TMI 1352 - SUPREME COURT] . On 22.03.2019, as per the second Public Notice, the eligible quantity desiring to avail quota of the total import of raw pet coke were to apply for the import license along with their capacity of the unit and a valid consent certificate from SPCB/PCC in the name of user industrial units indicating the quantity permitted for import and its usage on a monthly and yearly basis. This notice is more or less identical to the first Public Notice dated 22.11.2018 - The Appellant attempted to move the DGFT for the increase in their quota based on the increase in their production capacity which was rejected by the DGFT by Order dated 22.04.2019 on the ground that any change in the quota would be violative of the order of the Apex Court. The reasoning of the learned Single Judge that the public notice dated 17.04.2020 makes a distinction between the certificate in the first part a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -2023 - HON BLE THE CHIEF JUSTICE SATISH CHANDRA SHARMA, AND HON'BLE MR. JUSTICE SUBRAMONIUM PRASAD For the Appellants : Mr. P Chidambaram, Senior Advocate Mr. Rajashekhar Rao, Senior Advocate with Ms. Shivani Khandekar, Mr. Gokul Holani, Ms. Yamini Mukherji, Advocates Mr. Gaurav Kejriwal, Advocate Mr. Dhananjaya Mishra, Mr. Arnav Dash, Mr. Navneet Dogra, Mr. Ayan Rai, Advocates For the Respondents : Mr. Chetan Sharma, ASG with Mr.Ripudaman Bhardwaj, CGSC with Mr. Kushagra Kumar, Ms. Aakriti Roy, Mr. Vineet Malhotra, Mr.Vishal Gohri, Ms. Kirti Sarin, Advocate Advocates for UOI Mr. Amit Sibal, Sr. Advocate with Mr. Ashish Prasad, Ms. Mukta Dutta, Mr. Abhishek Shivpuri, Mr. Vinay Tripahi, Mr. Vinemra Kopariha, Advocates for Sanvira Mr. T V S Raghavendra Sreyas, Ms.Gayatri Gulati, Mr. Siddharth Vasudev, Advocates for R-4 Mr. Shubhranshu Padhi, Mr. Vishal Bansal, Advocates for R-5 JUDGMENT 1. At the outset, it is imperative to set out the description of each of these matters. LPA Nos. 25/2021, 70/2021 and 71/2021 have been filed by the Appellants challenging the common Judgment dated 15.01.2021 passed by the learned Single Judge, disposing W.P.(C) No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me is an essential raw material in the calciner industry. The Appellant is aggrieved by the alleged excess allocation of RPC to Respondent No. 3, which the Appellant contends, has been made in excess of stipulated parameters. 8. The present matter is to be analyzed within the framework of certain orders of the Hon ble Apex Court and this Court. The said policy framework, Orders of the Hon ble Supreme Court and this Court along with the specific facts of this matter are set out hereinbelow: - a. On 22.04.2017, the Andhra Pradesh Pollution Control Board (APPCB) issued an authorization order inter alia granting consent to Respondent No. 3 to operate its unit in Vishakhapatnam for manufacturing CPC up to a quantity of 2,00,000 MTPA. The Consent to Operate (hereafter, CTO ) was granted in terms of Sections 25 of the Water (Prevention and Control of Pollution) Act, 1974 read with Section 21 of the Air (Prevention and Control of Pollution) Act, 1981 and Rule 6 of the Hazardous Other Wastes (Management and Transboundary Movement) Rules, 2016, which mandates an industrial unit discharging effluents and emissions to seek a CTO from the concerned State Pollution Control Board (her ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ely, cement, lime kiln, calcium carbide and gasification for use as feedstock or in the manufacturing process only on actual user basis as per the conditions stipulated below: (1) Petcoke importing industries namely, cement, lime kiln, calcium carbide and gasification shall obtain the consent of and registration with the concerned State Pollution Control Boards (SPCB)/Pollution Control Committees (PCC). (2) Consent issued by the concerned SPCB/ PCC shall clearly specify the quantity permitted for import and its use on a per month and per annum basis. (3) Only registered industrial units with valid consent from SPCBs/PCCs as per clause (1) shall be permitted to directly import pet coke and consignment shall be in the name of user industrial units for their own use only. (4) Import of pet coke for the purpose of trading shall not be permitted. (5) Authorised importers of Petcoke shall furnish opening and closing stock of imported Petcoke to the concerned SPCB/ PCC on a quarterly basis. (6) The SPCBs/ PCCs shall develop an electronic record system for uploading of consents, registration and record of use of imported Petcoke by industrial units, as mention ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h) 4. Kalinga Calciners Pvt Ltd, plant based in Paradeep (Orissa) 5. India Carbon Ltd, plant based in Budge Budge, West Bengal 6. Petro Carbon N Chemicals Pvt Ltd, plant in Haldia, West Bengal The industry cannot use domestic pet coke as that grade called anode grade - is not readily available. The structure of the pet coke in India is different therefore, import becomes essential. The industry also provided EPCA with details of the quantity required by the industry (see Annexure 1). According to this estimation, the 6 industries, with combined production capacity of 1.17 million tonnes require 1.36 million tonnes of imported petcoke to produce l million tonnes of calcined pet coke annually. The industry has also informed EPCA that it meets S02, NOx and particulate emission standards, as stipulated by CPCB. A.1.2 EPCA Recommendation on Calciner Industry The calciner industry should be allowed to import pet coke as its industry uses it for feedstock and not for fuel. This import is required as anode grade petcoke is not available in sufficient quantities in the country. xxx g. On 09.10.2018, the Hon ble Supreme Court, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the process of allocating RPC. The manner in which such allocation was made was subjected to contest by the Appellant and Respondent No. 3. Respondent No. 3 had contested that its production capacity was actually 330,000 MT and that the same was not taken into account for providing its requisite allocation. The Committee disposed of such representations on the grounds that equal opportunity of allocation of imported RPC ought to be extended to all industries that require RPC. It was further observed that: - 6. The Committee examined the SPCB certificates of all the nine applicants for RPC imports. On examination, Committee observed that the SPCBs have adopted varying conversion rates for calculating the requirement of RPC for producing CPC, in their Consent to Operate (CTO) certificates. The Committee also noted that consumption requirement is not indicated in SPCB certificates of all industries. For the sake of uniformity, the Committee decided to consider the allocation of RPC in proportion to the production capacities of the applicants as indicated in SPCB certificates. As in some of the SPCB certificates, production capacity of CPC was indicated in TPD (Tonnes Per Day); ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the MOEF CC issued vide O.M No. Q-18011/54/2018-CPA dated10.09.2018 and that the annual quantity limitation on import would be operated on fiscal year basis. Accordingly, of the total quantity permitted for import per annum by this Hon'ble Court, only half would be available for import during the remaining period of the financial year (October to March). By the Public Notice the DGFT further directed that applications for allotment of quota were required to be submitted to the DGFT by 7.12.2018 and reiterated that inter-alia, the production capacity of the applicant as certified by the SPCB/PCC was to be furnished. A copy of the Public Notice No. 50/2015-2020 dated 26.11.2018 issued by the DGFT is annexed hereto as Annexure A-19 (Pages 248-250) (iv) The Applicant received CTO for its Phase II expansion on 29.11.2018 and thus had SPCB certification for total production capacity of 330,000 MTPA of CPC before the deadline for applications. (v) The Applicant duly applied for allocation of import quota of RPC vide its application to DGFT dated6.12.2018 and requested for allocation of 183,746MT of RPC for 2H2018-19 based on its current certified production capaci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o ensure that a fully compliant unit operating the best in class environment safeguards and servicing the economy by reducing the aluminium industry's dependence on import of CPC was not forced to shut it operations. Copy of the said representation dated 11.01.2019 to EPCA280is annexed hereto as Annexure A-23 (Pages 264-304). (x) Being left with no option, the Applicant has received such allocation under protest and recorded its objections to DGFT by its Objections dated 17.01.2019. The Applicant has also sought clarification as to whether its current Cl2rtiflcdcapacity of 330,000 MTPA would be considered for the next quarter starting from 1.4.2019. The Applicant has not received any response to its letter dated 17.01.2019 till date. Copy of the Applicants Objections dated 17.01.2019 is annexed hereto as Annexure A-24 (Pages 305-307). 12. It is submitted that the following facts in particular, emerging from the above background may kindly be noted: (i) This Hon'ble Court was pleased to permit the use and import of RPC by CPC manufacturing units after noting the views expressed by the CPCB as regards inter-alia, need for treatment of S02emission by calciners ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Coke import quota as certified by certificates granted by the Andhra Pradesh pollution control board; (b) Direct the Directorate General of Foreign Trade to allocate in favour of the Applicant 222,750 MT of Raw Petroleum Coke for the period April 2019 to September 2019, 310,500 MT of Raw Petroleum Coke for the period October 2019 to March 2020 and thereafter 621,000 MT of Raw Petroleum Coke annually on a continuous basis out of the total 1.4Million MT of Raw Petroleum Coke per annum as permitted to be imported by this Hon'ble Court vide order dated 09.10.2018 passed in Writ Petition No.13029 of 195, titled M.C. Mehta vs Union of India Ors; (c) Clarify that those calciners who have not so far placed their requirement of imported Raw Petroleum Coke either before the EPCA or before this Hon'ble Court are not eligible for allocation of Raw Petroleum Coke from the restricted Raw Petroleum Coke import quota allowed to Calcined Pet Coke manufacturing units and issue appropriate directions to the Directorate General of Foreign Trade; (d) Enhance the annual import limit on Raw Petroleum Coke for Calcined Pet Coke manufacturing units beyond 1.4 million MT if deemed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the committee observed as follows in its MoM: - 5. M/s. Rain CII Carbon (Vizag) Ltd. has submitted additional requirement of4,88,000 MT of RPCSEZ Visakhapatnam Plant, which is yet to be operational. Similarly, M/s. Sanvira Ltd. has also submitted its requirement for meeting the additional capacity of 1,30,000 MT In this regard, the Committee noted that the request for additional requirement of Raw Pet Coke by these two applicants had been set aside by the Hon'ble Supreme Court, vide Order of the Supreme Courtdated09.10.2018. The Hon'ble Supreme Court in its order dated 28.1.2019whiledisposing off the I.A. No. 168847/2018, 1451/2019 1847/2019 (filed on behalf of Rain carbon); I.A.No.12291 /2019(filed on behalf of Sanvira Ind. Ltd.) andI.A.No.164303 (filed on behalf of Saket Agarval) and I.A.No.13210/2019 (filed on behalf of Goa Carbon Ltd) had pronounced that the order passed by this Court is clear. This Court has set the outer limit for import of raw pet coke cannot exceed 1.4 MT per annum in total. In view of the aforesaid, prayers made on the basis of expansion etc. are totally misconceived and cannot be entertained. No further orders are required to be passed on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of order dated 15.03.2019 in writ petition No.1784 of 2019 is annexed hereto and marked as Annexure A-16 (Page 166-174). xxx (a) Pass appropriate directions permitting the Applicant to challenge Minutes of Meeting dated 22.03.2019 issued by the DGFT to finalise allocation of RPC for CPC manufacturing on grounds open to it under law in Writ Petition. (emphasis supplied) n. On 08.07.2019, the Hon ble Supreme Court dismissed I.A. No.73242/2019, observing that no clarification was required in respect of the Orders passed earlier. o. On 06.12.2019, W.P(C) No. 4485/2019 was disposed of by this Court directing the Respondents to consider the petition as a representation. While doing so, the Ld. Single Judge agreed with the contentions of Respondent No. 3 stating that the Order dated 09.10.2018 passed by the Hon ble Supreme Court set an outer limit on import of RPC and did not decide on production capacity and corresponding allocation for ant industry. The Order reads as follows: - 7. I have considered the submissions made by the learned counsels for the parties. A perusal of the Impugned Minutes of Meeting dated 22.04.2019of the respondent no. 1, also cle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he aforesaid, prayers made on the basis of expansion etc. are totally misconceived and cannot be entertained. No further orders are required to be passed on these I.As. The same are hereby dismissed. M/s Rain CII (Vizag) Ltd. had prayed before the Hon'ble Supreme Court to enhance the limit of 1.4 Million MT by a specific quantity of 4,88,000 MT which it has expanded through its SEZ unit. Therefore, the orders of the Hon'ble Supreme Court is clear neither the limit of 1.4 Million MT can be enhanced nor the expansion of the capacity by the calciners can be entertained. The Committee, therefore, did not approve M/s Sanvira Industries representation who was seeking allocation for its additional capacity of 1,30,000 MT. 7. The Committee while considering the submission of M/s Sanvira Industries Ltd. was of the view that the capacity of each applicant was decided on the basis of Consent to Operate certificate available with the firm on the date of passing of Order dated 9.10.2018 by the Hon'ble Supreme Court in WP No. 13029 of 1985. The firm was not having Consent to Operate on 09.10.2018 for their plant and accordingly it was not considered by the Committee which d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... make allocation of such quota subject to outcome of the writ petition. r. In the interregnum, on 17.04.2020, Respondents issued a Public Notice (hereafter, Third Public Notice ) for allocation of RPC for 2020-21, Clause 2(iii) of which stated that all eligible allocatees desirous of availing RPC import, were required to do so by submitting documents in the following terms: - xxx Conditions and modalities of application for import of Pet coke. xxx iii. All eligible entities desiring to avail quota as mentioned above, may apply for import license as per procedure mentioned in Trade Notice No. 49 dated 15th March, 2019 along with State Pollution Control Board Certificate (SPCB)/Pollution Control Committee (PCC) indicating capacity of the unit as on 9.10.2018 (Hon'ble Supreme Court Order in Writ Petition No. 13029/1985) and also valid consent certificate from SPCB/ PCC, in the name of user industrial units indicating the quantity permitted for import and its usage on a monthly and yearly basis. (emphasis supplied) s. This Court, vide its Order dated 02.05.2020, reject ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... requirement is not indicated in SPCB certificates of all the firms. To bring uniformity, the Committee decided to allocate RPC by adopting following criteria: i. The production capacity of the applicant is to be calculated on annual basis. Wherever, SPCB certificates shows production figures in TPD, the annual production capacity is to be arrived at by multiplying the capacity with 350 days (average operational days for the unit) to bring uniformity. ii. The production capacity for each applicant to be converted to input/raw material requirement by taking industry average conversion rate i.e. 1:1.36 (as mentioned in the EPCA report). iii. The additional capacity added by the applicants after the Hon ble Supreme Court s order dated 9.10.2018 is not taken into consideration; iv. The quota be divided on a proportionate basis as per the following formula: Quota allocated = Total Quota available for allotment multiplied by the demand of applicant divided by the Total demand for all applicants v. In cases where requested quantity is lower than eligible quantity, the surplus on their heads are redistributed among others proportionately. u. The Appellant ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of 09.10.2018. 5. Mr. Chidambaram assails the Impugned Judgment by pointing out that the Ld. Single Judge has erroneously held that the Hon ble Supreme Court considered only one prayer while dismissing I.A. No. 12291/2019, whereas the application was dismissed vis- -vis all prayers made by Respondent No. 3. He maintains that the criteria and convention of allocation of RPC as determined by the MoM dated 03.06.2020 is purportedly the same as that which had been used consistently for previous years as well. It is his submission that the Ld. Single Judge erred in holding that the past practice of allocation and consideration of production capacity stands altered by the Third Public Notice. Merely on account of the requirement of another document, being the production capacity certificate from the SPCB, as required by the Third Public Notice, allocation cannot be increased since the CTO exists only to the extent of 2,00,000 MTPA. 6. He has further submitted that the Ld. Single Judge has erred in inferring that the Orders of the Hon ble Supreme Court in the PIL Proceedings do not constitute a bar on DGFT to allocate additional to RPC to Respondent No. 3 since it does not restrict ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hallenge. 9. In his view, the policy of the Respondents stands altered by virtue of the Third Public Notice and such modified policy has been applied to all calciners uniformly. It is his submission that previously, allocations, were made on the basis of the CTO certificate only and it was the conscious decision of Respondent Nos. 1 2 to introduce Public Notice dated 17.04.2020, whereby the burden of determining the Production Capacity of eligible entities as on 09.10.2018 was put on SPCBs and with that intent, the eligible entities were called upon to produce SPCB Certificates indicating production capacity of the respective units as on 09.10.2018. Accordingly, no interference is warranted with the same as per him. 10. Mr. Sibal has drawn the attention of this Court to the public notice dated 17.04.2020 and states that the said notice makes a distinction between certificate in the first part and the consent to operate in the second part and if both, the certificate and the consent to operate, were the same document, clearly there would not have been any necessity to make a separate mention of the certificate and the consent to operate in two parts of the same clause of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... force in the submission of Mr. Chidambaram. As on 12.09.2018 the production capacity of the Appellant was 2,00,000 MT. This is fortified by the CTO Order of the APPCB dated 22.04.2017. 15. A perusal of the said Order dated 22.04.2017 shows that the APPCB has granted consent to manufacture calcine petroleum coke to the Appellant to a maximum of 2,00,000 MTPA. A perusal of the said order further shows that Respondent No.3 was directed not to increase the production capacity mentioned in the order. The Appellant was thus restricted from increasing their production capacity beyond 2,00,000 MTPA as per the consent to operate. 16. The material on record also states that Respondent No.3 had applied for increasing their capacity from 2 Lakh Metric Tonnes to 3.30 Lakh Metric Tonnes but a renewed CTO recognizing and allowing operation of the unit at the capacity of 3,30,000 MT was only granted vide the APPCB s order dated 29.11.2018. The said CTO Order is, therefore, after the Judgment of the Apex Court passed on 09.10.2018 wherein the Apex Court had accepted the recommendations of the EPCA for permission of 1.4 Million Metric Tonnes per annum. The finding of the learned Single Judge t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... This Public Notice has to be read in consonance with the Judgment of the Apex Court and cannot be permitted to do violence with the Orders of the Apex Court. 21. On 22.03.2019, as per the second Public Notice, the eligible quantity desiring to avail quota of the total import of raw pet coke were to apply for the import license along with their capacity of the unit and a valid consent certificate from SPCB/PCC in the name of user industrial units indicating the quantity permitted for import and its usage on a monthly and yearly basis. This notice is more or less identical to the first Public Notice dated 22.11.2018. Pursuant to the said notice, Respondent No.3 was granted allocation of 99,154.07 MT on the basis of production capacity of 2 Lakh Metric Tonnes. Also, there was no increase in the share of RPC of the total 1.4 Million Metric Tonne as permitted by the Apex Court. The Appellant attempted to move the DGFT for the increase in their quota based on the increase in their production capacity which was rejected by the DGFT by Order dated 22.04.2019 on the ground that any change in the quota would be violative of the order of the Apex Court. The relevant portion of the order h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsent certificate from the SPCB/PCC. 26. Based on the said certificates, the DGFT in its Minutes of Meeting dated 03.06.2020 increased the allocation of raw pet coke out of the total limit of 1.4 Million Metric Tonnes to Respondent No.3 at 3,11,247 MT for a production capacity of 3,30,000 MT and has proportionately reduced the allocation for the Appellant from 553574.23 MT in the previous allocations to 4,81,961 MT in the Minutes of Meeting dated 03.06.2020. 27. A perusal of the said Minutes of Meeting dated 03.06.2020 shows that the increase has been accepted on the basis of the request of Respondent No.3. It is in this context that it must be examined whether there was any change in the method of allocation that was to have been followed by Respondent No. 2 in the three Public Notices. 28. As indicated earlier, on 09.10.2018, that is the date on which the Apex Court passed the order, every calciner had given its capacity. The total capacity of all the calciners put together came to 11,72,750 Metric Tonnes and the production and the total import that was necessary for the calciners to continue producing pet coke from raw pet coke was assessed as 1.4 Million Metric Tonnes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Apex Court. As stated earlier, the total limit of import of 1.4 Million Metric Tonnes was based on the total production capacity as on 09.10.2018 which had been fixed by the Apex Court on the basis of the capacity disclosed by the calciners themselves. A State Pollution Control Board can only indicate the permissible limit of production of calcined petroleum coke, which for the Respondent No.3 was only 2,00,000 Metric Tonnes. As stated earlier, the consent to produce 3.3 Million Metric Tonnes of coke was given only after November, 2018 which is after 09.10.2018 and, therefore, the same could not have been considered by the Apex Court. The certificate dated 04.05.2020 issued by the State Pollution Control Board only certifies that the installed capacity of Respondent No.3, as on 09.10.2018, for manufacture of calcined petroleum coke, was 3.3 Million Metric Tonnes per annum and is obviously immaterial. Even though the public notice dated 17.04.2020 is not under challenge but this Court cannot be a party to any interpretation that will have the effect of upsetting the rationale of the Apex Court in fixing 1.4 Million Metric Tonnes of raw petroleum coke which, as stated earlier, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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