Supreme Court: The Bench comprising of Madan B. Lokur and Deepak Gupta, JJ. disposed of substantive applications in Kant Enclave Matters directing the illegal construction in Aravali Hills to be demolished. The Court further directed the State and R. Kant and Co. to compensate the citizens duped by them into investing large amounts in the illegal colonising activity.
Factual background of the matter is that R. Kant and Co. was granted exemption by the State of Haryana in 1984 for setting up a film studio and allied complex in Faridabad district. The land in exemption to which the exemption was granted, falls in the Aravali Hills range. According to the terms and conditions of exemption, the company was to complete the construction within 5 years which did not happen. There was nothing on record to show that an extension was granted for group housing (activity subsequently undertaken by the company). Subsequently, the State took decision to close all construction activity in certain areas, which included the subject land, due to serious environmental concerns vide a notification dated 18-8-1992 issued under Punjab Land Preservation Act, 1900. However, the Town and Country Planning Department of the State, on the basis of the exemption granted in 1984, encouraged the company to carry on its colonising activity. It is notable that many a number of citizens had invested large sums of money in the properties sold by the company in the subject land — Kant Enclave. Also, some of them even started/completed construction in the same. The present proceedings were in connection to a writ petition filed by M.C. Mehta being WP No. 4677 of 1985.
The Supreme Court, after considering whole factual matrix, held that the colonising activity in the subject land was illegal. The Notification having been issued, the company should have refrained from all further activity in the subject land. The Court noted that there were two categories of persons who were taken for a ride by R. Kant and Co. In respect of the first category — persons who only made investments — it was ordered that the company will repay the entire amount of investment with an interest at 18% pa from the date of investment so made. In respect of second category — persons who also made construction — it was ordered that the construction done before 18-8-1992 (date of the Notification) will remain, while those done after that date would be demolished. The company was directed to pay such persons, the entire amount of investment with interest at 18% pa. The Court, following Godrej and Boyce Mfg. Co. Ltd. v. State of Maharashtra, (2014) 3 SCC 430, held that well-meaning citizens were led up the garden path by the State allowing such illegal construction. Therefore, State, along with the company, was directed to pay Rs 50 lakhs as compensation to those whose construction is to be demolished. Furthermore, referring to Indian Council for Enviro-Legal Action v. Union of India, (1996) 3 SCC 212 and Vellore Citizens Welfare Forum v. Union of India, (1996) 5 SCC 647, the Court held that polluter pays principle is a wholesome and universally accepted principle. It was observed that the damage caused to Aravali Hills due to such illegal activity was irreversible. Consequently, R. Kant and Co. was further directed to pay Rs 5 crores (10% of the total amount spent on developing Kant Enclave) for rehabilitation of the damaged areas. [M.C. Mehta v. Union of India (Kant Enclave Matters), 2018 SCC OnLine SC 1426, decided on 11-09-2018]