Legislative Intent Was to Keep Building Projects Outside ‘General Conditions’: Supreme Court Slams NGT’s Overreach in Landmark Environmental Ruling”

“A plain reading of the EIA 2006 Notification reveals that the General Conditions were never attracted to projects falling under Items 8(a) and 8(b). The NGT has not construed the Notification in its correct perspective.” –  In a significant decision impacting the entire real estate and environmental regulatory framework, the Supreme Court of India delivered a landmark judgment in the case titled Confederation of Real Estate Developers’ Association of India (CREDAI) & Ors. vs. Union of India & Ors., holding that General Conditions under the Environmental Impact Assessment (EIA) Notification of 2006 do not apply to building, construction, township, and area development projects listed under Items 8(a) and 8(b) of its Schedule.

Setting aside the controversial order dated August 9, 2024, passed by the National Green Tribunal (NGT), the Court categorically ruled that Column 5 of the EIA 2006 Schedule makes no mention of General Conditions for these project categories, and this deliberate legislative silence cannot be overridden by purposive or interpretative expansion.

The ruling, authored by Justice R. Mahadevan and concurred by Justice J.B. Pardiwala, restores the decentralized appraisal mechanism via State Environment Impact Assessment Authorities (SEIAAs) and strongly warns against judicial and quasi-judicial encroachments upon the domain of delegated legislation and statutory structure.

“NGT Cannot Legislate from the Bench: Tribunal’s Jurisdiction Doesn’t Extend to Abstract Policy Directions in Absence of a Lis”

The Court began by emphasizing that the NGT had grossly exceeded its jurisdiction under the National Green Tribunal Act, 2010, in entertaining an application that did not involve any concrete dispute or grievance. The so-called environmental issue raised by Respondent No. 3 (an NGO) was purely academic, bereft of any personal locus or factual basis.

Referring to previous precedents, including Techi Tagi Tara v. Rajendra Singh Bhandari, the Court reiterated:

“The jurisdiction of the NGT under Sections 14 and 15 is confined to civil cases involving a substantial environmental question. It cannot venture into abstract, policy-based questions without a claimant or demonstrable environmental damage.”

It held that the NGT’s assumption of authority to ‘clarify’ or ‘reclassify’ projects under the EIA Notification amounted to judicial overreach that upset the statutory scheme, created regulatory paralysis, and halted critical housing projects across India.

“Literal Interpretation is the First Principle of Law: EIA 2006 Clearly Excluded Items 8(a) and 8(b) from General Conditions”

The Court engaged in a detailed analysis of the textual structure of the EIA 2006 Notification, with particular focus on Column 5 of the Schedule, which outlines applicable conditions for each listed category of project.

Quoting from its own decision in Vanashakti v. Union of India, the Court observed: “Wherever the delegated legislation intended the General Conditions to apply, the Schedule itself made a specific provision. The absence of such stipulation in Column 5 for Items 8(a) and 8(b) reflects deliberate exclusion.”

The Court highlighted that the NGT’s reliance on a quashed 2014 Notification, and its interpretation of the Kerala High Court’s 2024 judgment in One Earth One Life v. MoEF&CC, was fundamentally flawed.

The Kerala High Court had quashed the 2014 Notification only on procedural grounds, without reviving the General Conditions, and its territorial applicability was limited to the State of Kerala. The Court firmly rejected the idea that a procedural quashing could be stretched to have pan-India legislative consequences.

“Excluding Schools and Hostels From EIA Was Arbitrary”: Supreme Court Upholds 2025 Notification, Strikes Down Note 1

While upholding the Notification dated 29.01.2025 issued by the Ministry of Environment, Forest and Climate Change (MoEF&CC) — which reaffirmed that General Conditions do not apply to Items 8(a) and 8(b) — the Court found fault with Note 1 that exempted educational and industrial buildings from the scope of environmental clearance.

The Court struck down Note 1, observing: “It cannot be gainsaid that if any construction activity for an area of more than 20,000 sq. meters is to be carried out, it will naturally have an effect on the environment and ecology, even if the building is for industrial or educational purposes.”

The Court further noted that modern education is no longer a purely service-oriented field but is now a flourishing industry, and thus cannot be given a free pass from environmental scrutiny. It held the discriminatory exemption in Note 1 to be arbitrary, irrational, and violative of the very object of the Environment (Protection) Act, 1986.

“SEIAAs are Expert Statutory Bodies, Not Subordinate to MoEF”: Court Restores Decentralization in Environmental Appraisal

A core feature of the judgment was the Court’s reaffirmation of the decentralised regime of environmental appraisal, established under the EIA 2006 Notification, which designates SEIAAs and SEACs as the competent bodies for Category B projects.

The Court underlined: “The SEIAA is a statutory body comprising of experts appointed by the Central Government itself. It is better equipped to undertake study qua environmental impact of proposed projects in the respective State or Union Territory.”

It was emphasized that centralisation of project appraisal, as directed by the NGT, would overburden the MoEF&CC, cause delay in project execution, and violate the principle of federal environmental governance.

“Sustainable Development is Not a Slogan But a Legal Principle”: Right to Housing Cannot be Sacrificed on Procedural Misinterpretation

Balancing ecological protection with developmental needs, the Court invoked a consistent line of jurisprudence, starting from Vellore Citizens’ Welfare Forum v. Union of India to In Re: Zudpi Jungle Lands, reinforcing that sustainable development is a part of constitutional and international law.

The Court warned: “Development cannot be indefinitely stalled on account of incorrect interpretation of notifications. Environmental protection and housing needs must co-exist under the umbrella of sustainable development.”

Thousands of homebuyers, including slum dwellers and society members, were affected by the stalled projects, the Court noted. It observed that RERA-registered projects, third-party rights, and redevelopment efforts were undermined by regulatory uncertainty, thereby violating the fundamental right to shelter under Article 21.

NGT Order Quashed, SEIAAs Retain Appraisal Powers, 2025 Notification (Minus Note 1) Prevails

Concluding its judgment, the Supreme Court declared: “We are in full agreement with the view taken by the coordinate Bench in Vanashakti. The impugned order dated 09.08.2024 of the NGT does not survive for consideration. The 2025 Notification, excluding Note 1 to Entry 8(a), presently holds the field.”

All three civil appeals — filed by CREDAI, Godrej Properties, and Sai Sahara Developers — were accordingly disposed of, with the impugned NGT order declared invalid and no order as to costs.

This judgment now settles the law surrounding the EIA applicability to construction and township projects, re-establishes SEIAAs’ exclusive jurisdiction, and warns tribunals against legislating policy through interpretation.

Date of Judgment: September 12, 2025