Supreme Court Allows Continued Operation of Tamil Nadu Power Plant in Public Interest: Compliance with Conditions Emphasized

In a recent judgment, the Supreme Court of India has permitted the continued operation of the M/s IL&FS Tamil Nadu Power Company Limited's thermal power plant in Tamil Nadu. The judgment, delivered by Justice M.R. Shah, emphasizes the importance of compliance with the conditions imposed in the Environmental Clearance (EC) and a subsequent corrigendum.

The headline quotes from the judgment highlight the significant decision made by the Supreme Court. It underscores the court's recognition of the public interest involved in the power plant's continued operation. The judgment acknowledges the power deficit situation in Tamil Nadu and the adverse consequences that would arise from closing the plant, which currently supplies power to approximately 40 lakh households.

The court acknowledged the appellant's compliance with the clearance conditions and the submission of six-monthly reports to the Ministry of Environment, Forest and Climate Change (MoEF). The power plant employs imported coal with low sulfur content and has a Flue Gas Desulphurisation (FGD) system in place, ensuring compliance with SO2 standards. The court recognized the substantial investment made by the appellant, amounting to Rs. 775 crores, for the installation of the FGD system.

Furthermore, the court considered the appellant's affiliation with the IL&FS Group, which is undergoing restructuring. It highlighted the value realization and recovery of public sector undertaking (PSU) debt as being in the larger public interest. The appellant's corporate social responsibility (CSR) initiatives, including the adoption of several villages in the surrounding areas, were also mentioned.

Regarding the maintainability of the appeal, the court ruled that an appeal against the corrigendum to the EC would be permissible if the original EC was not under challenge or had been confirmed earlier by the National Green Tribunal (NGT) on certain conditions. The scope of the appeal was limited to the corrigendum and the additional conditions imposed.

While permitting the continued operation of the power plant, the court emphasized the importance of full compliance with the conditions mentioned in the EC and the corrigendum. It noted that there were no fundamental breaches or non-compliance, but certain conditions required further compliance within the stipulated time. The court's order reflects the commitment to ensuring environmental standards are met while allowing the power plant to continue operating.

Date of Decision: February 17, 2023

M/s IL&FS Tamil Nadu Power Company Limited vs Muruganandam & Others