CWP No.1389 of 2002                                                    [1]
                                    *****

  IN   THE     HIGH COURT OF PUNJAB                  AND HARYANA
                      AT CHANDIGARH



                                      CWP No.1389 of 2002
                                      Date of Decision:27.11.2012



M/s. Kundan Mill Board & Paper Mills                           ...Petitioner

                              Vs.

Union of India and another                                  ...Respondents

CORAM: Hon'ble Mr. Justice A.K.Sikri, Chief Justice Hon'ble MR. Justice Rakesh Kumar Jain Present: Mr. Deepak Sibal,Advocate, for the petitioner.

Mr.B.S.Walia,Advocate, for the respondents.

**** A.K.SIKRI, CJ, (Oral) The petitioner-firm is engaged in the manufacture of cardboard. The "No Objection Certificate" for setting up the manufacturing unit was granted to it on 13.03.1991 and the consent, as required under Sections 25 and 26 of the Water (Prevention and control of Pollution) Act, 1977 (hereinafter referred to as the "1977 Act") for running the manufacturing unit was also granted upto 31.12.2010.

As per the case of the petitioner, till May 1998, the manufacturing process was continued without any dispute but in June 1998, the petitioner received two demand notices raised by respondent No.2 by CWP No.1389 of 2002 [2] ***** invoking Section 6(1A) of the1977 Act. The first demand was for payment of `54,955/- for the period 26.01.1992 to 28.02.1998 and the second demand was for payment of `3,004/- for the period from July 1990 till 25.01.1992. The appeals filed by the petitioner against the said demands were rejected and the writ petition bearing CWP No.12099 of 2000 was disposed of on 07.09.2000 with the direction that "the respondents- authorities shall appoint a paper technologist, who will visit the site of the petitioner alongwith the representative of the Board and the team shall assess the power consumption for the period of July 1990 to October 1999 and evaluate the production details for the corresponding period. The respondents-authorities shall then charge the cess as per the observations made by the Appellate Committee. The fee of the paper technologist expert shall be borne by the petitioner. If the Appellate committee comes to the conclusion that the petitioner was running the unit more than 2.5 ton, the petitioner shall not only pay the levy, but also, pay interest at the rate of 12% p.a. which shall be calculated by the respondents-authorities". Thereafter, the petitioner filed an application for review and the fee of the paper technologist was fixed @ `15,000/- in lump sum but till date no expert was appointed. The petitioner has, thus, challenged the demands raised by the respondent-Board in the present writ petition.

From the aforesaid narration, it becomes clear that two aspects need consideration in this matter:-

(i) "Whether the respondent Pollution Board could undertake 'best judgment assessment' and pass the orders in that manner; and CWP No.1389 of 2002 [3] *****

(ii) If the answer to the first question is in the affirmative, whether the manner in which 'the best judgment assessment' is carried out, is sustainable in law"?.

Insofar as the first question is concerned, answer to that has to be in affirmative i.e. in favour of the Pollution Board. As pointed above, in order to enable the Pollution Board to carry out assessment on actual basis, it was imperative on the part of the petitioner to install meter reflecting the actual consumption of water. The petitioner was also supposed to file the returns. Admittedly, no such returns were filed despite opportunities granted by the Pollution Board to the petitioner. Once the returns are not filed, the Pollution Board is left with no alternative but to take recourse to the 'best judgment assessment'. There is yet another factor which itself goes in favour of the Pollution Board.

The petitioner had approached the Appellate Committee, by filing appeal under Section 13 of the Water (Prevention & Control of Pollution) Cess Act, 1977. In the said appeal, orders were passed whereby the Appellate Committee decided that installed capacity of the mill may be got verified by engaging Paper Technologist along-with representative of the Board. It was further directed that the same team shall assess power consumption for the period from July 1990 to October 1999 and evaluate the production details for the corresponding period. Thereafter, the water cess shall be decided. In an event, it is found by the Appellate Committee that the installed capacity is 5.0 ton for which the NOC was obtained, the assessment order shall be drawn on the 5.0. ton capacity and the penalty shall be levied on the compound amount.

 CWP No.1389 of 2002                                                     [4]
                                  *****

The matter was adjourned thereafter and again taken up by the Appellate Committee on 28.6.2000. On this date, submissions of both the parties were considered and the Appellate Committee passed the order deciding that the balance payment be deposited along-with interest on or before 30.6.2000.

Significantly, the petitioner challenged this order by filing the writ petition No.12099 of 2000 in this Court. That writ petition was disposed of at the admission stage itself vide order dated 07.9.2000, directing the respondents to appoint Paper Technologist, who shall visit the site of the petitioner along-with the representative of the Board and the team shall assess the power consumption for the period July 1990 to October 1999 and evaluate the production details for the corresponding period. The Court specifically ordered that fee of the Paper Technologist shall be borne by the petitioner. It was also directed that if the Appellate Committee comes to the conclusion that the petitioner was running the unit more than 2.5. tone, the petitioner shall not only pay the levy but also pay interest at the rate of 12% per annum which shall be calculated by the respondent-authorities. We would like to point out that inspite of passing the order, the respondent had proceeded with the assessment taking into consideration installed capacity of 5 tons for which NOC was obtained, the petitioner on the other hand was maintaining that capacity of the plant was 2.5 tons and 5 tons.

Review of this order was sought and in the said review application, Division Bench of this Court passed an order dated 23.11.2001 CWP No.1389 of 2002 [5] ***** fixing the fee of the Paper Technologist at Rs.15,000/- in lump sum. Thereafter, the Pollution Board appointed the Expert from Saharanpur as the Paper Technologist to carry out the matter in terms of the order of this Court. A letter dated 17.11.2003 was addressed to the petitioner to deposit the fee and charges of the Institution which is accepted on record but the petitioner did not deposit the said fee.

Having regard to the same, we are of the view that neither the petitioner alleges violation of principle nor the petitioner can question the move of the respondents in proceeding with the 'best judgment assessment'.

Coming to the second issue as diluted above, it has to be decided as to whether the basis on which the 'best judgment assessment' is carried out, is correct or not.

As already pointed out above, the Pollution Board had taken into consideration the capacity of the petitioner as 5 metric tons and on that basis, water consumption is calculated in the absence of actual record, which could be furnished by the petitioner. The contention of the petitioner on the other hand, is that actual capacity installed was 2.5 metric tons. No doubt, this issue could be sorted out in clear terms and authoritatively, the petitioner had deposited the fee of consultant, to that extent, the petitioner is to be blamed. At the same time, we find on the basis of record that without the Expert going into that question, there are certain documents on record on the basis of which this controversy can be determined by this Court.

No doubt, the NOC was given by the Pollution Board for 5 CWP No.1389 of 2002 [6] ***** metric tons capacity. However, after obtaining NOC, the petitioner set up the factory and applied for consent of the Pollution Board under the provisions of Water (Prevention & Control of Pollution) Cess,Act,1978. In the said application dated 26.3.1993 submitted to the Pollution Board, the petitioner showed installed capacity. It is this application which was considered by the Pollution Board and the Pollution Board gave the consent vide order dated 29.1.1996 for three tons capacity. It can easily be inferred that before giving this consent, the Pollution Board might have inspected the factory of the petitioner but would have satisfied itself about the directions stated in the application for consent, wherein it was mentioned that installed capacity was 2.5 tons. Once we find from the record that the petitioner had constructed the factory with the installed capacity of 2.5 tons and consent was also given only for three tons, there cannot be any basis for making the assessment on the premise that 'No Objection Certificate' was obtained for five tons. No doubt, there could have been increase in the capacity afterwards, however, it could be only for three metric tons for which consent was given. If the petitioner had added the installed capacity more than three metric tons, the petitioner had to approach the Pollution Board again for fresh consent. No such event even took place. Therefore, on the basis of the material placed on record, we are of the opinion that 'the best judgment assessment' could have been done on the basis of consent order and not on the basis of 'NOC' given by the Pollution Board.

Mr.Walia, learned counsel for the Pollution Board has produced the record of assessment for the period from July 1990 to January CWP No.1389 of 2002 [7] ***** 25,1992. The assessment is made at `3004/-. For the period from January 26,1992 to February 1999, the assessment comes to `54955/-. Since these two assessment orders have been taken into consideration for five metric tones capacity, it should have been in our above discussion three metric tons capacity. We modify the assessment reducing the aforesaid amount by 40%.

As a result, this writ petition is partly allowed. The petitioner shall pay 60% of the amount assessed. This amount shall be paid within four weeks from the date of receipt of certified copy of this order along-with interest which shall be calculated at the rate of 9% per annum from January 01.2000 till the date of payment.

                                                     ( A.K.SIKRI )
                                                    CHIEF JUSTICE


27.11.2012                                      (RAKESH KUMAR JAIN)
vinod*                                                  JUDGE