Ex Post Facto Clearance: Where That Law Now Stands

In one line

The law on clearing a project after it has been built moved four times between 2020 and 2026, and it now stands at this: a perpetual administrative amnesty is unconstitutional, and a narrow time-bound amnesty by notification is not.

This is the most contested question in the environmental clearance regime and the one on which every textbook is out of date. The chapter states the law as it stands after the judgment of 29 July 2026, and it traces how it got there, because an examiner asking about ex post facto clearance is asking about a moving line.

The problem

A project is built without a prior environmental clearance. It employs people, it has a bank loan, and it may be operating within every standard the pollution statutes impose. What should the law do?

Two answers, both respectable.

Refuse, and close it. The whole point of a prior clearance is that the assessment must precede the decision. A clearance granted afterwards is not an assessment; it is a certificate written over an accomplished fact, and permitting it destroys the incentive to apply first.

Regularise on terms. Closing a built plant destroys value and employment without restoring the environment, and the remedy that actually repairs the harm is money and conditions, not demolition.

The Supreme Court has given both answers in the last six years, and the current position gives a version of each.

The line, in order

2017. The Central Government issued a notification of 14 March 2017 creating a six-month window in which projects that had begun without clearance could apply for one, on terms.

2021. The Ministry issued an office memorandum of 7 July 2021 providing a standard operating procedure under which such applications could be made, without any time limit.

2017 and 2020, the principle. In Common Cause v. Union of India, (2017) 9 SCC 499, mining without environmental or forest clearance was held illegal, with compensation under section 21(5) of the Mines and Minerals (Development and Regulation) Act 1957 equal to the entire price of the mineral raised, the Court rejecting proposals to recover only a proportion of it and holding the recovery compensatory rather than penal.

Facts. In Alembic Pharmaceuticals Ltd. v. Rohit Prajapati, (2020) 17 SCC 157, a circular of 14 May 2002 had extended a deadline so that units already in production without a clearance under the 1994 notification could obtain an ex post facto clearance on a graded contribution to a fund; the National Green Tribunal held the circular contrary to law, revoked the clearances and ordered closure, and the units and the Ministry appealed. Held. The concept of an ex post facto or retrospective environmental clearance is completely alien to environmental jurisprudence and in derogation of its fundamental principles, because the notification requires a careful application of mind and a study of the likely consequences before the activity begins, through screening, scoping, public hearing and appraisal, and a clearance comes into force not earlier than the date of its grant. But on the facts revocation and closure were not warranted; applying the precautionary principle the Court directed the three companies to deposit compensation with the State Board under Article 142, over and above what the Tribunal had ordered, and set aside the direction for revocation and closure. Why it matters. It is the sharpest illustration in this book of the difference between a principle and a remedy: the principle was stated in the strongest possible terms and the industries were allowed to continue on payment.