SC lets Electrosteel operate plant till Centre considers request for revised clearance

Vedanta, which took over ESL in 2018 after the NCLT approved its resolution plan, said that the successful resolution applicant, who is mandated by law to revive the unit cannot be scantioned for the misdeeds of the prior management, and as long as the shortcomings (if any) in the environment compliances are addressed, the new management should be allowed to operate the unit.

It is in the interest of the economy and to meet the ends of justice that the integrated steel plant be allowed to obtain the revised EC sought by the new management in place under the CIRP of the IBC, lest it frustrates the object and purpose of the Electrosteel’s insolvency resolution, the application stated.
It is in the interest of the economy and to meet the ends of justice that the integrated steel plant be allowed to obtain the revised EC sought by the new management in place under the CIRP of the IBC, lest it frustrates the object and purpose of the Electrosteel’s insolvency resolution, the application stated.

The Supreme Court (SC) on Thursday allowed Vedanta-led Electrosteel to operate its steel plant in Jharkhand till the central government considered its request for grant of revised environmental clearance (EC) within three months.

A bench led by Justice Indira Banerjee, while allowing Electrosteel’s plea, directed the ministry of environment and forests (MoEF) to consider its plea for revised EC within three months. While setting aside the Jharkhand High Court’s interim order that had stayed the EC while relying on a Madras High Court order in another related case (Alembic Pharma vs Rohit Prajapati), the apex court said that pending such decision by the ministry, the operations of the plant will not be interfered with for want of EC.

The MoEF had in August this year rejected the application “as of now”, which in effect kept the ESL’s application in abeyance, the company said.

Vedanta, which took over ESL in 2018 after the NCLT approved its resolution plan, said that the successful resolution applicant, who is mandated by law to revive the unit cannot be scantioned for the misdeeds of the prior management, and as long as the shortcomings (if any) in the environment compliances are addressed, the new management should be allowed to operate the unit.

It is in the interest of the economy and to meet the ends of justice that the integrated steel plant be allowed to obtain the revised EC sought by the new management in place under the CIRP of the IBC, lest it frustrates the object and purpose of the Electrosteel’s insolvency resolution, the application stated.

According to counsel Ninad Laud, there is a clear distinction between the two cases — as in the Alembic Pharma case, the operations had commenced without obtaining an EC, but in the Electrosteel’s case, an allegedly irregular EC was obtained by the previous management and the present management is merely seeking to cure the defect. Electrosteel’s case is, at worst, one of irregular EC and not of violation or non-compliance, he said.

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