' JUSTICE (R) CH. MUHAMMAD YOUNIS (CHAIRPERSON).--- The instant appeal has been preferred against the impugned orders dated 9-1-2015, 4-5-2015 and 3-6-2015 passed by the respondent No,2 against the appellant.
' Briefly stated the facts relevant for the disposal of the instant appeal are that the appellant imported a Fifth Generation Pyrolysis Plant with Complete Environmental Protection Control Devices. Allegedly It is state of the art plant which fulfills European environmental and quality standards for the production of Tyre Oil or Pyrolysis Oil which is an alternate Fuel/ source of energy.
The pyrolysis is an environment-friendly use of waste/scrap tyres, wherein tyres are stacked in a steel reactor of approx. 8 ft. Diameter and 20 ft. Length and then sealed. The cylinder or reactor is initially heated with wood or gas resulting in heating up of tyres in an oxygen-less environment.
Tyres start generating gas which is filtered through various condensers for purification to allow only pure methane which is generally called Sui Gas in Pakistan to burn under the reactor to replace initially used wood or Gas. The reactor is then run on gas generated by tyres. After reaching a certain temperature limit the gas generated by tyres yields oil which is called pyrolysis oil or tyre oil or Bio-Diesel or Tyre Pyrolysis Oil (TPO) an alternate fuel used for burning. The process takes almost 10-12 hours where-after, Tyre oil, carbon black and steel wire is obtained from Pyrolysis or tyres. The aforementioned process involves the most environment-friendly use of tyres as it does not emit polluting toxic fumes which are released when tyres are burnt openly or directly for heating in furnaces or kilns etc. Further tyre oil replaces use of coal or wood or even tyres as burning fuel in small industries. This oil is now being widely used by Steel Re-Rolling Mills and other industries. It is also a health conducive process as better and continuous disposal of tyres in Punjab has reduced breeding grounds of dengue mosquitoes. On 18-6-2013 the appellant moved the Punjab Environmental Protection Agency, Lahore for environmental approval and submitted IEE report but no such approval was granted in spite of the fact that within 10 working days the Agency was required to confirm that IEE was complete for the purpose of initiating the review process or require the proponent to submit such additional information as may be specified or to return the IEE clearly listing the points requiring further study and discussion. The EPA obtained a site inspection report dated 30-8-2013 in which the District Officer Environment recommended the plant to be installed at the site which was declared suitable for the same. The Agency did not even follow the provisions of Pakistan Environmental Protection Agency Review of EIA and IEE Regulations, 2000 and within the stipulated period the matter was not decided. Due to the in-action of the Agency the appellant was constrained to file writ petition and thereafter to invoke the jurisdiction of this Tribunal. The earlier appeal of the appellant was disposed of by this Tribunal in the light of the judgment delivered on 4-2-2015 in similar cases of Pyrolysis plants whereby the Agency was required to deem the request of environmental approval of the appellant pending and decide the matter afresh in accordance with law after hearing the appellant and the proponent of the other similar Units. This Tribunal had declared the Pyrolysis as Green Technology in pursuance of Basel Convention, 2011 of which Government of Pakistan was also a signatory. Revised Technical Guidelines for the Environmentally Sound Management of Used and Waste Pneumatic Tyres were formulated under the said Basel Convention. According to the appellant the process of Pyrolysis is recognized as one of the only three environmentally suitable processes by the said Basel Convention held under the aegis of UNEP, in which the Government of Pakistan also participated and signed the same. The EPA was under a legal obligation to follow the said Guidelines relating to 2015] Hussain Indus. Corpn. Pyrolysis Unit v. Environmental 1777 Protection Agency (Justice (R) Ch. Muhammad Younis, Chairperson) management of waste/scrap rubber tyres. Hence, delay in issuance. Of Environmental approval to Pyrolysis Plant is violative of an International Convention. In spite of a favourable report of the District Officer Environment after inspection of the site the environmental approval was delayed and this action of the Agency was based on mala fides and the impugned orders are result of malice and abuse of powers as well as discriminatory treatment.
That guidelines formulated under the Basel Convention in 2011, cover almost all the aspects including components of tyres, the possible harmful effects on human health and environmental hazards, the various methods of handling, storage and disposal etc. And the possible positive and negative effects of the various disposal processes on environment and remedial measures. The guidelines also discuss the environmental impacts of products/by-products that are obtained during various disposal processes in the hierarchy. It was after in-depth deliberations and based on research relating to process and disposal of byproducts that the guidelines have determined waste rubber pyrolysis as one of the three environmentally suitable processes but all these facts were ignored by the Agency.
2. The appellant had fulfilled all the legal and technical requirements required by PEP Act, 1997.
There was no adverse environmental impact due to operation of the plant of the appellant but the EPA was reluctant to issue environmental approval and this action was based on mala fides. It was on .4-5-2015 when without any prior intimation or show-cause notice the Unit of the appellant was sealed. Hence the instant appeal has been filed to challenge the vires of the said orders. From the said notice dated 4-5-2015 the appellant came to know that the action of sealing the Unit was based on some EPO dated 9-1-2015. According to the appellant this order was never served on him and the defense plea submitted before the Agency in response to the notice of the EPA was discarded without giving any reason for the same by basing it at an earlier report of the DO(E).
Allegedly the impugned order dated 9-1-2015 was illegal and not sustainable in the eye of law.
' Since the Tribunal was not functional due to expiry of the term of the Members so the appellant was constrained to file the W.P and the honorable Lahore High Court referred the matter to the DG, EPA who was directed to decide the matter within a week. The said W.P was filed during the pendency of this appeal. The EPA disposed of the said matter vide order dated 3-6-2015 so through the instant appeal the original EPO dated 9-1-2015, order dated 4-3-2015 as well as 3-6-2015 have been assailed on the ground that the same are against law and facts. There was no Unit with the name of Muqadas Tyre Pyrolysis Plant as mentioned in the impugned orders. In the garb of the order in respect of the said plant the unit of the appellant (Hussain Industries) was illegally sealed.
It is further contended by the appellant that after passing of the order by this Tribunal in appeal the appellant was never heard and he was not informed of any order passed on 9-1-2015 so all the impugned orders are liable to be set aside being illegal and based on mala fides.
3. The learned counsel for the appellant argued that the application for environmental approval along with the draft of the requisite amount dated 3-6-2013 had been moved along with the IEE report. The site inspection report by the DO(E) dated 30-8-2013 shows that after through inspection it was reported that locality where the proposed project was to be established had developed as Industrial area. It was recommended by the DO(E) Lahore that the site was suitable for the proposed project hence NOC/environmental approval may be granted as per policy on the 11 conditions mentioned in the said report placed at page No,17 of this appeal. The learned counsel contends that in spite of this favorable report/recommendation the EPA did not grant environmental approval. Rather after lapse of statuary period the appellant was directed to submit EIA. The learned counsel maintained that as per PEPA Review of IEE and EIA Regulation, 2000 the appellant could not be directed to submit EIA because the rules and regulations on the subject did not empower the Agency to direct the appellant to submit EIA as the project of the appellant falls in Schedule 1-B(6) i,e, relating to Waste to Energy Generation project whereas EIA could be asked to be submitted only in respect of the projects enlisted in Schedule-II. The learned counsel contends that since the project does not fall within purview of Schedule-II of the said Regulations so EIA could not be directed to be submitted. As per Regulation-5 of the PEPA Review of IEE and EIA Regulation, 2000 the EIA could only be directed to be submitted if the project was likely to cause an adverse environmental effect but as per Proviso to Regulation 5 no such direction could be issued without the recommendation in writing of the Environmental Assessment Advisory Committee constituted under Regulation 23. The learned counsel argued that no such recommendation was made by the said Advisory Committee regarding Pyrolysis Plant. In these circumstances, the impugned orders are liable to be set aside being not sustainable in the eye of law. The learned counsel for the appellant also expressed the grievance of the appellant for being afforded discriminatory treatment as 200 other similar Units were working.
4. The learned Director Legal argued that the impugned EPO dated 9-1-2015 was served on the appellant and he was also heard by the Director General EPA in compliance with the direction of honorable High Court as well as this. Tribunal and the impugned order dated 3-6-2015 is quite legal. The Agency was fully competent to direct the appellant to submit EIA. The learned Director Legal argued that the case of the appellant falls in Schedule-II so no exception could be taken to the direction of the Agency. He further argued that the impugned order dated 9-1-2015 finds mention of the written defense of the appellant submitted on 8-4-2014 which was fully discussed but on the basis of report against the appellant from the DO(E) the EPO was passed as there were issues of gaseous emissions, pungent smell and waste water. He further argued while defending the impugned EPO to the appellant to stop the operation of his Unit unless the approval was obtained from the EPA that under section 12 the plant could not be installed without approval whereas in violation of the said direction the Unit was installed by the appellant without approval which generated pollution and the EPA vide letter dated 28-4-2015 directed the DO(E) Lahore to implement the said EPO against Muqadir Tyre Pyrolysis Plant and in pursuance of this direction the Unit was sealed. The Agency was empowered under section 16 to immediately stop the operation of such Unit generating the pollution and established without approval. The learned Director Legal further admitted that on 18-6-2013 the IEE report was submitted by the appellant and the matter could not be decided within statuary period due to multiple litigation by the appellant and the proponents of similar other Units. The learned Director Legal argued that the impugned orders have rightly been passed by the EPA in accordance with law as the appellant failed to submit EIA and requisite fee for review thereof so the appeal is liable to be dismissed.
5. We have considered the arguments advanced from the both the sides and perused the record.
There is no denial of the fact that before establishing the plant in question the appellant submitted an application for environmental approval accompanied by a draft of 15000 along with IEE report as required by law on 18-6-2013. Admittedly the EPA cannot direct every proponent to file EIA report as it has to be filed only in certain cases falling in Schedule II or having adverse environmental effect on the recommendation of the Environmental Assessment Advisory Committee. This Tribunal has already discussed this legal point in the earlier appeals relating to the Pyrolysis Plants. It would be appropriate to reproduce para-15 of our judgment dated 4-2-2015 as under:--- "Dwelling upon the legal aspects of the matter it is observed that after promulgation of the amended Act the Provincial Agency was required to make rules under section 31 of the PEP Act, 1997 and for carrying out the purposes of this Act the Provincial Government was empowered to make regulations under section 33 but the Provincial Agency has not been able to make and notify in official gazette its rules and regulations for Review of IEE and EIA. Although the Regulations made by the Federal Govt. Are not strictly applicable to the Provincial Agency but just for the sake of arguments even if we borrow the wisdom from the Regulations of the Federal Government namely "Pakistan Environmental Protection Agency Review of IEE and EIA Regulations, 2000, the EIA was to be filed only if the project was likely to cause an adverse environmental effect.
' Although the Agency can direct the proponent of a project whether listed in Schedule I & II or not, to file an EIA for reasons to be recorded but no such direction could be given without the recommendation of the Environmental Assessment Advisory Committee."
6. For better appreciation of the matter we would like to refer to the relevant provisions of section 33 of the Punjab Environmental Protection Act, 1997 as amended in 2012 as under:---
33. Power to make regulations.--- (1) For carrying out the purposes of this Act the Provincial Agency may by notification in the official Gazette and with approval of the Government, make regulations not inconsistent with the provisions of this Act or the rules made thereunder.
(2) In particular and without prejudice to the generality of the foregoing power, such regulations may provide for:---
(a) ... To ... (d)
(e) monitoring and measurement of discharges and emissions;
(f) categorization of projects to which, and the manner in which section 12 applies; ' It is clear from the above provision of law that the words 'this Act' refer to the amended Act and the word 'Government' means the Provincial Government and not the Federal Government. So the regulations have to be made under the amended Act of 2012 and section 33(0 further clarifies that the regulations have to be made by the Provincial Agency for providing the category of projects to which, and the manner in which, section 12 applies.
'Admittedly the requisite Regulations have not been framed as yet nor the Advisory Committee has been constituted and notified under the new regulations. Even if we borrow the provisions of Pakistan Environmental Protection Agency Review of IEE and EIA Regulations, 2000, the learned Director Legal has not been able to produce before this Tribunal any recommendation of the Advisory Committee in respect of the project of the appellant or any other Pyrolysis plant. When confronted with the above legal requirements the learned Director legal referred to the statuary provision of Section 12 and argued that Statute would prevail upon the Regulations and under section 12 the Agency could direct the appellant to submit EIA report. This argument of the learned Director Legal has no substance for lack of legal support because subsection (6) of section 12 itself provides that the provisions of subsections (1), (2), (3), (4) and (5) were to apply to such category of projects and in such manner as may be prescribed. So unless the rules and regulations were, framed by the Provincial Government or the Provincial Agency as the case may be, the EPA had no unfettered powers under section 12 to direct any proponent to file an EIA. In order to get the support of statutory law it is essential that rules and regulations are framed and notified as the aforementioned subsection (6) of section 12 imposes a condition that the provisions of section 12(1)
(2)(3)(4) and (5) would only apply to such category of projects and in such manner as may be prescribed. Admittedly the statutory provisions of S.12 do not categorize the projects, proponents of which are required to submit IEE or EIA as the same was to be prescribed by the Regulations as required by the PEP Act, 1997 which are yet to be framed. Even the manner of applying for the approval was to be prescribed therein so the statutory provisions of S.12 and the Regulations are concomitant with each other.
' For the sake of arguments if we still borrow the provisions of Pakistan Environmental Protection Agency Review of IEE and EIA Regulations, 2000, even then the Agency cannot direct the submission of EIA unless the project of the appellant falls within the ambit of Schedule II or it had an adverse environmental effect and there was any recommendation of the Advisory Committee as required by proviso to Regulation 5. For ready reference we would like to reproduce Regulation 5 of the PEPA Review of IEE and EIA Regulation, 2000 as under:---
(5) A proponent of a project not falling in any category listed in Schedules I and II shall not be required to file an IEE OR EIA: ' Provided that the proponent shall file--
(a) An EIA, if the project is likely to cause an adverse environmental effect;
(b) For project not listed in Schedules I and II in respect of which the Agency has issued guidelines for construction and operation, an application for approval accompanied by an undertaking and affidavit that the aforesaid guidelines shall be fully complied with.
(2). Notwithstanding anything contained in sub-regulation (1) the Agency may direct the proponent of a project, whether or not listed in Schedule I or II, to file an IEE or EIA, for reasons to be recorded in such direction; ' Provided that no such direction shall be issued without the recommendation in writing of the Environmental Assessment Advisory Committee constituted under Regulation 23.
(3) The provisions of section 12 shall apply to a project in respect of which an IEE or EIA is filed under sub-Regulations (1) and (2).
7. Keeping in view the above legal position this Tribunal has time and again observed that the above Regulations relate to the Federal Agency which have not been adopted after necessary modifications so as to apply to the Provincial Agency. So strictly speaking the Provincial Agency has to frame its own Regulations under the PEP Act, 1997 as amended in 2012. Similarly the EPA will have to constitute its own Environmental Assessment Advisory Committee under the Regulations yet to be framed. The Agency claims to have followed the above mentioned Regulations but as pointed out above it has even failed to follow the same. Even if the Agency had borrowed the provisions of the said Regulations relating to the Federal Agency, the learned Director Legal has not been able to substantiate his arguments as to under what provisions of law the EPA was empowered to direct the appellant to file EIA report without any recommendation in writing of the Environmental Assessm ent Advisory Committee. He has not produced before us any notification regarding the constitution of the Advisory Committee under the PEP Act, 1997 after amendment thereof in 2012. Even if we presume that such a committee exists there is admittedly no recommendation thereof regarding the project of the appellant. As regards the argument of the learned Director legal that the project of the appellant is included in Schedule II of the aforementioned Regulations we find no substance therein. The Pyrolysis plant is based on the latest technology and nobody could imagine or foresee such a project/technology in 2000 when the Regulations were promulgated and notified as the said technology was not in existence at that time so there was no question of including the same in Schedule-II.
8. Now we come to the impugned EPO dated 9-1-15 whereby the appellant was directed to stop the operation of the Pyrolysis unit until obtaining the environmental approval. Admittedly a notice under section 16 was issued to the appellant and in response to the notice the written reply dated 1-4-2014 was submitted before the Agency in which the contention of the appellant was as under:- -- "That a comprehensive LEE report had already been submitted and that the appellant had imported the Pyrolysis plant from M/s. Shangqui Yilong Machinery Equipment Company, China which is ISO-14000 and ISO-9000 certified company and as such it has incorporated all the safety and environmental protection devices including wet scrubber, de dusting system, automatic slag system with characteristics of safety and environmental protection, exhaust gases purification, recycling and combustion system, environmental protection and exhaust system for heat source, central electric control system, safety relief valves and alarm systems etc. The appellant further undertook that the project will be run by qualified Chemical Engineers with rich experience in Safety, Health and Environment from Unilever Pakistan.
' It was also contended in the said reply that the project is located on 5 kanals of land in Industrial estate Kacha Road, Lahore located far away from any residential area. It has vast open land on two sides and road on the front side and the project does not lead to any environmental issues.
' Later on the appellant submitted on 28-5-14 copy of audit report conducted by Pak Green Enviro-Engineering (Pvt.) Ltd. According to which the project of the appellant met all the necessary NEQS. The audit report also included Environmental Management Plan and Monitoring Report."
' In spite of the above detailed defence plea raised by the appellant in writing the competent authority passed the impugned EPO brushing aside the defence plea merely on the basis of a stereotype report of DO(E) regarding the pungent smell and waste water. There is no expert report on the record nor any analysis report was obtained by the Agency before passing the impugned order. The appellant had already filed IEE with the Agency and without deciding the same the Agency proceeded to pass the said order by discarding the defence plea without giving any sound and plausible reasons. The impugned order is not a speaking order whereas the authority was bound to consider and discuss each and every point raised by the appellant. The appellant could be directed to adopt some remedial measure even if there was some environmental issue but a harsh order was passed without giving solid reasons. The learned counsel for the appellant rightly pointed out that this order was passed after about 9 months after hearing on 8-4-14. The Agency was bound to decide the matter within 30 days after hearing the appellant or within a reasonable time but it slept over the matter for a long time and then without verifying the stance of the appellant and without getting the fresh expert report for negating the plea of the appellant the impugned EPO was passed surreptiously and it was never served on the appellant by the DO(E) within a week as directed. There is not even a single sentence incorporated in the EPO in respect of the plant of the appellant and equipment and protective devices mentioned in the reply. Neither nor the audit report and environmental management plan have been discussed to negate the version of the appellant. It seems the officer passing the impugned order had no technical knowledge or acumen to give any findingin respect thereof. It was not even opined that the protective devices were not there in the plant or the same were found by some technical expert to be ineffective or inefficient to co inefficient to control the emissions etc, The learned Director Legal was unable to prove that this order was ever served on the appellant so from that point of view the appeal is well within time. Yet another valid point raised by the appellant was that the EPO was passed against M/s. Muqadar Tyre Pyrolysis Plant whereas the name of the appellant was Hussain Industries though owned by Muqadar. One proprietor may have more than one plant. If the order was meant to be passed against Hussain Industries there was no justification for passing it against M/s. Muqadar Tyre Pyrolysis Plant and the impugned EPO could not be implemented against Hussain Industries as one proprietor may have more than one units. So on this score also the impugned order is not sustainable because the IEE was submitted by Hussain Industries Corporations and the entire litigation was in the name M/s. Hussain Industries. The Agency has not been able to justify this action. The report of District Officer Environment dated 30-8-2013 was a detailed one wherein he recommended the issuance of NOC as the site was found to be suitable he had imposed some conditions to avoid any kind of environmental issue. We are unable to understand as how the same District Officer Environment made a contradictory report on 4-3-2014 on which the EPO was based. The appellant had submitted IEE report and sought environmental approval and this matter was still pending with the Agency so how it could be said the unit was established illegally. The appellant was not responsible for the inordinate delay caused by the Agency in deciding the matter regarding environmental approval. The appellant had submitted the IEE report as back as 18-6-2013 whereas the EPO was passed after the lapse of about 18 months without deciding the matter. Even there was no mention of the said IEE in the EPO. The impugned order was also discriminatory as several other plants of similar nature were never sealed as stated at bar by the learned counsel for the appellant. Even if there was any violation of section 11 or 12 the appellant could be prosecuted under section 17(i) of the PEP Act, 1997. Hundreds of complaints alleging the violation of section 12 of the Act are pending before this Tribunal in which the proponents who had already established their units without approval were directed to regularize the same by moving the EPA for approval but in the instant case a very harsh direction to stop the operation of the unit was passed 9 months after hearing the appellant and without affording any opportunity to adopt the remedial measures to control the emissions etc. Such a direction could not be passed as the same was the last resort in any case.
Even before the sealing of the unit no show cause-notice was given to the appellant especially when the EPO has never been served upon the appellant at the relevant time. Even otherwise this EPO has lost its efficacy in the light of the decision of this Tribunal dated 4-2-15 in appeal. This order could not be implemented. The Agency had been directed to deem the request of the appellant for environmental approval pending and to decide the matter afresh after hearing the appellant. In a way we can treat the implementation order to be a violation of the judgment of this Tribunal.
Keeping in view all the above facts and circumstances the impugned order is found to be arbitrary and whimsical. It is not a speaking order containing any cogent reasons for discarding the defence plea of the appellant. It is not sustainable in the eye of law being against law and facts and is liable to be set aside.
9. As regards the direction of the Agency dated 28-4-2015 to the District Officer Environment to implement the EPO dated 9-1-2015 it is also against the principles of natural justice. First of all it was the duty of the Director General to ensure that the EPO had been duly served on the appellant and only thereafter it could be said that the appellant violated the direction. In this letter dated 28-4- 2015 there is no mention of the date when the EPO was served on the appellant. So in absence of the service of the EPO on the appellant, the unit could not be sealed. The District Officer must have issued a show-cause notice before taking such a harsh decision especially when no EPO was ever served on the appellant. So the appellant was condemned unheard. Similarly the order dated 3-6- 2015 passed by the Director General EPA in compliance with the order of the honorable Lahore High Court was also not sustainable in the eye of law. After the decision of earlier appeal of the appellant on 4-2-2015 the EPA was duty bound not to stick on the EPO dated 9-1-2015 as all the earlier orders were to be deemed to be no more in existence and the request of the appellant for the environmental approval was to be deemed to be pending and was to be decided afresh after hearing the appellant but it seems that the EPA never reconciled with the appellate order of this Tribunal and was adamant to stick to its earlier order dated 9-1-2015. The EPA must have reviewed the IEE after the decision of this Tribunal without being influenced by the earlier EPO or any other order passed by the Agency. The order dated 3-6-2015 also does not find mention of the date as to when the EPO dated 9-1-2015 was served on the appellant. In the last paragraph of the said order the Director General referred to an order dated 31-3-2014 but the said order has not been brought on the record. It is further mentioned in this order dated 3-6-2015 that the appellant was directed to adopt inter alia, remedial measures to minimize environmental pollution. The fact remains that no such direction to take remedial measures was ever given to the appellant in the EPO rather he was given only one direction to stop the operation unless NOC was issued. It seems that while passing this order the learned Director General did not even bother to go through the EPO dated 9- 1-2015 which contained no directions at all for adopting remedial measures to minimize environmental pollution. As regards the observation that the appellant failed to submit EIA as per order dated 31-3-2014 we have already held above that the agency was not empowered to direct the appellant to file EIA without any recommendation of the advisory committee and the agency was bound to pass an order in respect of the IEE already submitted along with the audit report as well as the Environmental Management Plan and Monitoring Report. Since the impugned original order dated 9-1-2015 is illegal so all the subsequent directions/orders of the EPA are not sustainable in the eye of law.
10. 'In the light of the above discussion the appeal is allowed and all the impugned orders are hereby set aside with the direction to the EPA to de-seal the unit of the appellant immediately and decide the IEE already submitted by the appellant without requiring EIA from the appellant without any recommendation of the Advisory Committee. The Agency can while reviewing the IEE impose certain conditions while granting environmental approval to avoid any environmental issue.
' Before parting with this judgment it is clarified that any violation of section 11 or 12 is punishable under section 17(i) of the PEP Act, 1997 (as amended in 2012) and after initiating fresh proceedings and thorough investigation a complaint can be filed if any offence under the PEP Act, 1997 was established to have been committed by the appellant. The EPA shall however strictly adhere to the provision of the PEP Act, 1997.