The Supreme Court, in a review petition, reversed its earlier judgment by allowing the recall of the ban on ex-post facto environmental clearances. The Court ruled that the Environment (Protection) Act, 1986 does not absolutely prohibit such clearances and that they may be granted in exceptional cases after applying the principle of proportionality and the polluter pays principle. The bench emphasized that a balanced approach, weighing ecological damage against economic and public interest, must be adopted.
Facts Of The Case:
The case originates from legal challenges to a 2017 notification and a 2021 office memorandum issued by the Ministry of Environment, Forest and Climate Change (MoEF&CC). These instruments created a framework for granting ex-post facto Environmental Clearance (EC) to projects that had already commenced or expanded without the mandatory prior clearance under the 2006 Environment Impact Assessment Notification. Environmental groups, including Vanashakti, successfully challenged these provisions before the Supreme Court. In a judgment dated May 16, 2025 (the Vanashakti judgment), the Court declared the 2017 notification and 2021 office memorandum illegal, striking them down on the principle that retrospective environmental approval is alien to India’s environmental jurisprudence. This ruling put numerous public and private infrastructure projects—including hospitals, airports, and housing developments—at risk of demolition, as they had been initiated in reliance on the now-invalidated clearance mechanism. The Confederation of Real Estate Developers of India (CREDAI), along with other entities, filed a review petition arguing that the earlier judgment had overlooked binding precedents and would cause massive economic waste and environmental harm from demolition. The central legal question in review was whether the absolute prohibition on ex-post facto EC was correct in law, considering past judicial decisions that permitted a balanced, case-specific approach.
Procedural History:
The procedural history of this case is complex, involving multiple petitions across different judicial forums. The challenge began with writ petitions filed directly in the Supreme Court by environmental groups, including Vanashakti, assailing the validity of the 2017 notification and the 2021 office memorandum that permitted ex-post facto environmental clearances. Parallelly, the Madras High Court, in a separate proceeding, had quashed the 2021 office memorandum, an decision which was appealed to the Supreme Court. These writ petitions and civil appeals were consolidated and heard together by a two-judge bench of the Supreme Court. On May 16, 2025, this bench delivered the Vanashakti judgment, striking down the impugned notification and memorandum. Subsequently, review petitions were filed by affected parties, including CREDAI and state instrumentalities. A three-judge bench, led by the Chief Justice, heard the lead review petition. The bench delivered a split verdict, with the majority opinion allowing the review, recalling the 2025 judgment, and restoring the original writ petitions for fresh consideration, thereby setting aside the absolute ban on ex-post facto clearances.
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Court Observation:
In a split decision, the Supreme Court’s majority observations, authored by Chief Justice B.R. Gavai, formed the basis for recalling the earlier Vanashakti judgment. The Court observed that the previous ruling was per incuriam (rendered in ignorance), as it had failed to consider the full ratio of key precedents like Common Cause and Alembic Pharmaceuticals, which, while emphasizing the necessity of prior clearance, had also adopted a balanced approach by allowing operations to continue subject to penalties and remediation. Crucially, the majority held that the Environment (Protection) Act, 1986 does not contain an absolute prohibition on ex-post facto environmental clearance. It emphasized that such approvals should not be granted routinely but can be considered in exceptional cases by applying the principles of proportionality and “polluter pays,” where the adverse consequences of demolition outweigh the benefits of regularization, provided the project is otherwise permissible under environmental norms. The Court underscored that a rigid, pedantic application of the law leading to the demolition of vast public infrastructure like hospitals and airports, constructed using significant public funds, would be counterproductive to both public interest and the environment itself.
Final Decision & Judgement:
By a 2:1 majority, the Supreme Court allowed the review petition and recalled its judgment dated May 16, 2025 (Vanashakti v. Union of India). The majority, comprising Chief Justice B.R. Gavai and Justice K. Vinod Chandran, held that the previous ruling was per incuriam for not fully considering binding precedents and their nuanced approach. Consequently, the writ petitions and civil appeals that challenged the 2017 notification and 2021 office memorandum were restored to the court’s file for a fresh hearing. The operative effect of the Vanashakti judgment, which had absolutely prohibited ex-post facto environmental clearances, was thus set aside. Justice Ujjal Bhuyan, in a dissenting opinion, would have dismissed the review, maintaining the absolute ban as correct in law and essential to environmental jurisprudence. The majority directed the Registry to place the restored matters before the Chief Justice on the administrative side for necessary orders regarding their fresh hearing.
Case Details:
Case Title: Confederation of Real Estate Developers of India (CREDAI) vs. Vanashakti & Anr. Citation: 2025 INSC 1326 Petition Number: (Arising from Diary No. 41929 of 2025) in Writ Petition (C) No. 1394 of 2023 Date of Judgement: November 18, 2025 Judges/Justices Name: Justice B.R. Gavai & Justice Ujjal Bhuyan & Justice K. Vinod Chandran
Download The Judgement Here