Ex Post Facto Environmental Clearance

India’s environmental regulatory framework has consistently attempted to strike an appropriate balance between the country’s developmental objectives and its constitutional commitment to environmental protection. This equilibrium is most visible in the Environmental Impact Assessment (“EIA”) system, which is built upon the requirement of obtaining prior environmental clearance (“EC”) for activities that pose substantial environmental risks. The EIA Notification of 2006 (“EIA Notification”), promulgated under the Environment (Protection) Act, 1986 (“Act”), establishes this requirement for a wide range of sectors, including township and area development, mining and extraction operations, chemical and industrial manufacturing, and large-scale infrastructure and environmental services.

In practice, however, a significant number of projects had commenced operations without securing the mandatory prior EC. To address this regulatory gap, the Ministry of Environment and Forests (now to as the Ministry of Environment, Forest and Climate Change referred herein as the “Ministry”)) issued an Office Memorandum on 12 December 2012. The memorandum created an administrative mechanism to consider proposals that involved violations of the EIA or Costal Regulation Zone (CRZ) regime, subject to verification, undertakings from senior management, and the initiation of statutory proceedings under the Act. While framed as an exception, the 2012 OM marked the first administrative movement toward the possibility of ex post facto consideration of EC applications. A subsequent Office Memorandum dated 27 June 2013 strengthened this process, directing that all project activities in violation be restrained through directions under section 5 of the Act until the required environmental or coastal regulation clearance had been obtained.

This administrative approach was later replaced by a statutory mechanism through the Notification issued by the Ministry dated 14 March 2017 (“2017 Notification”). The 2017 Notification introduced a formal framework under the EIA regime for examining violation cases and established a dedicated appraisal route for projects that had commenced construction, expanded production capacity, or altered their product mix without securing prior EC. It required an immediate halt to project activities, mandated detailed ecological damage assessments and remediation as well as resource augmentation plans supported by bank guarantees, and limited the eligibility for regularisation to projects already in violation as on the date of the notification. The window for filing such applications was restricted and ultimately closed in April 2018.

In May 2021, the National Green Tribunal, in Tanaji B. Gambhire v. Chief Secretary, Government of Maharashtra[1], directed the Ministry to develop a comprehensive Standard Operating Procedure for the handling of violation cases and to circulate the framework to all State-level appraisal authorities. In response, the Ministry issued the Office Memorandum dated 7 July 2021 (“2021 SOP”), which laid down a detailed SOP for identifying and assessing violation cases under the EIA Notification. The SOP required classification of projects into permissible and impermissible categories, preparation of damage assessment and remediation plans, community resource augmentation measures, and the imposition of monetary penalties. Projects found to be legally impermissible were to be closed or demolished, while those deemed permissible could proceed to regularisation under stringent conditions.

The Vanashakti Judgment

The 2017 Notification, the 2021 SOP, and the earlier Office Memoranda of 2012 and 2013 were subsequently challenged before the Supreme Court and decided in Vanashakti v. Union of India[2] on 16 May 2025. The petitions questioned the statutory validity of the 2017 Notification and the 2021 SOP, as well as the broader practice of granting ex post facto ECs. The Bench held that the very concept of granting post facto environmental clearance was fundamentally inconsistent with the structure and purpose of the EIA Notification of 2006, which makes prior appraisal the essential safeguard against irreversible environmental degradation. Relying principally on Common Cause v. Union of India[3], Alembic Pharmaceuticals Ltd. v. Rohit Prajapati[4], and Electrosteel Steels Ltd. v. Union of India[5], the Court reasoned that violations of the prior clearance requirement cannot be cured retrospectively by imposing financial penalties or mandating remediation. It therefore struck down the 2017 Notification, the 2021 OM, and all analogous instruments, prohibited the Central Government from issuing any direction permitting ex post facto EC in any form, and preserved only those clearances already granted that had attained finality.

The Supreme Court’s Review in CREDAI

The decision was subsequently examined in a review petition filed by the Confederation of Real Estate Developers’ Associations of India (CREDAI). On 18 November 2025, a three-judge Bench, by a majority of two to one, recalled the judgment in Vanashakti. The majority held that several binding precedents had not been placed before the Vanashakti Bench, including significant portions of Alembic Pharmaceuticals which adopted a proportionality-based approach rather than mandating closure, and two coordinate Bench decisions, D. Swamy v. Karnataka State Pollution Control Bd.[6], which involved a sponge-iron unit operating without an initial EC but later regularised by the Court, and Pahwa Plastics Pvt. Ltd. v. Dastak NGO[7], which concerned long-standing plastic manufacturing units in an industrial estate seeking regularisation, had upheld the grant of ex post facto environmental clearance in appropriate circumstances. The Court treated the failure to cite these binding precedents as a clear error that required the Vanashakti judgment to be recalled.

The majority also took note of the substantial real-world consequences that would flow from the implementation of Vanashakti. The Union of India submitted a list of major public and private projects that had either completed environmental appraisal or were at an advanced stage, but had been stalled due to the judgment. The Court recorded that demolition or cessation of near-complete public infrastructure, cumulatively valued at nearly twenty thousand crore rupees, would follow if the judgment remained in force. Examples included the nearly completed AIIMS medical college and hospital in Odisha with approximately 962 beds, a newly constructed greenfield airport at Vijayanagar in Karnataka, and common effluent treatment plants designed to mitigate industrial pollution.

The outcome of the review is procedural rather than substantive. The Supreme Court has restored the petitions and the connected civil appeal to its file and directed that they be placed before the Chief Justice of India for assignment to an appropriate Bench for fresh hearing. The underlying questions concerning the validity of the 2017 Notification, the 2021 SOP, and the permissibility of ex post facto environmental clearances therefore remain open.

Practical Implications for Existing Projects

The recall of Vanashakti provides temporary relief to a large number of infrastructure and industrial projects that had been impacted by the May 2025 decision. As noted by the Court and reflected in contemporary reporting, several public-sector projects, including the new AIIMS facility in Odisha, the Vijayanagar airport in Karnataka, expansion projects undertaken by the Steel Authority of India, and multiple common effluent treatment plants, were at risk of demolition or indefinite suspension. The recall enables these projects to be re-examined under an appropriate legal framework rather than being automatically invalidated.

At present, however, the legal position remains unsettled. The Vanashakti judgment no longer governs the field, but the Supreme Court has yet to deliver a final pronouncement on the permissibility and scope of ex post facto ECs. The future of the 2017 Notification and the 2021 SOP will depend on how the restored matters are adjudicated. Regulators, project proponents, and affected communities must therefore await further directions from the Supreme Court, which will ultimately determine the contours of India’s approach to addressing legacy violations under the EIA regime.

[1]Tanaji B. Gambhire v. Chief Secretary, Government of Maharashtra & Ors., Appeal No. 34/2020 (WZ), Order dated 24 May 2021 (NGT Western Zone).

[2]Vanashakti v. Union of India, Writ Petition (Civil) No. 110 of 2022, judgment dated 16 May 2025 (Supreme Court of India).

[3]Common Cause v. Union of India, (2017) 9 SCC 499.

[4]Alembic Pharmaceuticals Ltd. v. Rohit Prajapati, (2020) 10 SCC 705.

[5]Electrosteel Steels Ltd. v. Union of India, (2021) 12 SCC 244.

[6]D. Swamy v. Karnataka State Pollution Control Bd., (2021) 9 S.C.C. 336

[7] Pahwa Plastics Pvt. Ltd. v. Dastak NGO, (2022) 2 S.C.C. 224.