On 10 May 2022, the Supreme Court of India delivered a significant ruling in a batch of appeals led by M/s Aravali Power Co. Pvt. Ltd. v. Vedprakash & Anr. (CA Nos. 1692–1693 of 2020), addressing the critical issue of fly ash disposal and utilization by thermal power plants (TPPs).

The judgment, authored by Justice D.Y. Chandrachud (as he then was, later Chief Justice of India) and Justice P.S. Narasimha, dealt with multiple challenges to orders passed by the National Green Tribunal (NGT) regarding fly ash handling and environmental compliance.

Background

The NGT orders (2019–2020) had found fault with several TPPs, including units in Haryana, for failing to achieve 100% utilization of fly ash as mandated under successive notifications issued by the Ministry of Environment, Forest and Climate Change (MoEF&CC).

Key directions from the NGT included:

• Evacuation of fly ash stored in ash ponds by specific deadlines (e.g., 31 December 2020 for Jhajjar units).
• Imposition of environmental compensation on non-compliant plants, calculated from the cut-off date of 31 December 2017, as per the MoEF&CC’s notification of 27 January 2016.
• Performance guarantees and monitoring by State Pollution Control Boards.

Aggrieved by these orders, multiple TPPs and stakeholders, including Aravali Power Co., approached the Supreme Court.

Supreme Court’s Analysis

During pendency of the appeals, a new MoEF&CC notification dated 31 December 2021 was issued. This notification:

• Superseded earlier notifications on ash utilization.
• Introduced fresh timelines for clearance of “legacy ash” (unutilized accumulated ash), requiring full clearance within 10 years.
• Mandated progressive utilization (20% in year 1, 35% in year 2, and at least 50% per year thereafter).
• Required environmentally sound loading, transport, and storage, along with monitoring and audits by the CPCB and State Boards.

The Court observed that this new notification fundamentally altered the regulatory framework, thereby rendering the NGT’s earlier compensation orders unsustainable.

Judgment

The Supreme Court:

• Set aside the NGT’s impugned orders, including the levy of environmental compensation.
• Directed the MoEF&CC to revisit and strengthen the December 2021 notification, especially regarding safe handling and transportation of ash, keeping in view the 2016 Hazardous and Other Wastes Rules.
• Emphasized precautionary principles and strict monitoring by CPCB and SPCBs.
• Clarified that the Court was not ruling on the validity of the 2021 notification itself — affected parties remain free to challenge it separately.

Significance

This decision reflects the Court’s balancing act between environmental protection and regulatory pragmatism. By recognizing the updated framework, the Court relieved TPPs from retrospective liabilities, but reinforced the obligation of strict compliance with future timelines.

It also highlights the judiciary’s role in nudging executive authorities to ensure sustainable industrial practices in line with precautionary environmental governance.