The two petitioners, who are "Environment Protection Groups" objected to the clearance, by the State of Maharashtra and the Union of India, of a proposal of the Bombay Suburban Electricity Supply Company Limited for the construction of a thermal power plant over an area of 800 hectares or thereabouts in Dahanu, Maharashtra. They filed writ petitions in the Bombay High Court challenging the decision of the Central Government to that effect dated March 29, 1989. The Present Petition is an appeal against the decision of the Bombay High Court whereby the High Court had upheld the sanction granted to the Company for setting up a thermal power plant. An Appraisal Committee was established to check the viability of the project at Dahanu. The Appraisal Committee was of the opinion that Dahanu was not suitable for setting up of the plant. The government however gave its approval without disclosing any reason for rejecting the Appraisal Committee's report.
The Court while rejecting this contention held that views of the Appraisal Committee do not represent the decision of the government and the same cannot be binding on the Central Government. It stressed on the principle that the Court's role is restricted to examine whether the Government has taken into account all relevant aspects and has neither ignored or overlooked any material considerations nor been influenced by extraneous or immaterial considerations in arriving at its final decision and considered that the High Court had gone into the matter in depth and found nothing wrong with the decision of the Government.
As far as the second objection of the petitioners regarding the fact that the approval was contrary to the Environmental Guidelines for Thermal Power Plants, 1987, the Court held that the guidelines (this was regarding the argument that the plant was not outside the specified distance from the sea and the forest) are only intended as a safeguard against possible pollution effects and cannot be treated as rigid and inflexible irrespective of local conditions. The third argument raised by the environmentalists was regarding the Coastal Regulation Zone (CRZ) guidelines as the project was in flagrant violation of that as well. The Court rejected this argument on the same ground that it had rejected its earlier arguments as the CRZ notification was considered while giving the clearance.
The petitioners also argued that the Company after starting the unit would start violating all the stringent conditions laid down as it had already applied for exemption from the installation of flue gas desulphurisation FGD. The Court held that the Company had to adhere to the conditions laid by the Government and if any of the conditions are waived at a later stage the same have to be tackled at that stage. However, the Court held that if the Government considers the application for exemption of installation of FGD the Government must give its decision after hearing the petitioners.