POLITICS
16/05/2019 7:03 AM IST | Updated 16/05/2019 1:37 PM IST

How Pawar, Modi Tried To Help A Builder Fight India's Green Laws

After the National Green Tribunal imposed Rs 105 crores in damages against a Pune builder, Sharad Pawar reached out to the Prime Minister.

Hindustan Times via Getty Images
Rajya Sabha MP and veteran Maharashtra politician Sharad Pawar with Prime Minister Narendra Modi in a file photo from February 2016. 

NEW DELHI—Veteran Maharashtra politician Sharad Pawar lobbied Prime Minister Narendra Modi to defang the National Green Tribunal (NGT) after the tribunal imposed damages of at least Rs 105 crore on Goel Ganga Developers (India) Pvt. Ltd, a Pune-based real estate company.

The damages were imposed for violating environmental laws, and to undo environmental destruction caused when the company expanded the scope of a residential and commercial construction project beyond what was allowed in its environmental clearance, official documents accessed by HuffPost India reveal.

The documents show Pawar’s efforts began in October  2016, and the Prime Minister’s Office (PMO) took his lobbying efforts seriously.

The PMO told the Environment Ministry and the Finance Ministry to gather inputs and prepare comments within five days, the documents show. The environment ministry’s internal communication shows its officials treated the matter as a “priority.”

The following year, in March 2017, the Modi government gave itself wide-ranging powers to appoint and dismiss members of the NGT by making changes to the NGT Act. These legally questionable changes were subsequently stayed by the Supreme Court in mid-2018.

In July 2017, the Ministry of Environment issued an Office Memorandum, a kind of official clarification, that bent rules in a way that suited builders like Goel Ganga Developers India Pvt. Ltd.

The text of this Office Memorandum clearly stated that it was issued at the written request of the Confederation of Real Estate Developers’ Associations of India (CREDAI). HuffPost India has seen the letter CREDAI wrote to the environment secretary in April 2017 in this regard.

At the time, Atul Goel, the managing director of the developer Goel Ganga, was the Honorary Joint Secretary of CREDAI’s Pune chapter.

The office memorandum was so evidently in favour of real estate developers such as Goel Ganga Developers India Pvt. Ltd that the ministry earned a rap on the knuckles from a two-judge bench of the Supreme Court hearing the Goel Ganga matter.

“We expect the officials of the Ministry of Environment, Forest and Climate Change to take a stand which prevents the environment and ecology from being damaged, rather than issuing clarifications which actually help the project proponents to flout the law and harm the environment,” Justices Madan Lokur and Deepak Gupta observed in their 10 August 2018 order, which went against Goel Ganga.

When HuffPost India filed requests under the Right To Information Act to access relevant files, the Prime Minister’s Office refused permission, while the Environment Ministry claimed in its response that it was unable to locate the relevant file.

Yet, Pawar’s letter to Prime Minister Modi, and the letters subsequently sent by the PMO to government ministries, accessed by HuffPost India, suggest business trumped any political and ideological differences between Modi and Pawar. Pawar’s suggestions were not included in the amendments to the NGT Act, but some of his recommendations were subsequently implemented by the environment ministry.

First page of the Rajya Sabha MP Sharad Pawar's letter to Prime Minister Narendra Modi. In addition to this main text, the letter has two pages long 'salient points' and a bunch of recommendations for amendments to the NGT Act on a single page. 

The documents also illustrate how India’s fragile environment is under threat from influential politicians of all stripes, and that it will take far more than a change of government to stave off the country’s urban crisis.

While Pawar was content to request Modi to dismantle the NGT as we know it in 2016, the Maharashtra strongman has now pledged to assemble an opposition coalition to overturn the Bharatiya Janata Party (BJP) government after the 2019 elections. Meanwhile, Modi has described Pawar as a spent force on the campaign trail, even though his Office urged its officers to take Pawar’s recommendations seriously.

“We are witnessing large-scale dilutions to the environmental governance in the last 5 years of the Modi government,” said environmental lawyer Lara Jesani.

“We are witnessing large-scale dilutions to the environmental governance in the last 5 years of the Modi government,” said environmental lawyer Lara Jesani, adding that each of these dilutions were systematically introduced to aid specific lobbies. “If one traces down each of these amendments, the nexus with the private beneficiaries is clearly borne out.”

In an email response to HuffPost India’s questions, Atul Goel, managing director of the Goel Ganga Group and a director at Goel Ganga Developers (India) Pvt. Ltd, said it would be inappropriate to comment on this matter as the case was still pending before the Supreme Court, and he would speak once the court ruled on the matter.

“Please take note imputation in your questionnaire is completely misplaced and unfair and contrary to the facts,” Goel wrote, in response to HuffPost India’s email, which included questions on if Goel had sought backing from CREDAI and Pawar for his project.

The PMO, Sharad Pawar and CREDAI did not respond to requests for comment. 

Through these "salient points", which were also part of Rajya Sabha MP Sharad Pawar's letter, the veteran Maharashtra politician defended the controversial project after the NGT delivered its judgement on 27 September 2016.

Why The National Green Tribunal Ruled Against The Builder

On 7 October 2016, Sharad Pawar wrote to Prime Minister Narendra Modi, seeking his personal intervention to alter the functioning of the NGT by amending the National Green Tribunal Act of 2010. The tribunal, Pawar said, “had lost sight of its purpose.”

To buttress his argument, Pawar offered an example: A fortnight previously, on 27 September 2016, Justice Jawad Rahim and expert member Dr Ajay Deshpande of the Western Bench of the NGT had fined Goel Ganga Developers the lesser of Rs 100 crore, or 5% of the project cost, in a case filed by Tanaji Gambhire, a Pune resident who had bought an apartment in the project being developed by the builder in the Vadgaon Budruk Village on Sinhgad road in Pune.

The NGT order on Goel Ganga, Pawar wrote in his letter to Modi, “will create havoc in the real estate industry which is already facing other challenges.”

Pawar also said, “The NGT has not been able to find any environmental violation in the project.”

This was not true. A closer reading of the order shows the NGT asked Goel Ganga to pay Rs 5 crore for violating mandatory provisions of environmental laws. 

The details of Gambhire’s case are important because they illustrate the deftness with which an ecosystem of lawyers, bureaucrats, politicians and project developers subvert the spirit of India’s environmental legislation.

In his application, which was filed in December 2015, Gambhire accused Goel Ganga of violating environmental norms by substantially increasing the scope of the project without seeking fresh environmental clearance.

The environmental clearance for the project, Gambhire noted, was granted in April 2008 for 12 towers with 552 residential apartments, 50 shops and 34 offices. However, by December 2015, Goel Ganga had built 15 towers with 738 apartments and 115 shops and offices.  By 2018, the case papers indicate, the number of buildings constructed reached 18, and two more buildings comprising 454 tenements were proposed to be built.

Lawyers for Goel Ganga acknowledged that the number of buildings had increased, but claimed that — taken as a whole — the project was still within the limits of construction activity allowed by the 2008 environmental clearance.

Gambhire’s case, and Goel Ganga’s defence, was premised on a difference in interpretation of two technical parameters — Built Up Area, and Floor Space Index.

Gambhire, the aggrieved homeowner, argued as per the definition of Built Up Area in the Environmental Impact Assessment Notification of 2006, the builder had violated environmental norms by expanding the scope of the project from 12 buildings to 18 towers. Expanding the project, Gambhire said, meant the builder had exceeded the Built Up Area of the project as sanctioned by the environmental clearance given in April 2008.

Goel Ganga’s lawyers argued that the expanded project, as measured by Floor Space Index, was within permissible limits, and that under the  Development Control Regulations of the Pune Municipal Corporation, 1982, Floor Space Index or FSI, and Built Up Area or BUA, were one and the same thing.

Further, the exact definition of Built Up Area, the developer argued, was only clarified in April 2011 by the environment ministry — three years after the project had first received its clearance. So, the definition of Built Up Area, as made clear in 2011, could not be retrospectively applied to the Goel Ganga project. Finally, the developer argued, the new expansion plans had been cleared by the Pune Municipal Corporation.

The NGT ruled in the home-owner Gambhire’s favour.

“There could be ambiguity in calculation of built up area as per earlier Environment Clearance Regulations, but this cannot be stretched under any circumstances to take a plea that the built up area and FSI are synonymous and interchangeable terminologies,” the Tribunal wrote in the order.   “Any such activity or construction beyond permissible limits cannot be saved by jugglery of words, misinterpreting against the statutory definition of F.S.I and BUA.”

Any such activity or construction beyond permissible limits cannot be saved by jugglery of words, misinterpreting against the statutory definition of F.S.I and BUA: National Green Tribunal

The tribunal ordered that the builder pay the lesser of Rs 100 crore, or 5% of project cost, as environmental compensation for damage caused by expanding the scope of the project.

The tribunal also told the builder to pay an additional sum of Rs 5 crore for violating mandatory provisions of several environmental laws in addition to carrying out excess construction and not obtaining Consent To Operate from the Maharashtra Pollution Control Board.

The tribunal also imposed a fine of Rs 5 lakh on the Pune Municipal Corporation (PMC) for suppressing facts of illegality committed by the builder and directed the Municipal Commissioner to take legal action against erring officials.

Additionally, it asked the Chief Secretary of Maharashtra to “take notice” of the conduct of officers who “misled” the Department of Environment (DoE) on the question of the legal definition of Built Up Area. This included the state’s environment secretary. Notably, the Tribunal directed the PMC, DoE and State Environment Impact Assessment Authority to pay cost of Rs 1 lakh each to Gambhire as well.

This is because Gambhire had alleged in his petition that Goel Ganga Developers had expanded the scope of their project because key officials, meant to monitor environmental violations, had “virtually allowed” the builder to “proceed with the illegal construction”.

In its order, the NGT said these authorities have been “either the mute spectator or have not performed their statutory duties” in this case.

In his letter to Modi, Pawar insisted that the Tribunal had misinterpreted the definition of Built Up Area, and also batted for the bureaucrats chastised by the court. Many of Pawar’s arguments mirrored the arguments made by the Goel Ganga group in the NGT, and in a letter CREDAI wrote to the environment secretary.

“NGT have misinterpreted the definition of built up area and exceeded its jurisdiction and passed strictures against all officers involved in giving clearance from passed 9 years,” Pawar wrote.

The tribunal, Pawar said, was creating an “atmosphere of fear” in the minds of builders, municipal corporations and state governments by wanting to “punish them harshly” and encouraging “fraudulent and extortionist applicants.”  

Pawar concluded his letter by offering “some suggestions” for amendments to the National Green Tribunal Act, without disclosing by whom, and sought the Prime Minister’s personal intervention to amend the law based on the suggestions which were attached in a separate note with the letter.

This page was also a part of documents attached with Rajya Sabha MP Sharad Pawar's letter. The main text of the letter carried no mention about who gave Pawar these recommendations but the veteran politician made a strong case for their implementation.

In 2017, the Modi government made changes to the NGT Act of 2010. Pawar’s recommendations were not incorporated.

However, Pawar’s letter and CREDAI’s submissions to the environment ministry made three similar points that would help construction projects like Goel Ganga. These three recommendations were subsequently implemented by the environment ministry. The first two were part of an Office Memorandum issued in June 2017, the third was added to a notification notified in December 2016.

1) That the definition of Built Up Area, as described in the 2011 Environment Ministry, be prospectively applicable — ie, applicable for projects cleared after 2011 while older projects, like Goel Ganga’s, remain outside its purview.

2) That projects should follow the definition of Built Up Area as per the regulations of local municipal corporations, and finally,

3) That residential projects be freed from the need to obtain “Consent to Operate” and “Consent to Establish” clearances as per a Delhi High Court judgement given in January 2012.  The Delhi Pollution Control Committee has appealed against this particular judgement, and the case is ongoing.

As per the current law of the land, residential projects still need to obtain consent to operate and consent to establish clearances. In December 2016, the environment ministry tried to remove these two clearances for the residential properties, but the NGT said the ministry’s actions were illegal.

HuffPost India has reported extensively on this particular matter.

The Prime Minister’s Office Gets Into The Act

The Prime Minister’s Office acted swiftly in response to Pawar’s letter, suggesting that Modi took his letter seriously.

On October 13 2016, a week after Pawar wrote to Modi, A K Sharma, the Joint Secretary to the Prime Minister, wrote to Ajay Narayan Jha, then Environment Secretary, and Ashok Lavasa, then Finance Secretary, seeking comments and inputs from their respective ministries on Pawar’s letter by October 17 2016.

On October 20, 2016, Arvind Nautiyal, a Director in the Policy and Law section of the Ministry of Environment Forests & Climate Change (MoEF&CC) internally circulated an office memorandum seeking comments on Pawar’s letter “positively by 24.10.2016 for sending it to PMO.”

The final line of the memo, printed in bold typeface, communicated great urgency in the  prose of the Indian bureaucracy. “It is further requested to accrued priority in the matter,” Nautiyal’s letter read.

As mentioned earlier, the PMO declined HuffPost India’s requests for further information filed under the Right To Information Act or to an emailed questionnaire seeking comment; the environment ministry claimed it could not locate the relevant file.

(Right) Letter from A K Sharma, Joint Secretary to Prime Minister, to then Environment Secretary Ajay Narayan Jha and then Finance Secretary Ashok Lavasa.This letter led to an internal Office Memorandum (Left) of the Environment ministry which deemed it a "priority" matter.

Why The Supreme Court Criticised The Environment Ministry

In late 2016, Gambhire, the aggrieved home-owner, filed a review petition at the NGT. This time, he asked the tribunal to increase the fine on Goel-Ganga to Rs. 190.03 crore based on his assessment on the scale of environmental damage caused by the illegal expansion of the project.

The NGT concurred, and increased the compensatory sum to Rs. 190 crore or 5% of the total cost of the project, whichever is more, in a judgement passed on January 8, 2018. The exact sum, the Tribunal said, would be assessed by the State Expert Appraisal Committee — a committee set up by the environment ministry — and would be used to repair any environmental damage caused by the builder.  

Meanwhile, the matter was also being argued in the Supreme Court as Goel Ganga had appealed against the Rs 105 crore fine imposed by the NGT. In February 2018, soon after the NGT upped the penalty on the builder, Gambhire filed a petition in the Supreme Court and asked it to impose a fine of Rs 500 crore on Goel Ganga.

Here too, legal arguments focused on the definitions of Built Up Area and Floor Space Index, and the Goel Ganga group argued that the definition of Built Up Area was only clarified in 2011, while the project began in 2008, and hence it was unfair to penalise the builder retrospectively.

However, this time, the lawyers for Goel Ganga referred to a fresh government memorandum passed on 7 July 2017. This new memorandum, passed after the NGT order had concluded that Goel Ganga was in violation of the law, appeared to give the builder a free pass.

On 4 April 2017, three months before the July 7, 2017 office memorandum was issued, CREDAI President Geetambar Anand and President-elect Jaxay Shah wrote to environment secretary Ajay Narayan Jha requesting that the definition of Built Up Area be applicable prospectively (ie going-forward), while for all projects that received environment clearance before the notification, the definition should follow local development control laws.

The government complied.

This July 7, 2017 Office Memorandum, which explicitly said it was being passed at CREDAI’s request, “clarified” that the 2011 notification was applicable only prospectively — which was Goel Ganga’s stance in court all along. This was also the meat of Pawar’s letter to Modi.

Atul Goel, the Managing Director of the company, as stated earlier in this article, was an Honorary Joint Secretary for CREDAI’s Pune chapter at the time.

Jesani, the environmental lawyer, explained that the definition of “built up area” was of great significance for the real estate industry as it also determines the degree of regulatory scrutiny a given project attracts.

“This would remove some big construction projects from the requirement of environment clearance in the first place, by understating the area, giving a go-ahead to some builders to build commercial properties without governmental scrutiny. Several big builders have profited from these changes,” Jesani told HuffPost India.

Neither Goel Ganga’s arguments nor the environment ministry’s actions impressed the Supreme Court. The two-judge bench of Justices Madan Lokur and Deepak Gupta  quashed the 2017 Office Memorandum, and chastised the Environment Ministry for “issuing clarifications which actually help the project proponents to flout the law and harm the environment.” 

We expect the officials of the Ministry of Environment, Forest and Climate Change to take a stand which prevents the environment and ecology from being damaged, rather than issuing clarifications which actually help the project proponents to flout the law and harm the environment: Supreme Court

There was no need for the 2017 Office Memorandum to be issued, the court said, as the definition of Built Up Area is clear even under the Environment Impact Assessment notification of 2006.

The court changed the environmental compensation amounts mentioned in the two previous NGT’s orders to Rs. 100 crores or 10% of the project cost—whichever is higher—on Goel Ganga Developers India Pvt. Ltd, in addition to a separate amount of Rs 5 crore for violating environmental laws.

The SC also prevented the builder from constructing two more buildings — which were meant to have  454 apartments — and asked the builder to return the money to those who had put down payments with 9% yearly interest.

For now, Pawar, Modi and the real estate lobby had failed, but Goel Ganga Developers have continued to argue their case in two separate applications before the Supreme Court. At the time of publication, the matter is still pending before the Apex court.

Modi’s War On India’s Environment

Modi, Pawar and CREDAI’s attempts to weaken Indian environmental laws to favour the real estate sector must be seen in the broader context of the BJP government’s war on the environment in the name of improving ease of doing business by cutting red tape.

HuffPost India has previously reported how the PMO overturned a decade’s worth of environmental law to aid the real estate lobby and improve India’s rank on the World Bank’s Ease of Doing Business Index —only to be halted in its tracks by the NGT. One of the particular provisions detailed in this investigation was how the government sought to remove the real estate sector from the purview of the Air (Prevention and Control of Pollution) Act, 1981 and Water (Prevention and Control of Pollution) Act, 1974.

One of the suggested amendments to the NGT Act made in an attached document to Pawar’s letter was to remove the residential building construction projects from the need to get consent to operate and consent to establish —both provisions found in air and water pollution laws. A demand which CREDAI had lobbied for as well.

But it is not only the real estate sector. A closer look shows the pattern of dilution of legal safeguards for environment is much more broad-based in terms of sectors. And as HuffPost Indiareported in March, Prime Minister Narendra Modi is personally overseeing this process. This may well be the reason why Maratha strongman Sharad Pawar felt confident enough to lobby against the NGT and in favour of a builder with the Prime Minister himself.