Judgment of the Supreme Court of India regarding storage facility for an edible oil unit outside port area, Chennai, Tamil Nadu, 01/02/2023

  • 01/02/2023

Judgment of the Supreme Court of India in the matter of K T V Health Food Pvt Ltd. Vs Union of India & Others dated 01/02/2023.

The Supreme Court upheld the decision of the National Green Tribunal, Southern Zone which set aside the ex post facto clearance granted by the Union government to K T V Health Food and KTV Oil Mills (one of the largest edible oil companies in South India) for its edible oil storage and transit terminal. 

As to whether the pipeline can continue to be used if the storage tanks are demolished is a matter which must engage the attention of the authorities, the SC said.

The apex court said that in regard to the pipeline, it would be District Coastal Zonal Management Authority, which could take a decision. The SC said that the appellants can approach the District Coastal Zonal Management Authority within a period of one month with respect to the pipelines.

The coastal management authority will consider the application made in regard to the continued use of the pipeline and take a decision in accordance with law within a period of six weeks from the date of the receipt of the application. The appellants had requested for permission to continue to use the pipeline along with the storage facility for a period of one year and the apex court gave a period of six months to comply with the order of the NGT. And this with regard to the direction to demolish the storage tanks. The company is given a month's time to pay the compensation ordered, if not already paid.

As far as the direction to demolish the pipeline, the matter will await the decision to be taken by the District Coastal Zonal Management Authority.

KTV Group has its headquarters in Chennai, comprises of KTV Health Food (Pvt) Ltd, KOG KTV Food Products India Ltd, and KTV Oil Mills. KTV today is a 50:50 joint venture with Adani Wilmar Limited (AWL).

The M/s. KTV Health Foods Pvt. Ltd. (appellant) challenged the National Green Tribunal (NGT), Southern Zone order. The appellant was given clearance for the laying of pipeline for transfer of edible oil from the Chennai port to the storage terminal tank and for the establishment of the storage transit terminal of the appellant.

The NGT had found that while the ex post facto clearance could be granted under "paragraph-4.3, and that it would have prospective operation, however, the activity of putting up a storage tank transit terminal, being contrary to the 2011 Notification, the same was illegal". It was found to be illegal in turn, on the ground that the storage terminal was not located in the Chennai Port, in which case alone, it would have been permissible under the permitted activities of Coastal Regulation Zone II (CRZ II).

The appellant is in the business of processing and refining edible oil. Towards the said business, the appellant imports edible oil. The edible oil is imported through the Chennai Port. On November 5, 2014 in the public auction, the appellant purchased an existing storage facility. It was located at Old Door No. 4061/A and New Survey No. 4061/2 in the Ennore Expressway.

The appellant thereafter, according to it, "started the process to seek approvals for laying an underground pipeline of 4.5 kilometres to the said storage facility". On payment of Rs.5097921/-, the Chennai Fishing Harbour Management Committee granted permission to lay the underground pipeline. The National Highways Authority of India (NHAI) granted permission to lay the underground pipeline. On August 24, 2016 the Chennai Port Trust issued a certificate and permitted the laying of the pipeline, which, according to the appellant, was based on the need to avoid usage of tanker lorries and as it resulted in better handling of vessels at the port.