Salu Sugathan Someni vs Noushad.K., S/o Khalid.E

K. Vinod Chandran, J.

The above appeal arises from a common judgment of the learned Single Judge in two writ petitions filed by the respondents 1 to 4 herein. W.P(C) No.22117 of 2018 challenged Ext.P12 order of the Tribunal for Local Self Government Institutions, Thiruvananthapuram [for brevity 'the Tribunal'] from which the above appeal arises. W.P(C) No.35055 of 2016 was filed by respondents 1 to 4 in this appeal and another, seeking a direction to the respondent-Panchayat not to grant permit/consent to establish a M-Sand Plant in the land possessed by the other party respondents in the appeal.

Learned Senior Counsel Sri.T.Krishnanunni, instructed by Smt.Mini.M.R, points out that a consent to establish has already been issued and in any event, there can be no permanent injunction against the respondent-Panchayat for consideration of a fresh consent to establish. The learned Senior Counsel would assert that by virtue of the amendments made to the Kerala Panchayat Raj Act, 1994 (Act of 1994, hereafter), on an application made, the Panchayat has to necessarily grant a permit, if necessary, with conditions imposed to abate any nuisance or pollution. It has been declared by a Full Bench of this Court in Tomy Thomas v. State of Kerala [2019 (4) KHC 553] that 'from the date of enforcement of the amendments from 20th October, 2017, it cannot be said that Village Panchayats have got primacy of power to take an independent decision to reject the applications for permission/licence under provisions of the Act and the Licensing Rules, for construction or for establishment of any factory, workshop or work place'.

The learned Single Judge found that the building permit issued by the Panchayats as of now is a 'commercial building' under Group-F of the Kerala Panchayat Building Rules, 2011 (Rules of 2011, hereafter) and an 'industrial occupancy' under Group-G1 has different parameters. It was held that the requirement of an establishment permit under Section 233 under the Act of 1994 arises only when the building permit granted is one for industrial occupancy. Hence, leaving open the remedy of the respondents 1 and 2 therein to seek category change before the Panchayat under the Act of 1994 and the Rules of 2011, the writ petition was disposed of. The learned Senior Counsel argues that there is no requirement for such category change since the establishment permit under Section 233 itself has been issued as a building permit.

We see that subsequent to the issuance of the building permit, as the appellant proceeded with the construction, a stop memo was issued by the Panchayat, which was challenged before the Tribunal. The stop memo was stayed by the Tribunal and since the appellant was prohibited from carrying on the construction, the permit holders approached this Court with a writ petition seeking police protection, which was disposed of by Ext.P13. The very same contention of a permission having been granted under Section 233 was raised before Court; which the Court did not consider since the Tribunal was seized of the issue. However, noticing that the Tribunal had stayed the stop memo, it was directed that the Police would look into any law and order problem created by reason of any undesirable obstruction caused, to acts based on subsisting statutory permits. The Tribunal has now allowed the claim of the appellant-entrepreneur, against which the local residents have approached this Court in W.P(C) No.22117 of 2018. The question in the instant appeal is as to whether Ext.P11 produced in the writ petition is an establishment permit; which issue has to be considered on the basis of the unamended Rules. In W.P(C) No.35055 of 2016 the question is regarding the further grant of an establishment permit which, according to the learned Senior Counsel, falls for consideration on the basis of the amended provisions and the judgment in Tomy Thomas (supra). We hence are of the opinion that the issue has to be considered separately in the two appeals [W.A.Nos.1371 and 1503 of 2019].

In the present appeal, the issue arises as per the Act of 1994 that existed in 2016; the amendments having been brought only by Act 14 of 2018. At the relevant time, Section 233 requires permission for construction of factories and installation of machinery, in which it is proposed to employ any manner of power. The application has to be submitted to the Village Panchayat addressed to the Secretary as per sub-section (2). The Secretary, on receipt of the same, has to conduct an enquiry and report whether such establishment would be 'objectionable by reason of density of population in the neighourhood and the possibility to cause nuisance or pollution' as per sub-section (3). The Village Panchayat would then consider the application, the report of the Secretary and report of such authorities as specified in sub-section (4). The Village Panchayat can under sub-clause (a) of sub-section (3) grant the permission either absolutely or subject to conditions and by sub-clause (b) refuse the permission for reasons to be recorded. Sub-section (4) requires the Panchayat to obtain and consider a report of the Inspector of Factories or of an officer of the Industries Department regarding the sufficiency or adequacy of the premises, if the establishment is of a factory, workshop or work place coming within the purview of the Factories Act, 1948. Sub-clause (b) requires a report of the District Medical Officer, if the machinery proposed exceeds 25 HP or if it is likely to cause nuisance or pollution. Sub-clause (c) requires a report of the Divisional Fire Officer, if the proposed machinery involves the use of high tension power or inflammable or explosive materials. The proviso also exempts the requirement of a report of the DMO as provided under sub-clause (b) for establishment of an industry, if there is a recommendation by an authorized officer of the Industries Department or a certificate by the State Pollution Control Board to the effect that such industry would not cause pollution.

The learned Senior Counsel would point out that the report of the Secretary under Section 233(3) is evident in Ext.P11, being one dated 25.07.2016. The other requirements under sub-section (4) are satisfied by Ext.R1(b) of the Assistant Divisional Officer, Fire & Rescue Services, Ext.R1(c) report of the DMO, Ext.R1(d) issued by the Joint Director of Factories and Ext.R1(e) Consent to Establish issued by the SPCB. The learned Counsel for the Panchayat and the party respondents would point out that even as per Ext.P11, the Secretary has not reported on the density of population or nuisance or pollution, which is mandatory insofar as the consideration by the Panchayat. It is also pointed out that the appellant has made an application for a building permit under the Rules of 2011 and not under Section 233 of the Act of 1994. The Panchayat argues that, Annexure A6 produced along with their affidavit dated 17.03.2020, is the proper application format, and the applicant has not applied under Section 233. The learned Senior Counsel would however alertly point out that Annexure A6 by its heading itself, indicates an application prescribed, after the amendment.

We have bestowed our anxious consideration to the rival contentions. Before we adjudicate on the same, we have to notice that a building permit and an establishment permit are distinct and separate as per the scheme of the Act of 1994 and the Rules of 2011. While the establishment permit is granted by the Village Panchayat under Section 233, the building permit is issued by the Secretary of the Panchayat as per the Rules of 2011. The permission to establish an industrial unit should be obtained, prior to the application for a building permit, for housing the industrial unit which uses any manner of power. Merely on the ground that the Secretary has issued a building permit, for the purpose of an industrial unit, it cannot be assumed that the Village Panchayat has conceded to the establishment. The establishment has to follow the procedure prescribed under the statute as per Section 233.

In the case of installation of a hot mix plant, a Division Bench of this Court in George Joseph v. Bose Well John [2021 (2) KLT 233] held that only after the establishment permit is issued and the establishment is carried out, a contractor can seek issuance of a Trade Licence. In George v. Vannappuram Grama Panchayat [2017 (3) KLT 1049] (one of us KVC,J sitting single) held so on this specific issue:

"5. Building permit has been issued by the Panchayat and based on which construction has also been carried out. The mistake is insofar as the petitioner having not applied for a permission to establish, as provided under S.233 of the KPR Act; after which alone building permit could be applied for and then a D&O Licence sought as provided under S.232 of the KPR Act. The petitioner also cannot take a contention that since the building permit has been granted, there can be no further refusal of a permission to establish. The permission to establish was required for applying for a building permit as mandated in the statute and there cannot be any sustainable claim of estoppel against the specific terms of the statute".

The application filed by the appellant is produced at Annexure-A2 of I.A.No.3 of 2020, filed by the Panchayat, which is an application for building permit under the Rules of 2011. We do not think the defect pointed out by the Panchayat, as to the appropriate form being that at Annexure 6, is correct. After an amendment of 2017 the classification of the "Dangerous and Offensive Trades and Factories' as spoken of in the Rules framed for issuance of license was changed to 'Factories, Trades, Entrepreneurship Activities and Other Services'. Annexure-A6 by its heading shows the latter nomenclature, which form would not be available in the year 2016. But, we cannot accept the contention of the learned Senior Counsel that in the application at Serial No.5 - occupancy - a manufacturing unit is shown and hence while issuing the building permit, the Panchayat was aware of the same and the building permit Annexure A5, read with Ext.P11, is to be construed as an establishment permit under Section 233. We are unable to accede to the said contention especially noticing the trite law that when a thing is required to be done in a particular manner, it has to be done in that manner or not at all. Annexure A2, as we noticed, is an application for building permit for a non-residential purpose. But without the establishment permit, it cannot be said that, if the application for building permit; showing the purpose of the building to be industrial, is considered by the Village Panchayat, then it has to be construed as one issued under Section 233.

We also find a lacunae in Ext.P11 insofar as the report of the earlier Secretary dated 25.07.2016, noticed in Ext.P11, only speaks of having verified the measurements, extent and title after a site inspection and the recommendation made is for construction of a plant as per the KPBR 2011. We cannot also accede to the argument of the learned Senior Counsel that once the certificates under sub-section (4) of Section 233 is available with the Village Panchayat, then the report of the Secretary would be superfluous.

The statutory scheme, as available under Section 233 requires the Secretary, on the receipt of an application, to make enquiries and report specifically on the density of population in the neighborhood which would make the establishment of the industry objectionable to the residents and the possibility of causing nuisance or pollution. The consideration of the application at the initial stage is based on the report of the Secretary and additionally it is provided under sub-section (4) that before granting or refusing permission under sub-section (3), the Village Panchayat shall obtain and consider the reports as provided under sub-clauses (a) to (c). If the certificates under sub-section (4) alone was the requirement, then there was no reason why the legislature directed a report to be placed before the Village Panchayat, by the Secretary of the Panchayat on specific objections; which could impact the peaceful life of the residents of the locality, to ensure which is the primary responsibility of the Village Panchayat.

A reading of Ext.P11 also would indicate that what has been granted is a building permit for the manufacturing unit and not an establishment permit. Merely because the Village Panchayat had considered an application with the object shown as establishment of an industry; it cannot be assumed that the same is an establishment permit. In this context Rule 16 of the Rules of 2011 assumes relevance. Annexure A2 application by the entrepreneur is made on 06.06.2016 and the report of the Secretary as seen from Ext.P11 is on 25.07.2016. Rule 16 mandates a reference to the Panchayat, if the Secretary does not grant or refuse approval for a building site or execution of work within thirty days, on a written request of the applicant. The consideration by the Village Panchayat was made after one month, as required under Rule 16 and hence Ext.P11 is only a building permit and not an establishment permit.

The Tribunal in Ext.P12 found that the appellant was granted a development permit and building permit for the construction of M-Sand unit; produced respectively as Exts.A1 and A2 before the Tribunal. The stop memo issued by the Secretary under Section 235X was held to be bad, since the appellant had the necessary permits and there was no deviation from the permit, contravention of statutory permits or apprehension of the construction being dangerous to the public. It was assumed that the stop memo was motivated by public protest and the appeal filed by the appellant was allowed, setting aside the stop memo. The learned Tribunal failed to notice that establishment permit is a precursor to the building permit, which the appellant admittedly did not obtain. We notice that in George v. Vannapuram Grama Panchayat (supra) the petitioner was permitted to move an application under Section 233 for an establishment permit, which ought to be considered as provided under Section 233 of the Act of 1994. This position would also be perfectly valid in the present case; which however has to be considered in W.A.No.1503 of 2019, in which the learned Senior Counsel has further contentions with reference to the amended provisions under Section 233. Leaving such contentions open, we dispose off the above Writ Appeal finding that the change of categorization under the Rules of 2011 as directed by the learned Single Judge would not enure to the benefit of the appellant, since the establishment permit under Section 233 has still not been obtained. The appellant having not obtained an establishment permit cannot be permitted to establish the unit on the strength of a building permit, issued for commercial purposes. Parties are left to suffer their costs.