Centre can't grant retrospective Environmental Clearance through OM route, valid notification a must: Supreme Court

The Supreme Court on Wednesday quashed the Central government's 2021 office memorandum (OM), which created a protocol for the grant of retrospective environmental clearances (EC) to projects that had commenced without obtaining prior EC [Vanashakti v. Union of India]..A Bench of Chief Justice of India Surya Kant and Justices Joymalya Bagchi and Vipul Pancholi clarified that the Central government retains the power to issue an "appropriate, narrowly tailored amnesty notification" to grant ex post facto or retrospective clearances in public interest in exceptional cases. However, the same has to be done through valid amending notifications under Section 3 of the Environment (Protection) Act, and not via office memorandum, the Court ruled.Pertinently, it found that the 2021 OM impermissibly supplanted the Environment Impact Assessment (EIA) Notification of 2006, which makes it mandatory for projects to get prior ECs."The 2021 Office Memorandum is an administrative order and envisages a perpetual regime for grant of environmental clearances to projects undertaken without prior EC. It substantially alters the nature of enquiry as well as the criteria for grant of EC under the 2006 Notification. The 2021 Office Memorandum thereby supplants delegated legislation through an administrative instruction, which is impermissible in law," the Court said. .The Court underscored that the prior EC regime under the 2006 EIA Notification is usually mandatory. Unless amended by an appropriate notification, it does not accommodate the grant of ex post facto EC or the retention of projects where construction has commenced or operations have begun without a valid EC, the Court said. .The Court went on to observe that the “perpetual amnesty scheme” envisaged by the 2021 OM went beyond what is permitted under India’s Environment (Protection) Act, 1986 and the 2006 EIA Notification issued under it. “Even otherwise, being a perpetual amnesty scheme applicable to all permissible projects, it fails to lay down an intelligible differentia for the selection of projects for grant of ex post facto EC having a rational nexus to supervening public interest. It is therefore ultra vires the object of the Environment (Protection) Act, 1986, namely preservation of the environment through a balanced approach between the precautionary principle and sustainable development.”.The Court, therefore, struck down the 2021 OM as being unconstitutional. “In these circumstances, the Office Memorandum does not satisfy the test of proportionality and reasonableness and is violative of Articles 14 and 21 of the Constitution. Accordingly, the 2021 Office Memorandum is quashed prospectively, keeping in mind the prevailing confusion regarding the validity of the impugned instruments and the supervening public interest," the Court ruled. The Court, however, upheld a notification issued in 2017 on the subject of retrospective clearances. The Court explained that the said amending notification was narrowly tailored and a time-bound delegated legislation traceable to Section 3 of the Environment (Protection) Act, 1986, read with Section 21 of the General Clauses Act..Notably, the Court also made it clear that today's ruling will not automatically affect any project that has got the benefit of the 2021 OM or the 2017 notification. "All environmental clearances granted under the 2017 Notification or the 2021 Office Memorandum shall remain valid unless individually assailed in accordance with law," the Court said. However, no further applications for the grant of environmental clearances under the 2017 Notification or the 2021 Office Memorandum shall be entertained, the Court ordered. The Court also directed the Centre not to grant retrospective ECs in future unless a specific notification is issued for the same under Section 3 of the 1986 Act."The Central Government is restrained from passing administrative orders in future granting ex post facto environmental clearances to projects that commence in violation of the 2006 Notification, save and except by way of a valid notification issued in exercise of powers under Section 3 of the Environment (Protection) Act, 1986."The Court added that its judgment today will not prevent the Supreme Court from using its inherent powers under Article 142 of the Constitution to grant ex post facto environmental clearance in appropriate cases..The Court's ruling came on a review petition filed in the Vanashakti case concerning the grant of retrospective environmental clearances (EC) .The case stemmed from the November 2025 judgment of the apex court allowing retrospective ECs.Before this, in May 2025, the Supreme Court in Vanashakti v. Union of India, had ruled that no project can legally start without prior approval. Retrospective clearances violate both environmental law and constitutional principles, the Court had held at the time. It, therefore, quashed the 2017 notification and 2021 OM permitting retrospective grant of ECs.However, in November 2025, the Court allowed a review petition against the May 2025 decision thereby, reviving retrospective ECs. The judgment was passed on a review petition moved by the Confederation of Real Estate Developers of India (CREDAI), arguing that the judgment caused significant hardship to real estate industry and interdependent sectors.Vanashakti filed a review petition against this November 2025 judgment, opposing any regime that permits retrospective clearances.In its verdict today, the Court quashed the 2021 OM, but upheld the validity of the 2017 notification. The Court's ruling also permits the Central government to permit exceptions to the prior EC regime in future, provided it is done through a validly introduced amending notification and not by the OM route. .[Read Judgment].[Read Live Coverage]