Electrotherm gets relief from SC on shutdown order

In a relief to the Ahmedabad-based Electrotherm (India) Ltd, the Supreme Court on Friday stayed Gujarat High Court's order to shut down the company's steel and pipe manufacturing plant in Bhachau block of Kutch district.

Following the Apex Court's order the production, which the High Court had directed to be stopped, would continue as before.

Joint managing director of Electrotherm Avinash Bhandari confirmed the development and said, "I have received the message from my team in Supreme Court that High court order has been stayed. I am yet get the order of the copy."

A division bench of Justices BS Chauhan and Dipak Misra observed that there was no need for closure of the plant. They also put in abeyance, the High Court's order cancelling the environment clearance granted to the company in January 2010. The stay is likely to continue until further orders from the court.

The next hearing on Electrotherm's appeal in Supreme Court is scheduled in thrid week of July.

Electrotherm (India) Ltd had approached the Supreme Court early this week against Gujarat High Court's order to shut down its steel and pipe manufacturing plant in Bhachau block of Kutch district. On May 11 the Gujarat High Court had ordered shut down of Electrotherm's plant with 360,000 TPA capacity for producing structural steel, alloy steel and stainless steel, after concluding that company did not have proper environment clearance mandatory under Environment Impact Assessment (EIA) Notification, 2006.

High Court, which was acting on a petition filed by Kutch-based RTI activist Vipulkumar Patel, had held that the environmental clearance given for the plant was illegal as there was no public consultation before it was set up. The Court had also cancelled the environment clearance granted in January 2010.

According to case details, Electrotherm had applied for environment clearance, while it was expanding capacity of the unit.

The company had obtained environment clearance for expansion; but it turned out the they did not have clearance for the main project. This led the court to hold that the environment clearance accorded by the company was illegal and it cannot continue with production.