Summary and Analysis of Confederation of Real Estate Developers Associations of India CREDAI & Ors vs Union of India & Ors 2025 INSC 1112

1. Heading of the Judgment

Confederation of Real Estate Developers' Associations of India (CREDAI) & Ors. vs. Union of India & Ors. (Civil Appeal Nos. 10043 of 2024, 5532 & 5533 of 2025)
Date of Judgment: September 12, 2025
Coram: Justice R. Mahadevan and Justice J.B. Pardiwala
Citation: 2025 INSC 1112

2. Related Laws and Legal Provisions

This judgment primarily interprets and applies the following laws and notifications:

• The Environment (Protection) Act, 1986 (EP Act): The parent legislation under which the environmental clearance regime is established.
  Sections 3(1) and 3(2)(v): Empower the Central Government to take measures for protecting and improving the environment.

• The Environmental Impact Assessment (EIA) Notification, 2006 (S.O. 1533(E)): The primary subordinate legislation that mandates prior environmental clearance (EC) for specified projects. Its key features include:
  Categorization of Projects: Projects are classified as:
  Category A: Appraised by the Central Expert Appraisal Committee (EAC) and approved by the Ministry of Environment, Forest and Climate Change (MoEF&CC).
  Category B: Appraised by the State Expert Appraisal Committee (SEAC) and approved by the State Environment Impact Assessment Authority (SEIAA). Category B is further divided into B1 (requires EIA report) and B2 (exempt from EIA report).
  The Schedule: Contains a list of projects. Item 8(a) covers "Building and Construction projects" and Item 8(b) covers "Townships and Area Development projects".
  General Conditions (GC): A clause stating that any Category B project located within a specified distance (10 km, later reduced to 5 km) of environmentally sensitive areas (like Protected Areas, Critically Polluted Areas, etc.) shall be treated as a Category A project and appraised at the central level.
  Column 5 of the Schedule: This column specifies "Conditions, if any" for each project type. The applicability of the General Conditions to a specific project type depends on whether it is mentioned in this column.

• The National Green Tribunal Act, 2010 (NGT Act):
  Section 22: Provides for appeals against NGT orders to the Supreme Court.

3. Basic Details of the Case

This appeal was filed by real estate developers' associations and companies against an order of the National Green Tribunal (NGT).

• The NGT Order: The NGT, in its order dated August 9, 2024, directed that all building and construction projects (under Items 8(a) and 8(b) of the EIA 2006 Notification) falling within 5 km of protected areas, critically polluted areas, etc., must be treated as Category A projects. This meant their environmental clearance would have to be appraised by the central expert committee (EAC) and not the state-level committees (SEAC/SEIAA).

• The NGT's Reasoning: The NGT held that the "General Conditions" (GC) of the EIA 2006 Notification were applicable to these projects. It based this on the fact that a 2014 notification, which had explicitly stated that GCs do not apply to these projects, had been quashed by the Kerala High Court in 2024. The NGT reasoned that quashing the 2014 notification automatically revived the applicability of the GCs.

• Impact of the NGT Order: This decision effectively paralyzed the real estate sector. Thousands of projects across the country, which were previously being appraised at the state level, were suddenly left in a limbo as neither the state authorities (who were stripped of power) nor the central authority (which was not equipped for the sudden deluge) could process their applications.

• Appellants' Challenge: The appellants (CREDAI, Godrej Properties, and Sai Sahara Developers) argued that the NGT's order was based on a fundamental misinterpretation of the law. They contended that the GCs were never meant to apply to building and construction projects from the very inception of the EIA 2006 Notification, and the 2014 notification was merely clarificatory. They also challenged the NGT's jurisdiction to issue such a sweeping directive.

4. Explanation of the Judgment

The Supreme Court allowed the appeals and set aside the NGT's order. The Court's reasoning provides an in-depth analysis of the legislative intent behind the EIA notification and the role of judicial bodies.

A. Core Legal Issue: Applicability of General Conditions to Building Projects

The central question was whether the General Conditions (GC) under the EIA 2006 Notification apply to building and construction projects (Items 8(a) and 8(b)), thereby requiring them to be appraised at the central level if near sensitive zones.

The Supreme Court's Analysis and Findings:

1. Plain Language and Legislative Intent of the EIA 2006 Notification:
The Court applied the literal rule of interpretation. It meticulously examined the Schedule to the EIA 2006 Notification and observed a critical pattern:

• For many other project types (e.g., mining, thermal plants, industries), Column 5 explicitly stated "General Conditions shall apply".

• However, for Items 8(a) and 8(b) (Building and Construction projects), Column 5 was left blank regarding the GCs. Instead, it contained other specific conditions related to built-up area.
  The Court held that this deliberate omission was a clear indication of legislative intent. The framers of the notification consciously decided that building projects should be appraised at the state level (as Category B), regardless of their location, to promote decentralization and efficient decision-making. This intent was further corroborated by the minutes of a high-level meeting chaired by the Prime Minister in 2006, which was also noted in the landmark case of In Re: Construction of Park at Noida near Okhla Bird Sanctuary (2011) 1 SCC 744.

2. Nature of the 2014 and 2025 Notifications:
The Court agreed with the appellants that the 2014 notification (which added a note saying "General Conditions shall not apply") was merely clarificatory. It did not change the law but simply stated what was already implicit in the original 2006 Notification. Therefore, when the Kerala High Court quashed the 2014 notification on procedural grounds, it did not and could not alter the original legal position that GCs never applied to these projects. There was no question of an "automatic revival" of GCs because they were never applicable in the first place.

3. The Final Position: 2025 Notification Upheld:
Following the NGT's order, the MoEF&CC issued a new notification on January 29, 2025, which once again explicitly stated in Column 5 that "General Conditions shall not apply" to Items 8(a) and 8(b). The validity of this 2025 notification was challenged in a separate writ petition (Vanashakti v. Union of India).
The Supreme Court, in its judgment in that case (which was referenced and adopted in this present judgment), upheld the 2025 notification. It reaffirmed that the GCs were never applicable to building projects. The Court only struck down a separate note (Note 1) in the notification that exempted industrial sheds and educational buildings from the EC process altogether, calling that exemption arbitrary.

B. Supreme Court's Directions and Conclusions

• The NGT's order dated August 9, 2024, was set aside for having misread the statutory scheme and the intent of the EIA 2006 Notification.

• The legal position was settled: The General Conditions (GC) under the EIA 2006 Notification do not apply to building and construction projects under Items 8(a) and 8(b).

• Consequently, these projects will continue to be appraised for environmental clearance by the State-level authorities (SEAC/SEIAA), even if they are located within 5 km of protected areas, critically polluted areas, or other zones mentioned in the GC.

• The Court expressed confidence in the expertise of the SEIAA, noting that it is a statutory body whose members are appointed by the Central Government based on prescribed expertise, and it is best suited to assess the environmental impact of projects within its state.

• The Court emphasized the principle of sustainable development, balancing the need for environmental protection with the necessity of development and providing housing.

This judgment provides much-needed clarity and stability to the real estate sector, ending the regulatory paralysis caused by the NGT's order and restoring the original decentralized framework envisioned by the EIA 2006 Notification.