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Madras High Court directs PESO to give licence to petroleum retail outlets in Tamil Nadu, Puducherry only if they fulfill mandatory norms

The Madras High Court passed certain directions and disposed of a Public Interest Litigation (PIL) filed seeking direction to  the 5 th and 6 th respondents (The Joint Director and Head of Zone Central Bureau of Investigation-Chennai Zone and The Head of Bureau Central Bureau of Investigation – ACB, Chennai)   or any other independent investigation agency to investigate and take appropriate actions, in accordance with law, against wrongful and negligent issuing of provisional site approvals and final explosive licenses in Form XIV by the 3 rd and 4 th respondents (The Joint Chief Controller of Explosives Petroleum and Explosive Safety Organisation (PESO) and The Deputy Chief Controller of  (PESO)) to the Petroleum Retail Outlets in Tamil Nadu and Puducherry.

The cause that the petitioner brings to the notice of the Court by way of the PIL is that any Petroleum Retail Outlet has to comply with several parameters relating to public safety and environment. The general public do not have sufficient knowledge and exposure about the relevant rules and procedure in force for granting site approvals for Petroleum Outlets as well as about the extent of harm that wrongful site approvals shall cause to their health and safety. The potential fire hazards and health problems associated with the continuous emission of Volatile Oil Compounds (VOC) such as Benzene, Toluene, etc., which are medically proven to cause major diseases of Cancer and damages to Brain and nervous systems, makes it necessary that these outlets are located as per law.   

The safety and public health norms are prescribed under the Petroleum Rules, 2002 . The Central Pollution Control Board (CPCB) had issued Siting and other mandatory   criteria for new Petroleum Outlets, vide Circular dated 07.01.2020. However, greedy applicants who seek prior site approvals from the Petroleum and Explosive Safety Organisation (PESO), as well as the No Objection Certificate (NOC) and Explosives Licence, play fraud with the system and succeed. False declarations are made and documents are produced as if every site is suitable and safe. Without any inspection whatsoever, the PESO authorities grant initial permission under Rule 133 of the Rules. Thereafter, on the strength of the same, the parties seem to manoeuvre the State authorities in getting the NOC with respect to the site and also Fire Safety and Explosive Licences. On the strength of the same the final licence is also granted by PESO. This resulted in innumerable retail outlets being illegally located posing potential danger to the society and therefore, repeated orders have been passed by this Court relating to the cancellation of NOC, license and ordering re-location of retail outlets. 

Hence, the petitioner is seeking constant vigil and prior site approvals based on independent and thorough verification of site, conforming to the standards and mandatory requirements. In many cases, wilfully and wantonly, the licenses are issued. In some cases, fake NOC’s were also produced. Without even proper verification of the same, the retail outlets are run. Under these circumstances, the above prayer is made.

The Division Bench of Chief Justice Sanjay Vijaykumar Gangapurwala and Justice D. Bharatha Chakravarthy observed that this is not an adversarial litigation and all concerned are interested in the safety of the general public as well as the due compliance of the Petroleum Rules and the mandatory criteria in respect of the location of the retail outlets. It is true that even at the stage of prior site approval, an enquiry is contemplated under Section 131 (2), wherein, the PESO authorities are to satisfy themselves as to the necessary ingredients in respect of Rule 131 (1) of the Rules. Similarly, the District Authorities are to satisfy the various criteria mentioned in Rule 144. Both the Rules, within the ambit would include the siting criteria and or any other mandatory norms imposed by any other law or authorities including CPCB or Directorate of Town and Country Planning or Water Resources Department or the Highways Department or the Fire Department etc.. 

However, it is also submitted before the Court that a number of Petroleum Retail Outlets are opened across the country and PESO does not have the wherewithal or the staffing pattern to physically inspect each and every site. Site inspection would also involve the proper identification of the site. Only the concerned Surveyor / Revenue Official will be in a position to earmark the concerned site, in order to measure the location of other protected areas around the site, such as water bodies, schools or other public building, residences etc., and the distances between the same and the Retail Outlets. In that view of the matter, the Court noted that the District Authorities granting NOC are better suited for the said purpose to coordinate with the local authorities in identifying and verifying the survey numbers boundaries and making measurements.

Rule 144 of the Rules also specifically mention the possession of the site, interest of public, specially the facilities like schools, hospitals and their proximity and any other matter pertinent to public safety. Therefore, the verification of the mandatory criteria of CPCB, or any other lawful authority would also come within the purview of granting of NOC. It would also be the duty of the respondents 2 to 4 – PESO authorities, to ensure that every Retail  Outlets which are licensed by them are not violating any of the mandatory norms, held by the High Court.  

Under the said circumstances, the Bench disposed of the Petition with the following directions:-   

“(i) While granting prior site approvals under Rule 131, the respondents 2 to 4 shall conduct due enquiry and satisfy themselves as to the fact that the site satisfies all the criteria mentioned under Rule 131 (1) and all other legal requirements; 

(ii) For the said purpose, it is not necessary to carry out physical inspection in each and every case, but whenever any doubt arises or in any situation which they deem fit and proper, a physical inspection shall also be made by PESO; 

(iii) Upon request of PESO, the concerned Revenue Tahsildar shall depute the jurisdictional Surveyor, who will demarcate the boundaries and assist in the location of the premises of the Retail Outlets and also assist in the measurements between the site and location of other buildings, water bodies etc.;    

(iv) Whenever a prior site approval is granted and the matter proceeds to the District Authority for issuance of NOC, the respondents 2 to 4 shall also in every case can prepare and forward a check list for the District Authorities to check, apart from the parameters for the District Authorities, which should include mandatory CPCB guidelines and other locational requirements; 

(v) Every State authority granting NOC shall grant the same only after objective satisfaction of all the criteria mentioned in the proforma and the criteria that may be contained in the checklist or any other criteria which it founds to be relevant and only upon satisfaction of the same shall issue a NOC; 

(vi) Satisfaction of the same shall be made by making a site inspection; 

(vii) Site inspection shall be carried on with the help of the jurisdictional Revenue Authorities upon request of the District Authority, concerned Tahsildar or the Authority as the case may be shall depute the jurisdictional Surveyor, who will identify the location and boundaries and shall  also assist the authority in making the measurements between the site and other relevant locations around the site so as to satisfy the mandatory requirements; 

(viii) The notes of inspection shall also be prepared in writing indicating therein, the objective satisfaction of each of the criteria, where under, the actual measurement and the distances between the houses or hospitals or water bodies etc., should be specifically mentioned. Site inspection notes shall also be forwarded to the respondents 2 to 4 for their consideration at the time of grant of final license; 

(ix) Even at the time of grant of final license, it would still be the duty of the respondents 2 to 4 to ensure that the Retail Outlets satisfy all the mandatory norms and if any doubt arises or in any appropriate cases, site inspection can also be made.”

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