Gujarat HC orders Alstom-Bharat Forge JV to stop construction

Gujarat HC orders Alstom-Bharat Forge JV to stop construction

Ahmedabad: In a setback to French power company Alstom SA’s joint venture with Bharat Forge Ltd, the Gujarat high court on Wednesday ordered the company to stop construction at the Mundra special economic zone (SEZ) till the Adani group firm got an environmental clearance from the Centre.

Alstom Bharat Forge Power Ltd has started construction for a power equipment manufacturing facility in the Mundra SEZ with an annual capacity for 5,000 megawatts (MW). It was to be commissioned by 2013 and aimed to be the largest private integrated power equipment manufacturing facility in the country, the company said in an announcement on 24 April.

Alstom Bharat Forge planned to invest about 2,400 crore in the project and had leased space for it in Mundra SEZ—one of the largest multi-product economic zones in the country.

The villagers had argued that the joint venture company could not begin construction in the area until the developer Mundra Port and Special Economic Zone Ltd (MPSEZ) obtained the mandatory environmental clearance from the Centre.

The petitioners told the court that the ministry of environment and forests had issued a show-cause notice to MPSEZ for allegedly violating coastal regulations and had not issued Mundra a mandatory prior clearance.

Adani group said in a statement that according to the high court order, the Alstom-Bharat Forge joint venture does not require an environmental clearance but it cannot construct in the area till Mundra SEZ receives an environmental clearance.

The order will have no impact on ongoing port operations and development at Mundra, for which the company has environmental clearance, the company said.

Email queries to Alstom and Bharat Forge remained unanswered till press time.

“So long the environmental clearance is not granted by the central government in favour of MPSEZ for creation of infrastructural facilities on the land so allotted and consequent to such permission, such facilities have been actually created by the allottee (MPSEZ), the latter cannot lawfully lease out the right of enjoyment of the infrastructural facilities to its lessee," Bhaskar Bhattacharya, acting chief justice, said in his order.