The High Court · 2025

Petition under Article 226 of the Constitution of lndia praying that in the circumstances stated in the affidavit .filed therewith, the High Court may be pleased to issue a writ of mandamus or any writ order or direction declaring the impugned order No.D.O.Lr.No.188/APPCB|2O12 dated-01 12.2013 issued by the 2nd Respondent demanding for a sum of Rs.7,7'1 ,000/- (Seven Lakhs Seventy One Thousand Only) from the Petitioner as without authority of law, illegal and hence unenforceable l.A. NO: 1 OF 2014(WPMP. NO: 5028 OF 2014) Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to stay the impugned demand No.D.O.lr.No.1BB/APPCB/20'12 dated:0'1 .12.2013 by the 2nd Respondent Counsel for the Petitioner: SRl. M. S. SRINIVASA IYENGAR Counsel for the Respondents: Ms. S. SRAVANTHI, AGP FOR REVENUE The Court made the following: ORDER THE HONOURABLE SRI WSTICE K.SARATH WRIT PETITION No.4O73 of 2OL4 ORDER: Heard Sri M.S.Srinivasa lyengar, learned Counsel for the petitioner and Mrs. S.Sravanthi, learned Assistant Government Pleader for Revenue appearing for the respondents and perused the material on record.

2. Learned counsel for the petitioner submits that the petitioner filed the present Writ Petition seeking to declare the impugned order No.D.O.Lr.No.18S/APPCB/2012 dated

01.12.2013 issued by respondent No.2 demanding for a sum of Rs.7,7I ,OOO/ from the petitioner towards Corporate Social Responsibility (for brevity, "CSR")/Enterprise Social Responsibility (for brevity, "ESR') i.e., O.2o/o contribution of thc project cost by industrialists, as illegal and arbitrary.

3. Learned counsel for the petitioner further submits that the petilioner's company is a reputed company engaged in the business of manufacture, supply and sales 2 of Insulation products, having its plant at Kohir 'X' Road, I(ave li, Ncar Zaheerabad, Kohir Mandal, Medak District. The petitioner also obtained consent order from the Andhra Pradesh Pollution Control Board (now called "the Telangana Pollution Control Board" and for breviqy, "PCB") under the relevant provisions of the Water (Prevention & Control of Pollution) Act, 1974 (hereinafter referred to as "thc Act, 1974"1 and under Section 2I of the Air (Prevention & Control of Pollution) Act, 1981 (hereinafter referred to as "the Act, 198 1") read with Rule 5 of thc Hazardous Waste (Management Handling & Transboundry Movement) Rules, 2OO8 (hercinafter referred to as "the Act, 2008")

4. Learned counsel for the petitioner lurther submits that, while it being so, the respondent No.2 issued a letter dated O l.l2.2Ol3 to the petitioner demanding an amount of Rs.7,71,OOO/- purporting to be under CSR/DSR lor the year 201.2-13. In response to the same, the petitioner submitted a reply letter dated 2l .OI.2014. Thc respondent No.2, without any power or jurisdiction as per lalr, and basing only on the letter of the PCB, has issued the said impugned order demanding the payment of the said amount and if the petitioner defaulted the pa5rment of CSR/ESR, the Registrar o[ Companies (ROC) has to take appropriate action against the petitioner as per the Companies Act, 2013 (for brevity, "the Act, 2O13") and requested to allow the Writ Petition by setting aside the impugned order dated Ol.L2.2Ol3 issued by respondent No.2.

5. On the other hand. Iearned Assistant Government Pleader lor Revenue, basing on the counter filed by respondent No.2. submits that as per the suggestions of the PCB, the District Administration has created a District Corporatc ResponsibiLity Cell for proper supervision and monitoring o[ the lund flow contributed towards CSR/ESR and accordingly, a letter was addressed to the petitioner- company uide leLter dated 01.12.2013 inviting the attention of the letter received from PCB and the industry's responsibility towards ailocating the CSR/ESR amount. It was informed in the letter that the petitioner's company ') 'shall contribute at least O.08ol, to O.2o/o of the project cost 4 and that the fund has to be utilized for social welfare activities like health, education, sanitation, drinking water supply, welfare of weaker sections, women empowerment and skill development for making people employable. In view of the same, learned Assistant Government Pleader requested to dismiss the Writ Petition as devoid of merits.

6. After hearing both sides and on a perusal of the material on record, this Court is of the considered view that the petitioner company is established in Medak District and the respondent No.2 issued a letter dated 01.12.2013 uide No.D.O.Lr.No.1S8/APPCBl20l2, basing on a letter issued by the thcn Andhra Pradesh Pollution Control Board. It is the case of the petitioner that the respondent No.2-Collector and District Magistrate has no power or jurisdiction to penalize the petitioner for pa5rment of CSR/ESR and il the petitioner's company is default in payment ol such arnounts, the Registrar of Companies has to take appropriate steps against the petitioner as per the Act,

2013. 5

7. Section 135 (5), (6) and (7) of the Act,2013, reads as under: '(5) The Board of euery compang refered to in sub- section (1), shall ensure that ttrc companA spends, in euery financial Aear, at least two per cent of th.e auerage net profits of tle compang made during tlrc three immediately preeding financial gears, [or where the compang has not completed the period of tht ee financial gears since its incorporatioru, during such immediately preceding financial gears,l in pursuane of its Corporate Social Responsibility Policy: xxxxxxxl (6) Any amount remaining unspent under sub-sedion (5), pursuant to any ongoing project, fuljilling such mnditions as mag be prescribed, undertaken by a compang in pursuane of its Corporate Social Respo nsibility Policy, shall be transfened bg the company uithirt a peiod of thirtg dags from the end of the financial year to a special account to be opened bg the cornpany irt tlmt behalf for tlnt ftnancial year in ang scheduled bank to be called the Unspent Corporate Social Respo nsibilitg Account, and such amount slnll be spent bg the cornpang in pursuance of its obligation towords tlLe Corporate Social ResponsibilitA Policg within a peiod of three financial years from the date of such transfer, failing whicl4 tlrc compar"LA shall transfer tlrc sam.e to a Fltnd specified in Schedule VII, ruithin a peiod of thirtA dags from the date of completion of the third. fina ncial year. (7) If a companA is in- default in complying uith tte prouisions of sub-sectiort (5) or sub-section (6), the companA shall be liable to a penalty of twice the amount required to be 6 transfered by the companA to the Fund specifted in Schedule VII or the (Jnspent Corporate Social Responsibtlitg Acaunt, as the case maA be, or one crore rupees, whicheuer is less, and euery officer of the company tu?n is in default shnll be liable to a penaltA of one-tenth of the amount required to be transfened bg the cor.rlpanA to such Fund specifred in Schedule Vfi, or the Unspent Corporote Soctal Responsibilitg Account, as the case mag be, or tuto lakh rupees, uhicheuer is less. "

8. In view of the above provisions of the Act, 2013, respondent No.2 has nc power or jurisdiction to demand the said arnolrnt lrom the petitioner uide impugned order dated 01.I2.2O13 and also in the counter affidavit, the respondent No.2 nou,here mentioned about its power and jurisdiction in issuing the impugned order datcd Ol.l2.2ol3 and basing only on the letter of the PCB, the respondent authorities cannot issue the said order to the petitioner under the claim of CSR/ESR. In view ol the same, the letter issued by respondent No.2 is liable to be set aside and if any action is to be taken against the petitioner for the payment of said amounts towards CSR/ESR, the respondent authorities have to take action as per Section 135 of the Act, 2O13.

9. Accordingly, this Writ petition is allowed by setting aside the impugned order dated Ol.l2.2}l3 uid.e No.D.O.Lr.No.188/AppCB/2012, issued by respondent No.2. However. there shall be no order as to costs. Miscellaneous Petitions, if any, pending in this Writ Petition, sha-ll stand closed. That Rrrle Nisi has been made absolute as above Witness THE HON'BLETHE CHIEF JUSTICE APARESH KUMAR SINGH, MONDAY,THE SIXTH DAY OF OCTOBER TWO THOUSAND AND TWENW FIVE //TRUE COPY// SD/.P.C.SULEKHA DEVI ASSISTANT REGISTRAR SECTION OFFICER To, Medak, Andhra Pradesh. 'I . The Principal Secretary, Department of Revenue, T.S.,Hyderabad. 2. The Collector & District Magistrate, Medak District, Hqrs., Sangareddy, 3. One CC to SRl. M S SRINIVASA IYENGAR, Advocate [OPUC] 4. Two CCs to GP FOR REVENUE ,High Court for the State of Telangana at 5. Two CD Copies Hyderabad [OUT] BM HIGH GOURT DATED:0611012025 I I ;1 /A i U JAtl 2ilm z * ORDER WP.No.4073 of 2014 ALLOWING THE WRIT PETITION WITHOUT COSTS t 'r)r{ I,{