“No Industry Can Run Without Valid Consent”: MP HC Dismisses Mudra Steel’s Plea Against Pollution Board Closure

The Madhya Pradesh High Court at Indore has upheld the closure of a steel factory in Pithampur, holding that an industry running without a valid Consent to Operate cannot insist on a show-cause notice before the pollution control board shuts it down.

A Division Bench of Justice Subodh Abhyankar and Justice Jai Kumar Pillai dismissed the writ petition filed by Mudra Steel Industries Private Limited on September 28, 2026. A connected petition by Pensol Industries Private Limited raised a common question and was decided together.

Mudra makes TMT steel bars at Pithampur in Dhar district, melting scrap and sponge iron in an open induction furnace. The Madhya Pradesh Pollution Control Board granted it a Consent to Operate on April 21, 2025, valid till March 31, 2026. Condition 13 required a “Dog House Type” fumes extraction system on both furnaces within six months. That period ended on October 21, 2025, and the company admitted it had not installed the system on time.

The company sought renewal on March 28, 2026. After an inspection, the Board rejected it on April 29, citing multiple defects. On May 8, it ordered closure under Section 31-A of the Air Act and disconnected electricity. When the company sought 90 days and furnished a bank guarantee of Rs 17,62,500, the Board on June 16 put closure on hold and allowed upgrades till July 31.

The company filed a fresh application on August 13. A Board officer inspected on August 19 and recommended consent. However, a committee formed by the Collector of Dhar, which inspected on August 12, found the new arrangements not working, with suction pipe joints open. The Board encashed the guarantee on August 25, ordered closure on August 27 and rejected the fresh application on September 11.

Senior Advocate Amit Agrawal, assisted by Advocate Akhil Godha, argued for Mudra that only the full Board, not its Chairman, could pass such an order. His strongest plea was breach of natural justice: no show-cause notice, no hearing and no inspection reports supplied. He added that the Board ignored its engineer’s favourable report, the Collector lacked technical knowledge, and closure hurt 300 families, violating Articles 14 and 19(1)(g).

Government Advocate Pradyumna Kibe appeared for the State and Advocate Aniket Naik for the Board. They argued that an appeal lay under Section 31 of the Air Act, and that the June 16 order was only temporary relief for installing machines, not permission for production. They alleged violation of Section 21(4) of the Act and the 2025 Central Guidelines.

The Court accepted that the alternate remedy rule does not apply where natural justice is denied. However, “natural justice is not a rigid mathematical formula,” it said. Anyone claiming a hearing must show a legal right being taken away, and Mudra’s right to operate ended on March 31, 2026. “No industry can run without a valid consent,” the bench observed.

Since the factory lacked consent when closure was ordered, no legal right was violated. “Giving a long notice period to an illegally running factory would defeat the purpose of the environmental laws,” it said. It rejected the Chairman’s-power objection, noting he may act immediately in emergencies.

Comparing the inspection reports, the Court found the machines were installed but switched off. “Having a machine is useless, if it is not turned on during the manufacturing process,” it said. The bench added that it “cannot act as an expert engineer” and could not discard the Collector’s report merely because he is not an engineer.

Holding that “the Board did not act blindly,” the Court found the closure and rejection orders legal and valid. It dismissed the petition but allowed the company to file a fresh application only after all technical and pollution control conditions are completely fulfilled. No costs were imposed.

In the Pensol petition, Advocate Abhinav Dhanodkar appeared for the petitioner, while Mr. Agrawal with Mr. Godha appeared for respondent no. 6.

Case Title: Mudra Steel Industries Private Limited vs. State of Madhya Pradesh and Others with connected matter

Order Date: September 28, 2026

Bench: Justice Subodh Abhyankar and Justice Jai Kumar Pillai