CAV Order

1. Since all the writ petitions in the present batch involve substantially identical questions of fact and law, challenge the same administrative action of the respondent authorities and arise out of a common factual and legal background, they were heard analogously with the consent of the learned counsel appearing for the respective parties and are being disposed of by this common order.

2. The core controversy involved in these writ petitions relates to the legality and validity of the action of the respondent authorities in directing recovery of 2% Access and Benefit Sharing (for short, 'ABS') from the purchase price of Tendu Forest Lots allotted to the petitioners under the provisions of the Biological Diversity Act, 2002 (for short, 'Act, 2002'), the Chhattisgarh Biological Diversity Rules, 2015 (for short, 'Rules, 2015'), and the Guidelines on Access to Biological Resources and Associated Knowledge and Benefit Sharing Regulations, 2014 (for short, 'Regulations, 2014'). The challenge in all these petitions is directed against the Order dated 24.01.2023 issued by respondent No.2/Chhattisgarh State Biodiversity Board and the consequential Letter dated 25.01.2023, whereby the respondent authorities authorized recovery of 2% ABS from the successful purchasers of Tendu Forest Lots and directed the concerned Divisional Forest Officers-cum-Managing Directors of the District Minor Forest Produce Co-operative Unions to obtain the prescribed forms and agreements from the purchasers and to realize 2% of the purchase price towards Access and Benefit Sharing for deposit with the Chhattisgarh State Biodiversity Board. The petitioners contend, inter alia, that they are purchasers of Tendu Forest Lots through public auction conducted by the Chhattisgarh State Minor Forest Produce (Trading and Development) Co-operative Federation (for short, 'Federation') and do not directly procure Tendu Leaves from forest dwellers, tribal collectors, primary minor forest produce co-operative societies or Gram Sabhas.

3. According to the petitioners, the entire process relating to collection, procurement, storage and sale of Tendu Leaves in the State of Chhattisgarh is exclusively governed by the provisions of the Chhattisgarh Tendu Patta (Vyapar Viniyaman) Adhiniyam, 1964 (for short, 'Adhiniyam, 1964'), under which the State exercises complete control over the trade in Tendu Leaves. It is their specific case that they merely purchase Tendu Forest Lots from the State through the statutory auction process and, therefore, there is no direct access to biological resources or associated knowledge so as to attract the provisions relating to Access and Benefit Sharing under the Act, 2002, the Rules, 2015 or the Regulations, 2014. The petitioners further contend that Rule 17(4) of the Rules, 2015 and Clause 3 of the Regulations, 2014 are wholly inapplicable to their transactions and, consequently, they are not liable to pay the impugned 2% ABS amount. They also submit that the levy is dehors the contractual stipulations governing the allotment of Tendu Forest Lots for the relevant auction year and cannot be retrospectively enforced by insertion of Clause 15-B of the Regulations, 2014 through subsequent executive instructions.

4. Aggrieved by the aforesaid order dated 24.01.2023 and consequential letter dated 25.01.2023, the petitioners have questioned their legality and validity by filing the present batch of writ petitions.

5. Since the pleadings, the questions involved, the statutory provisions requiring interpretation, the nature of challenge, the reliefs claimed and the submissions advanced on behalf of the parties are substantially identical in all the connected matters, all these writ petitions were heard analogously and are being decided by this common judgment. The principal issue for determination in every petition is whether the respondent authorities are legally justified in recovering 2% ABS from the petitioners in respect of Tendu Forest Lots purchased through the statutory auction mechanism. 6. Considering the commonality of issues, W.P.(C) No. 1457 of 2023 has been treated as the lead case for the purpose of narration of facts and adjudication. The decision rendered in the lead matter shall govern all the connected writ petitions, subject to any distinguishing facts, if any. It is also pertinent to note that during the pendency of these petitions, this Court had granted interim protection to the petitioners. Since the tenders for the subsequent auction year had already been finalized and the Forest Lots had been allotted in favour of the petitioners, this Court, taking note of the common challenge involved, restrained the respondents from making recovery of the impugned 2% Access and Benefit Sharing amount under the Act, 2002 and the Regulations, 2014 till further orders. For the sake of convenience, the relief sought by the petitioners in W.P.(C) No. 1457 of 2023 is extracted hereinbelow:-

          "i. To Set-Aside the Order dated 24th January 2023 and Letter dated 25th January 2023 issued by Respondent No.2 being bad in law and contrary to Regulations, 2014.

          ii. Pass any other relief/order or direction, as this Hon'ble Court deems fit and proper looking to the facts and circumstance of the case in the interest of justice."

7. The brief facts, shorn of unnecessary details, giving rise to the present batch of writ petitions are that the petitioners are traders/contractors engaged in the business of procurement and processing of Tendu Leaves (Tendu Patta), which constitute one of the most important Minor Forest Produce in the State of Chhattisgarh. Tendu Leaves are abundantly available in the forest areas predominantly inhabited by Scheduled Tribes and other traditional forest dwellers and constitute a major source of livelihood for thousands of tribal families. The collection of Tendu Leaves is undertaken by local pluckers through the machinery established by the State Government and the Federation, which is entrusted with the procurement, management and disposal of the said minor forest produce. The revenue generated from the sale of Tendu Leaves is utilized not only for payment of wages to the pluckers but also for distribution of profits amongst the tribal collectors, primary societies, district unions and the Federation in accordance with the policy framed by the State Government.

8. The petitioners in the present batch of writ petitions are successful bidders to whom different Forest Lots situated in various districts of the State, including Sukma, Kondagaon, Kanker, Gariaband, Korba, Khairagarh, Rajnandgaon and other districts, were allotted pursuant to public auction conducted by the Federation for the collection years 2022 and 2023. Upon acceptance of their bids, allotment orders were issued in favour of the respective petitioners and purchaser's agreements were executed between the concerned Divisional Forest Officers acting on behalf of the Federation and the successful bidders. Under the contractual arrangement, the petitioners acquire the right to receive the Tendu Leaves comprised in the allotted Forest Lots upon payment of the bid amount and are thereafter required to undertake the processes necessary for making the leaves commercially marketable.

9. According to the petitioners, the procurement mechanism followed by the Federation is materially different from a direct purchase of biological resources from forest dwellers or tribal cultivators. The Tendu Leaves are initially procured by the Federation and its district-level authorities from the village-level collectors through the statutory procurement system established by the State Government. It is only after such procurement that the Forest Lots are put to public auction and allotted to the successful bidders. Consequently, the petitioners contend that they do not enter into any contractual relationship with the tribal collectors, Gram Sabhas, Joint Forest Management Committees or forest dwellers, nor do they purchase Tendu Leaves directly from them. Their contractual relationship is exclusively with the Federation and its officers under the terms of the auction and purchaser's agreement.

10. It is further the case of the petitioners that the Tendu Leaves received from the Federation are not immediately fit for commercial use in the manufacture of beedis. The green leaves supplied to the petitioners are incapable of being directly utilized for beedi manufacturing and are required to undergo an elaborate process of value addition. After taking delivery, the petitioners undertake a series of operations including pruning, drying, sprinkling of water, weathering, preservation, application of insecticides, sun-drying, rinsing, bundling and packing in jute bags under prescribed conditions. It is only upon completion of these processes that the leaves acquire the requisite texture, flexibility, durability, flavour and fire-retaining capacity necessary for the manufacture of beedis and become commercially marketable. According to the petitioners, by virtue of such extensive processing, the Tendu Leaves are transformed into value-added products, thereby taking them outside the ambit of the expression "biological resources" as defined under Section 2(c) of the Act, 2002.

11. The petitioners further plead that while the Act, 2002, the Rules, 2015 and the Regulations, 2014 regulate access to biological resources and provide for equitable sharing of benefits arising from their commercial utilization, the statutory framework primarily contemplates situations where biological resources are accessed or procured directly from local communities, forest dwellers, tribal cultivators or similar stakeholders. According to the petitioners, since the Federation itself procures the Tendu Leaves from the collectors and thereafter auctions the Forest Lots, the petitioners do not fall within the category of persons upon whom the obligation of ABS can legally be imposed.

12. It is the further case of the petitioners that although the State Government approved insertion of Clause 15-B in the purchaser's agreement requiring compliance with the provisions of the Act, 2002 and the Rules, 2015, the said clause was admittedly not incorporated in the original agreements executed for the collection year 2022. Nevertheless, the respondent authorities subsequently issued communications directing execution of supplementary agreements and thereafter proceeded to enforce the said clause in respect of the contracts already concluded. The petitioners contend that such unilateral incorporation of contractual obligations after execution of the agreements is legally impermissible and cannot form the basis for recovery of any amount from them.

13. The immediate cause for filing the present batch of writ petitions arose when the Chhattisgarh State Biodiversity Board issued the Order dated 24.01.2023, declaring certain forest officers as "Authorized Officers" under Rule 17(4) of the Rules, 2015 and directing them to recover 2% ABS from the purchase price of the Forest Lots allotted to the petitioners. The said order was followed by a detailed communication dated 25.01.2023, prescribing the manner in which Clause 15-B of the Rules, 2015 was to be incorporated in the purchaser's agreements and directing recovery and deposit of the ABS amount with the State Biodiversity Board. Pursuant thereto, the concerned Divisional Forest Officers initiated steps for deduction and recovery of the aforesaid amount from the petitioners.

14. Aggrieved by the aforesaid order and consequential communications, the petitioners in all the connected writ petitions have approached this Court invoking its writ jurisdiction under Article 226 of the Constitution of India. The principal challenge in the entire batch of petitions is to the legality, validity and enforceability of the Order dated 24.01.2023 and Letter dated 25.01.2023, whereby recovery of 2% ABS has been directed from the purchase price of Tendu Forest Lots.

15. The petitioners contend that the impugned action is contrary to the provisions of the Act, 2002, the Rules, 2015 and the Regulations, 2014; that they are neither direct purchasers of biological resources from forest dwellers nor persons covered by Regulation 3 of the Regulations, 2014; that the Tendu Leaves handled by them constitute value-added products after undergoing extensive processing; that the levy sought to be imposed has no statutory sanction in the facts of the case; and that, in any event, no such liability could have been retrospectively fastened upon them for the contracts relating to the collection year 2022 in the absence of any contractual stipulation authorizing such recovery.

16. Mr. Prafull N. Bharat, learned Senior Counsel, assisted by Mr. Siddharth Shukla, learned counsel appearing for the respective petitioners, submits that the entire foundation of the impugned order dated 24.01.2023 and the consequential letter dated 25.01.2023 proceeds on a complete misconception of the scheme of the Act, 2002, the Rules, 2015 and the Regulations, 2014. According to him, the sole controversy in the present batch of writ petitions is a narrow one, namely, whether the State Biodiversity Board could invoke Clause 3 of the Regulations, 2014 and direct recovery of 2% ABS from the petitioners merely because they purchase Tendu Forest Lots through a statutory auction conducted by Respondent No.3. Learned Senior Counsel submits that the constitutional validity of the Act, 2002 or the concept of Access and Benefit Sharing is not under challenge. The petitioners have confined their challenge to the jurisdiction of the respondent authorities to invoke Clause 3 of the Regulations in the facts of the present cases.

17. Elaborating his submissions, learned Senior Counsel contends that the entire trade of Tendu Leaf in the State of Chhattisgarh is governed by the provisions of the Adhiniyam, 1964, which creates a complete statutory code regulating procurement, storage, transportation, auction and disposal of Tendu Leaves. By virtue of Sections 4, 5, 6, 7, 9 and 12 of the Adhiniyam, 1964, the State Government, acting through its statutory agent, i.e. Federation alone is authorized to procure Tendu Leaves from forest dwellers and tribal collectors, determine the procurement price, pay wages to the collectors and thereafter dispose of the Forest Lots by way of public auction. It is submitted that the petitioners enter into the statutory chain only after the procurement process is complete and their contractual relationship commences only upon allotment of the Forest Lots by Respondent No.3. Consequently, the petitioners neither negotiate with nor purchase Tendu Leaves directly from forest dwellers, Gram Sabhas, Tribal Cultivators or Joint Forest Management Committees, but merely purchase Government auction lots under the statutory mechanism.

18. Learned Senior Counsel further submits that the petitioners do not commercially exploit raw biological resources as contemplated under the Act, 2002. According to him, after taking delivery of the green Tendu Leaves from the Government authorities, the petitioners undertake an elaborate process involving drying, weathering, sprinkling of water, insect protection, sun-drying, rinsing, bundling, packing and preservation before the leaves become fit for transportation and eventual use in the manufacture of beedis. The said processes substantially enhance the commercial utility, quality and characteristics of the leaves, thereby converting them into value-added products, which, according to the petitioners, stand excluded from the definition of "biological resources" under Section 2(c) of the Act, 2002. Thus, the very premise on which the respondents seek to invoke the ABS mechanism is stated to be legally unsustainable.

19. It is next contended that the Act, 2002 is not a charging statute creating an automatic liability to pay Access and Benefit Sharing in every commercial transaction involving a biological resource. Referring to Sections 7, 21, 23 and 24 of the Act, 2002, learned Senior Counsel submits that the determination of fair and equitable benefit sharing is required to be made strictly in accordance with the Regulations framed by the National Biodiversity Authority. Therefore, the authority of the State Biodiversity Board to impose ABS is circumscribed by the conditions stipulated in Clause 3 of the Regulations, 2014, and unless the jurisdictional facts contemplated therein exist, the Board lacks competence to direct recovery of any amount from the petitioners. It is further argued that Clause 15-B of the Regulations, 2014 was admittedly absent in the purchaser's agreements executed for the collection year 2022 and, therefore, the respondents could not retrospectively incorporate the said clause through executive instructions and recover ABS for contracts already concluded.

20. Learned Senior Counsel has laid considerable emphasis on the language employed in Clause 3 of the Regulations, 2014 and submits that the said provision specifically contemplates cases where an applicant, trader or manufacturer purchases biological resources directly from Joint Forest Management Committees, forest dwellers, tribal cultivators or Gram Sabhas. According to him, the expression "purchases directly" constitutes the very jurisdictional fact for invocation of Clause 3 of the Regulations, 2014. Since the petitioners admittedly purchase only Government auction lots from Respondent No.3 and have no direct transaction with any of the specified benefit claimers, the essential pre- condition for invoking Clause 3 is absent. It is argued that the interpretation advanced by the respondents renders the words "purchases directly" wholly otiose and impermissibly enlarges the scope of delegated legislation. In support of the principles governing statutory interpretation, reliance has been placed on Sri Tarkeshwar Sio Thakur Jiu v. Dar Dass Dey & Co., (1979) 3 SCC 106, wherein the Hon'ble Supreme Court interpreted the expression "directly", and B.D. Shetty v. CEAT Ltd., (2002) 1 SCC 193, wherein it was held that every word employed by the Legislature must be given its due meaning and no statutory expression can be treated as redundant.

21. Learned Senior Counsel further submits that the validity of the impugned orders must be tested solely on the reasons contained therein and cannot be supplemented by fresh reasons in the counter affidavits. Reliance in this regard has been placed upon the celebrated decision in Mohinder Singh Gill v. Chief Election Commissioner, (1978) 1 SCC 405, as followed in City and Industrial Development Corporation of Maharashtra Ltd. v. Shishir Realty (P) Ltd., (2022) 16 SCC 527, State of Bihar v. Shyama Nandan Mishra, (2022) 17 SCC 420 and Babanna Machched v. Union of India, (2024) 5 SCC 306, to contend that an administrative order must stand or fall on the reasons recorded therein. It is submitted that the impugned Order dated 24.01.2023 nowhere records the existence of the jurisdictional facts necessary for invocation of Clause 3 of the Regulations, 2014 and, therefore, the respondents cannot improve their case by introducing new grounds during the course of litigation.

22. Learned Senior Counsel also submits that the Adhiniyam, 1964 and the Act, 2002 operate in distinct but harmonious fields and there exists no conflict between the two enactments. According to him, while the Adhiniyam, 1964 governs the statutory trade in Tendu Leaf through the State machinery, the Biological Diversity Act regulates access to biological resources and equitable benefit sharing. A harmonious construction of both enactments necessarily leads to the conclusion that where the State itself, acting through its statutory agency, procures Tendu Leaves from forest dwellers and thereafter auctions Government Forest Lots, the successful auction purchasers cannot, by any legal fiction, be treated as persons directly procuring biological resources from benefit claimers. Learned Senior Counsel further submits that the respondents themselves have described ABS as a "fee" in their pleadings and, therefore, in the absence of any identifiable service or quid pro quo rendered to the petitioners, the levy cannot be sustained. Reliance in this regard has been placed upon the Constitution Bench judgment in Commissioner, Hindu Religious Endowments v. Lakshmindra Thirtha Swamiar of Sri Shirur Mutt, AIR 1954 SC 282.

23. Lastly, learned Senior Counsel submits that the reliance placed by the respondents on the decision of the Uttarakhand High Court in Divya Pharmacy v. Union of India & Others, 2018 SCC OnLine Utt 1035, is wholly misconceived, as the said judgment arose in an entirely different factual and statutory backdrop and did not involve purchasers of Government-auctioned Forest Lots under the Adhiniyam, 1964. It is further contended that the provisos appended to Clause 3 of the Regulations, 2014 cannot operate independently of the substantive provision and cannot enlarge its scope. In support of the State's statutory ownership and control over forest produce and the mechanism governing procurement and sale of Tendu Leaves. Reliance has also been placed upon the decision of the Division Bench of this Court in Krishna Shukla v. State of Chhattisgarh & Others, WPPIL No.113 of 2021, decided on 07.04.2026, as well as State of West Bengal v. Sujit Kumar Rana, (2004) 4 SCC 129.

24. On the strength of the aforesaid submissions, learned Senior Counsel contends that the foundational jurisdictional facts prescribed under Clause 3 of the Regulations, 2014 are admittedly absent in the present cases and, therefore, the impugned order dated 24.01.2023 and the consequential letter dated 25.01.2023 are without authority of law, arbitrary, contrary to the statutory scheme and deserve to be quashed.

25. Mr. Amrito Das, learned Senior Counsel, assisted by Mr. Ankur Agrawal, learned counsel appearing for the respective petitioners, would submit that the impugned letter dated 24.11.2022, the consequential order dated 24.01.2023 and letter dated 25.01.2023, whereby the respondent authorities have directed recovery of 2% ABS from the purchase price of Tendu Forest Lots, are wholly without jurisdiction, contrary to the statutory scheme governing trade in Tendu leaves and liable to be quashed. According to the learned Senior Counsel, the petitioners are merely successful auction purchasers of Tendu Forest Lots from the State Government and do not have any direct transaction or privity with forest dwellers, tribal cultivators, Gram Sabhas or primary collectors from whom the Tendu leaves are initially procured.

26. It is submitted that the entire trade in Tendu leaves in the State of Chhattisgarh is exclusively governed by the provisions of the Adhiniyam, 1964 (as applicable to the State of Chhattisgarh), which creates a complete statutory monopoly in favour of the State Government. Referring to the Preamble and Sections 4, 5, 7, 9, 12 and 12-A of the Adhiniyam, 1964, learned Senior Counsel would contend that the State Government alone, or its authorised officer or agent, is empowered to purchase Tendu Leaves from growers and forest dwellers, fix the purchase price, and thereafter dispose of the Tendu Leaves by sale or auction. The statutory scheme, therefore, completely excludes any direct purchase by private traders from forest dwellers and vests the ownership of Tendu Leaves in the State Government before they are sold through public auction.

27. Learned Senior Counsel would further submit that Sections 5(1) and 5(3) of the Adhiniyam, 1964 expressly prohibit any person other than the State Government or its authorised agent from purchasing Tendu Leaves from growers, while Section 9 casts a statutory obligation upon the State Government or its authorised officer to purchase the produce at the price fixed under Section 7. Thereafter, under Section 12, the State Government alone is authorised to sell or otherwise dispose of the Tendu Leaves. Even the resale of surplus Tendu Leaves is regulated under Section 12-A, which requires prior permission of the State Government. Thus, the entire chain of procurement, ownership, transportation, sale and resale is statutorily regulated by the State Government, leaving no scope for any direct procurement by the petitioners from the original collectors.

28. Proceeding on the aforesaid statutory scheme, learned Senior Counsel would argue that the provisions relating to Access and Benefit Sharing contained in the Act, 2002, the Rules, 2015 and the Regulations, 2014 are wholly inapplicable to the petitioners. Inviting attention to Regulation 3 of the Regulations, 2014, it is contended that the obligation to share benefits arises only where a trader or manufacturer directly purchases biological resources from Joint Forest Management Committees, forest dwellers, tribal cultivators or Gram Sabhas without any prior benefit-sharing arrangement. Since the petitioners purchase Tendu Forest Lots only from the State Government through a statutory auction conducted by the State Federation, they do not fall within the class of persons upon whom benefit-sharing obligations are imposed under the Regulations, 2014.

29. It is further submitted that the impugned levy of 2% ABS has been sought to be imposed by executive instructions in the midst of the contractual period after the auction process had already been concluded and the Forest Lots had been allotted to the petitioners. The terms and conditions governing the auction did not contemplate any such additional financial liability at the time the bids were submitted and accepted. According to learned Senior Counsel, the respondent authorities could not unilaterally alter the contractual terms by directing recovery of an additional amount through executive orders, particularly when no such liability is contemplated either under the Adhiniyam, 1964 or under the contractual documents executed between the parties.

30. Learned Senior Counsel would further contend that even assuming, without admitting, that the impugned 2% amount is not in the nature of a tax but is sought to be justified as compensation, cess or benefit-sharing contribution, the petitioners cannot be saddled with such liability. The petitioners acquire ownership over the Tendu Leaves only after the State Government has completed the statutory process of procurement and disposal under the Adhiniyam, 1964. Consequently, the petitioners are merely subsequent purchasers from the State Government and cannot be equated with traders who directly access biological resources from forest dwellers or indigenous communities. It is submitted that fiscal and charging provisions must receive strict interpretation, and in the absence of any express statutory provision authorising recovery from subsequent purchasers, no such liability can be imposed.

31. On the strength of the aforesaid submissions, learned Senior Counsel would submit that the impugned letter dated 24.11.2022, order dated 24.01.2023 and consequential letter dated 25.01.2023 are contrary to the scheme of the Adhiniyam, 1964, the Act, 2002, the Rules, 2015 and the Regulations, 2014. It is, therefore, prayed that the impugned communications directing recovery of 2% Access and Benefit Sharing from the petitioners be declared illegal and quashed, and the respondents be restrained from making any such recovery from the petitioners.

32. Ms. Akansha Jain, learned counsel appearing for the respective petitioners, while adopting the submissions advanced by Mr. Amrito Das, learned Senior Counsel, would further submit that the very foundation of the impugned demand is contrary to the statutory framework of the Act, 2002 and the Regulations, 2014. According to her, Clause 3 of the Regulations, 2014 contemplates benefit-sharing obligations only in cases where a trader or manufacturer directly procures biological resources from Joint Forest Management Committees (JFMCs), forest dwellers, tribal cultivators or Gram Sabhas. In the present cases, the petitioners do not have any direct commercial transaction with such benefit claimers, as they purchase Tendu Forest Lots only from the Federation through a statutory auction conducted under the provisions of the Adhiniyam, 1964. Consequently, the essential jurisdictional requirement for invoking Clause 3 of the Regulations, 2014 is wholly absent.

33. Learned counsel would further submit that the statutory scheme under the Adhiniyam, 1964 creates a complete monopoly in favour of the State Government in the procurement and trade of Tendu Leaves. The growers and forest dwellers are statutorily obliged to sell Tendu Leaves only to the State Government or its authorised officers or agents, who thereafter dispose of the produce by public auction. The petitioners are, therefore, merely subsequent purchasers from the State and cannot be equated with traders who directly access biological resources from benefit claimers. She would further contend that the reliance placed by the respondents on the decision in Divya Pharmacy (supra) is wholly misconceived, as the said decision did not consider the statutory scheme under the Adhiniyam, 1964 creating State monopoly over the trade in Tendu Leaves, and, therefore, the ratio laid down therein cannot be mechanically applied to the facts of the present cases.

34. Learned counsel would next contend that, even otherwise, the Tendu Leaves dealt with by the petitioners cannot be regarded as "biological resources" within the meaning of Section 2(c) of the Act, 2002 at the stage when they are commercially utilised. It is submitted that after procurement, the leaves undergo several processes such as pruning, drying, weathering, sprinkling, preservation, grading, bundling and packing, whereby they acquire enhanced utility and commercial value and become value-added products. Since Section 2(c) of the Act, 2002 expressly excludes "value-added products" from the definition of "biological resources", the processed Tendu Leaves fall outside the ambit of the Act, with the result that the provisions relating to ABS cannot be invoked against the petitioners.

35. It is further submitted that the respondents have sought to impose the impugned liability by executive instructions after the auction process had concluded and the agreements governing the collection year 2022 had already been executed. The agreements executed pursuant to the auction did not contain any stipulation requiring payment of Access and Benefit Sharing. Clause 15-B, incorporating such liability, was admittedly introduced subsequently, and the respondents themselves sought execution of supplementary agreements, thereby acknowledging that no such obligation formed part of the original contractual arrangement. According to learned counsel, the respondents, by virtue of their monopolistic position in the trade of Tendu Leaves, attempted to compel the petitioners to execute supplementary agreements at a stage when they had already undertaken substantial contractual obligations. Such unilateral alteration of concluded contracts, it is submitted, is contrary to Section 21 of the Act, 2002, which contemplates determination of equitable benefit sharing only on the basis of mutually agreed terms and conditions, and is therefore arbitrary and violative of Article 14 of the Constitution of India.

36. Learned counsel would also submit that the object of equitable benefit sharing already stands substantially fulfilled through the existing statutory mechanism governing the trade in Tendu Leaves in the State. It is contended that the profits generated from the sale of Tendu Leaves are distributed under the State policy, whereby a substantial portion is paid to the collectors and forest-dependent communities, while the remaining amount is utilised for development of Primary Minor Forest Produce Co- operative Societies and value addition of forest produce. In such circumstances, the additional levy of 2% ABS upon the petitioners, who merely purchase Tendu Forest Lots through public auction, amounts to duplication of benefit sharing and imposes an unreasonable financial burden having no rational nexus with the object sought to be achieved under the Act, 2002. According to learned counsel, the impugned levy therefore imposes an unreasonable restriction upon the petitioners' fundamental right to carry on trade and business guaranteed under Article 19(1)(g) of the Constitution of India.

37. Lastly, learned counsel would submit that the impugned levy cannot be sustained either as a fee or as a tax. It is argued that the respondents themselves do not contend that any service is rendered to the petitioners in consideration of the levy and, therefore, the essential element of quid pro quo, which is the distinguishing characteristic of a fee, is completely absent. If the levy is not a fee, it assumes the character of a compulsory fiscal impost, which can be sustained only upon the authority of a valid charging provision enacted by the legislature, as mandated by Article 265 of the Constitution of India. The Act, 2002 contains no express charging provision authorising compulsory recovery of Access and Benefit Sharing from auction purchasers such as the petitioners.

38. Alternatively, it is submitted that even if the levy is treated as a regulatory fee, such power vests only in the Biodiversity Management Committee constituted under Section 41 of the Act, 2002 and admittedly no such Committee has either determined or demanded the impugned amount. It is, therefore, prayed that the impugned order dated 24.01.2023 and consequential letter dated 25.01.2023 be declared as illegal, arbitrary, without jurisdiction unconstitutional, and the same be quashed with all consequential reliefs.

39. On the other hand, learned State counsel would oppose the writ petitions and submit that the challenge to the order dated 24.01.2023 and the consequential letter dated 25.01.2023 is wholly misconceived and contrary to the scheme of the Act, 2002. According to him, the impugned communications merely seek to ensure compliance with the statutory mandate relating to ABS and do not create any new liability dehors the provisions of the Act, 2002, the Rules, 2015 and the Regulations, 2014. It is submitted that the principal object of the Act, 2002 is the conservation of biological diversity, sustainable use of its components and fair and equitable sharing of benefits arising from the commercial utilisation of biological resources, and the impugned action has been taken only to achieve the said statutory objectives.

40. Learned State counsel would further submit that the petitioners have proceeded on an erroneous interpretation of Regulation 3 of the Regulations, 2014 by contending that the obligation to share benefits arises only when biological resources are purchased directly from Joint Forest Management Committees, forest dwellers, tribal cultivators or Gram Sabhas. According to the respondents, the liability of the petitioners does not emanate solely from Regulation 3 but flows from the substantive provisions of Sections 2(a), 7 and 24 of the Act, 2002 read with Rule 17 of the Rules, 2015. It is argued that the expression "access" under Section 2(a) is of wide amplitude, and once the petitioners acquire biological resources, namely Tendu Leaves, for commercial utilisation through public auction conducted by the Federation, they are persons having "access" to biological resources within the meaning of the Act and are consequently obliged to comply with the statutory requirement of prior intimation and execution of the prescribed agreement containing conditions relating to equitable benefit sharing. The provisions of the Adhiniyam, 1964, according to the learned State counsel, regulate only the trade and procurement of Tendu Leaves and do not exclude the applicability of the Act, 2002.

41. It is further submitted that the petitioners, instead of complying with the statutory procedure contemplated under Section 24 of the Act, 2002 and Rule 17 of the Rules, 2015, have sought to avoid their statutory obligations by placing undue reliance on the provisions of the Adhiniyam, 1964. Learned State counsel would argue that if the petitioners had accessed biological resources without following the procedure prescribed under the Act, 2002, they would expose themselves to the consequences contemplated under Sections 55 and 58 of the Act, 2002. However, instead of initiating coercive proceedings, the Chhattisgarh State Biodiversity Board adopted a pragmatic approach by issuing administrative instructions to the concerned forest authorities to ensure execution of the prescribed agreements and recovery of the benefit-sharing amount from the successful auction purchasers. It is therefore contended that the impugned orders merely facilitate implementation of the statutory scheme and cannot be said to be without jurisdiction.

42. Learned State counsel would lastly submit that the petitioners, being commercial beneficiaries of biological resources, are under a statutory obligation to contribute towards equitable benefit sharing and cannot evade such liability merely because the biological resources were acquired through a statutory auction conducted by the Federation. It is further contended that the petitioners have not challenged the supplementary agreements executed pursuant to the auction conditions, nor have they challenged any specific demand or sought refund of the amounts already deposited. It is pointed out that from the collection year 2023 onwards, the petitioners have been depositing the prescribed ABS amount without protest under the scheme of the Act, 2002 and the Rules framed thereunder. Accordingly, it is prayed that all the writ petitions, being devoid of merit, deserve to be dismissed.

43. Mr. Jitendra Pali, learned counsel appearing for the Chhattisgarh State Biodiversity Board, while supporting the submissions advanced by the learned State counsel, would submit that the Act, 2002 is a beneficial social and environmental legislation enacted by Parliament to give effect to India's international obligations under the Convention on Biological Diversity, 1992 (CBD) and the Nagoya Protocol on Access and Benefit Sharing. According to him, the three foundational objectives of the Act, 2002, namely conservation of biological diversity, sustainable use of its components and fair and equitable sharing of benefits arising from commercial utilisation of biological resources, constitute the guiding principles of the enactment and every provision of the Act is required to receive a purposive interpretation so as to advance these statutory objectives. It is submitted that ABS is the heart of the statutory scheme and is intended to ensure that local communities, tribal people and forest dwellers, who have traditionally conserved biological resources, receive a fair share of the economic benefits generated from their commercial utilisation. The amount recovered towards ABS, it is contended, is neither a tax nor a fee but a statutory mechanism of environmental justice and equitable distribution of benefits.

44. Learned counsel would further submit that Tendu Leaves are undisputedly "biological resources" within the meaning of Section 2(c) of the Act, 2002 and the petitioners admittedly commercially utilise the same for manufacture and trade of beedis. By virtue of Sections 7, 23 and 24 of the Act, 2002 read with Rule 17 of the Rules, 2015, every Indian citizen or body corporate intending to access biological resources for commercial utilisation is required to furnish prior intimation to the State Biodiversity Board and execute the prescribed agreement containing conditions relating to equitable benefit sharing. The liability under the Act, according to the learned counsel, is attracted by the commercial utilisation of the biological resource itself and is not dependent upon the identity of the immediate seller. Merely because the petitioners procure Tendu Forest Lots through the Federation, they cannot escape the statutory obligation of benefit sharing, as the Federation merely acts as the statutory procurement and marketing agency under the Adhiniyam, 1964 and does not alter the character or origin of the biological resource.

45. Learned counsel would further contend that the Adhiniyam, 1964 and the Act, 2002 operate in distinct and complementary fields. While the former regulates procurement, trade, transportation and marketing of Tendu Leaves through a State monopoly, the latter is an environmental legislation regulating access to biological resources, biodiversity conservation and equitable benefit sharing. It is submitted that there is no conflict or repugnancy between the two enactments, as is evident from Section 59 of the Act, 2002, which provides that the provisions of the Act are in addition to and not in derogation of any other law relating to forests or wildlife.

46. Consequently, compliance with the provisions of the Adhiniyam, 1964 does not dispense with or exclude compliance with the independent statutory obligations arising under the Act, 2002. Learned counsel would also point out that despite issuance of public notices by the State Biodiversity Board calling upon commercial users of biological resources to comply with Section 7 of the Act and Rule 17 of the Rules, 2015, the petitioners failed to furnish the mandatory prior intimation or execute the statutory agreement before commercially utilising Tendu Leaves.

47. Refuting the contention of the petitioners regarding value-added products and contractual stipulations, learned counsel would submit that the liability to pay ABS arises at the stage of commercial utilisation of Tendu Leaves, which remain biological resources within the meaning of Section 2(c) of the Act, 2002, irrespective of subsequent processing. It is argued that the obligation to comply with the provisions of the Act, 2002 is statutory in nature and cannot be avoided on the ground that the tender conditions or purchaser's agreements did not expressly stipulate payment of ABS. The doctrine that there can be no estoppel against a statute squarely applies and no contractual omission can override or dilute a statutory mandate enacted in public interest. The respondents, therefore, were competent to enforce the statutory obligation notwithstanding the absence of a specific contractual clause.

48. Learned counsel would lastly submit that the controversy involved in the present batch of writ petitions is no longer res integra in view of the decisions of the Uttarakhand High Court in Divya Pharmacy (supra), and the Allahabad High Court in Sayeed Absar Bidi Works v. State of U.P. and others, 2021 SCC OnLine All 1609. Placing strong reliance upon the aforesaid judgments, it is contended that the High Courts have categorically held that the provisions relating to ABS are applicable to Indian entities commercially utilising biological resources and that the Act, 2002, rather than conflicts with, State enactments regulating the trade of forest produce. It is further submitted that the liability to pay ABS is determined by the commercial utilisation of biological resources and not by the mode of procurement or the identity of the immediate seller. The contention that beedi manufacturers or traders are exempt merely because the biological resources are procured through a State-regulated trading mechanism has been specifically rejected in the aforesaid decisions.

49. In support of the aforesaid submissions, learned counsel has placed reliance upon the decisions in Divya Pharmacy (supra); Sayeed Absar Bidi Works (supra); Kasinka Trading v. Union of India, (1995) 1 SCC 274; Shri Bakul Oil Industries v. State of Gujarat, (1987) 1 SCC 31; and Union of India v. Godfrey Philips India Ltd., (1985) 4 SCC 369, to contend that statutory obligations cannot be defeated by contractual terms or by invoking the principles of promissory estoppel and that the impugned orders having been issued in furtherance of a statutory mandate deserve to be upheld and the writ petitions dismissed.

50. Mr. Animesh Tiwari, learned counsel appearing for the Chhattisgarh State Biodiversity Board, submits that the writ petitions are not maintainable in view of the efficacious alternative statutory remedy available under Section 52A of the Act, 2002, which provides for an appeal before the National Green Tribunal against any determination of benefit sharing or any order passed 78 by the State Biodiversity Board under the Act, 2002. He submits that the impugned order dated 24.01.2023 and communication dated 25.01.2023 pertain to determination and collection of ABS and, therefore, fall squarely within the ambit of Section 52A of the Act, 2002. It is contended that the petitioners have bypassed the statutory appellate mechanism and directly invoked the extraordinary jurisdiction of this Court under Article 226 of the Constitution of India, rendering the writ petitions not maintainable.

51. Learned counsel further submits that the entire edifice of the petitioners' case rests upon an erroneous assumption that the State Government is the owner of the Tendu Leaf merely because the trade is regulated under the Adhiniyam, 1964. He contends that the Adhiniyam, 1964 merely creates a State monopoly over the trade of Tendu Leaf with the object of protecting forest dwellers from exploitation by private traders and ensuring remunerative prices for them. The Adhiniyam, 1964 does not vest ownership of the Tendu Leaf in the State. On the contrary, under the scheme of the Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006 (for short, 'Act, 2006'), ownership over Minor Forest Produce, including Tendu Leaf, stands recognized and vested in forest dwelling Scheduled Tribes and other traditional forest dwellers. The State and the Federation merely act as statutory agencies facilitating procurement and sale on behalf of such forest dwellers.

52. Learned counsel next submits that the Chhattisgarh State Minor Forest Produce Cooperative Federation functions through a three-tier cooperative structure consisting of Primary Cooperative Societies, District Unions and the Apex Federation. The Primary Cooperative Societies comprise the Tendu Leaf collectors themselves and the Federation conducts auctions only on their behalf. The sale proceeds ultimately flow to the collectors and forest dwellers, while the Federation merely receives a nominal commission for carrying out the statutory functions entrusted to it. Consequently, the interposition of the Federation as a statutory agent does not alter the true nature of the transaction. The petitioners, though purchasing the Tendu Leaf through the Federation, are in substance procuring the biological resource collected and owned by the forest dwellers, and therefore cannot avoid their statutory obligation of benefit sharing.

53. Learned counsel further submits that Regulation 3 of the Regulations, 2014 has to be construed purposively in the light of the objectives of the Act, 2002. According to him, the expression "directly" occurring in Regulation 3 of the Regulations, 2014 cannot be interpreted in a narrow or literal manner so as to defeat the legislative intent of ensuring fair and equitable benefit sharing with the actual conservers and collectors of biological resources. Since the Tendu Leaf admittedly originates from and is harvested by forest dwellers and is commercially utilized by the petitioners for manufacture of beedis, the petitioners are squarely covered by the ABS mechanism. He further submits that the impugned levy of 2% falls within the statutory range prescribed under Regulation 3 and has been fixed by the State Biodiversity Board in exercise of its statutory powers.

54. Lastly, learned counsel submits that the petitioners have not challenged the validity of Regulation 3 of the Regulations, 2014, which continues to enjoy the presumption of constitutionality. So long as the Regulation remains in force, the State Biodiversity Board is under a statutory obligation to implement the same by enforcing the ABS mechanism. He submits that the impugned orders have been issued in exercise of powers conferred under Sections 7, 21, 23 and 24 of the Act, 2002 read with Rule 17 of the Rules, 2015 and Regulations 2, 3 and 4 of the Regulations, 2014. In support of his submissions, learned counsel has placed reliance upon the decisions in Divya Pharmacy (supra), which holds that Indian entities commercially utilizing biological resources are equally liable for benefit sharing, and Sayeed Absar Bidi Works (supra), wherein it has been held that the Act, 2002 and the State Tendu Patta legislation operate in distinct and complementary fields and that commercial users of Tendu Leaf cannot avoid their obligations under the Access and Benefit Sharing regime merely because the procurement is routed through a State-regulated trading mechanism.

55. Mr. Trivikram Nayak, learned counsel appearing for the Chhattisgarh Minor Forest Produce Cooperative Federation Ltd., submits that the Federation is merely an agent of the State Government appointed under Section 4 of the Adhiniyam, 1964 and functions as part of the State machinery. The Federation has no independent role in determining the liability towards ABS, as the impugned orders dated 24.01.2023 and 25.01.2023 have been issued by the Chhattisgarh State Biodiversity Board. It is contended that no substantive relief has been sought against the Federation and, therefore, no cause of action survives against it.

56. Learned counsel further submits that the Federation merely facilitates procurement and trade of Tendu Leaf in accordance with the statutory framework under the Adhiniyam, 1964. The purchase price of Tendu Leaf is fixed by the State Government, while the Federation functions through its three-tier cooperative structure comprising the State Federation, District Unions and Primary Cooperative Societies. It is submitted that the Federation receives only a nominal commission for carrying out the trade and the profits earned from the Tendu Leaf trade are distributed in accordance with the policy of the State Government, whereby 80% is paid as incentive wages to collectors, 15% is earmarked for procurement, processing and storage of minor forest produce by Primary Societies, and the remaining 5% is utilized to meet losses suffered by the Societies.

57. It is further submitted that, pursuant to the Government's policy of advance sale of green Tendu Leaf, successful bidders enter into agreements with the Federation after the e-tender/e-auction process, whereafter the Tendu Leaf is handed over in accordance with the contractual terms. The Federation merely administers the procurement, storage and release of Tendu Leaf in accordance with the statutory policy and has no authority to alter or ignore directions issued by the competent Government authorities.

58. Learned counsel also submits that, pursuant to the communication dated 07.12.2021 issued by the Forest and Climate Change Department, the Federation, being an agent of the State Government, issued consequential directions on 20.12.2021 to its District Unions for incorporating amendments relating to compliance with the Act, 2002 and the Rules, 2015 in the purchaser agreements. Thereafter, acting upon the subsequent communications dated 24.11.2022, 24.01.2023 and 25.01.2023 issued by the Chhattisgarh State Biodiversity Board, the Federation merely implemented the directions requiring incorporation of the amended contractual clauses and collection of 2% ABS from the purchasers on the net sale value of Tendu Leaf for deposit with the Biodiversity Board.

59. Lastly, learned counsel submits that the Federation was statutorily bound to act in accordance with the directions issued by the State Government and the Chhattisgarh State Biodiversity Board. Relying upon the settled principle that where a statute prescribes that a thing is to be done in a particular manner, it must be done in that manner alone, it is contended that the Federation had no discretion to disregard the statutory directions or adopt any different course. In support of the said proposition, reliance has been placed upon Municipal Corporation of Greater Mumbai v. Abhilash Lal, (2020) 13 SCC 234; Varshunn Bhan Miskeen v. Hidayatullah National Law University, (2024) 1 HCC (Chh) 62; and Dharmin Bai Kashyap v. Babli Sahu, (2023) 10 SCC 461. Accordingly, it is submitted that no illegality can be attributed to the Federation, which has merely acted in compliance with binding statutory and administrative directions issued by the competent authorities.

60. I have heard learned counsel for the parties at considerable length and have carefully perused the pleadings, documents brought on record and the statutory provisions relied upon by them. I have also examined the provisions of the Biological Diversity Act, 2002, the Chhattisgarh Biological Diversity Rules, 2015, the Guidelines on Access to Biological Resources and Associated Knowledge and Benefit Sharing Regulations, 2014, the Chhattisgarh Tendu Patta (Vyapar Viniyaman) Adhiniyam, 1964, as well as the provisions of the Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006, which have substantial bearing on the controversy involved in the present batch of writ petitions.

61. Before embarking upon an examination of the rival submissions on merits, this Court considers it appropriate to notice the statutory framework governing the controversy. The adjudication of the present batch of writ petitions substantially turns upon the interpretation of the provisions of the Biological Diversity Act, 2002, the Chhattisgarh Biological Diversity Rules, 2015, the Guidelines on Access to Biological Resources and Associated Knowledge and Benefit Sharing Regulations, 2014, the Chhattisgarh Tendu Patta (Vyapar Viniyaman) Adhiniyam, 1964, and the Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006.

62. The rival submissions advanced by the learned counsel appearing for the respective parties are founded principally upon the scope, ambit and interplay of various Sections, Rules and Regulations contained in the aforesaid enactments. Since the resolution of the issues involved in these petitions necessarily depends upon a correct understanding of the statutory scheme governing access to biological resources, commercial utilization thereof, determination of ABS, regulation of trade in Tendu Leaf, and the rights vested in forest dwelling Scheduled Tribes and other traditional forest dwellers over Minor Forest Produce, this Court deems it appropriate to reproduce the relevant statutory provisions in extenso.

63. The relevant provisions of the Biological Diversity Act, 2002, the Chhattisgarh Biological Diversity Rules, 2015, the Guidelines on Access to Biological Resources and Associated Knowledge and Benefit Sharing Regulations, 2014, the Chhattisgarh Tendu Patta (Vyapar Viniyaman) Adhiniyam, 1964, and the Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006, which have been extensively relied upon by the learned counsel appearing for the parties, are accordingly extracted hereinbelow for ready reference and to facilitate a proper appreciation of the statutory framework governing the controversy.

A. The Biological Diversity Act, 2002

          "The preamble of the Biological Diversity Act, 2002

          An Act to provide for conservation of Biological Diversity, sustainable use of its components and fair and equitable sharing of the benefits arising out of the use of biological resources, knowledge and for matters connected therewith or incidental thereto.

          WHEREAS India is rich in biological diversity and associated traditional and contemporary knowledge system relating thereto;

          AND WHEREAS India is a 'Party] to the United Nations Convention on Biological Diversity signed at Rio de Janeiro on the 5th day of June, 1992;

          AND WHEREAS the said Convention came into force on the 29th December. 1993;

          AND WHEREAS the said Convention reaffirms the sovereign rights of the States over their biological resources;

          AND WHEREAS the said Convention has the main objective of conservation of biological diversity, sustainable use of its components and fair and equitable sharing of the benefits arising out of utilisation of genetic resources;

          AND WHEREAS India is a Party to the Nagoya Protocol on access to genetic utilisation to the convention on Biological Diversity which was adopted on the resources and the fair and equitable sharing of benefits arising from their 29th October, 2010 in Nagoya, Japan;

          AND WHEREAS it is considered necessary to provide for conservation, sustainable utilisation, fair and equitable sharing of the benefits arising out of utilisation of biological resources and also to give effect to the said Convention: Be it enacted by Parliament in the Fifty-third Year of the Republic of India as follows:-

          Section 2(a) - "access" means collecting, procuring or possessing any biological resource occurring in or obtained from India or traditional knowledge associated thereto, for the purposes of research or bio-survey or commercial utilisation;

          Section 2(aa) - "benefit claimers" means the conservers of biological resources, their by- products, creators or holders of traditional knowledge associated thereto (excluding codified traditional knowledge only for Indians) and information relating to the use of such biological resources, innovations and practices associated with such use and application;]

          Section 2(c) - "biological resources" include plants, animals, micro-organisms or parts of their genetic material and derivatives (excluding value added products), with actual or potential use or value for humanity, but does not include human genetic material;]

          Section 2(f) - "commercial utilization" means end user of biological resources for commercial utilization such as drugs, industrial enzymes, food flavours, fragrance, cosmetics, emulsifiers, oleoresins, colours, extracts and genes used for improving crops and livestock through genetic intervention, but does not include conventional breeding or traditional practices in use in any agriculture, horticulture, poultry, dairy farming, animal husbandry or bee keeping;

          Section 3 - Certain persons not to undertake Biodiversity related activities without approval of National Biodiversity Authority.-(1) No person referred to in sub- 88 section (2) shall without previous approval of the National Biodiversity Authority, obtain any biological resource occurring in India or knowledge associated thereto for research or for commercial utilisation or for bio-survey and bio-utilisation.

          (2) The persons who shall be required to take the approval of the National Biodiversity Authority under sub-section (1) are the following, namely:-

          (a) a person who is not a citizen of India;

          (b) citizen of India, who is a non-resident as defined in clause (30) of section 2 of the Income-tax Act, 1961 (43 of 1961);

          (c) a body corporate, association or organisation-

          (i) not incorporated or registered in India; or

          [(ii) incorporated or registered in India under any law for the time being in force, which is controlled by a foreigner within the meaning of clause (27) of section 2 of the Companies Act, 2013 (18 of 2013).]

          COMMENTS

          Any person (i) who is not a citizen of India; (ii) a citizen of India, who is non-resident; (iii) a body corporate, association or organisation not incorporated or registered in India, or incorporated or registered in India under any law for the time being in force which has any non-Indian participation in its share capital or management is required to take prior approval of the National Biodiversity Authority for obtaining any biological resource occurring in India or knowledge associated thereto for research or for commercial utilization or for bio-survey and bio-utilisation.

          Section 4 - Results of research not to be transferred to certain persons without approval of National Biodiversity Authority.- No person or entity shall share or transfer any result of the research on any biological resource occurring in, or obtained or accessed from, India or traditional knowledge associated thereto, for monetary consideration or otherwise, to a person or body corporate referred to in sub-section (2) of section 3, without the prior written approval of the National Biodiversity Authority, except the codified traditional knowledge which is only for Indians:

          Provided that the provisions of this section shall not apply if publication of research papers or dissemination of knowledge in any seminar or workshop involving financial benefit is as per the guidelines issued by the Central Government:

          Provided further that where the results of research are used for further research, then, the registration with the National Biodiversity Authority shall be necessary:

          Provided also that if the results of research are used for commercial utilisation or for obtaining any intellectual property rights, within or outside India, prior approval of the National Biodiversity Authority shall be required to be taken in accordance with the provisions of this Act.]

          Section 6 - Application for intellectual property rights not to be made without approval of National Biodiversity Authority.-[(1) Any person or entity covered under sub-section (2) of section 3 applying for an intellectual property right, by whatever name called, in or outside India, for any invention based on any research or information on a biological resource which is accessed from India, including those deposited in repositories outside India, or traditional knowledge associated thereto, shall obtain prior approval of the National Biodiversity Authority before grant of such intellectual property rights.

          (1A) Any person covered under section 7 applying for any intellectual property right, by whatever name called, in or outside India, for any invention based on any research or information on a biological resource which is accessed from India, including those deposited in repositories outside India, or traditional knowledge associated thereto, shall register with the National Biodiversity Authority before grant of such intellectual property rights.

          (1B) Any person covered under section 7 who has obtained intellectual property right, by whatever name called, in or outside India, for any invention based on any research or information on a biological resource which is accessed from India, including those deposited in repositories outside India, or traditional knowledge associated thereto, shall obtain prior approval of the National *[Biodiversity] Authority at the time of commercialisation.]

          (2) The National Biodiversity Authority may, while granting the approval under this section, impose benefit sharing fee or royalty or both or impose conditions including the sharing of financial benefits arising out of the commercial utilisation of such rights.

          (3) The provisions of this section shall not apply to any person making an application for any right under any law relating to protection of plant varieties.

          (4) Where any right is granted under law referred to in sub-section (3), the concerned authority granting such right shall endorse a copy of such document granting the right to the National Biodiversity Authority.

          Section 7 - Prior intimation to State Biodiversity Board for accessing Biological resource for certain purposes.-(1) No person, other than the person covered under sub-section (2) of section 3, shall access any biological resource and its associated knowledge for commercial utilisation, without giving prior intimation to the concerned State Biodiversity Board, but such access shall be subject to the provisions of clause (b) of section 23 and sub-section (2) of section 24:

          Provided that the provisions of this section shall not apply to the codified traditional knowledge, cultivated medicinal plants and its products, local people and communities of the area, including growers and cultivators of biodiversity and to vaids, hakims and registered AYUSH practitioners only who have been practicing indigenous medicines, including Indian systems of medicine as profession for sustenance and livelihood.

          (2) In the case of cultivated medicinal plants, the exemption under sub-section (1) shall be available only if a certificate of origin is obtained from the Biodiversity Management Committee in such manner as may be prescribed.

          (3) The Biodiversity Management Committee shall, on the basis of entries made in such books, maintained in such manner, issue the certificate of origin under sub-section (2) in such manner as may be prescribed.]

          Section 21 - Determination of equitable benefit sharing by National Biodiversity Authority.-(1) The National Biodiversity Authority shall, while determining benefit sharing for the approval granted under this Act, ensure that the terms and conditions subject to which the approval is granted secures fair and equitable sharing of benefits arising out of the use of accessed biological resources, their derivatives, innovations and practices associated with their use and applications and knowledge relating thereto in accordance with mutually agreed terms and conditions between the person applying for such approval, and the Biodiversity Management "[Committee] represented by the National Biodiversity Authority.]

          (2) The National Biodiversity Authority shall, subject to any regulations made in this behalf, determine the benefit sharing which shall be given effect in all or any of the following manner, namely:-

          (a) grant of joint ownership of intellectual property rights to the National Biodiversity Authority, or where benefit claimers are identified, to such benefit claimers;

          (b) transfer of technology;

          (c) location of production, research and development units in such areas which will facilitate better living standards to the benefit claimers;

          (d) association of Indian scientists, benefit claimers and the local people with research and development in biological resources and bio-survey and bio-utilisation;

          (e) setting up of venture capital fund for aiding the cause of benefit claimers;

          (f) payment of monetary compensation and other non-monetary benefits to the benefit claimers as the National Biodiversity Authority may deem fit.

          (3) Where any amount of money is ordered by way of benefit sharing, the National Biodiversity Authority may direct the amount to be deposited in the National Biodiversity Fund:

          [Provided that where biological resource or associated knowledge was a result of access from an individual or group of individuals or organisations, the National Biodiversity Authority may direct that the amount shall be paid directly to such benefit claimer or organisation in accordance with the terms of any agreement and in such manner as it deems fit.]

          (4) For the purposes of this section, the National Biodiversity Authority shall, in consultation with the Central Government, by regulations, frame guidelines.

          Section 22 - Establishment of State Biodiversity Board.-(1) With effect from such date as the State Government may, by notification in the Official Gazette, appoint in this behalf, there shall be established by that Government for the purposes of this Act, a Board for the State to be known as the... (name of the State) Biodiversity Board.

          (2) Notwithstanding anything contained in this section, no State Biodiversity Board shall be constituted for a Union territory and in relation to a Union territory, the National Biodiversity Authority shall exercise the powers and perform the functions of a State Biodiversity Board for that Union territory:

          Provided that in relation to any Union territory, the National Biodiversity Authority may delegate all or any of its powers or functions under this sub-section to such person or group of persons for body] as the Central Government may specify.

          (3) The Board shall be a body corporate by the name aforesaid, having perpetual succession and a common seal, with power to acquire, hold and dispose of property, both movable and immovable, and to contract, and shall by the said name sue and be sued.

          (4) The Board shall consist of the following members, namely:-

          (a) a Chairperson, who shall be an eminent person having adequate knowledge, expertise and experience in the conservation and sustainable use of biological diversity and in matters relating to fair and equitable sharing of benefits, to be appointed by the State Government;

          (b) not more than seven ex officio members to be appointed by the State Government to represent the concerned departments of the State Government, including departments dealing Panchayati Raj and tribal "[affairs];

          (c) not more than five non-official members to be appointed from amongst experts, including legal experts, scientists having special knowledge, expertise and work experience in matters relating to conservation of biological diversity, sustainable use of biological resources and fair and equitable sharing of benefits arising out of the use of biological resources.]

          (5) The head office of the State Biodiversity Board shall be at such place as the State Government may, by notification in the Official Gazette, specify.

          Section 23 - Functions of State Biodiversity Board. The functions of the State Biodiversity Board shall be to-

          [(a) advise the State Government on matters relating to the conservation of biodiversity, "[sustainable] use of its components and fair and equitable sharing of benefits arising out of the utilisation of biological resources or traditional knowledge associated thereto, in conformity with the regulations or guidelines if any, issued by the Central Government or the National Biodiversity Authority;

          (b) regulate any activity referred to in section 7 by granting or rejecting approvals;

          (ba) determine the fair and equitable sharing of benefits as provided under the regulations made in this behalf by the National Biodiversity Authority while granting approvals;]

          (c) perform such other functions as may be necessary to carry out the provisions of this Act or as may be prescribed by the State Government.

          Section 24 - Power of State Biodiversity Board to restrict certain activities violating the objectives of conservation etc.-[(1) Any person other than the person referred to in sub-section (2) of section 3, intending to undertake any activity covered under section 7. shall give prior intimation to the State Biodiversity Board, in such form as may be prescribed by the State Government.

          (2) If the State Biodiversity Board is of the opinion that such activity is detrimental or contrary to the objectives of conservation and sustainable use of biodiversity of fair and equitable sharing of benefits arising out of such activity it may by order, restrict or reject such activity:

          Provided that no such order or rejection shall be made without giving an opportunity of being heard to the person concerned.

          (3) The State Biodiversity Board shall place in public domain the details of every approval granted or rejected under this section.]

          Section 52A - Appeal to National Green Tribunal.- Any person aggrieved by any determination of benefit sharing or order of the National Biodiversity Authority or a State Biodiversity Board under this Act, on or after the commencement of the National Green Tribunal Act, 2010, may file an appeal to the National Green Tribunal established under section 3 of the National Green Tribunal Act, 2010, in accordance with the provisions of that Act.]

          Section 55 - Penalties.-If any person or entity covered under sub-section (2) of section 3 or section 7 contravenes or attempts to contravene or abets the contravention of the provisions of section 3 or section 4 or section 6 or section 7, such person shall be liable to pay penalty which shall not be less than one lakh rupees, but which may extend to fifty lakh rupees, but where the damage caused exceeds the amount of penalty, such penalty shall be commensurate with the damage caused, and in case, the failure or contravention continues, an additional penalty may be imposed, which shall not exceed one crore rupees and such penalty shall be decided by the adjudicating officer appointed under section 55A."

64. From a careful perusal of the scheme of the Biological Diversity Act, 2002, it appears that the Parliament has enacted the said legislation as a comprehensive and self-contained code to fulfil India's international obligations flowing from the Convention on Biological Diversity, 1992 and the Nagoya Protocol. The Statement of Objects and Reasons, the Preamble and the substantive provisions of the Act, 2002 unmistakably demonstrate that the legislation rests upon three fundamental pillars, namely, (i) conservation of biological diversity; (ii) sustainable utilisation of its components; and (iii) fair and equitable sharing of the benefits arising out of the utilisation of biological resources. The statutory framework, therefore, does not merely regulate access to biological resources, but simultaneously seeks to balance commercial utilisation with ecological conservation and the legitimate rights of those communities and persons who have conserved such resources and preserved the traditional knowledge associated therewith. It is in the backdrop of the aforesaid statutory object that the relevant provisions of the Act, 2002 deserve consideration.

65. A conjoint reading of Sections 2(a), 2(aa), 2(c) and 2(f) of the Act, 2002 reveals that the legislature has consciously employed definitions of wide amplitude. The expression "access" has been defined to include collection, procurement and possession of biological resources for research, bio-survey or commercial utilisation. Likewise, the expression "biological resources" has been given an expansive meaning by including plants, animals, microorganisms, their genetic material and derivatives possessing actual or potential value for humanity, subject only to the limited statutory exclusions expressly incorporated therein. Equally significant is the recognition accorded to "benefit claimers", namely the conservers of biological resources and holders of traditional knowledge, thereby acknowledging their statutory entitlement to participate in the benefits arising from the utilisation of such resources. The definition of "commercial utilisation" further makes it evident that the legislature intended to regulate every organised commercial activity involving biological resources except those activities which have been specifically excluded. Thus, the definitional provisions themselves disclose the broad legislative intent of creating a comprehensive regulatory regime governing commercial exploitation of biological resources.

66. The regulatory architecture under the Act, 2002 becomes evident upon a conjoint reading of Sections 7, 22, 23 and 24. Section 7 mandates prior intimation to the concerned State Biodiversity Board before any person, other than those specifically exempted, undertakes commercial utilisation of any biological resource. Sections 22 and 23 constitute the State Biodiversity Board and entrust it with wide statutory responsibilities, including regulation of commercial access to biological resources, grant or refusal of approvals, determination of fair and equitable benefit sharing in accordance with the statutory regulations and discharge of such other functions as may be necessary for effectuating the purposes of the legislation. Section 24 further empowers the Board to examine the proposed activity and, upon arriving at the conclusion that such activity is detrimental to the objectives of conservation, sustainable utilisation or equitable benefit sharing, to restrict or reject the same after affording an opportunity of hearing. The cumulative effect of these provisions unmistakably establishes that the State Biodiversity Board is not merely an advisory body but is the statutory regulator entrusted with supervising commercial utilisation of biological resources within the State.

67. Equally significant is Section 21 of the Act, 2002, which embodies one of the foundational principles underlying the entire legislation, namely, fair and equitable sharing of benefits. The provision obligates the competent authority to ensure that the economic and other benefits arising from the utilisation of accessed biological resources, their derivatives and the traditional knowledge associated therewith are shared with the identified benefit claimers in accordance with mutually agreed terms. The statute contemplates multiple modes through which such benefit sharing may be achieved, including monetary compensation, transfer of technology, participation in research and development, establishment of development facilities and other non-monetary measures. The legislative scheme, therefore, treats benefit sharing not as a fiscal exaction or revenue-generating measure but as a statutory obligation intended to secure distributive justice in favour of those who have conserved biological resources and preserved traditional knowledge over generations.

68. The Act, 2002 also incorporates a complete adjudicatory and enforcement mechanism. Section 52A provides a statutory remedy of appeal before the National Green Tribunal against every determination of benefit sharing or any order passed by the National Biodiversity Authority or the State Biodiversity Board, while Section 55 prescribes penalties for contravention of the statutory obligations created under the enactment. The availability of a specialised appellate forum, coupled with a comprehensive regulatory and enforcement mechanism, leaves little room for doubt that the Act, 2002 is intended to operate as a complete code governing access to biological resources, determination of benefit-sharing obligations, regulatory control over commercial utilisation and adjudication of disputes arising therefrom. It is the scheme of the Act, 2002, viewed in its entirety, that must guide the interpretation of the provisions which fall for consideration in the present batch of petitions.

          B. The Chhattisgarh Biological Diversity Rules, 2015

          "Rule 17 - Procedure for access to/ collection of biological resources.--(1) Any citizen of India or a body corporate, association or organization registered in India seeking access to / collection of biological resources for commercial utilization or bio- survey and bio-utilisation for commercial utilisation with the exception of those as provided in the proviso to Section 7 of the Act, shall make an application to the Board in Form-1 appended to these rules. Every application for commercial utilization shall be accompanied with a demand draft of Rs. 1,000/- in favour of Biodiversity Board;

          (2) The Board, after due evaluation of the application, consultation with the concerned local bodies and collecting such additional information as it may deem necessary, shall take decision on the application as far as possible within a period of 3 months of receipt of the same;

          In this context, the word "consult", for the purposes of the Act, includes the following steps, inter alia:--

          (a) Issuing of public notice of the proposal for access/ collection in local languages;

          (b) discussion/ dialogue with the general assembly of the local body; and

          (c) formal consent from the assembly after being provided adequate information about the proposal and its implications for conservation and livelihoods.

          (3) On being satisfied with the merit of the application, the Board may allow the application or restrict any such activity if it is of the opinion that such activity is detrimental or contrary to the objectives of conservation and sustainable use of biodiversity or equitable sharing of benefits arising out of such activity;

          (4) A written agreement duly signed by an authorized officer of the Board and the applicant shall regulate commercial utilization or bio-utilization of biological resource;

          (5) The conditions for access to/ collection may specifically provide measures for conservation and protection of biological resources to which the access to/ collection is being granted;

          (6) The Board may reject the application, if it considers that the request cannot be acceded to, after recording the reasons thereof. Before passing an order of rejection, the applicant shall be given a reasonable opportunity of being heard;

          (7) Any information given in the form referred to in the sub-rule (1) for prior intimation shall be kept confidential and shall not be disclosed, either intentionally or unintentionally, to any person not concerned thereto."

69. A careful and conjoint reading of Rule 17 of the Rules, 2015 leaves no manner of doubt that the Rules prescribe a comprehensive statutory procedure regulating access to and collection of biological resources for commercial utilization or for bio-survey and bio-utilisation undertaken for commercial purposes. Rule 17(1) mandates that every citizen of India, body corporate, association or organization registered in India intending to access or collect biological resources for commercial utilization, except those specifically exempted under the proviso to Section 7 of the Act, 2002, shall make an application to the Chhattisgarh State Biodiversity Board in the prescribed Form-I appended to the Rules. The Rule further stipulates that every such application seeking commercial utilization must be accompanied by the prescribed application fee. The legislative intent underlying this provision is manifestly clear that no commercial exploitation of biological resources can be undertaken as a matter of right, but only upon compliance with the statutory procedure prescribed under the Rules and subject to regulatory scrutiny by the competent authority constituted under the Act, 2002.

70. Rule 17(2) further delineates the statutory duties cast upon the State Biodiversity Board while considering such applications. Upon receipt of an application, the Board is required to undertake a detailed evaluation thereof and, wherever necessary, consult the concerned local bodies before arriving at any decision. The Rule expressly provides that such consultation is not to remain an empty formality but must necessarily include issuance of public notice in the local language, meaningful discussion with the General Assembly of the concerned local body and obtaining its formal consent after placing before it adequate information regarding the proposed activity and its likely implications upon biodiversity conservation and the livelihood of the local communities. The Rule also authorizes the Board to seek such additional information as it may deem necessary and obligates it to take a decision, as far as possible, within a period of three months from the date of receipt of the application. The elaborate consultative mechanism incorporated under Rule 17 clearly reflects the legislative intention of ensuring transparency, participatory decision-making and protection of the interests of local communities who are the primary conservers and custodians of biological resources.

71. Sub-rules (3) to (7) of Rule 17 prescribe the substantive regulatory powers of the State Biodiversity Board while processing applications for commercial utilization of biological resources. Upon being satisfied regarding the merits of the application, the Board may grant permission; however, where it forms an opinion that the proposed activity is detrimental or contrary to the objectives of conservation of biological diversity, sustainable use of its components or equitable sharing of benefits, it is fully empowered to restrict such activity. Rule 17(4) further contemplates that every approval shall be followed by execution of a written agreement between the applicant and the authorized officer of the State Biodiversity Board regulating the commercial utilization or bio-utilisation of the biological resources. Such agreement constitutes the statutory instrument governing the rights and obligations of the parties, including compliance with the conditions imposed by the Board. Rule 17(5) further authorizes incorporation of specific conditions relating to conservation and protection of the biological resources in respect of which access has been granted. Equally important are the safeguards contained in Rule 17(6), which mandate that before rejecting any application, the Board must record reasons in writing and afford the applicant a reasonable opportunity of hearing, thereby incorporating the fundamental principles of natural justice into the statutory decision-making process. Rule 17(7) further ensures confidentiality of the information furnished by an applicant by prohibiting its unauthorized disclosure, thereby balancing commercial confidentiality with statutory regulation.

72. Thus, Rule 17 of the Rules, 2015 operationalizes and gives practical effect to the substantive provisions contained in Sections 7, 23 and 24 of the Act, 2002. While the parent enactment creates the statutory obligation of obtaining prior approval and empowers the State Biodiversity Board to regulate commercial access to biological resources, Rule 17 prescribes the detailed procedural mechanism through which such statutory powers are to be exercised. The Rule envisages a complete regulatory process beginning with submission of an application in the prescribed form, followed by scrutiny and evaluation by the State Biodiversity Board, consultation with the concerned local bodies through a participatory process, consideration of the impact of the proposed activity upon biodiversity conservation and livelihood of local communities, grant or refusal of permission by a reasoned decision, execution of a written agreement governing the terms of commercial utilization, incorporation of conservation measures and benefit-sharing obligations, and observance of procedural safeguards, including adherence to the principles of natural justice and maintenance of confidentiality.

73. The cumulative effect of these provisions unmistakably establishes that the statutory framework does not permit unrestricted commercial exploitation of biological resources but subjects every such activity to a carefully structured regulatory regime intended to secure ecological conservation, sustainable utilization of biological resources and fair and equitable sharing of the benefits arising therefrom.

C. Guidelines on Access to Biological Resources and Associated Knowledge and Benefit Sharing Regulations, 2014

          "Regulation 1 - Procedure for access to biological resources and/or associated traditional knowledge for research or bio- survey and bio-utilization for research.-(1) Any person referred to under sub-section (2) of section 3 of the Act, who intends to have access to biological resources and/or associated traditional knowledge for research or bio-survey and bio-utilization for research shall apply to the National Biodiversity Authority (NBA) in Form I of the Biological Diversity Rules, 2004 for obtaining access to such biological resource and/or associated knowledge, occurring in India.

          (2) The NBA shall, on being satisfied with the application under sub-regulation (1), enter into a benefit sharing agreement with the applicant which shall be deemed as grant of approval for access to biological resource for research referred to in that sub-regulation:

          Provided that in case of biological resources having high economic value, the agreement may contain a clause to the effect that the benefit sharing shall include an upfront payment by applicant, of such amount, as agreed between the NBA and the applicant.

          Regulation 2 - Procedure for access to biological resources, for commercial utilization or for bio-survey and bio- utilization for commercial utilization.-(1) Any person who intends to have access to biological resources including access to biological resources harvested by Joint Forest Management Committee (JFMC)/Forest dweller/Tribal cultivator/Gram Sabha, shall apply to the NBA in Form-I of the Biological Diversity Rules, 2004 or to the State Biodiversity Board (SBB), in such form as may be prescribed by the SBB, as the case may be, along with Form 'A' annexed to these regulations.

          (2) The NBA or the SBB, as the case may be, shall, on being satisfied with the resources, for commercial utilization or for bio-survey and bio-utilization for commercial utilization referred to in that sub-regulation.

                    Regulation 3 - Mode of benefit sharing for access to biological resources, for commercial utilization or for bio-survey and bio-utilization for commercial utilization.-(1) Where the applicant/ trader/manufacturer has not entered Management Committee (IFMC)/Forest dweller/Tribal cultivator/Gram Sabha. into any prior benefit sharing negotiation with persons such as the Joint Forest sharing obligations on the trader shall be in the range of 1.0 to 3.0% of the and purchases any biological resources directly from these persons, the benefit on the manufacturer shall be in the range of 3.0 to 5.0% of the purchase price purchase price of the biological resources and the benefit sharing obligations of the biological resources:

          Provided that where the trader sells the biological resource purchased by him to another trader or manufacturer, the benefit sharing obligation on the buyer, if he is a trader, shall range between 1.0 to 3.0% of the purchase price and between 3.0 to 5.0%, if he is a manufacturer:

          Provided further that where a buyer submits proof of benefit sharing by the benefit sharing buyer shall be applicable only on that portion of the purchase price for which the benefit has not been shared in the supply chain.

          (2) Where the applicant/trader/manufacturer has entered into any prior Committee (JFMC)/Frest dweller/Tribal cultivator/Gram Sabha, and purchases benefit sharing negotiation with persons such as the Joint Forest Management any biological resources directly from these persons, the benefit sharing obligations on the applicant shall be not less than 3.0% of the purchase price of the biological resources in case the buyer is a trader and not less than 5.0% in case the buyer is a manufacturer.

          (3) In cases of biological resources having high economic value such as sandalwood, red sanders, etc. and their derivatives, the benefit sharing may include an upfront payment of not less than 5.0%, on the proceeds of the auction or sale amount, as decided by the NBA or SBB, as the case may be, and the successful bidder or the purchaser shall pay the amount to the designated fund, before accessing the biological resource.

          Regulation 4 - Option of benefit sharing on sale price of the biological resources accessed for commercial utilization under regulation 2.-When the biological resources are accessed for commercial utilization or the bio-survey and bio-utilization leads to commercial utilization, the applicant shall have the option to pay the benefit sharing ranging from 0.1 to 0.5% at the following graded percentages of the annual gross ex- factory sale of the product which shall be worked out based on the annual gross ex- factory sale minus government taxes as given below:-