This writ petition under Article 226 of the Constitution of India was filed in public interest by some residents of villages Batamandi and Ganguwala falling in Tehsil Paonta Sahib of District Sirmaur in Himachal Pradesh. The petitioners questioned the legality and propriety of the expansion of the existing fermentation plant of Ranbaxy Laboratories Limited at Ganguwala for manufacture of bulk drugs and setting up of a new formulation plant. One of the main issues raised was with regard to the withdrawal of ground water by M/s Ranbaxy Laboratories for the two plants and the effect of this withdrawal on the availability of ground water to the villagers. It was stated by the petitioners that the effluent of the plant is highly toxic and will have great adverse effect on the river Yamuna on the banks of which the plant is situated. It was contended that the plant if permitted to be set up will cause massive pollution affecting the health of the residents in the area. The petitioners contention was that the ‘zoning atlas as prepared by the Central Pollution Control Board (CPCB) stipulates the siting criteria for different industries. This has been violated since the same prohibits the setting up of a bulk drug manufacturing unit in Paonta Sahib. On 1.4.2005 the Court set up a Committee to go into the questions of legality, propriety and correctness of the setting up of the units and inter alia to enquire, find out and report whether in setting up these units any laws relating to the acquisition / transfer / alienation / possession of land in any manner had been violated or not, and if violated to what effect. The Court after considering the detailed report of the Committee came to the conclusion that the entire district of Sirmaur has been termed as highly aerial sensitive area and therefore A-l Industries cannot be set-up in that area. With regard to water pollution again as per the zoning atlas the fermentation plant of the Ranbaxy Laboratory was held to have the potential of water pollution of the category W-l (very high impact potential). The highest risk areas for water pollution are on the river banks of Markanda, Bata and Yamuna rivers where the zoning atlas advises that ‘no water polluting industries should be situated. analysis must be done by preparation of a comprehensive Environment Impact Assessment (EIA). The other guidelines of the Zoning Atlas with regard to maintenance of buffer zone especially for reserve forests and sanctuaries etc. must be kept in mind while preparing EIA. All these aspects must be taken into consideration when the EIA is prepared and only thereafter the site should be approved or rejected”. The Court in conclusion held: no industry can be set up without a proper EIA. It is for the Impact Assessment Authority and not for the proponent of the Industry to decide whether a comprehensive EIA should be prepared or the rapid EIA is sufficient to meet the needs of the Industry. Till this comprehensive EIA is filed and approved by the Impact Assessment Authority no further construction can be permitted to take place. In the present case before respondent is permitted to set-up the plant it must get prepared a comprehensive EIA as well as Environment Management Plan. These two documents will take into consideration the recommendations made in the Development Plan and also various guidelines issued in the Zoning Atlas. These documents would also show as to whether the guidelines are being complied with or not. In case the guidelines are being violated then there should be a recommendation whether they should be relaxed or not and if any guidelines are to be relaxed the reasons thereof.