The issue of waste import for recycling shot into limelight in 1995, when a public interest litigation was filed at the Supreme Court. Wastes were entering the country in huge quantities. The Hazardous Waste (Management & Handling) Rules, 1989, (HW-M&H), clearly indicated that wastes would not be allowed into the country for dumping. Wastes intended for reuse and reprocessing would be allowed only after getting appropriate environmental clearance.

This involved getting a no objection certificate from the concerned state pollution control board.

The court, however, learnt that wastes were entering the country unchecked, and certainly not as per rules. While seven importers had applied for permission to import wastes, virtually hundreds of importers were importing several thousand tonnes of wastes. The HW-M&H regulations were not reflected in the country's import procedures. The wastes were being imported under the open general licence (OGL), and could be imported by anyone without getting any clearance.

The authority for issuing licence for import of wastes is the directorate general of foreign trade (DGFT). Till April 1995, all wastes were imported under the OGL and were allowed to be traded freely. After April 1995, wastes for the purpose of re-use or reprocessing were to be imported only against a licence. In March 1996, the DGFT published the Indian Trade Classification-Harmonised System (ITC-HS) of export and import items. In this publication, all wastes and scrap were included in the negative list.

Another notification was published by the ministry of commerce on July 11, 1996, under the Foreign Trade (Development and Regulation) Act, 1992. As per this notification, specific scraps had been segregated and provided distinct ITC-HS codes.