The US Court of Appeals for the District of Columbia ruled on Tuesday that the EPA had the right to retroactively veto a water pollution permit for one of West Virginia’s largest mountaintop removal coal mines years after it was issued.

The permit for Mingo Logan Coal’s Spruce no 1 mountaintop removal mine was granted by the Army Corps of Engineers with input from the EPA in 2007.

But in January 2011, the EPA announced it was going to veto the permit, saying that destructive, unsustainable mining practices would cause irreparable environmental damage and threaten the health of residents nearby.

Last March, Mingo Logan, an Arch Coal subsidiary, subsequently filed a lawsuit to get the permit back and the US District Court for the District of Columbia sided with the company.

But in Tuesday’s unanimous decision by a three-judge panel the appeals court said that section 404 of the Clean Water Act did not place a time limit on when the EPA administrator could intervene if the agency believed there could be an "unacceptable adverse effect" on the environment.

“We’re disappointed in the decision, which was related to the procedural aspects of the proceeding,” Arch spokeswoman Kim Link said in an email.

“The case will now go back to the District Court for a decision on the merits.”

Still at issue is whether the EPA’s revoking of the permit was an “arbitrary and capricious” violation of the Administrative Procedure Act, as Arch Coal contends.

Congressman Nick Rahall said the decision would up-end the traditional balance between the states and the governments in the permitting process.

“Today’s decision would open the floodgates to disrupting coal mining in West Virginia and elsewhere by granting the EPA unprecedented and seemingly limitless authority over Clean Water Act 404 permits,” Rahall said in a statement.

“The court, in this decision, gives license to the EPA to retroactively veto any Clean Water Act 404 permit ‘whenever’ the administrator deems necessary, rendering all such permits for any range of industrial or construction activities throughout the country completely meaningless.”

Rahall pledged to reintroduce the Clean Water Cooperative Federalism Act, legislation the house approved last year to prevent the EPA from “using the guise of clean water” to hinder the industry.

The ruling marks only the 13th time since 1972 that the EPA has used the veto authority and the first time it has acted on a previously permitted mine.

The agency reserves the power for “rare and unacceptable” cases.