The Environmental Protection Agency has the authority to revoke a mining permit to protect streams and wildlife, a federal appeals court ruled on Tuesday. The decision was a victory for the agency, which in 2011 retroactively vetoed a permit granted by the Bush administration in 2007 to allow a subsidiary of Arch Coal of St. Louis to dump tons of mining waste into several West Virginia rivers and streams. The veto was declared illegal in a 2012 decision by Judge Amy Berman Jackson of Federal District Court, who called it an illegal power grab. But on Tuesday, a three-judge panel of the United States Court of Appeals for the District of Columbia Circuit ruled unanimously that the Clean Water Act and Congressional intent gave E.P.A. the authority to retroactively revoke a mining permit. The ruling affects a proposed mine known as Spruce No. 1, which would have involved dynamiting the tops off mountains to get at coal. Kim Link, a spokeswoman for Arch Coal, said in an e-mail: “We’re disappointed in the decision, which was related to the procedural aspects of the proceeding. The case will now go back to the district court for a decision on the merits.”