THE Highways Department has bulldozed a breeding ground of the protected Hong Kong newt, despite advice from the Environmental Protection Department (EPD) to control the impact of its work. The Hong Kong newt, while fairly common in the territory, is believed to live only here and is protected under the Wild Animals Protection Ordinance. It breeds in the Lam Tsuen River, parts of which have been hit by work over the past three years to widen Lam Kam Road. But earlier this month bulldozers dug up a section of the river where the newt is known to breed. Dr David Dudgeon, a reader in the University of Hong Kong's Zoology Department, had been doing research at the site. He said the newt's breeding season was just about to begin, but it had had a succession of bad years in the area, making it highly vulnerable. ''It frustrates me that you get this progressive deterioration of the environment,'' he said. ''The Wild Animals Protection Ordinance says you can't possess a Hong Kong newt or sell or kill one, but it doesn't say you can't trash its habitat.'' Dr Dudgeon began studying the site in 1991 after the first bulldozers arrived. They were digging up parts of the river to retrain it in connection with the road-widening works, but in the process were releasing large amounts of silt into the river which smothered the plants and animals on the bottom. Dr Dudgeon wanted to measure the impact and recovery rate and, after questioning the Highways Department, chose a site which he believed would be safe from bulldozing. But earlier this month he showed up one day to find his research site destroyed. John Climus, chief highway engineer for capital works in the New Territories, said it had always been intended to bulldoze the site, but Dr Dudgeon was not made aware of this because of the way his query was interpreted. ''We weren't trying to hide anything. It was simply that he asked a narrow question and the person who answered it interpreted it in a narrow way,'' he said. ''Unfortunately, Dr Dudgeon's research cannot be restored, which we very much regret.'' Mr Climus admitted they were supposed to control the soil and rocks entering the river, as requested by the EPD in a 1989 environmental review. But this would have required damming the river and creating a pond which would have created other problems, particularly during heavy rains, he said. Robert Law, Deputy Director of Environmental Protection, said he did not have all the details of the case at hand, but he would pursue the matter if Dr Dudgeon filed a formal complaint with him. If the Highways Department is found to have consciously ignored the EPD's advice, the department can only appeal internally through the Government because the advice was passed on before last year when such provisions were required to be put before the Legislative Council.