I. Corporate Liability.
Under the legal framework of India, corporations, recognized as distinct legal entities, can be held accountable for environmental harm that directly results from their operational activities. A cornerstone principle governing this liability is the ‘Polluter Pays Principle’. This principle unequivocally establishes that the financial responsibility for compensating for environmental damage rests with the entity that caused the pollution. Beyond mere compensation, this principle also serves as a significant deterrent, incentivizing corporations to adopt environmentally sound practices and to prevent pollution from occurring in the first place.
Read Also : Air ( Prevention and Control of Pollution) Act,1981
Furthermore, Indian jurisprudence recognizes the ‘Principle of Absolute Liability’, which evolved significantly in the aftermath of the Bhopal Gas Tragedy. This principle applies to corporations that are engaged in hazardous or inherently dangerous activities. It dictates that if harm is caused to any person as a result of an accident during the operation of such an activity, the corporation is held strictly and absolutely liable to provide compensation to those affected, without any exceptions for reasonable care taken. The increasing emphasis on Corporate environmental Responsibility (CER) further underscores the expectation that corporations must proactively integrate environmental conservation and sustainability into their core business operations, recognizing it as a fundamental duty alongside their pursuit of economic goals. This evolving legal and ethical landscape reflects a growing societal expectation that corporations must be responsible stewards of the environment.
The Environment (Protection) Act, 1986, the Water Act 1974, and the Air Act 1981 all contain specific provisions that address offenses committed by companies. Section 16 of the environment (Protection) Act, 1986 , explicitly states that if an offense under this Act is committed by a company, every individual who was directly in charge of and responsible to the company for the conduct of its business at the time of the offense, as well as the company itself, shall be deemed guilty of the offense. However, this section also provides a potential defense for such individuals if they can prove that the offense was committed without their knowledge or that they had exercised all due diligence to prevent its commission. Similar provisions are found in Section 47 of the Water Act, 1974 , and Section 40 of the Air Act, 1981 , which address offenses by companies in the context of water and air pollution, respectively. These sections establish a legal framework for attributing liability to both the corporate entity and the individuals responsible for its operations. The concept of an ‘officer in default’ is also relevant in these contexts, extending liability to directors, managers, secretaries, or other officers of the company if the offense was committed with their consent or connivance, or if it is attributable to any neglect on their part. These legislative provisions collectively aim to ensure that both the corporate body and the responsible individuals within it are held accountable for environmental transgressions.
The concept of ‘officer in default’ is a crucial aspect of corporate environmental liability, designed to pierce the corporate veil and hold individuals within a company responsible for environmental offenses. This provision extends liability beyond the company itself to include directors, managers, secretaries, and other key personnel if the environmental offense was committed with their explicit consent, through their active connivance, or as a direct result of their negligence. The primary objective of this concept is to prevent individuals from using the legal separation between themselves and the company to shield themselves from accountability for environmental harm caused by the corporation. However, a significant challenge in the practical application of this provision lies in the difficulty of definitively proving the direct involvement or the specific criminal intent of individuals in the commission of environmental crimes by a corporation. Recent judicial pronouncements, such as the case of Sanjay Dutt v State of haryana , have clarified the threshold for establishing vicarious liability in such cases. The supreme Court in this instance held that merely holding an authorization or a supervisory role within the company is not sufficient to establish criminal liability. Instead, there must be clear and compelling evidence demonstrating the individual’s direct involvement in the matter and a discernible criminal intent. This judicial interpretation underscores the need for a high standard of proof when seeking to hold individuals within a corporation criminally liable for environmental offenses.
The ‘Polluter Pays Principle’ and the ‘Principle of Absolute Liability’ serve as fundamental pillars in holding corporations accountable for the environmental impacts of their operations in India. The ‘Polluter Pays Principle’ firmly establishes that corporations that are responsible for causing pollution must bear all associated costs, including those related to environmental remediation, providing compensation to affected victims, and undertaking comprehensive environmental restoration efforts. This principle is explicitly recognized and given legal force under the Environment (Protection) Act of 1986. The ‘Principle of Absolute Liability’ represents an even stricter standard of accountability, specifically applicable to corporations that are engaged in activities deemed to be inherently hazardous. This principle, notably articulated in the context of the Bhopal Gas Tragedy , holds such corporations liable for any environmental damage that occurs as a result of their operations, without allowing for exceptions based on the demonstration of reasonable care or the absence of negligence. The National Green Tribunal (NGT) has emerged as a key adjudicatory body in India, actively enforcing the ‘Polluter Pays principle’ by holding corporations financially responsible for ecological damage through the imposition of substantial penalties and the issuance of orders for environmental compensation. The proactive role of the NGT highlights the increasing rigor in holding corporations accountable for the environmental consequences of their activities.
Several landmark judgments by the Supreme Court of India and the National Green Tribunal have been instrumental in establishing and clarifying the contours of corporate liability for environmental harm. The Bhopal Gas Tragedy case, Union Carbide Corporation v. Union of India , stands as a seminal judgment that firmly established the principle of absolute liability for Industries engaged in hazardous undertakings. The case of Vellore Citizens Welfare Forum v. Union of India further cemented the ‘Polluter Pays Principle’ and the precautionary principle in indian environmental law, holding polluting industries accountable for the environmental damage they cause. A series of cases under the title M.C. Mehta v. Union of India , including those related to the pollution of the Ganga River and the protection of the Taj Mahal from industrial emissions, have significantly contributed to the development of environmental jurisprudence concerning corporate liability. Other notable cases such as Sterlite Industries (India) Ltd. Vs. and LG Polymers India Pvt Ltd. Vs. demonstrate the continued application of the ‘Polluter Pays Principle’ and the imposition of substantial penalties by the NGT on corporations for environmental damage and public health risks. The case of Research Foundation for science Technology and Natural Resource Policy vs. Union of India & Others further illustrates the application of this principle in cases involving the illegal handling and disposal of hazardous substances by corporations. These judicial pronouncements collectively underscore the increasing emphasis on holding corporations accountable for the environmental consequences of their actions in India.
Also Read : Water ( Prevention and Control of Pollution) Act,1974
II. Governmental Liability.
Indian environmental law extends the ambit of liability to include government departments for environmental offenses committed under their purview. Section 17 of the Environment (Protection) Act, 1986 , specifically addresses offenses by government departments, stipulating that the Head of the Department shall be held prima facie guilty of such offenses unless they can demonstrate that the offense was committed without their knowledge or was due to circumstances beyond their control. This section also holds other officers within the department liable if the offense is proven to be attributable to their neglect. Similar provisions can be found in Section 48 of the Water Act and Section 41 of the Air Act , further reinforcing the principle that governmental bodies are not exempt from environmental accountability. Moreover, the ‘Polluter Pays Principle’, which holds the polluter responsible for the costs of environmental damage, is equally applicable to government entities. This is evidenced in cases where the National Green Tribunal (NGT) has held state governments and municipal corporations liable for environmental degradation resulting from their actions or omissions. Additionally, the Doctrine of Public Trust, a Significant legal principle, can be invoked against the government when it fails in its duty to protect natural resources that are held in trust for the benefit of the public. These legal mechanisms collectively underscore the principle that government bodies and officials are subject to environmental accountability under Indian law.
As previously mentioned, Section 17 of the Environment (Protection) Act, 1986, Section 48 of The Water Act, 1974, and Section 41 of the Air Act, 1981, explicitly delineate the liability of government departments and their heads for environmental offenses. These provisions generally establish a presumption of guilt against the head of the department in cases of environmental violations, placing the onus on them to prove a lack of knowledge or control over the commission of the offense. Furthermore, these sections also allow for the prosecution of other officers within the department who are found to be directly involved in or negligent with respect to the environmental offense. This legislative framework clearly indicates an intention to hold government entities to a standard of environmental responsibility that is comparable to that expected of private corporations.
Also Read :Consent mechanism in Water and Air Act
Ensuring the accountability of government bodies and officials is paramount for the effective protection of the environment, particularly given their role as custodians of natural resources and their mandate to enforce environmental laws. Instances of government departments failing to adhere to environmental regulations or to comply with orders issued by judicial bodies can lead to legal repercussions, as highlighted by the reference to potential liability for non-compliance with NGT orders. Recognizing the critical role of regulatory bodies, the supreme Court has issued directives to state governments to address vacancies in Pollution control Boards, emphasizing that the effective functioning of these governmental agencies is essential for tackling environmental challenges such as pollution. Moreover, the NGT has taken a proactive stance in holding government entities accountable by imposing environmental compensation on bodies like the National Highway Authority of India (NHAI) for environmental damage caused during infrastructure development projects. These actions underscore the increasing scrutiny of governmental activities and inactions that have an impact on the environment.
The National Green Tribunal (NGT) has emerged as a pivotal judicial body in India for adjudicating cases that involve governmental liability for environmental damage. The NGT often takes suo motu cognizance of environmental issues that come to its attention, demonstrating its commitment to proactively addressing environmental degradation. In numerous instances, the tribunal has imposed significant amounts of environmental compensation on government bodies that have been found responsible for failing to prevent pollution or for directly causing environmental damage through their projects and policies. The active role of the NGT in this area signifies an increasing level of judicial oversight and accountability concerning the environmental performance of government entities.
Several significant case laws have addressed the issue of governmental liability for environmental offenses in India. In the case of M.C. Mehta v. Kamal Nath , the Supreme Court held the Himachal Pradesh government accountable for violating the Doctrine of Public Trust by leasing an ecologically sensitive forest area to a private entity for commercial purposes. The case of Radhe Shyam Sehra vs. State of U.P. saw the NGT impose substantial environmental compensation on the Uttar Pradesh government for its failure to prevent the unchecked dumping of garbage on the floodplains of the Rapti River, leading to severe water pollution.
Furthermore, a recent judgment by the Supreme Court, which recognizes the freedom from the adverse effects of climate change as a fundamental right , could potentially have far-reaching implications for governmental liability in cases where inadequate measures are taken to mitigate the impacts of climate change, although the full extent of this is yet to be seen. These case laws demonstrate a clear trend in the Indian judiciary towards holding government bodies liable for environmental offenses based on established legal principles and evolving understandings of environmental rights and responsibilities.
Read Next : Environment Protection Act 1986
