polluter pays

Experts Divided as Government Moves to Decriminalise Environmental Offences

Changes to the Environment, Water and Air Acts mean that offenders will need to pay only monetary penalties for non-compliance under some sections and will no longer face the threat of imprisonment.

Kochi: Legal and policy experts are divided over the Union government’s move to “decriminalise” existing provisions in three legislations that govern offences relating to the environment to “weed out fear of imprisonment for simple violations”.

The latest proposed amendments to the Environment, Water and Air Acts dated June 30 and July 1 propose to remove the provision of imprisonment as a penalty for offenders.

Therefore, offences – including failure to comply with the Acts’ provisions, such as not meeting safeguards set up to deal with hazardous substances – would attract only a monetary fine. The amendment proposes to also increase these fines. This money will go into specific funds under each Act, and the government will disburse them to compensate the affected parties.

While some legal and policy experts say that such a ‘decriminalisation’ is not a dilution and makes no difference since very few criminal cases are filed under these Acts anyway, others noted that doing away with imprisonment could affect the implementation of these Acts and encourage a pollute-and-pay attitude.

Moreover, the concept of compensatory penalties being directed to specific funds does not ensure that the money reaches aggrieved parties as some existing remedial funds have shown, they added.

What are the proposed amendments?

The Ministry of Environment, Forest and Climate Change (MoEFCC) proposes to make three main changes to legislations governing environmental protection and pollution in the country – the Environment (Protection) Act, 1986, Water (Prevention and Control of Pollution) Act, 1974 and Air (Prevention and Control of Pollution) Act, 1981 – as per notices uploaded on its website on June 30 and July 1.

One is to remove the provision of imprisonment as a penalty for non-compliance under some sections of these Acts. For example, non-compliance under the Environment Act will currently attract fines (of up to Rs 1 lakh) or imprisonment (up to five years), or both. If violations continue for more than one year after conviction, the imprisonment term can extend to seven years. However, the latest amendment proposes to restrict penalties to fines alone, which an adjudicating officer appointed by the government will authorise.

Another change that the amendment proposes is to increase the monetary penalties for some offences. Under the Environment Act, for example, non-compliance currently attracts a fine of up to Rs 1 lakh and an additional fine may extend to Rs 5,000 for every day of the violation. As per the latest amendment, however, non-compliance will now attract penalties of anywhere between Rs 5 lakh to 5 crore; additional fines can range from Rs 50,000 to Rs 5 lakh per day.

The third change that the amendments seek is to create specific funds under each Act, to house the compensatory money that offenders pay. The amendment moots an ‘Environmental Protection Fund’ under the Environment Act, a ‘Water Pollution Remediation Fund’ under the Water Act and an ‘Air Pollution Remediation Fund’ under the Air Act. The government will disburse these funds to the affected parties.

The changes are being mooted based on “inputs from various stakeholders” that raised concerns regarding current penal provisions, and “to weed out fear of imprisonment for simple violations”, according to the notices for public comments that were uploaded on the MoEFCC’s website.

A boy searches for fish in the polluted sea backwaters near marina beach in the southern Indian city of Chennai July 3, 2013. Credit: Reuters/Babu/Files

A boy searches for fish in the polluted sea backwaters near Marina beach in Chennai, July 3, 2013. Photo: Reuters/Babu/File

Deterrent for compliance?

“That penalties will be increased is a good thing but even these amounts may not be enough to capture the losses to both people and the environment,” said Debadityo Sinha, a policy researcher at Delhi’s Vidhi Centre for Legal Policy. Most offenders can afford to pay these amounts and this could foster a pollute-and-pay attitude, he added.

“Penalties alone are no deterrent for big corporates and industries. With no fear of imprisonment, the implementation of the Acts could be affected,” he said. For instance, willfully delaying or obstructing an officer’s entry or investigation is an offence that currently attracts both fines and imprisonment. But with penalties being only monetary for this as per the amendment, offenders can easily obstruct or refuse to comply, and just pay later, Sinha said.

According to the amendment in the Environment Act, the adjudicating officer will decide the penalty amount based on several factors such as the losses caused to people. The factors listed do not include the assessment of losses that the ecosystem and biodiversity would have borne, or the costs involved in offsetting these losses such as through restoration activities, Sinha said.

Moreover, there are numerous funds that are not really effective – such as the Compensatory Afforestation Fund and Environment Relief Fund (ERF), he added.

The ERF, for example, was instituted under the Public Liability Insurance Act, 1991, following the Bhopal Gas tragedy. It is meant for victims of accidents in the process of handling hazardous substances and compensations awarded by the National Green Tribunal (NGT) are also deposited in this fund. (Incidentally, the Union government has sought to decriminalise this act as well, in its call for public comments on the matter on June 30.)

In 2020, Sinha’s research revealed several problems, including the lack of separate records of contributions that came in via the NGT for environmental damage. The same year, the NGT directed the MoEFCC to take action when it received a plea alleging the non-utilisation of more than Rs 800 crore in the ERF. Similarly, scientists have pointed out several issues with the compensatory afforestation undertaken by the Compensatory Afforestation Fund Management and Planning Authority (CAMPA), including the inability of new plantations to really ‘compensate’ for the loss of old-growth forests.

Also Read: Punishing the Polluters: Why Large Fines Are an Important Step Towards Cleaner Corporations

‘An issue that needs attention’

However, we should “view these proposals as the government’s acknowledgement that pollution control and liability is an issue that needs attention”, said environment policy expert Kanchi Kohli, senior researcher at the Centre for Policy Research, New Delhi.

“Given that these laws have been in existence for over a decade, its footprint is visible not just on private sector profits, but on food security, health, ecology and social life of people living in contaminated areas. It is also important to debate these proposals by asking first, how it will address the long legacy of pollution, livelihood loss and loss of life arising out of past illegalities,” she said.

Secondly, we need to ask whether changing liability from criminal to civil will necessarily change the deliberate and conscious nature of violations that have been in practice for decades, she added.

National Green Tribunal in New Delhi. Photo: PTI

Moreover, such a ‘decriminalisation’ does not make a difference because very few criminal cases are filed under these Acts anyway, said environmental lawyer Ritwick Dutta, co-founder of the Legal Initiative for Forest and Environment. Data from the National Crime Records Bureau shows that every year, just around 10 cases are filed under the Air Act and around 40 under the Water Act, he said.

Criminal provisions of the Environment, Air and Water Acts have never worked because the Code of Criminal Procedure is too complicated to deal with environmental matters; it takes years or even decades until someone is finally persecuted. However, civil cases under the NGT, for example, have met with resolution, Dutta added – companies have been held liable, been told to cough up compensation for restoration, and so on.

“I support the need to amend the laws,” he told The Wire. “I don’t see decriminalisation as a definite kind of dilution.”

Though it is problematic that the Union government didn’t provide a longer timeframe for public comments (currently, comments on these Acts are open till July 21), it is still better than seeking comments on a new draft amendment or the change being pushed through office memoranda,” Dutta added.

Two Recent Judgments Risk Damaging the SC’s Enviable Track Record on Environmental Law

The top court’s Pahwa Plasticsis order is bound to have ripple effects given courts haven’t addressed violations of environmental law as the simple violation of laws but as an infringement of constitutional rights.

This article was originally published on The Wire Science, our website dedicated to science, health and environment reportage and analysis. Follow, read and share.

India’s courts have given new meaning and substance to environmental law, including through the ‘polluter pays’ and precautionary principles and the ‘public trust doctrine’. Newer ones such as ‘species best-interest standard’, ecocentrism and the environmental rule of law have also become part of the law of the land.

Judgments of the Supreme Court in particular are quoted by courts across the world for their bold and farsighted approach. Overall, India stands as a shining example of how a nation with 1.3 billion people, with millions below the poverty line, is still able to prioritise the environmental rule of law and protect its ecological riches.

However, judgements of the Supreme Court in Pahwa Plastics Pvt. Ltd. on March 22, 2022, and in Electrosteel Steels Ltd. of 2021 have together departed in significant ways from the court’s enviable track record, and mark a fundamental shift in the court’s approach towards environmental issues.

Pahwa Plastics

In June 2021, the National Green Tribunal (NGT) held that industrial units that manufacture synthetic organic chemicals – specifically, formaldehyde in the state of Haryana – were required by law to obtain environmental clearance from the Union environment ministry before commencing operations. The units were also required to prepare an environment impact assessment report and conduct a public hearing before the approval is granted (or not).

Since none of the units in question had a prior environmental clearance, the NGT found to be operating in violation of the law. Subsequently, the aggrieved industrial units approached the Supreme Court to challenge the tribunal’s decision. They argued that they were “bona fide under the impression” that they were not required to obtain environmental clearance to manufacture formaldehyde and further that “it was thought that Environmental Clearance was not required for (the) units”.

Before the Supreme Court, the question of the relevant law, as stated in the judgement, is whether an establishment employing around 8,000 workers and which has been set up after receiving the ‘consent to establish’ and the ‘consent to operate’ from the proper statutory authority and which has applied for ex post facto environmental clearance can be closed pending issuance of the clearance – even though it may not release pollutants and/or may be found to comply with the required norms.

The Supreme Court bench, headed by Justice Indira Banerjee, concluded:

[Para 56] The manufacturing units of the Appellants appoint about 8,000 employees and have a huge annual turnover. An establishment contributing to the economy of the country and providing livelihood ought not to be closed down only on the ground of the technical irregularity of not obtaining prior Environmental Clearance irrespective of whether or not the unit actually causes pollution. …

[63] Ex post facto environmental clearance should not be granted routinely, but in exceptional circumstances taking into account all relevant environmental factors. …

[65] The 1986 Act (Environment Protection Act 1986) does not prohibit ex post facto [Environmental Clearance]. Some relaxations and even grant of ex post facto EC in accordance with law, in strict compliance with Rules, Regulations, Notifications and/or applicable orders, in appropriate cases, where the projects are in compliance with environment norms, is not impermissible.

Legalising illegality

At the heart of the judgement is the legality of post facto clearances. Note that this term does not exist either in the Environment (Protection) Act 1986 nor in the Environment Impact Assessment Notification 2006. It is a term that the executive introduced through a so-called ‘office memorandum’ – i.e. an order to regulate the working of the office. What exists in law is “prior environmental clearance” – i.e. an approval from statutory authorities before the commencement of work.

In the Pahwa Plastics case, the court categorically held that “post facto approval” is permissible under the law. A plain reading of the court’s conclusion shows that its main emphasis was on the industry’s “8,000 employees” and “huge annual turnover”, that it contributes to the “economy of the country” and provides “livelihoods”.

Further, a unit not obtaining prior approval as required under the law amounts to a ‘technical irregularity’ – but according to the court, it’s a ‘technical irregularity’ even if the unit pollutes the environment. This conclusion is bound to have serious consequences on the environmental rule of law as well as on the right to life of the citizens, guaranteed under Article 21 of the Constitution.

Pahwa Plastics is also bound to have a ripple effect given the fact that, to date, courts haven’t addressed violations of environmental law as the straightforward violation of statutory laws but as an infringement of the constitutional right to clean air and water and balanced ecosystems.

This isn’t the first time the court legalised “post facto approvals”. Pahwa Plastics itself draws from the Supreme Court’s judgement in Electrosteels Steel Ltd. of 2021, which was also authored by Justice Banerjee.

In Electrosteel, a unit that had obtained environmental clearance had shifted its premises by nearly 5.3 km from the site for which it had obtained the clearance. Since these clearances are site-specific, and based on each site’s ecological parameters, the shift warranted a fresh clearance. But the court held otherwise:

[Para 82] The question is whether an establishment contributing to the economy of the country and providing livelihood to hundreds of people should be closed down for the technical irregularity of shifting its site without prior environmental clearance, without opportunity to the establishment to regularise its operation by obtaining the requisite clearances and permissions, even though the establishment may not otherwise be violating pollution laws, or the pollution, if any, can conveniently and effectively be checked. The answer has to be in the negative.

The court concluded:

… ex post facto environmental clearance should not ordinarily be granted, and certainly not for the asking. At the same time ex post facto clearances and/or approvals and/or removal of technical irregularities in terms of Notifications under the 1986 Act cannot be declined with pedantic rigidity, oblivious of the consequences of stopping the operation of a running steel plant.

Interestingly, the Pahwa Plastics judgement uses many of the same turns of phrase as Electrosteel.

The court also repeatedly stated that “post facto approval” is permitted under the Environment (Protection) Act 1986. However, the Act contains no reference to “post facto approvals”. The Environment Impact Assessment Notification of 2006 also makes no reference to “post facto” clearances.

Further, the court also allowed decision-makers unfettered discretion. Specifically, while “ex post facto environmental clearance should not be granted routinely,” according to Pahwa Plastics, it can be granted in “exceptional circumstances”. These “circumstances” have not been defined, however.

Finally, the court provided a window within which the government could grant a “post facto approval” – “where the adverse consequences of denial of ex post facto approval outweigh the consequences of regularisation of operations by grant of ex post facto approval”.

Doctrine of proportionality

The principal issue here is the court’s excessive reliance of late on the doctrine of proportionality. In Pahwa Plastics, the Supreme Court invoked the doctrine of proportionality to hold that closing an industrial unit would be disproportionate to the offence committed. That is, administrative action shouldn’t be more drastic than it ought to be to obtain the desired result. In other words, the court says, “don’t use a cannon to shoot down a sparrow”.

The question that arises is whether insisting on prior environmental clearance and requesting closure can be termed disproportionate. Clearly, once a law has clearly stated that prior environmental clearance has to be sought, it means every project proponent has to seek approval in advance and that any deviation from this procedure has to be regarded as a deliberate act of illegality.

But the Supreme Court’s conclusion that such a violation is a mere “technical irregularity” is deeply disturbing: it implies that compliance with environmental law is discretionary, not mandatory.

Both Pahwa Plastics and Electrosteel are problematic for another reason: they address environmental issues within the narrow lens of pollution. The Supreme Court repeatedly said the reason to allow the implicated industries some leeway is because they are not polluting and that they comply with environmental laws. But environmental law is not only about pollution: it is about where industrial units are located, their cumulative impact, the carrying capacity of their environment and, importantly, the views and concerns of the affected people.

Yet if we abide by the legal principles espoused by these two judgments, we may find ourselves at liberty to erect a large plastic-making enterprise in the middle of Lutyens Delhi without an environmental clearance, on the grounds that the facility would be non-polluting, comply with environmental laws in future, and employ a thousand people.

Like most judgments pertaining to our environmental laws, Pahwa Plastics liberally refers to the 1972 Stockholm declaration as well as to the principles of sustainable development. Unfortunately, these two entities carry little meaning if we are not also serious about implementing our laws.

Put another way, it is important for the court to consider violations of environmental laws as more than “technical irregularities,” and in fact as crimes against humanity and nature, and as a violation of constitutionally guaranteed rights. If it doesn’t, Pahwa Plastics will mark the day India’s position as a world’s leader in environmental law went from ‘vulnerable’ to ‘endangered’.

Ritwick Dutta is an environmental lawyer.

Punishing the Polluters: Why Large Fines Are an Important Step Towards Cleaner Corporations

Tougher penalties are a useful tool for environmental watchdogs.

Polluting the environment is a crime which can have countless victims – of numerous species and future generations. Whether it’s an oil spill in the sea, a release of raw sewage into a river, or a cloud of toxic gas into the air, the public has a clear interest in seeing criminal acts of pollution punished.

For a long time, courts have often been seen as soft on polluters, hesitating to penalise environmental criminals harshly. Yet recently, it seems that large fines against corporations have become increasingly common in the UK.

In March 2019, Severn Trent Water was fined £500,000 for spilling thousands of gallons of raw sewage in a Birmingham park. It was the latest in a series of expensive court appearances for water companies over the last half decade.

In 2014, the Court of Appeal handed a £250,000 fine to Thames Water, following the illegal discharge of untreated sewage materials into a stream in the North Wessex Downs. A year later, United Utilities was fined £750,000 after a pumping failure resulted in a raw sewage spill into the protected Duddon Estuary in Cumbria.

In 2016, Thames Water found itself in the dock again for illegally emitting sewage debris and sludge into the Grand Union Canal. It received a record £1m fine – a record which lasted little more than a year. In 2017, the same company was charged with emitting an estimated 1.4 billion litres of raw sewage into the river Thames and fined £20m.

Also read: How Higher Temperatures and Pollution Are Affecting Mosquitoes

These large fines represent a visible change in the way courts have responded to environmental crimes committed by large corporations. It is a change which followed the introduction in 2014 of specific sentencing guidelines for environmental offences, which provide a set of considerations a judge must take into account when sentencing an environmental offender.

They include the culpability of the offender, the level of environmental harm caused, and the offender’s financial means. Evidence from the Sentencing Council indicates that the median fine levied against corporate offenders has more than doubled since they were introduced.

So does this mean environmental criminals can now expect hard justice when committing environmental crimes? Sometimes, yes – at least if you are a large utility company causing significant environmental harm. But there are several reasons to think the impact of the fines might be limited.

First, the evidence compiled by the Sentencing Council suggests no spike in the level of fines handed down to individual (non-corporate) criminal offenders. This could mean that severe penalties are not applied to every transgressor.

Second, the increase in severity of fines has taken place against a drop in the overall number of prosecutions brought by the Environment Agency.

Third, many of the companies in charge of Britain’s crumbling water utility infrastructure are large companies which generate hefty profits. The £20m fine against Thames Water amounts to less than two weeks’ worth of the company’s profits. Is that an inadequate deterrent?

Yet on the positive side, a move towards stricter penalties does create an incentive for polluters to come forward and report accidental, yet criminal, environmental harm to the Environment Agency. By doing so, they can enter into a so-called “enforcement undertaking”, a legally binding agreement between an offender and a regulator. In these, an offender aims to take certain steps to cease illegal activities which cause environmental harm, and promises to make specific changes to its operations.

Credit: Rilsonav/Pixabay

Since being made available in 2011, the Environment Agency has accepted over 300 enforcement undertakings, and collected more than £13m in payments to environmental organisations and community groups.

Money talks

Importantly, almost all enforcement undertakings agreed by the Environment Agency include provisions for compensation to third parties affected as a result of the crime or for charitable donations to be made to environmental organisations. An example of this was when after the spillage of raw sewage in County Durham, Northumbrian Water paid £135,000 to three local environmental charities.

From an offender’s perspective, there is much to like in an enforcement undertaking, which can avoid the stigma and reputational damage of a criminal sentence. Similarly, they are popular with the Environment Agency which is able to save on the costs of a criminal prosecution. The undertakings also allow for the community affected by pollution to receive some kind of financial compensation.

These positive developments notwithstanding, there are risks associated with the widespread use of enforcement undertakings. We don’t know, for example, what the £13m in payments to environmental organisations is actually spent on, as there is no public scrutiny or accountability mechanism overseeing this. Nor do we know how negotiations between the Environment Agency and a polluter are conducted.

Also read: In Photos | Zooming Into the Environmental Problems of a Growing Chennai

These limitations, however, might not be reason enough to limit the use of enforcement undertakings which are generally seen as a cost-effective and informal way of securing compliance.

Importantly, as Brexit will fundamentally alter the legal landscape for environmental protection, the need for innovative and effective action is likely to increase. The combination of heavy fines and negotiable enforcement undertakings provides a solid foundation from which to respond to those changes.

Ole Pedersen is a reader in environmental law, Newcastle University.

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Why Take Away the Cess Meant to Clean India’s Mess?

Instead of doing away with the Swachh Bharat cess, the Centre should have made sure that the money made its way to the municipalities.

A boy crosses a drain on the banks of the river Ganges in Kanpur, India, April 4, 2017. Credit: Reuters/Danish Siddiqui

The introduction of Goods and Service Tax (GST), a singular indirect tax on July 1, 2017, abolished multiple cesses, such as the Swachh Bharat Cess (SBC) and the Krishi Kalyan cess. The cesses were repealed to avoid a cascading effect on taxpayers.

The SBC, introduced on November 15, 2015, was levied at the rate of 0.5% on all services that attracted service tax. A cess, unlike a tax, is collected by the government for a pre-specified purpose. The SBC accounted for Rs 16,400 crore collectively during FY 2015-16 and 2016-17. The proceeds from this cess were housed with the Consolidated Fund of India and utilised for the construction of individual household latrines, solid and liquid waste management, information, education and communication, and other administrative costs under the Swachh Bharat Mission.

Solid waste management (SWM) and disposal is considered one of the pillars of the Swachh Bharat Abhiyan, and is yearning for attention, with the government still seeking to address it efficiently. This is especially true when considering targets such as for 2019, when the country goes into elections, conscious of the promises made on cleaning India as a tribute to the 150th birthday celebrations of Mahatma Gandhi. The government aims to build sound SWM plants and achieve 100% door-to-door segregated garbage collection by this period.

SWM is a state subject, with the mandate of providing services relating to SWM lying with local municipal governments. Thus, there lies an impending need for the government at the Centre to prioritise SWM and handhold the municipalities to achieve excellence in the sector. The government response to this need has provided support at various levels to the municipalities under the Swachh Bharat Abhiyan, ranging from preparing tender documents to providing viability gap funding.

Also read: Why Poor Funding of Swachh Bharat Mission Since 2014 Has Put its Goals at Risk

However, it fails to address a major gap in terms of solving the user fee conundrum. There are various studies that have dwelled upon the importance of levying a user fee to ensure sustainability of services relating to SWM. Studies have also documented the constraints of local governments in successfully collecting fees to ensure a source of income and timely payments to service providers. With budgetary allocations barely sufficient to sustain basic collection and transportation services, it is critical for both the Centre and the states to develop a mechanism to address the issue of user fee collection.

The SBC achieved success at two different levels. One, it was able to align closely with the much spoken about ‘polluter pays’ principle. Two, it demonstrated to the government a fairly channelised mode of collecting a “fee”. This mechanism could have, in many ways, solved the perennial misery of municipalities relating to collecting user fees. However, as the proceeds of the fund went into the Consolidated Fund of India housed with the central government, the root problem of funding for the bodies the responsibility of SWM still remained unaddressed.

Municipalities, barring a few, are still seen grappling for funds to address issues relating to SWM. The need of the hour was to channel the SBC efficiently to the municipalities.

What the government has lost by abolishing the SBC

The government has reportedly collected Rs 16,500 crore during the two fiscal years following the SBC’s inception. In addition to the steady stream of income, the government has lost a significant instrument that has efficiently collected cess with a specific motive. Funnelling of proceeds from the SBC only for Swachh Bharat-related activities ensured government expenditure of the cess into developmental activities pertaining to the sanitation sector. Now, such work will be completely up to the government’s priorities and budgetary allocations.

Also read: Jaipur Is Doing Many Things to Do Well on Swachh Bharat Survey, But Cleaning Isn’t One of Them

With the advent of the post-GST era, revenue sharing in terms of separate allocations for the Centre and states is not a foreign concept. The government must reassess the need, structure and use of the SBC in light of the right beneficiary. If channelled wisely, this may just be the opportune moment for the government to re-introduce the SBC and make sure it is utilised to address issues, such as user fee collection for a range of services offered by the municipalities. Further, municipalities, in turn, could pass on benefits in terms of innovative incentives among resident’s welfare associations and citizen groups to kindle positive SWM practices. While the Swachh Bharat Abhiyan has a clear, progressive intent, the central government must ensure that its priorities are achieved by guiding state and municipal governments.

Kaushik Chandrasekhar is associate fellow at the Centre for Waste Management, TERI, and Suneel Pandey is director, Green Growth and Resource Efficiency Division, TERI.

Landmark NGT Judgments Hold Private Firms, Not God or Government, Responsible

Activists are hopeful that the judgments will help deter private companies from functioning with impunity and under the cover of governmental apathy.

Activists are hopeful that the judgments will help deter private companies from functioning with impunity and under the cover of governmental apathy. The judgments in both cases acknowledged governmental inaction in dealing with environmental damage.

A rig addressing the oil spill off the Mumbai harbour in January 2011. Credit: felixdance/Flickr, CC BY 2.0

The National Green Tribunal (NGT) covered new ground for the ‘polluter pays’ principle by invoking it in two landmark judgments last week. First, it ordered Alaknanda Hydro Power Co. Ltd., a hydroelectric power company, to pay Rs 9 crore as compensation to people affected by Uttarakhand floods in 2013 because the dam constructed by the company contributed to the flooding experienced by residents of the region. Second, it fined Delta Marine Shipping Co., a marine shipping company, Rs 100 crore for the oil spill and ensuing ecological damage caused when one of the company’s ships sank off the coast of Mumbai in 2010.

The judgments in both cases are important instances of the NGT exercising its power to fix liability and hold private companies responsible for the environmental damage they cause. These judgments set a precedent for shifting the monetary responsibility of rectifying ecological damage from the government to the private actors responsible for causing the damage. The decisions will save taxpayer money and, importantly, the Alaknanda case is a rare example of affected civilians successfully suing a corporation for compensation.

Upendra Baxi, emeritus professor of law at the University of Warwick, wrote in an email, “These decisions are truly inaugural. They subject economic enterprises to a code of environmental jurisprudence.”

Ritwick Dutta, an environmental lawyer who served as counsel in both cases, stated that Alaknanda is the first time that a private company has been held responsible for damage precipitated by a natural disaster. It was also the first time that the NGT has used the ‘polluter pays’ principle to fine a marine shipping company for causing ecological damage.

Until now, according to Dutta, “The stand of the ministry of environment and forest has been that dams don’t damage the environment.” He added that previous court decisions reflected this way of thinking as companies would use an “act of God” defence to shun liability for the damage caused and instead ascribe it to floods and natural disasters.

However, in this case, the tribunal determined that the cloud burst on June 16 and 17, 2013, caused extreme amounts of rainfall in the region that collected in the dam’s reservoir. The company’s subsequent decision to open the dam’s sluice gates “resulted in [a] massive flow of water suddenly sweeping away the muck dumped on the river body and carrying it to the villages and the area flooded by the floods,” stated the judgment. The tribunal also noted the company’s negligence when it came to executing safety measures for disposing of the muck generated during the dam’s construction, another factor that exacerbated the flood-related damage.

Using the legal definition of ‘accident’, which means “an accident involving a fortuitous or sudden or unintended occurrence”, the tribunal determined that the loss of damage and property suffered by the applicants was indeed accidental. However, it still charged the company with paying compensation to those affected by the Uttarakhand floods by invoking the principle of no-fault liability. The principle is applied when the defendant in a case is held liable and expected to pay compensation even if their actions are not responsible for the damage caused.

The tribunal concluded by issuing directions, starting with: “Alaknanda Hydro Power Co. Ltd.-GVK to deposit an amount of Rs. 9,26,42,795 as compensation to the victims within a period of 30 days from the date of order.”

Baxi echoed Dutta’s positive take on the judgment, “The idea that there are pure natural disasters without any human human responsibility is firmly rejected in the Uttarakhand Case. Collective and corporate responsibility is encoded in the notion of foreseeability and the NGT has done well to accentuate this.”

The marine case

In the Delta case, the NGT used the ‘polluter pays’ principle to impose a fine on Delta Shipping Marine Co., a Panama-based shipping company, for the damage caused when a ship owned by the company sank and caused an ecologically devastating oil-spill off the Mumbai coast in 2011. Notably, the tribunal extended the principle to include Adani Enterprises Ltd., the intended recipient of the ship’s cargo of coking coal.

The ship was carrying over 600,000 metric tonnes of coal in its holds, over 290 tonnes of fuel oil and another 50 tonnes of diesel. The resultant oil spill caused grave damage to the mangrove forests and marine ecology of the region. The formation of tar balls on the ocean’s surface adversely impacted aquatic life in the area as well. The applicants even provided evidence to prove that the dispersants used to clear the oil spill were also harmful to the marine ecology of the affected region.

The tribunal ruled that “no party from any country in the world has the right/privilege to sail an unseaworthy ship to the Contiguous and Exclusive Economic Zone of India and in any event to dump the same in such waters, causing marine pollution, damage or degradation thereof.”

Dutta expanded on this order, saying that India currently functions as a “dumping ground” for old ships that are not seaworthy, citing the fact that Gujarat is home to the largest ship-breaking yard in the world. Thus, according to him, private companies are able to send old ships to India and incur very low liability on their part. The ship that sank in 2011 was kept in use by Delta despite its potential unseaworthiness.

Baxi wrote on the marine case judgment, “The NGT seems to have equally firmly dealt with the marine pollution case. No longer corporate immunity and impunity may extend to saying that loss belongs where it falls! Shipping companies may not ply unseaworthy ships either in coastal territorial waters or the high seas.”

Dutta too hopes that the NGT’s decision to fine Delta will ideally deter shipping companies from “taking the seas for granted.”

“The Indian coast is becoming increasingly vulnerable as there is significant increase in all types of oil tankers/bulk carriers/container ships passing through the Indian Ocean,” the applicants stated to the NGT while presenting cause and evidence for their case against Delta, Adani and other involved actors.

Additionally, the tribunal ordered Adani Enterprises to pay Rs 5 crore as “environmental compensation” and stated that the fine of Rs 100 crore “shall include the expenses incurred by the Coast Guard and other forces for the prevention and control of pollution in different ways, as stated above, caused by the oil spill and saving the crew etc.”

The judgment also ordered the formation of a committee to determine whether the ship’s wreckage needs to be removed from the site and to calculate the monetary cost of off-setting the ensuing environmental damage. Delta will have to remove the ship’s remnants within six months of the committee filing its report.

Implications of the verdicts

Dutta is hopeful that these judgments will help set a precedent for the future and deter private companies from functioning with impunity and under the cover of governmental apathy. The judgments in both cases acknowledged governmental inaction in dealing with environmental damage.

In the marine case, the NGT was “forced to come in”, said Dutta. Apart from the symbolic value of the judgment, imposing a fine on the polluter also shifts the monetary burden of rehabilitating the environment from the government to the responsible private company in question. “When the government handles rehabilitation, rescue and restoration projects in the aftermath of such cases, it draws from taxpayer money to do so” said Dutta. In the Alaknanda case, he hopes that the official acknowledgment of the fact that dams contribute to flooding will boost the cause for those who are against building dams.

He cited an academic paper by Maharaj Pandit and Edward Grumbine that states that the Himalayas are set to have the highest density of dams of any mountain range in the world. The paper, which was published in May 2012, states that the region’s dam density will be “nearly 62 times greater than current average global figures” and that the Himalayan average would be “1 dam for every 32 km of river channel”. This could greatly increase the danger of flooding and devastation in the area.

Dutta also noted that the Alaknanda dam implicated in this particular case has a capacity of 330 MW but dams with capacities as high as and over 500 MW can cause significantly larger amounts of damage in case of flooding or heavy rains.

While the two cases are similar in their use of the ‘polluter pays’ principle, the difference lies in the population affected. In the marine case, Dutta said the judgment on the 2011 oil spill, which mostly impacted the ecological system and not a particular community, has arrived “too late in many ways for rectifying the ecological damage.”

In the Alaknanda case, a specific group of people was directly affected by the action and inaction of Alaknanda Hydro Power and compensation will have to be distributed to residents of the affected region. Dutta thinks the efficient and organised distribution of the compensation by the government is the most crucial step that lies ahead.

Referring to both cases, Dutta explained that Indian “jurisprudence is not very well developed” when it comes to assessing environmental damage. He added that in such cases the “evidentiary burden also falls on the petitioners.” He acknowledged that though litigiousness is very common in Western countries and accommodated in their legal systems, this culture of litigiousness has not reached India in the same way. The overburdened status of Indian jurisprudence and the consequent slow processing of cases acts as another deterrent for potential petitioners or applicants.

Additionally, it has been rare for people affected by events such as the 2013 floods to seek help from the legal system. Dutta ascribed this to two problems. “First, most people don’t know that such forums exist. And the people who go through such events have already suffered so much” that it impedes their desire and resources for taking on such cases. Second, he added that the lengthy processing time of such cases is also a deterring factor. To sum up he said, “For all the damage that takes place, only a fraction is brought before the courts.”

Ramkishore Mankekar, the group head of corporate communications at GVK (the corporation charged in the Alaknanda case), wrote in an email, “We are contemplating to refer an appeal before the Supreme Court of India against the orders of the NGT.” There was no response from the Delta International Group.

Baxi commented on the possibility of the companies appealing, “Of course, there is a right to appeal to the Supreme Court. One hopes that the Supreme Court does not exercise the full appeals power and upholds the NGT decisional law by dismissing this at the threshold, if only to avoid the indictment of its robust ‘pro-environment’ approach that it has largely ‘upheld the concerns of middle-class environmentalism’ (as rightly said by Geetanjoy Sahu, Environmental Jurisprudence in India, at 67—68, Orient Blackswan, 2014).”