Pollution Control Boards can seek damages, bank guarantees: SC

New Delhi: The Supreme Court has held that pollution control boards can impose as restitutionary and compensatory damages fixed sums of money or require furnishing bank guarantees as an ex-ante measure towards potential environmental damage.

A bench of Justices P S Narasimha and Manoj Misra pointed out that the responsibility for repairing the damage is that of the offending industry and the application of the 'Polluter Pays principle' not only includes payment for restoring the damaged environment, taking remedial action and compensating for the direct harm caused, but also for avoiding pollution.

The court explained that the invocation of this principle is triggered in situations when an established threshold or prescribed requirement is breached, and it results in environmental damage, and when an established threshold is not breached but the act results in environmental damage and also when a likely adverse impact to the environment is anticipated.

Referring to Article 51A of the Constitution, the bench pointed out, of all the duties imposed under it, the obligation to conserve and protect water and air, is perhaps the most significant, amidst our climate change crisis.

"Public participation in environmental protection has assumed great importance with climate change threatening to drastically disrupt our way of living. Boards, being the first line of defence against polluting activities, must provide easy accessibility and encourage public participation in their function and decision making," Justice Narasimha wrote in the judgment on behalf of the bench.

Acting on an appeal filed by the Delhi Pollution Control Committee, the apex court set aside the Delhi High Court's single as well as division bench judgments, which held that penalties can be levied only by courts and that too after taking cognisance of offences specified under the Water Act and Air Act.

The court, however, underscored that the power to impose or collect restitutionary or compensatory damages or the requirement to furnish bank guarantees under Sections 33A and 31A of the Water and Air Acts should be enforced only after detailing the principle and procedure, incorporating basic principles of natural justice in the subordinate legislation.

Dealing with the provisions of the Water (Prevention and Control of Pollution) Act, 1974 and Air (Prevention and Control of Pollution) Act, 1981, the court noted unlike the Water Act, there is no specific appeal provision against directions issued under Section 31A of the Air Act.

"This asymmetry must be addressed legislatively," the court said.

The court also noted even after the Water (Prevention and Control of Pollution) Amendment Act, 2024, Jan Vishwas (Amendment of Provisions) Act, 2023, there is no conflict between the powers of the state boards to direct payment of environmental damages under the Water and Air Acts and the powers of the adjudicating officer to impose penalties.

"The decriminalisation of offences has not removed the punitive nature of actions that can be taken under them. There remains a clear distinction between the nature of directions that the State Boards can issue under Sections 33A and 31A of the Water and Air Acts for payment of environmental damage and the determination by adjudicating officers," the bench said.

The court emphasised the former is compensatory in nature and will be resorted to when remedial measures are being undertaken to restore the degraded environment or pollution caused. The latter is a penalty for an offence under the law and is imposed with the objective of punishing the offender. This penalty collected here will not be specifically directed towards the restoration of the degraded environment, it clarified.