INTRODUCTION

Rapid and unprecedented industrial development has brought, a lot of environmental and health problems. However, the industrial and technological
advancements have helped to improve food product, raise living standards, solve time and space problems and control some health related problems;
yet, they have adversely affected the natural environment and thereby disturbed the balance of nature. The capability of self-maintenance and self-
regulation of our ecosystem has been disrupted by the continuous discharge of pollutants by the industries and their products. Moreover, improper
treatment and discharge of the industrial waste and its unhygienic disposal has created a serious problem for biotic and abiotic components of the
environment.

Polluter Pays Principle (PPP) has become a popular catchphrase in recent times. “If you make a mess, it's your duty to clean it up”- this is the main
basis of this slogan. It should be mentioned that in Environmental Law, the polluter pays principle does not refer to "fault." Instead, it favors a curative
approach, which is concerned with repairing ecological damage. It is a principle in international Environmental Law where the polluting party pays for
the damage done to the natural Environment.

So, the two broad rationales behind the implementation of the PPP in the Environmental jurisprudence include firstly, a penalty or fine to act as a
discouragement and deterrent and secondly, to form compensation for the communities who have suffered damage due to pollution. The liability
model of “POLLUTER PAYS” generated particularly to deal with such substances is the focus of this project.
 ORIGIN AND HISTORY
 During the last 50 years, industries, especially manufacturing industries, nuclear industry and those using hazardous or ultra hazardous material are
the major contributors to environmental pollution. Industrialists are by and large thriving on such pollution disseminating units. But, now it has
been realized that industries are also social units with rights and duties towards the surrounding community and the consumer. They have a duty
not to harm the health of the man and nature. It is recognized that pollution is a form of waste, and a symptom of inefficiency in industrial
production. Therefore, it has been thought proper to devise various kinds of measures to curb or minimize industrial pollution.

 The first major reference to the PPP appeared 1972 in the session of The Organization for Economic Co-operation and Development (OECD)
Guiding Principles Concerning International Economic Aspects of Environmental Policies. The PPP as a guiding principle across countries became
necessary because some countries faced complaints by national firms about rising costs and a loss of international competitiveness following a
national implementation of the PPP within their borders.

 The PPP was reaffirmed as a fundamental principle for the Member States during the 1974 OECD Council Recommendation on the
Implementation of the Polluter-Pays Principle. The OECD initiative was the result of demands on governments and other institutions to introduce
policies and mechanisms for the protection of the Environment and the public from the threats posed by pollution in a modern industrialized
society. The principle was subsequently endorsed in 1973 when the European Community (EC) adopted a program of action on the Environment.

 Subsequently, an EC Council Recommendation (1975) provided that Member states should apply the PPP. It further provided that natural or legal
persons must pay the price of such measures that are necessary to reduce or remove the pollution to meet the standards or equivalent measures laid
down by public authorities.
 Although the EC Recommendation is not legally binding, unlike the OECD Recommendation, it encompasses many more issues concerning the
costs of Environmental damage. The EC took another step in 1986 when it adopted the Single European Act regarding the Environment, in which
it stated that preventive action should be taken as a priority to rectify Environmental damage at the source and the polluter shall be liable to bear
the cost. This Act is legally enforceable.

 The PPP was also adopted in the ASEAN Agreement on Conservation on Nature and Natural Resources adopted in 1985.

 Through the lens of international Law, the PPP is enshrined in Principle-16 of the Rio Declaration, which states that ‘the polluter should, in
principle, bear the cost of pollution.’ The United Nations Conference on Environment and Development, 1992 in Principle-15 incorporates that
very Principle.

 The range of costs to be borne by the polluter has expanded over time. In 1989, the OECD suggested extending the PPP in order to cover the costs
of accident prevention and to internalize the Environmental costs caused by accidents.

 The United Nations Conference on Environment and Development, 1992 in Principle 15 incorporates the PPP. The fact that 153 countries were
signatories of the Rio Declaration does not make this principle one of international customary law. What is required is a demonstrable willingness
to adhere to it and the practice of nations must alter according to the prescriptions of the new norm for it to attain the status of international
customary law.
INDIA AND ITS IMPLEMENTATION OF THE PPP
STATUTORY PROVISIONS

Article 48A, 51A and 21 of the Constitution of India comprise of the constitutional mandate to protect and improve the Environment.

Article 48A: Protection and improvement of Environment and safeguarding of forests and wild life. - The State shall endeavour to protect and improve
the Environment and to safeguard the forests and wild life of the country.

Article 51A (g): To protect and improve the natural Environment including forests, lakes, rivers and wild life, and to have compassion for living
creatures.

Article 21: “no person shall be deprived of his life or personal liberty except according to procedure established by law.” This Article provides Right
to Life to every person and Right to Life also includes the pollution free Environment.

 There are several enactments that protect the deal with the subject matter i.e. The Water (Prevention and Control of Pollution) Act, 1974, The Air
(Prevention and Control of Pollution) Act, 1981 and the Environment Protection Act 1986. These Acts prohibit the disposal of polluting matters in
their respective bodies.

 The Water Act provides for the constitution of the Central Pollution Control Board and the State Pollution Control Boards by various State
Governments and the restriction on discharging effluents without obtaining the consent from the Board. Prosecution and penalties have been
provided which include sentence of imprisonment.

 The Air Act also provides for the Central Pollution Control Board and the State Pollution Control Boards to perform the powers and functions
under this Act as well. The Boards aim to improve the quality of the air and to prevent, control and abate air pollution in the country.
 The Public Liability Insurance Act, 1991 entails a mandatory duty of all the industries to get an insurance which is collected under the
‘Environment Relief Fund’ which shall be made payable to the victims, by way of relief, of industrial accidents or disasters. This relief will not be
a bar to file a case for compensation separation.

 Similarly, The National Environmental Tribunal Act, 1995 provides for compensation to victims on the ground of any damage to the Environment
with such an amount being remitted to the authority specified under S. 7A(3) of the Public Liability Insurance Act, 1991 for being credited to the
Environmental Relief Fund.

THE SUPREME COURT

The PPP has been incorporated as part of Indian Environmental Law regime through the various judgements by the Indian judiciary.

The development of PIL in India brought forth the interpretation of the Right to Life to include the Right to a Healthy Environment. With this, the
International Environmental Law principles were included within judicial decisions.

 In the year 1986, the Supreme Court of India inexplicitly applied the PPP in the case of M.C. Mehta v. Union of India (Oleum Gas Leak Case).
The significance of the judgement lies in the Court’s formulation of a principle, which measures the liability of the industry engaging in ‘hazardous
or inherently dangerous activities’. The Court laid down that an enterprise engaged in a hazardous or inherently dangerous industry which poses a
potential threat to the health and safety of persons working in the factory and to those residing in the surrounding areas, owes an absolute and non-
delegable duty to the community to ensure that no harm results to any one on account of hazardous or inherently dangerous nature of the activity
which it has undertaken. The enterprise is absolutely liable to compensate for such harm and irrespective of all reasonable care taken on his
 account. The larger and more prosperous the enterprise, greater must be the amount of the compensation payable for the harm caused on account of
an accident in the carrying on of the hazardous or inherently dangerous activity by the enterprise. Such measure must be correlated to the
magnitude and capacity of the enterprise.
The Court here directed the industry to either shift from the present location or evolve a green belt around it as a condition precedent to restart the
industry. Further, the industry was asked to deposit a sum of Rs. 35,00,000/- in a bank and a guarantee of Rs. 15,00,000/- with the court for
compensation to be paid to one who can prove before the court of law that he suffered because of the Oleum gas leakage from the Sri Ram Food
and Fertiliser Corporation. The Court came up with an innovative remedy for the Oleum Gas Leak which was the indirect recognition and
application of the PPP.

 The PPP was first time explicitly applied in the case of Indian Council for Enviro-Legal Action v. Union of India, where the Court declared that
the polluter is liable to pay the cost of the individual sufferers as well as the cost for the damaged Environment and the cost for reversing it back. In
this case, five chemical industries were producing H -acid. An azo dye and untreated toxic sludge was discharged into the open compound which,
in due course of time, flowed through a canal across entire area and caused pollution of river water and underground water upto 70 feet below the
ground.

The Court while delivering its judgement kept in mind the simpleness and practicality of the principle while also looking at the widespread havoc
that had been created by hazardous and inherently dangerous activities. The Court held that once the activity carried on is hazardous or inherently
dangerous, the person carrying on such activity is liable to make good the loss caused to any other person by his activity irrespective of the fact
whether he took reasonable care while carrying on his activity. The rule is premised upon the very nature of the activity carried on. This judgement
is seen to have been part of a process of sustainable development.
 Indian Council for Enviro-Legal Action v. Union of India, is a classic example of how by abuse of the process of law even the final judgment of
the Supreme Court can be circumvented for more than 15 years by filing one interlocutory application in order to avoid compliance with the
judgment and the polluter unjustly adopted delaying tactics to avoid paying remedial environmental cost. Taking a strict action against this, the
Supreme Court applied the PPP and dismissed both interim applications with costs of Rs. 10 lakhs and further imposed compound interest @12%
p.a. on the remedial amount due of Rs. 37 crores on the polluter for 15 years’ delay in making payment of remediation costs imposed earlier.
Due to their immanent propensity to damage the environment, tanneries have always been under the watchful eyes of the Supreme Court. The
following are the important judicial pronouncements in the realm of “tannery control” by the Supreme Court.

 The Supreme Court in the case of Vellore Citizens Welfare Forum v. Union of India, reiterated and declared in unequivocal terms that both the
precautionary principle and the polluter pays principle are part of the Indian Environmental Jurisprudence. These principles are accepted as part of
our Law of the land under Article 21, 48-A and 51-A(g) of the Constitution of India as part of our duty to protect and improve the Environment and
also protection of life and personal liberty. The Court interpreted the meaning of the Polluter Pays Principle as the absolute liability for harm to the
Environment extends not only to compensate the victims of the pollution but also the cost of restoring the Environmental degradation. Remediation
of the damaged Environment is part of the process of sustainable development and as such the polluter is liable to pay the cost to the individual
sufferers as well as the cost of reversing the damaged ecology.
This was petition against pollution which was caused by the discharge of untreated effluent by tanneries and other industries into agricultural
fields, road sides, waterways and open lands, and into the river Palar which is the source of water supply to the residents of the area. According to
the petitioner the entire surface and sub-soil water of river Palar had been polluted resulting in non availability of potable water to the residents of
the area. It was stated that the tanneries in question had caused environmental degradation in the area.
The court ordered the central Government to constitute an authority and confer on it all powers necessary to deal with the situation. The authority
was to implement the precautionary principle and the “polluter pays” principle. It would also identify the families who had suffered from the
 pollution and access compensation and the amount to be paid by the polluters to reverse the ecological damage. The court required the Madras
High Court to monitor the implementation of its orders through a special bench to be constituted and called a “Green Bench”.

 In Deepak Nitrate Ltd. v. State of Gujarat, a PIL was filed alleging that the effluents discharged by certain industries into the effluent treatment
project has exceeded certain parameters fixed by the Gujarat Pollution Control Board and thereby caused damage to the environment. The High
Court had directed the industries to pay 1% of the maximum annual turnover of any of the preceding three years towards compensation and
betterment of environment within a stipulated time.
Clarifying the law on the point in such case, the Supreme Court observed that compensation to be awarded must have some broad correlation not
only with the magnitude and capacity of the enterprise but also with the harm caused by it. The use of % of turnover as a proper measure because
the method to be adopted in awarding damages on the basis of polluter-to-pay principle has got to be practical, simple and easy to apply.

 In Research Foundation for Science (18) v. Union of India, the Supreme Court has explained that the “Polluter Pays Principle” basically means
that the producer of goods or other items should be responsible for the cost of preventing or dealing with any pollution that the process causes. This
includes environmental cost as well as direct cost to the people or property, it also covers cost incurred in avoiding pollution and not just those
related to remedying any damage. It will include full environmental cost and not just those which are immediately tangible. However, this principle
does not mean that the polluter can pollute and pay for it. The nature and extent of cost and the circumstances in which the principle will apply may
differ from case to case.
Supreme Court in the instant case has further clarified that it cannot be inferred from the earlier decisions by this Court the in the absence of actual
degradation of environment by the offending activities, the payment for repair on application of the PPP cannot be ordered. The Court said that in a
given case, it might be possible to levy exemplary damages or penal damages depending upon the nature and intent behind the activity. The Court
 made clear that in India the liability to pay compensation to the affected persons is strict and absolute and the rule laid down in Rylands v.
Fletcher1 has been held to be not applicable.

 The Apex Court while dealing with environmental issues and pollution caused due to industrial development, has always applied the PPP and kept
in mind sustainable development. In Sterlite Industries (India) Ltd. v. Union of India, the environmental impact assessment for setting up copper
smelter plant by appellant company and environmental clearance by authorities was valid and as per procedure. However, the 400,000 tonne
capacity plant of Sterlite Industries, considered the cheapest copper smelter in the world, failed to emission and effluent standards and continued to
operate causing air and water pollution.
The High Court quashed the environmental clearance and directed the closure of plant. When the matter came before the Supreme Court, the
appellant company removed 29 out of 30 pollution-causing deficiencies at the plant, which were pointed out by NEERI (National Environmental
Engineering and Research Institute). The Supreme Court considering (a) the economic importance of plant and need of sustainable development in
public interest, (b) well-settled principles and grounds for judicial review and intervention, (c) that pollution could be checked/ remedied without
the plant being closed down, and (d) paying capacity of the plant, held that plant should not be closed down but instead the appellant company
should pay compensation of Rs. 100 crores to remedy environmental damage caused and to improve the environment. The court further clarified
that the award of Rs. 100 crores as compensation would not bar any other claim by any person that may be available under the law.

In M/s NTPC Limited v Uttarakhand Pollution Control Board The National Green Tribunal has upheld the penalty of 57.96 lakhs imposed on
NTPC on Polluter Pays principle by Uttarakhand Pollution Control Board, for damaging the environment. A three member Bench of NGT
comprising of Chairperson Justice Adarsh Kumar Goel, Justice Sheo Kumar Singh and Expert members Dr Nagin Nanda upheld the order passed
by the Board in December 2020 requiring NTPC to pay compensation of Rs. 57,96,000 for violating muck disposal sites maintenance norms,
resulting in damage to the environment.
1
 In the present case, NTPC has been operating the Vishnugad Hydroelectric Project located at District Chamoli in Uttarakhand and set up 5 muck
disposal dumping sites. Out of these dumping sites, 3 were completed 3-5 years back while 2 are still active and operational. The State Pollution
Control Board had found deficiencies in these sites and issued an notice to NTPC on 29th June 2020.
State PCB directed NTPC to repair and strengthen the damaged toe protection and contour stone walls with proper engineering design and provide
suitable fencing to control excess human and animal interference. Four months after the directions were given to NTPC, the Uttarakhand Pollution
Control Board conducted an inspection of the site and noticed non-compliances.
The State PCB therefore held that the NTPC had not complied with the directions of the State PCB which had resulted in damage to the
environment and was liable to pay compensation on 'Polluter Pays' principle of Rs. 57,96,000.

NATIONAL GREEN TRIBUNAL

A pursuant development of earlier judgments was that of the establishment of the National Green Tribunal (NGT) under the NGT Act, 2010. Under S.
16 of the NGT Act, this Tribunal has jurisdiction over all civil cases with a substantial question relating to the Environment. Therefore, the NGT has
jurisdiction over cases that pertain to the Air Act, 1981, the Water Act, 1974, the Forest Act, 1927, the Environment Protection Act, the Biological
Diversity Act, 2002 and the Public Liability Insurance Act, 1991.

S. 20 of the NGT Act deals with the PPP. It states, “the Tribunal shall, while passing any order or decision or award, apply the principles of
sustainable development, the precautionary principle and the polluter pays principle.”

 In the case of Hindustan Coca Cola Beverages Pvt. Ltd v. West Bengal Pollution Control Board (2011), a stringent application of the PPP was
seen against one of the biggest bottling and beverage company in India where the NGT held that a “polluting industry” must bear the costs for
abatement of the pollution and they were “bound to compensate”. The NGT held that the costs of damage were to be given to the West Bengal
Pollution Control Board and that the WBPCB would carry out the restoration of the Environment.

 The NGT in a case regarding water pollution in the river Yamuna ordered every household to pay a minimum Environment compensation amount
of Rs. 100, with the charge to be directly proportional to the water bill or the property tax paid by the household. However, this is a bad thing to
implement as this distorts the PPP very badly, as it wants the citizens to bear the burden of restoring the Environment with no clear link between
the “payer” and the pollution. This case diluted the difference between a tax and the PPP making it problematic.

 In Sher Singh v. State of Himachal Pardesh (2017), court held that the PPP can be applied to prevent as well as control further environmental
damage in the area. The principle is aimed at ensuring that the cost of the environment damage caused by the polluting activities are borne in full
by the person responsible for such pollution. It is said that the principle means that the polluter should pay for the administration of the pollution
control system and for the consequences of the pollution, for example, compensation and clean up. Under this principle the government alone
 cannot be held responsible for preventing and controlling the environment pollution. If this fiscal incident in its entirety is shifted on the
government, than it would amount to unduly burdening the common tax payer, for none of his fault, for taking anti pollution preventive and
remedial measures. The actual polluter, thus must be held liable for the damage done. This doctrine has been accepted as a larger part of the world
as a fundamental principle on environmental matters and has been one of the underlying principles for action programme on the environment.

CONCLUSION
Though the PPP is a legally well recognized principle both internationally and domestically its recognition is still very weak. The International Courts
are not able to apply it easily as the content of the principle is still not uniform and static, with different interpretations making the application of it
difficult in Courts. Within the Indian context, Even though PPP has been judicially recognized in India, one does not seem to find its mention in the
existing or upcoming legislations. Despite delivering landmark judgments within a short span of coming into existence, the Principle has not been
properly implemented in India due to reasons such as absence of appropriate formula for determining the compensation, the sufficiency of the fines
which have been imposed on the polluters, and the difficulty of identification of a ‘polluter’ in numerous cases. Also, if we look at the damages
granted by the judges in India, it doesn’t serve the purpose of the exemplary damages. Atleast it should be such an amount to deter the polluters from
spreading pollution.