Environmental Law 2023

Last Updated November 30, 2023


Law and Practice


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The Constitutional Framework

Article 21 of the Constitution of India provides for the fundamental right to life and personal liberty. The Supreme Court of India has interpreted the fundamental right to life to include the right to a healthy environment and has held it to be the duty of the government to protect the environment. It has been held that the right to life “includes the right of enjoyment of pollution free water and air for full enjoyment of life” (see Subhash Kumar v State of Bihar (1991) 1 SCC 598). Further, Part IV of the Constitution also outlines the Directive Principles of State Policy and the Fundamental Duties of citizens, both of which promote and protect the environment. While the Directive Principles of State Policy are not enforceable as obligations of the State, they serve as a guide for policy formulation. Article 48-A stipulates that the State shall preserve and enhance the environment and safeguard the country’s forests and wildlife. Every Indian citizen is required by Article 51-A(g) to protect and enhance the natural environment.

Statutory Framework

While the Constitution provides the groundwork for environmental protection, an extensive statutory framework consisting of a host of statutes, rules and notifications ensures that the laws are strictly enforced. Some of the key regulations to be complied with are as follows.

  • Environment (Protection) Act of 1986 (EPA) and the Environment (Protection) Rules, 1986 (the “EP Rules”) – the overarching environmental protection statute and rules in India. The EPA and the EP Rules make provisions for protection and improvement of the environment by setting standards for atmospheric pollution emissions and discharges, regulating industry locations, managing hazardous wastes, preventing accidents that pollute the environment, and protecting public health and welfare. They also prescribe the powers of central government for regulating, protecting and improvement of the environment, and mandate obtaining Environmental Clearances (EC) for certain projects. The EPA provides for penalties for contravention of its provisions.
  • Water (Prevention and Control of Pollution) Act, 1974 (the “Water Act”) – creates legal deterrents to prevent and regulate water contamination in the country. It also establishes central and state boards for these purposes.
  • Air (Prevention and Control of Pollution) Act, 1981 (the “Air Act”) – provides for the prevention, control and reduction of air pollution. It also establishes central and state boards for these purposes.
  • Forest (Conservation) Act (FCA) – aims at protecting the nation’s forests and regulates the use of forestland for non-forestry purposes. It mandates obtaining prior clearance from the appropriate authorities when a project involves forestlands. Recently, in July 2023, the Parliament introduced amendments to the FCA by virtue of the Forest (Conservation) Amendment Act, 2023. This includes exempting certain lands such as strategic projects concerning national security, the Line of Actual Control and the Line of Control from the purview of the FCA. The exemptions introduced are subject to terms and conditions, including compensatory afforestation, mitigation plans, etc.
  • Biological Diversity Act of 2002 (the “Biological Diversity Act”) – provides for the conservation of biological diversity, the sustainable use of its components, and the fair and equitable sharing of the benefits deriving from the use of biological resources and knowledge, as well as for matters connected with or incidental to these provisions. India has updated the Biological Diversity Act by passing the Biological Diversity (Amendment) Act, 2023, which, among other major amendments, decriminalises offences under the Act and introduces heightened penalties for non-compliance, and emphasises the monitoring of biological resources obtained from foreign countries used in India, complying with the Nagoya Protocol’s access and benefit-sharing provisions.
  • Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006 (the “Forest Rights Act”) – recognises the rights of forest-dwelling tribal communities and other traditional forest dwellers to forest resources, on which these communities rely for a variety of needs, including livelihood, habitation, and other socio-cultural needs.
  • Wildlife Protection Act of 1972 (the “Wildlife Act”) – seeks to protect and safeguard the nation’s wildlife against extinction. Its purpose is to protect the country’s biota, and it contains stringent regulations to prevent poaching, smuggling and illegal trade in wildlife and its derivatives.
  • National Green Tribunal Act, 2010 (the “NGT Act”) – establishes the National Green Tribunal (NGT) for the effective and expeditious disposal of cases relating to environmental protection and the conservation of forests and other natural resources, including the enforcement of any legal right relating to the environment and the provision of relief and compensation for damage to persons, property, and related or incidental matters.
  • Waste Management Regulations – India has numerous waste management rules and regulations for management and reduction of various kinds of wastes. For instance, the Hazardous and Other Wastes (Management and Transboundary Movement) Rules, 2016 (the “Hazardous Waste Management Rules”) and the Plastic Waste Management Rules, 2016 (the “PW Rules”), etc. These are accompanied by distinct regulations for each Indian state.

Environment Impact Assessment Notification

The Environmental Impact Assessment Notification dated 14 September 2006 (as amended from time to time), issued in exercise of powers under Section 3 of the EPA and Rule 5 of the EP Rules (the “EIA Notification”) is one of the key notifications affecting the business of industries within the country. The EIA Notification regulates the granting of environmental clearance for any specified new project, construction, or expansion of an existing project. The Ministry of Environment, Forest and Climate Change (MoEFCC) introduced a draft Environment Impact Assessment Notification (the “Draft EIA Notification”) in 2020, designed to replace the existing EIA Notification of 2006. The primary goal of the Draft EIA Notification is to enhance transparency and streamline regulatory compliance. It strives to achieve this by incorporating various notifications, amendments, office orders, circulars, as well as directives from courts and tribunals issued since the 2006 EIA notification, which is still in force.

The key regulatory authorities for environmental policy and enforcement in India include the following.

  • Ministry of Environment, Forests and Climate Change, Government of India (MoEFCC) – tasked with developing and implementing policies for conserving the nation’s natural resources, including its water bodies, biodiversity, forests and wildlife. Further, various statutes confer different powers and obligations on the central government. The MoEFCC also has the authority to grant forest and environmental clearances for major projects falling under the purview of the FCA and EIA Notification. Further, the MoEFCC is responsible for establishing environmental standards, such as emission and effluent norms, for industries.
  • Central Pollution Control Board (CPCB) – responsible for advising the central government on water and air pollution. CPCB is the statutory body that recommends environmental standards to the MoEFCC. It is further tasked with issuing industry-specific technical guidelines, categorising industries based on activity, raw materials and environmental impact potential.
  • State Pollution Control Board (SPCB) and Pollution Control Committees (PCC) – SPCBs in the States and PCCs in Union Territories are responsible for implementing the mandates under the Water Act and the Air Act, as well as enforcing the EPA. They possess authority to issue closure notices, levy fines and oversee environmental restoration measures for polluting industries. SPCBs regularly monitor all industries requiring environmental permits to ensure compliance with environmental standards and they can initiate legal action against non-compliant industries.
  • Central Ground Water Authority (CGWA) – regulates and manages groundwater developments in India. It can designate areas as “notified areas” in cases of water scarcity, where groundwater extraction is restricted to drinking and domestic use only. All industries, including existing, new or expanding ones, are required to obtain a “No Objection Certificate” from CGWA.

Commission for Air Quality Management in National Capital Region and Adjoining Areas (CAQM) – the Government of India established the CAQM in 2020 to identify, co-ordinate and resolve air quality issues in the National Capital Region of Delhi and neighbouring areas, where air quality remains a major concern for the better part of the year. CAQM focuses on implementing the Graded Response Action Plan (GRAP) and monitoring measures to curb various sources of air pollution.

Judicial Enforcement

The Supreme Court of India, High Courts and the NGT have played a crucial role in environmental protection by directing the aforementioned authorities to take measures and fulfil their responsibilities regarding pollution prevention and environmental protection. The NGT has jurisdiction to entertain cases involving a “substantial question relating to the environment” and can also take suo motu cognisance of environment-related cases. Constitutional Courts, ie, State High Courts and the Supreme Court of India, also consider environmental cases in the form of Public Interest Litigation (PIL) or under their writ jurisdiction. The Supreme Court of India is further equipped to hear appeals against NGT orders, decisions and judgments.

Some of the ways in which stakeholders, including industries and project proponents, co-operate with regulatory authorities are as follows.

  • Public Consultation – the EIA provides for “public consultation” as a step in the process for obtaining EC. The public consultation process is a process by which concerns of locally affected communities in the environment project are heard and addressed. The said process is conducted by the concerned SPCBs and PCCs.
  • Environmental Impact Assessment (EIA) – project participants must conduct EIAs for projects with potential environmental impacts. Co-operation involves preparing comprehensive EIA reports, conducting public consultations, and addressing concerns raised during the EIA process.
  • Environmental Management Plans (EMP) – co-operation with authorities involves developing and implementing EMPs to manage and mitigate the environmental impact of projects, including monitoring, reporting and remediation activities.
  • Corporate Social Responsibility (CSR) – companies can co-operate with environmental authorities by engaging in CSR activities that benefit the environment and local communities. These initiatives may include afforestation, conservation projects and community development.
  • Audits and inspections – regulatory authorities conduct audits and inspections to ensure compliance. Co-operation with inspections involves providing access to facilities, records, and assisting inspectors during their visits.

The EPA – Umbrella Legislation

The EPA is a comprehensive piece of legislation, providing a legal framework for protection of the environment in India. It establishes regulatory authorities, empowers them to set measures for pollution control and management and handling of hazardous waste. Importantly, Section 5 of the EPA also confers powers to the central government to issue directions to any person, authority or officer, who shall be duty bound to comply with the same. These directions include directions for closure, prohibition, regulation of any industry, process, operation or the stoppage or regulation of supply of electricity, water, etc. Additionally, the EPA also provides for an extensive procedure to be followed for testing of samples in an environmental laboratory, notified by the central government.

Further, the central government has enacted the EPA Rules for preventing, controlling and abating environmental pollution, which provide for the following:

  • standards of quality of air, water or soil for various areas and purposes;
  • maximum allowable limits of concentration of various environmental pollutants for different areas;
  • procedures, safeguards and restrictions for the handling of hazardous substances in different areas;
  • prohibition and restriction on the location of industries and the carrying on of processes and operations in different areas; and
  • procedures and safeguards for the prevention of accidents which may cause environmental pollution and providing for remedial measures for such accidents.

In a more recent development, the EPA Rules were amended by way of the Environment (Protection) Fourth Amendment Rules, 2023. The amendment introduces changes related to emission limits for new engines used in power generating sets (referred to as “Gensets”) with a Gross Mechanical Power of up to 800 kW.

Specific Legislations

In addition to the EPA, there are specialised legislations (as illustrated in 1.1 Environmental Protection Policies, Principles and Laws) for the protection of environmental assets, which provide for detailed measures to be undertaken for protection of the same. The said statutes grant regulatory authority to the CPCB and SPCBs to carry out their functions for conservation of these assets and prevention of environmental degradation and reduction in pollution.

The EPA provides for the imposition of fines in the event of violation of its provisions. Section 15 provides for the imposition of fines, which may extend to INR1.5 million. Further, Section 16 of the EPA provides that where an offence under the Act is committed by a company, every person in charge of the conduct of the business of the company shall be deemed to be guilty and will be punished accordingly.

Similarly, for the purpose of allocating liability, most resource specific legislations also provide for penalties in the form of fine for non-compliance with the obligations and directions under the said laws. For instance, Sections 37–41 of the Air Act lay down penalties for breaches of certain provisions of the Act, for certain acts, for offences committed by companies and even for offences committed by government departments. Pertinently, these legislations also provide the SPCB power to issue closure orders for industries that are in violation of the statutory provisions.

Notably, the Jan Vishwas (Amendment of Provisions) Act, 2023 has revised the penalties and fines of various Indian legislations, including the EPA and the Air Act. By way of these revisions in the penalty provisions, imprisonment has been removed for most offences. However, the amount leviable as fine has been increased substantially.

In practice, compliance with the relevant statutory provisions is a condition of granting approvals/clearances. Hence, on contravention of any provisions, the concerned authority may also revoke the approval/clearance.

Additionally, the constitutional courts have also taken note of damage caused to the environment at the hands of larger corporations and have thereby imposed liability on the violators. Courts in India have time and again upheld the jurisprudence of “polluter pays” and absolute liability in affixing liabilities. (See Indian Council for Enviro Legal Action v Union of India (1996) AIR 1446.)

In India, regulatory bodies like the CPCB, SPCBs and PCCs possess the authority to carry out inspections at industrial facilities to ensure environmental compliance.

  • Authority to Conduct Inspections – the above-mentioned regulatory bodies have the authority to conduct inspections at industrial facilities and can initiate inspections in two ways:
    1. based on complaints from public; and
    2. suo moto cognisance primarily based on suspected violations.
  • Information Gathering – during the inspections, the authorities have the power to seek any information related to the activities being carried out at the facility. This information may include details about effluent discharges, air emissions, waste disposal, and other environmental aspects.
  • Surveys and Sampling – the authorities are also empowered to conduct surveys within the facility, which might involve collecting information and taking soil or water samples to assess environmental quality.
  • Search and Entry – in cases where there is a potential violation or contamination issue, these authorities have the legal power to enter and search the facility premises to gather evidence and assess the situation.
  • Request for Further Information – the authorities can also request the occupier of the facility or other relevant individuals to provide additional information to assist in their investigation.

Environmental Permit Regime

Project proponents seeking to start an industrial project are required to abide by a specific regulatory process. This involves several key steps and permits.

  • Consent to Establish (CTE) – to commence the project, the individual or the entity must apply for CTE from the relevant authority, which could be the SPCB or PCC depending on the project’s location.
  • Consent to Operate (CTO) – once the industrial facility is up and running, the project proponent needs to obtain a CTO from the same authority that issued the CTE. This ensures ongoing compliance with environmental standards.
  • Forest Clearance (FC) – if the project involves land in forested areas, FC is required under the FCA. This step addresses environmental and ecological concerns in forested regions.
  • Environmental Clearance (EC) – depending on the project’s location, nature and scale, an EC may be necessary. This clearance is granted under the EIA Notification to assess and mitigate potential environmental impacts.
  • Other Permits – depending on the specific activities, additional permits may be needed. For example, groundwater usage may require a No Objection Certificate (NOC) from the CGWA. If the project generates waste, authorisations from the SPCB or PCC may be necessary for waste management.

Appeal Mechanism

In India, individuals or organisations have the option to dispute or appeal any decisions made by the SPCB. This appeal process is governed by both the Water Act and the Air Act. Project proponents have a 30-day period from the date they receive the SPCB’s order to initiate an appeal. The conditions and provisions for filing an appeal against an SPCB order are outlined in Section 31 of the Air Act and Section 28 of the Water Act. The right to appeal against SPCB decisions before NGT is also granted under the NGT Act.

Additionally, the option to appeal is available in the following situations.

  • FC Act – appeals can be made regarding orders or directions issued under specific provisions of the FC Act, addressing concerns related to forest conservation.
  • EC – appeals can be lodged in cases where an EC is denied or granted in non-permissible or restricted areas.

Furthermore, on certain limited grounds, the aggrieved party may also maintain a Writ Petition under the Constitution of India before the Constitutional Courts.

India’s approach towards environmental policies is aligned to its international commitments. India has ratified many international conventions and the same are also reflected in its policy framework. Two of these conventions are the United Nations Declaration on Environment and Development (the Rio de Janeiro Earth Summit, 1992) and the Ramsar Convention on Wetlands in 1982 (the “Ramsar Convention”), which are reflected in the EIA Notification and the Wetland (Conservation and Management) Rules, 2010 respectively. Therefore, the environmental policies are framed for regulation, conservation and improvement of the environment.

For the enforcement of these policies, India’s regulatory authorities use a mix of preventative, regulatory and enforcement tools to address the country’s numerous environmental issues. In India, the enforcement by the concerned regulators is under the statutory regime. The regulators are strict as far as compliance with the provisions are concerned and take appropriate actions as and when required.

Additionally, public participation in environmental decision-making is becoming increasingly important. Major projects increasingly include public consultations and hearings, allowing stakeholders and affected communities to voice concerns and provide comments. Hence, regulators also adopt consultative approaches for the enforcement of their policies.

Pertinently, India has also been actively pursuing various policy initiatives and campaigns to address environmental issues. Initiatives like the Swachh Bharat Abhiyan (Clean India Mission) and the National Action Plan on Climate Change are indicative of the government’s commitment to addressing environmental challenges.

In specific situations, like mergers and acquisitions, the existing CTO can be transferred from the previous owner to the new one, with the same validity period, if the new owner intends to continue the same type and scale of industrial activity as the previous owner. After the transaction is finalised, the new owner must inform the relevant authority (typically the SPCB in the case of CTO) with appropriate documents to confirm the nature and proof of the transfer. This notifies the regulatory authority that the old owner has been replaced by the new one, who will carry out the same activities. The CTO must be amended to reflect the new owner’s details. It is important to note that, if there is an expansion or change in the nature of the activity by the new owner, a fresh CTO application is required, as the old CTO cannot be transferred.

Similarly, FC and EC can also be transferred from one legal entity to another, provided that the nature, scale and other details of the proposed activity remain unchanged. Such transfers are subject to approval from the CPCB, SPCB or the MoEFCC, as applicable.

Additionally, permit transfers may occur under the Coal Mines (Special Provisions) Act, 2015, where, upon the transfer of a coal mine to a successful bidder, all the necessary licences, permits, approvals and consents issued to the previous mine owner are transferred to the new owner.

The Water Act, Air Act, and the EPA prescribe penalties for offences by companies. Individuals employed in a position of responsibility within a company can be held accountable if the company commits an offence. They can avoid liability by proving they did not have knowledge of the offence or took proper precautions. Offences involving consent or negligence by company officers also make these individuals liable.

Operating without the necessary CTO or CTE can lead to imposition of fine or immediate closure as directed by the relevant SPCB. Further, deliberate concealment or submission of false or misleading information in the EC Application can make the said application liable to rejection and may also lead to cancellation/revocation of prior EC granted on the said basis.

Further, under the guidance of the NGT, the CPCB has devised a formula to calculate environmental compensation based on factors like the severity of pollution, the duration of the violation, the scale of operation, and the location. The Supreme Court of India and State High Courts can also impose substantial fines for operating without the necessary permits.

The NGT has jurisdiction over civil cases related to various environmental laws listed in Schedule I to the NGT Act. The NGT can order relief, compensation and restitution for pollution victims, property damage, and environmental restoration.

In India, several types of liability can be imposed on operators, polluters, landowners or others for environmental damage or breaches of environmental law. The following is an overview of the key types of liability.

Tortious Liability

In India, damage amounting to environmental harm falls under the ambit of torts, inter alia, trespass, nuisance, strict liability, and negligence. Under the “absolute liability” principle established by the Supreme Court of India in the MC Mehta v Union of India, AIR (1987) SC 965, those engaged in hazardous activities are held absolutely liable for any harm or damage, irrespective of fault or intent.

Criminal Liability

Section 268 of the Indian Penal Code (IPC), which provides for the offence of public nuisance, and Section 277 of the IPC, which contemplates fouling of the water of a public spring or reservoir to be an environmental crime, are the only two provisions in the IPC that are directly related to penalising environmental harm.

Civil Liability

The following types of civil liability arise.

  • Compensation – polluters and operators may be required to compensate victims of pollution or environmental damage for losses, including property damage or health-related issues.
  • Restitution – courts can order the restoration or rehabilitation of damaged or degraded environments, including land, water bodies, and ecosystems.
  • Statutory Liability – violators of environmental statutes, such as the Water Act, Air Act and the EPA can be held liable for failing to comply with the law.
  • Vicarious Liability – companies or entities may be held vicariously liable for the actions or omissions of their employees, agents or officers in violation of environmental laws.
  • Joint and Several Liability – multiple parties involved in environmental violations can be held jointly and severally liable, meaning they can be individually or collectively responsible for the full extent of the damage or costs of remediation.
  • Penalties by NGT – the NGT can impose substantial fines and penalties on violators of environmental laws and can order relief, compensation and restitution for pollution victims and environmental damage.
  • Exemplary Damages – courts, including the NGT, may impose exemplary damages on polluters to deter environmental violations.
  • Contractual Liability – operators or polluters may be subject to contractual liabilities if their activities or operations result in environmental breaches, and these liabilities may be specified in contracts or agreements.

The specific liability mechanisms may vary based on the nature and severity of the environmental breach, as well as the relevant laws and regulations in India.

Disclosure of environmental issues is essential in various scenarios, particularly when seeking approvals, permits or clearances for industrial and development projects. The manner and timing of disclosure depends on the specific circumstances and regulations applicable to the project. Here are some key situations where environmental disclosure is required.

  • Environmental Impact Assessment (EIA) – environmental issues must be disclosed as part of the EIA process, which is mandatory for certain projects, particularly those with the potential for significant environmental impact. Project proponents must submit a comprehensive EIA report that includes details of the project’s potential environmental effects, mitigation measures, and plans to address environmental concerns.
  • Application for CTE and CTO – project proponents seeking CTE and CTO from SPCBs must disclose environmental information about their operations. This includes information on effluent discharges, air emissions, waste management, and compliance with environmental standards.
  • Application for FC – projects that require clearance for forestland diversion must disclose the environmental impact of the project on forests, wildlife and ecosystems as part of the FC application. This information is submitted to the MoEFCC.
  • Public Hearing – environmental disclosure is often required during public hearings, where project proponents present environmental information to the affected communities and stakeholders. This allows for public consultation and input on the environmental aspects of the project.
  • Corporate Reporting – publicly listed companies in India are often required to disclose their environmental performance and initiatives in their annual reports as part of their CSR obligations.
  • Pollution Reporting – companies and entities engaged in potentially polluting activities must regularly report their pollution and emissions data to the relevant regulatory authorities, as per the reporting requirements specified under the Water Act, Air Act and other environmental laws.

Consequences of Non-disclosure/Incomplete Disclosure

The consequences of non-disclosure/incomplete disclosure are as follows.

  • Rejection of Approvals – non-disclosure or incomplete disclosure can lead to the rejection of permits, clearances or approvals for a project. Regulatory authorities may refuse to grant CTE, CTO, FC or other necessary permits if they find that environmental information has not been adequately provided.
  • Legal Action – non-disclosure or fraudulent disclosure can result in legal action, including criminal prosecution and fines. Violation of environmental laws can lead to penalties and imprisonment for the responsible individuals or entities.
  • Environmental Damage – failure to disclose and address environmental issues may result in environmental damage, which could lead to compensation claims, restoration obligations or liabilities under the “polluter pays” principle.

In India, liability for historical environmental damage or historical pollution is not generally recognised, unless it can be established that it was the erstwhile owner who was completely responsible for such contamination. Hence, while the SPCB would initiate action against the current owner of the premises, the owner of the land or industrial premises could proceed against the erstwhile owner that may have caused the contamination, provided the current occupier has adequately safeguarded its interests in the contractual arrangement that it may have entered into with the previous owner.

Section 9 of the EPA requires notifying the authorities when there has been release of an environmental pollutant exceeding the defined standards or when there is a reasonable apprehension about such a release. Similarly, both Section 31 of the Water Act and Section 23 of the Air Act provide for an obligation to inform the concerned SPCB about incidents of pollution or situations where there is a reasonable apprehension of such incidents.

For an overview on the types of liabilities imposed for environmental damage, please refer to 5.1 Key Types of Liability.

Limits and Conditions to Liability

The following limits and conditions apply in cases of environmental incident or damage.

  • Enterprises engaged in inherently dangerous or hazardous activities are absolutely liable to compensate those affected by such environmental harm, irrespective of whether reasonable care was undertaken to carry out the activity. The defences of strict liability are not applicable to liability under the absolute liability principle in India.
  • Liability is contingent on demonstrating a causal link between the defendant’s actions and the environmental harm. Further, the measure of compensation levied by courts is usually correlated to the magnitude and capacity of the enterprise.
  • Liability for certain offences under environmental laws may require proving the mental state (intent) of the accused. An exception to this may be found in the Wildlife Act, wherein the burden of proof lies on the accused instead of the prosecution.
  • In some cases, having obtained the necessary permits and approvals can be a defence if the activities were carried out in accordance with these permits. However, the courts can hold a company liable for excessive environmental damage even if it was operating within the necessary permits.

Liability for environmental incidents in India is multifaceted, involving a combination of civil, administrative and regulatory aspects. The specific liability, defences, limits and conditions may vary depending on the nature of the incident, applicable laws and the circumstances of the case.

The nature of defence depends on the nature of liability. The key defences include proving that:

  • there has been no violation of statutory provision;
  • no harm has been caused to the environment;
  • the harm was not due to the defendant’s actions; or
  • the harm was unforeseeable.

Liability concerning corporate entities for environmental damages or breaches of environmental laws are specifically provided for under the EPA, the Air Act, and the Water Act. Section 17 of the EPA provides that every person who has overseen the conducting of business of the company shall be punishable under the statute when a company commits any offence provided under the statute. Section 40 of the Air Act and Section 47 of the Water Act prescribe for a similar manner of criminal liability on the persons in charge of the conduct of business of a company.

Please see 19.1 Green Taxes.

Incentives for “good” environmental citizenship include the following.

  • Access to Genetic Resources and Traditional Knowledge and Benefit Sharing – The Biodiversity Act and the Biological Diversity Rules, 2004 establish a legal framework for Access and Benefit Sharing (ABS). The Biodiversity Act sets out regulations for accessing biological resources and traditional knowledge, wherein a percentage of the revenue generated from the commercial sale must be deposited with the State Biodiversity Board for conservation of nature and an additional amount with the local community as incentive for conservation efforts.
  • Awards and Recognitions – Government agencies, non-governmental organisations (NGOs) and industry associations often confer awards and recognitions to individuals, organisations and industries that demonstrate outstanding environmental stewardship and sustainability practices. For instance, the Indian government’s “Protection of Plant Varieties and Farmers Right Authority” (PPV & FRA) established the “Plant Genome Saviour Community Recognition” award in the 2008–09 period to encourage the conservation of agrobiodiversity.
  • Joint Forest Management Committees (JMFCs) – JMFCs are agencies formed at a village level or a cluster of villages situated adjacent to Reserved Forests. Across most states, JMFCs have complete authority over all non-timber forest products except for nationally regulated minor forest produce. In most states, approximately 50% of the net benefits derived from the final felling of trees are allocated to JFMCs.
  • Tax Benefits and Subsidies and Grants – Some environmental initiatives, such as investments in renewable energy or energy-efficient technologies, may qualify for tax benefits and incentives. India promotes the growth of solar power projects by offering incentives such as income tax exemptions through provisions like Section 80-IA of the Income Tax Act, 1961, Accelerated Depreciation (AD), and exemptions from Goods and Services Tax (GST). Government programmes and schemes offer financial support, subsidies and grants to promote environmentally responsible projects, such as renewable energy installations, afforestation and pollution control.
  • Green Certification – Achieving green certifications, such as ISO 14001 (Environmental Management System), can enhance a company’s reputation, improve market access, and demonstrate a commitment to environmental responsibility.
  • Exemptions – Exemptions from obtaining EC apply to certain industries and sectors deemed to have a minimal environmental pollution impact, falling into the white category. This category covers industries like small and medium-sized businesses in agro-based, chemical, pharmaceutical, electronic, food and beverage, leather and leather goods, plastic, and textile sectors.

Penalties for “bad” environmental citizenship typically include fines, imprisonment, closure orders, compensation, revocation of permits, etc. The same have been discussed earlier in the chapter.

Ordinarily, the shareholder and the parent company will not be liable for environmental damage or breaches of environmental law by company/subsidiary company. In the case of a parent company, in certain exceptional circumstances the concerned regulator may lift the corporate veil to hold the parent company liable for the damage caused or breach of the subsidiary company.

From financial year 2022–23, the Security and Exchange Control Board of India (SEBI) issued a circular providing that the top 1,000 listed companies in India (by market capitalisation) are required to prepare a “business responsibility and sustainability report” (or BRSR), containing detailed ESG disclosures to be filed before the SEBI. The BRSR is based on the nine principles stipulated in the National Guidelines on Responsible Business Conduct and includes both quantitative and qualitative disclosures with respect to energy consumption, water withdrawal, air emissions, greenhouse gas emissions, waste management, sustainable sourcing, and compliance with extended producer responsibility. The BRSR further has to be a part of the annual report of the company, which has to be notified to the stock exchanges, published on official company websites, and provided to the shareholders. While the BRSR framework is not mandatory for smaller listed companies and unlisted public or private companies, they may comply with the same as a good housekeeping measure.

Apart from the BRSR, there are limited mandatory ESG disclosure requirements in India: for example, companies are also required to make disclosures regarding energy conservation in their annual reports in terms of Section 134(m) of the Companies Act, 2013.

Environmental audits are statutorily mandated under Rule 14 of the EP Rules. Said rule makes it mandatory for all persons carrying on an industry, operation or process requiring consent under the Water Act or under the Air Act or both or an authorisation under the Hazardous Waste Management Rules, to submit an environment statement to the SPCB every year for the period ending 31st March.

Almost all major environmental legislations in India provide that every person who was in charge of, and was responsible for, the conduct of a company’s business including directors and key managerial persons, along with the company, shall be deemed guilty of all offences and shall be liable accordingly. For instance, Sections 40 and 47 of the Air and Water Act respectively provide for liability on the part of a director and other key managerial persons if an offence under the said Acts is committed by a company.

Regulation 25(10) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 mandates the top 1,000 listed companies in India (by market capitalisation) to undertake a Directors & Officers (D&O) Insurance Policy for its independent directors. Accordingly, for other individuals/directors in the top 1,000 listed companies and smaller listed companies and unlisted public or private companies, it is optional and plausible to undertake such insurance.

Owners, users and carriers of hazardous chemicals, as defined under the EPA, who possess more than the minimal quantity stipulated in the Public Liability Insurance Act, 1991 are required by the Act to obtain insurance coverage mandatorily. Besides this, the environmental insurance depends on the insurance provider. In India, certain private insurance providers have introduced green insurance. Such insurance policies would typically cover potential liabilities arising from the pollution of water, land, air or collateral damages to the environment caused by the policyholders and can also help with the restoration of ecological damages. The exclusions typically include asbestos and lead, prior knowledge, terrorism, and war. However, the coverage of such insurance depends on various factors.

Lenders are not held directly accountable for environmental misconduct and damages unless they hold a position on the board of directors or are otherwise actively involved in its day-to-day operations.

As mentioned above, lenders are ordinarily not exposed to liability for environmental non-compliances. However, to avoid any vicarious impact of such liabilities, if at all, lenders can also conduct a due diligence report on the company concerned. Further, the lenders can restrict their roles in the day-to-day operations and management of the company.

The NGT has jurisdiction to hear civil cases involving a significant environmental issue, which arises from any of the explicitly listed environmental laws mentioned in Schedule I to the NGT Act. Further, it has the authority to issue directives pertaining to relief, compensation and restitution for claims, including civil claims, arising out of the violations. The said claims can be brought by individuals affected by pollution and other forms of environmental harm, for damaged property and restoration of the environment. The NGT can divide the compensation or relief payable under separate heads specified in Schedule II to the NGT Act, which includes claims due to harm, damage or destruction to the environment and costs of restoration on account of harm or damage to the environment including pollution of soil, air, water, land and ecosystems.

Additionally, civil claims can also be filed in competent courts for compensation in relation to environmental non-compliances and liabilities arising out of contractual disputes between private parties.

Courts in India on a regular basis impose exemplary damages for harm caused to the environment. The Supreme Court in MC Mehta v Kamal Nath (1997) 1 SCC 388 explicitly recognised that individuals/entities guilty of causing pollution can also be held liable to pay exemplary damages so that the same acts as a deterrent for others not to cause pollution in any manner. Further, judicial precedents in India have evolved the position that the quantum of compensation must be correlated to the capacity and magnitude of the enterprise at fault.

Class actions are not prevalent in India. However, Order 1 Rule VIII of the Civil Procedure Code, 1908 (CPC) provides for filing of representative suits. A representative suit is filed by one or more persons on behalf of themselves and others having a common interest in the suit. However, it is mandatory that prior leave of the court is taken before filing a suit in representative capacity.

Further, constitutional courts in India also permit PIL, which is a legal action initiated for the protection of public interest and/or redressing of grievances affecting rights, interests or liabilities of the community at large. A PIL can be filed by a person who does not have personal interest or personal grievance in the matter and is not directly affected.

The Supreme Court of India has demonstrated proactiveness in safeguarding human lives, plants, forests, wildlife and other natural resources, and has delivered significant environmental law judgments in response to various PILs filed by environmental activists that have helped in developing a sound environment jurisprudence. These precedents have led to enhanced accountability of hazardous industries and the enforcement of various pollution control measures.

In the pivotal case of Vellore Citizens’ Welfare Forum v Union of India (1996) 5 SCC 647, the Supreme Court, permitting a socially conscious organisation to represent the residents of Vellore, ordered the closure of tanneries discharging toxic chemicals into the river, posing health risks to residents. The Supreme Court applied the precautionary principle and propounded that the burden of proof is placed on the developer or the industry to prove that the proposed activity is environmentally benign. This was later upheld in AP Pollution Control Board v MV Nayudu (2001) 2 SCC 62.

In TN Godavarman Thirumulkpad v Union of India & Ors, AIR (1997) SC 1228, the Supreme Court issued extensive guidelines for the sustainable use of forests and created its own monitoring and implementation system via regional and state level communities and regulated the felling, use and movement of timber to preserve the nation’s forests. The Court further gave a wider meaning to forestland to broaden the scope of protection and included any area recorded as forest in the government record irrespective of the ownership within the definition.

In Narmada Bachao Andolan v Union of India (2005) 4 SCC 32, the Court held that wherein there is a state of uncertainty due to the lack of data or material about the extent of damage or pollution likely to be caused, then, in order to maintain the ecology balance, the burden of proof that the said balance will be maintained should necessarily be placed on the industry or the unit which is likely to cause pollution.

In MC Mehta v Kamal Nath (1997) 1 SCC 388, the Court further strengthened the application of the doctrine of public trust as a part of the environmental law jurisprudence. It was held that the state acts as a trustee of natural resources and bears the legal duty of protecting the natural resources. The public trust doctrine was primarily held to rest on the idea that certain natural resources belong to the public at large and that it is unjustifiable to make them a subject of private ownership.

Giving legal effect to the concept of sustainable development, the Supreme Court in Karnataka Industrial Areas Development Board v C Kenchappa (2006) 6 SCC 371 held that sustainable development means a development that can be sustained by nature with or without mitigation. While development of industry is essential for growth of the economy, the same must go hand in hand with the environment and the ecosystem which are required to be protected. To protect sustainable development, it was held that it is necessary to implement and enforce measures such as the precautionary principle, “polluter pays” and public trust doctrine.

In Church of God (Full Gospel) in India v KKR Majestic Colony Welfare Association (2000) 7 SCC 282, the Supreme Court held that noise pollution is a violation of Article 21 of the Constitution.

The regulator fixes liability on the identified defaulter/offender/polluter. As far as the regulator is concerned, the obligation to fulfil such liability falls solely on such defaulter. Therefore, liability cannot be transferred or apportioned by private agreements between the parties.

However, as far as monetary liabilities are concerned, a company can enforce indemnities or enter into contractual arrangements for recovery of said amount. The limits of recovery would depend on the contractual agreement between the parties. Such private contractual agreements are not binding on the regulator.

Please see 9.1 Environmental Insurance.

Currently, India does not have a specific legislation on contaminated land. The EPA (and relevant rules thereunder) and a repository of case precedents constitute the legal basis for regulatory authorities and courts to address land contamination. For instance, the Supreme Court of India in a PIL titled Indian Council for Enviro Legal Action v Union of India & Others (1996) 3 SCC 212 (Indian Enviro Legal case) held various chemical industries in the state of Rajasthan liable for causing damage to the soil and agricultural land, by discharging highly toxic effluents. It further directed the central government to determine the amount to be earmarked for remedial measures, including the removal of sludge that caused land contamination.

Section 2(a) of the EPA defines “environment” to include water, air and land and the inter-relationship that exists among and between water, air and land, and human beings, other living creatures, plants and micro-organisms, and property. The EPA provides for an extensive procedure to be followed for testing of the samples, including samples of soil, in an environmental laboratory notified by the central government. In case of a violation, the EPA provides for fine as a punishment where any damage is caused to the environment, including contamination of soil.

Section 9 of the EPA stipulates that where the discharge of any environmental pollutant in excess of the prescribed standards occurs, the person responsible for such discharge shall be bound to prevent or mitigate the environmental pollution caused as a result of it. This provision would include mitigation of the environmental harm caused by the discharge of an environmental pollutant on land.

In the absence of any specific legislation on contaminated land, the responsibility for clearing up contaminated land, including liability for soil pollution and impacted groundwater, is ordinarily on the current occupier of the land. This responsibility for cleaning up the affected site/land cannot be delegated/transferred, unless contractually agreed among the parties. In the Indian Enviro Legal case, the Supreme Court, placing the responsibility of clearing up the contaminated land on the defaulter industries, directed them to remove the toxic sludge that contaminated the land, as a remedial measure.

In the event of multiple parties being responsible for contamination, all responsible parties may be held jointly liable for the clean-up and compensation for damages caused to the environment and affected communities. While joint liability is recognised by law in India, the specific application and appropriation of liability shall depend on the facts and circumstances of each case. The Supreme Court has in multiple cases held industries to be jointly liable for the large-scale contamination caused by them. For illustration, the Supreme Court in the Indian Enviro Legal case held five industries to be responsible for pollution of the wells and generation of highly polluting sludge caused due to discharge of toxic effluents by them during the production of “H” acid (production of which is banned in multiple countries). Similarly, in Vellore Citizens’ Welfare Forum v Union of India (1996) 5 SCC 647, the Supreme Court held 533 tanneries operating in the state of Tamil Nadu to be responsible for discharging untreated effluent into agricultural fields, roadsides and open lands. The court imposed heavy costs separately on each such tannery that failed to take remedial measures as directed by the court.

India also recognises the principle of contributory negligence, wherein the courts, considering the degree of negligence or fault of each defaulter, allocate proportional liability and damages.

The requirements for locus standi can vary based on the nature of the legal action. PILs in cases related to environmental protection and larger citizen well-being can be initiated by any public-spirited citizen or non-governmental organisations. In cases where individuals or communities are directly affected by environmental contamination, the individual affected has the locus to bring action. Any person seeking relief and compensation for environmental damage involving subjects in the legislations mentioned in Schedule I to the NGT Act may approach the NGT. In addition, environmental regulatory authorities have the locus to act against polluters and environmental offenders.

Waste management in India is largely governed by the rules highlighted in 16.1 Key Laws and Regulatory Controls. While each rule delineates the roles and responsibilities of the stakeholders (including waste operators, occupiers, producers and processors), the key obligations on waste operators include keeping the SPCBs/PCCs (as applicable) informed of the accidents (if any) occurring at the facilities, maintaining records of wastes handled by them in the prescribed format, filing and maintaining statutory registers and forms, processing/treating the waste collected further within the prescribed timelines laws and setting up of treatment, storage and disposal facilities as per the prescribed technical guidelines.

Following complaints received from the public or on the basis of their own cognisance, CPCBs, SPCBs and PCCs have the powers to conduct an inspection at any industrial facility. Further, in certain cases, the constitutional courts may also direct the authorities to carry out investigations. They can seek any information about the activities being undertaken at the occupier’s facility, which may include details about effluent discharges, emissions, waste disposal, etc. Among other measures, they can undertake a survey of the facility, collect information, samples, enter and search any facility for any potential case of contamination, or ask the occupier or other persons to provide relevant information. Please also refer to 4.1 Investigative and Access Powers.

At the COP 26 Glasgow Summit in 2021, India announced its five nectar elements of climate action, namely:

  • to increase its non-fossil energy capacity to 500 GW by 2030;
  • to meet 50% of its energy requirements from renewable energy by 2030;
  • to reduce the total projected carbon emissions by 1 billion tonnes from now onwards till 2030;
  • by 2030, to reduce the carbon intensity of its economy to less than 45% (of 2021 base level); and
  • by the year 2070, to achieve the target of net zero carbon emissions.

Shortly thereafter, the Union Cabinet approved India’s updated Nationally Determined Contribution (NDC). The NDC translates the elements announced at COP 26 into enhanced climate targets. India’s updated NDC is being implemented through policies and schemes both at central and state level. Some key policies introduced to achieve the above stated targets are as follows.

  • Indian Railways is set to be a Net Zero Carbon emitter by 2030. To reduce its carbon emissions, Indian Railways has switched to energy efficient technologies, introducing three-phase electric locomotives, the use of 5% blending of biofuels in traction diesel fuel, complete electrification of railway tracks, the use of LED lights in buildings and coaches, star-rated appliances and afforestation along tracks.
  • The adoption of the green hydrogen/green ammonia policy aims to facilitate the transition from fossil fuel to green hydrogen/green ammonia and reduce dependency on crude oil. Under the policy, India aims to meet the target of production of 5 million tonnes of green hydrogen by 2030 and aims to emerge as a global hub for the production, utilisation and export of green hydrogen and its derivatives.
  • MoEFCC has also notified emission and effluent discharge standards for the polluting industrial units. The compliance of environmental standards by industries is tagged to be enforced by the respective SPCBs. Further, the CPCB has issued directions to 17 categories of highly polluting industries to install the Online Continuous Effluent/Emission Monitoring System (OCEMS) with real-time data connectivity to the CPCB server.
  • The Government of India has extended the operative period of phase 2 of the much-celebrated Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) scheme introduced to push for Electronic Vehicles (EV). With proper implementation of FAME II, India could realise EV sales penetration of 30% of private cars, 70% of commercial cars, 40% of buses, and 80% of two- and three-wheelers by 2030.

Please refer to 14.1 Targets to Reduce Greenhouse Gas Emissions.

In 2011, the Supreme Court of India rejected a PIL, calling for a ban on asbestos usage (Kalyaneshwari v Union of India (2011) 3 SCC 287). However, the court called for improved supervision and regulatory control from the state on the use of asbestos in industries. While India has banned asbestos mining, it currently remains the top importer of the commonly used white (chrysotile) asbestos. In 2014, the White Asbestos (Ban on Use and Import) Bill, 2014, was tabled in Parliament; however, it has not yet attained finality.

While the EPA is an umbrella legislation providing for all matters of protection of the environment, the union government, through its rule-making powers provided under the EPA at regular intervals, frames rules for the management and handling of various categories of wastes. At present, the key laws governing waste in India are as follows.

  • E-Waste (Management) Rules, 2022 (the “E-Waste Rules”) – effective 1 April 2023, the E-Waste (Management) Rules, 2022 replace the E-Waste (Management) Rules, 2016. The new rules introduce the Extended Producer Responsibility (EPR) regime for e-waste recycling and have reintroduced annual e-waste recycling targets. Notably, the 2022 rules also provide for recognition and registration, skill development, monitoring and ensuring the safety and health of workers involved in the dismantling and recycling of e-waste.
  • PW Rules – mandate the generators of plastic waste to minimise generation of plastic waste, prevent littering of plastic waste, and ensure segregated storage of waste at source, among other measures. The rules ensure the responsibilities of producers and generators, both in the plastic waste management system and the introduction of the collect-back system of plastic waste by producers/brand owners, as per EPR.
  • Hazardous Waste Management Rules – ensure safe storage, treatment and disposal of hazardous and other wastes which by reason of characteristics such as physical, chemical, biological, reactive, toxic, flammable, explosive or corrosive nature are likely to cause danger, in an environmentally sound manner without causing adverse effect to environment and human health.
  • Construction and Demolition Waste Management Rules, 2016 – provide for the management of every waste resulting from construction, remodelling, repair and demolition of any civil structure by the individual or organisation generating construction or demolition waste such as building materials, debris, rubble, etc.
  • Bio-Medical Waste Management Rules, 2016 – provide for the management of bio-medical waste including any waste generated, collected, received, stored, transported, treated, disposed of, or bio-medical waste in any form generated during the diagnosis, treatment or immunisation of human beings or animals or research activities pertaining thereto or in the production or testing of biological materials or in health camps.
  • Solid Waste Management Rules, 2016 – provide for the management of solid waste including solid or semi-solid domestic waste, sanitary waste, commercial waste, institutional waste, catering and market waste and other non-residential wastes, street sweepings, silt removed or collected from the surface drains, horticulture waste, agriculture and dairy waste. The rules mandate for source segregation of waste to channel the waste to wealth by recovery, reuse and recycling.
  • Batteries (Management and Handling) Rules, 2022 – premised on the concept of EPR wherein the producers (including importers) of batteries are responsible for the collection and recycling/refurbishment of waste batteries and recovered materials from wastes are used in manufacturing new batteries.
  • Municipal Solid Wastes (Management and Handling) Rules, 2000 – provide for management of solid waste including commercial and residential wastes generated in municipal or notified areas in either solid or semi-solid form.

The above rules are subject to amendment by the government from time to time to incorporate developments.

The regulations regarding waste management in India provide that the primary responsibility and liability for waste disposal lies with the producer. For instance, Rule 6 of the E-Waste Rules prescribes the responsibilities of a producer with respect to waste treatment under said rules.

However, in certain circumstances/stages, such responsibility is shifted to third parties such as refurbishers (under Rule 7 of the E-Waste Rules), bulk consumers (under Rule 8 of the E-Waste Rules), recyclers (under Rule 9 of the E-Waste Rules) and occupier (under Rule 4 of the Bio-Medical Waste Management Rules, 2016).

Under its waste management regulations, India has introduced the concept of EPR, an effective tool putting the onus of efficient end-of-life waste management on producers, importers and brand-owners. Currently, the newly introduced E-Waste Rules and EPR guidelines under PWM Rules have specific provisions with producers being required to meet recycling targets under them.

Please see 6.2 Reporting Requirements.

In India, the Right to Information Act, 2005 (the “RTI Act”) governs a citizen’s right to obtain information from a public authority. Such a request for information need not be backed by a specific reason and is available at a minuscule cost. The RTI Act, however, lists certain exceptions under Section 8 owing to which a public authority can refrain from dispensing information sought. Some of these exceptions are as follows:

  • information that any court of law or tribunal has expressly forbidden to be published, or the disclosure of which may constitute contempt of court;
  • information, the disclosure of which would harm the competitive position of a third party, unless the competent authority is satisfied that larger public interest warrants the disclosure of such information; and
  • information that relates to personal information, the disclosure of which has no relationship to any public activity or interest, unless there is a larger public interest prevailing.

“Public Authority” for the purposes of the RTI Act means any authority or body or institution of self- government established or constituted:

  • by or under the Constitution;
  • by any other law made by Parliament;
  • by any other law made by State legislature; or
  • by notification issued or order made by the appropriate government, and includes any—
    1. body owned, controlled or substantially financed; or
    2. non-government organisation substantially financed, directly or indirectly, by funds provided by the appropriate government.

Please refer to 7.5 ESG Requirements.

An estimated INR162,500 billion (USD 2.5 trillion) from 2015 to 2030, or roughly INR11,000 billion (USD 170 billion) per year is required realistically to achieve India’s goals under the updated NDC. Currently, India is falling short of these estimates. To make up the deficit, the government of India has taken several positive steps to boost the green funding ecosystem. Some of the more prominent ones are as follows.

  • Renewable energy projects have been included as a part of Priority Sector Lending (PSL). In 2015, the PSL criteria were expanded to bank loans up to a limit of INR15 Crore to borrowers for purposes like solar/biomass-based power generators, windmills, micro-hydel plants and for non-conventional energy based public utilities like street-lighting systems, and remote village electrification. In 2020, this limit for bank loans was doubled to INR30 Crore.
  • As announced in Union Budget 2022–23, the government of India will be issuing Sovereign Green Bonds (SGrBs) for mobilising resources for green infrastructure. The proceeds will then be deployed in public sector projects which aid in minimising carbon intensity.
  • India has introduced sustainable finance instruments such as sustainability-linked loans and sustainability-linked bonds. Liberalised External Commercial Borrowings (ECB) norms have also allowed Indian companies to raise offshore finance through green bonds, social bonds, sustainable bonds and sustainability-linked bonds. SEBI is the primary entity that regulates the issuance and requirements of listing of green bonds.

Owing to heightened environmental law implications and environmental activism, it is now rather common for buyers to undertake environmental due diligence (typically in an asset sale). Based on this due diligence, the buyer can identify any critical environmental non-compliance and pre-transaction environmental liabilities that may be transferred from the seller to the buyer. Accordingly, an indemnity package may appropriately be negotiated to cover for any and all risks/liabilities arising out of environmental non-compliances.

Depending on the nature of the business of the target, environmental due diligence typically involves assessment (for the look-back period) of:

  • environmental clearances, EIA, consents to operate and establish;
  • all notices/applications/petitions filed against or by the target or any past environmental litigation;
  • environmental audits;
  • details of any environmental liabilities of any member of the target group under contract, eg environmental indemnities or warranties or covenants in leases; and
  • licensees and details of registrations relating to environmental matters under specific environmental legislations.

The disclosure requirements are largely dependent on the negotiated commercials and the terms of the transaction documents. In event of representation and warranties in relation to environmental compliances and violations, the seller would be required to make appropriate disclosures to the satisfaction of the purchaser.

The Ministry of Road Transport and Highways levies “Green Tax” on old vehicles which are heavily polluting the environment. It varies from state to state across the country: ie, there is a higher Green Tax (up to 50% of road tax) provided for vehicles registered in highly polluted cities. Further, the rate at which the Green Tax is payable is dependent on the vehicle being a transport vehicle or a personal vehicle. Special provisions have been made to exempt vehicles like strong hybrids, electric vehicles and alternate fuels like CNG, LPG and agricultural vehicles. The revenue collected from the Green Tax is required to be kept in a separate account and used for tackling pollution and for states to set up state-of-the-art facilities for emission monitoring. The Supreme Court of India by way of its order in MC Mehta v Union of India (2018) 18 SCC 752 also imposed an Environment Compensation Charge (ECC) of 1% for the registration of diesel cars having an engine capacity greater than 2,000 CC in Delhi-NCR.

Very recently, the Ministry of Road Transport and Highways also indicated that there may be a proposal in pipeline to levy an additional 10% tax on diesel vehicles to curb fuel emissions and pollutants. However, there is no formalisation of the proposal yet.

Environmental disputes are mostly resolved through litigation in India, with NGT being the primary forum. Litigants are allowed to appeal against the orders of NGT to the State High Courts under whose jurisdiction the bench of NGT lies. Appeals against the orders of the NGT also lie to the Supreme Court of India by way of special appeal. However, the NGT can only adjudicate civil cases; certain violations of environmental laws constituting criminal offences are required to be filed in criminal courts by the appropriate government authorities. Further, under the writ jurisdiction, litigants can move directly to the Supreme Court or the High Courts to challenge a state action. Unlike the writ jurisdiction of the Supreme Court, the High Courts may be approached not only for a violation of a fundamental right but also for a violation of a statutory right. The writ jurisdiction provides for the courts to not be bound by the narrow provisions of environmental legislations and gives them the flexibility of providing any relief or taking any action necessary to meet the ends of justice.

India currently is the seventh most affected nation when it comes to tackling climate change. The effect of environmental degradation is experienced disproportionately by the developing countries. It is paramount that tomorrow’s generation is equipped with the requisite education, awareness and skills needed to tackle the changes. Environmental education is required to be updated at regular intervals considering that it stems from the rapid developments taking place. It will be a forward step to see the existing educational framework of environmental sciences at primary and secondary education levels in India being replaced with an empirical curriculum that gives the coming generation an insight into the challenges of the future and the possible solutions to them. It remains to be seen how effectively the National Education Policy 2020 and Mission LIFE, which stresses appropriate integration of environmental awareness and sensitivity towards its conservation and sustainable development in the school curriculum, is implemented.

In addition to this, the rapid land degradation and contamination presses for the need to enact a separate land contamination legislation.

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Trends and Developments


Khaitan & Co is a top-tier full-service law firm. The dispute resolution practice offers services spread across litigation, arbitration, regulatory and pre-disputes advisory assignments. The firm actively represent clients on the gamut of litigations in India before various forums such as the Supreme Court of India, High Courts, tribunals, appellate and regulatory bodies. Khaitan & Co regularly advises on the regulatory framework in India covering the businesses of banking and finance, insolvency and restructuring law, corporate law, competition law, environmental law, electricity law, data privacy and cybersecurity, financial services, fraud and financial crime, or other laws. The dispute resolution practice works seamlessly with other practices within the firm, delivering focused and commercial advice to the client and working closely with international law firms on international matters involving Indian laws.


In the past year, India saw some important and much required changes for tackling the shifting environmental landscape. India is faced with a unique and rather difficult challenge of balancing its commitment to combat climate change and at the same time keeping the wheel of fast-track development running. One of the ways of achieving this is by statutory amendments and policy decisions. Additionally, the courts in India have also played an active role in protection of the environment. Some of the crucial amendments to various environment-related legislations, policy decisions and judicial pronouncements are discussed in this chapter of the guide.

Major Amendments in Environment Laws

Forest Conservation (Amendment) Act, 2023

In August 2023, the Indian Parliament enacted the Forest (Conservation) Amendment Act, 2023 (the “FCA Amendment Act”) to amend the Forest (Conservation) Act, 1980 (FCA). The FCA is a significant statute aimed at safeguarding India’s forests. According to this legislation, obtaining prior approval from the central government is mandatory for actions such as de-reserving reserved forests, utilising forestland for non-forest purposes, leasing forestland to private entities, and clearing naturally grown trees for re-afforestation purposes.

The amendments to the FCA include the addition of a preamble to enhance the FCA’s scope. Further, the FCA’s name has been changed to Van (Sanrakshan Evam Samvardhan) Adhiniyam, 1980 to better reflect its provisions. Importantly, the amendments clarify the FCA’s applicability on various lands to eliminate uncertainties.

The FCA Amendment Act classifies land into two categories: (i) land officially recognised as a forest under the Indian Forest Act, 1927, or any other law, and (ii) land not falling under the first category but designated as a forest in a government record after 25 October 1980. Further, it grants exemptions to strategic linear projects of “national importance and concerning national security” within 100 km of international borders.

The FCA Amendment Act also encourages activities like silvicultural operations, the establishment of zoos and wildlife safaris, eco-tourism facilities, and other activities specified by the central government.

The most important amendment to the FCA is the exemption of specific types of land from the FCA, such as forestland along a rail line or government-maintained public road providing access to a habitation or a rail, and roadside amenity up to a maximum size of 0.10 hectare. Previously, state governments needed prior approval from the central government to allocate forestland to entities not owned or controlled by the government. The amendment extends this requirement to all entities, including those owned and controlled by the government. It stipulates that prior approval must adhere to terms and conditions set by the central government. The amendment aims to clarify the FCA’s application, streamlining decision-making on proposals involving the non-forest use of forestland.

Ultimately, the amendment removes restrictions from the FCA, allowing for the creation of infrastructure to support national security and generate livelihood opportunities for those residing on the outskirts of the forests.

Notably, the Supreme Court of India on 20 October 2023 issued notice in a petition being Ashok Kumar Sharma, IFS (Retd) & Others v Union of India & Others, Writ Petition (Civil) No 1164 of 2023, filed to challenge the constitutionality of the FCA Amendment Act. The petition states that the FCA Amendment Act poses a significant threat to India’s established forest governance system. According to the petition, the amendment allows for unchecked diversion of land without a nationwide cumulative limit, leading to the creation of deforested “islands” that could fragment forests and result in substantial ecological damage. It is pertinent to note that, as per the amendments, forestland of up to 10 hectares is exempted from scrutiny under the FCA when proposed for the construction of “security-related infrastructure”, with a lack of clarity on the specific inclusions in this category.

Biodiversity (Amendment) Act, 2023

The Parliament has also recently enacted the Biological Diversity (Amendment) Act, 2023 (the “BD Amendment Act”) amending the Biological Diversity Act, 2002 (the “BD Act”). The BD Act establishes a framework for the fair and equitable sharing of benefits arising from the use of biological resources, the conservation of biological diversity, and the sustainable use of its components. The BD Amendment Act promotes the use of indigenous medicine, simplifies patent applications for research, and encourages the cultivation of wild medicinal plants.

The National Biodiversity Authority (NBA) oversees access to biological resources and the dissemination of research findings. The BD Amendment Act expands the scope of individuals and organisations required to seek clearance from the NBA before acquiring biological resources or submitting an Intellectual Property Rights (IPR) application. This includes non-citizens, non-resident citizens, organisations not registered in India, and now, “foreign-controlled” companies registered in India under the Companies Act, 2013.

Further, the BD Amendment Act changes the notification process for using biological resources for commercial purposes. Instead of requiring permission from the NBA, entities must now notify the relevant State Biodiversity Board (SBB). SBBs are granted the authority to determine “benefit sharing” during the approval process. The BD Amendment Act also mandates specified entities to provide prior intimation for access to associated knowledge and commercial utilisation. Exemptions from intimation requirements are extended to codified traditional knowledge, cultivated medicinal plants/products, AYUSH practitioners, and more. Notably, the BD Amendment Act also modifies the approval process for IPR, now requiring approval before the grant of IPR rather than before the application. Foreign companies still need the NBA’s approval, while domestic companies only need registration. It is also stipulated that state governments must establish Biodiversity Management Committees with seven to 11 members in both rural and urban areas for the conservation of landraces, folk varieties, domesticated stocks, etc.

Most importantly, the BD Amendment Act decriminalises offences under the BD Act, replacing imprisonment with penalties ranging from INR100,000 to INR50 million. Adjudicating officers will determine penalties on a case-to-case basis.

The Union Ministry of Environment, Forest and Climate Change has also notified the Battery Waste Management Rules, 2022 (the “2022 Rules”), which replace the Batteries (Management and Handling) Rules, 2001. The 2022 Rules now extend to various types of batteries, including industrial batteries, electric vehicle batteries, portable batteries, and automotive batteries. Notably, the 2022 Rules introduce the concept of Extended Producer Responsibility (EPR), which places on the “Producer” responsibility for management of the disposal of products once those products are designated as no longer useful by consumers. EPR is a globally recognised way of facilitating a reverse collection mechanism and recycling post-consumer waste. The 2022 Rules prohibit the Producer from disposing of waste batteries in landfills and instead obligate Producers to recycle, refurbish or re-purpose waste batteries. The 2022 Rules also provide for targets which a Producer is required to attain to fulfil its EPR obligations under the rules.

Judicial Pronouncements

Taking note of the perils of mismanaged urban development and in the interest of sustainable development, the Supreme Court in Residents Welfare Association & Another v State (Union Territory of Chandigarh) & Others (2023) 8 SCC 643 held that it has now become critical that the Legislature, the Executive, and the policy-makers at the Union as well as at the State levels take note of the damage to the environment on account of haphazard developments and take a call to take necessary measures to ensure that the development does not damage the environment. The court once again batted for a proper balance to be struck between sustainable development and environmental protection. The Legislature, the Executive and the policy-makers were recommended to ensure that there were the necessary provisions for carrying out Environmental Impact Assessments before permitting urban development. At present, Environmental Impact Assessments are required only for certain development projects.

Ensuring conservation of the flora and fauna in Eco Sensitive Zone and Protected Areas from rapid mining, the Supreme Court in Re: TN Godavarman v Union of India (2023), expanding its earlier direction of prohibiting mining within the National Parks and Wildlife Sanctuaries (ie, Prohibited Areas), directed that mining within an area of 1 km from the boundary of the Protected Area shall not be permissible.

Separately, the National Green Tribunal took suo moto cognisance of the problem regarding submerging islands and ordered the constitution of a committee to frame policies and measures to protect submerging islands due to the rise of sea level and global warming. Interestingly, the suo moto cognisance was taken from the news item published in a national daily which highlighted that islands in India are grossly affected by unseasonal cyclonic storms and new development projects. The Tribunal, in a separate case, had also ordered a factual and action-taken report on the declining snowfall in the colder regions of the country (specifically the state of Himachal Pradesh).

Policy Measures

Indian policy space, too, saw an active year, as the union government proposed multiple measures to advance its efforts of achieving the five nectar elements declared at the COP 21 Glasgow summit.

Very recently, the Ministry of Environment, Forest and Climate Change has introduced two novel initiatives – the Green Credit Programme (GCP) and the Ecomark Scheme – which seek to embolden environmentally friendly practices rooted in tradition and conservation. The CGP introduces the concept of Green Credit, which has been defined as a singular unit of an incentive provided for a specified activity (ie, water conservation and afforestation in the initial phase), delivering a positive impact on the environment. The Green Credit Certificate issued to entities and individuals can be traded on the green credit platform. With the aim of driving manufacturers to opt for environmentally conscious production, the Ecomark Scheme introduces accreditation and labelling of household and consumer products that meet specific environmental criteria while maintaining quality standards as per Indian norms. Products accredited under the Ecomark Scheme will ensure minimal environmental impact.

India saw another milestone, with the union government taking a significant step towards environmental sustainability by kicking into action the establishment of the regulated carbon market. The Carbon Credit Trading Scheme, 2023 was introduced under the Energy Conservation Act, 2001. With the introduction of carbon credits, which are essentially units of measurement that represent the reduction or removal of greenhouse gas emissions (such as CO₂), below a specific benchmark, entities will be able to trade these carbon credits in the Indian Carbon Market. These Carbon credits are earned when entities engage in activities that decrease these emissions or actively remove greenhouse gases from the atmosphere. Each carbon credit will be equivalent to one metric ton of CO₂ or equivalent emissions that have been reduced. Further, under the scheme, entities bound by law are required to limit their emissions. If they fall below the designated level, they acquire carbon credits. Vice versa, if emissions surpass the designated threshold, they will be able to purchase credits from entities that have been able to reduce their emissions.


India has repeatedly shown its commitment to environmental stewardship, climate action and focus on renewables to decarbonise the way the country operates. The above measures and developments indicate India’s proactive approach to climate change, sustainability, and promotion of eco-conscious practices. While much has been done, much remains to be done. The concentrated and well-rounded efforts by the state and various stakeholders paint a positive picture of an environmentally conscious country.

Khaitan & Co

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Law and Practice


Khaitan & Co is a top-tier full-service law firm. The dispute resolution practice offers services spread across litigation, arbitration, regulatory and pre-disputes advisory assignments. The firm actively represent clients on the gamut of litigations in India before various forums such as the Supreme Court of India, High Courts, tribunals, appellate and regulatory bodies. Khaitan & Co regularly advises on the regulatory framework in India covering the businesses of banking and finance, insolvency and restructuring law, corporate law, competition law, environmental law, electricity law, data privacy and cybersecurity, financial services, fraud and financial crime, or other laws. The dispute resolution practice works seamlessly with other practices within the firm, delivering focused and commercial advice to the client and working closely with international law firms on international matters involving Indian laws.

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Khaitan & Co is a top-tier full-service law firm. The dispute resolution practice offers services spread across litigation, arbitration, regulatory and pre-disputes advisory assignments. The firm actively represent clients on the gamut of litigations in India before various forums such as the Supreme Court of India, High Courts, tribunals, appellate and regulatory bodies. Khaitan & Co regularly advises on the regulatory framework in India covering the businesses of banking and finance, insolvency and restructuring law, corporate law, competition law, environmental law, electricity law, data privacy and cybersecurity, financial services, fraud and financial crime, or other laws. The dispute resolution practice works seamlessly with other practices within the firm, delivering focused and commercial advice to the client and working closely with international law firms on international matters involving Indian laws.

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