Supreme Court Upholds Polluter Pays Principle in Tannery Pollution Case — Directs Comprehensive Compensation and Remediation for Environmental Degradation in Vellore District. The court affirmed that tanneries are strictly liable for ecological damage and health impacts, and the Loss of Ecology Authority's compensation assessment must be enforced with government backup liability.

Civil appeals against High Court order dismissing writ petitions seeking implementation of compensation award for tannery pollution and challenging subsequent orders of the Loss of Ecology Authority.

Appellants sought mandamus to enforce compensation payment and closure of defaulting tanneries, and certiorari to quash LoEA orders assessing damage beyond 1998 and the award for Vellore District.

Failure of authorities to recover compensation from polluting tanneries and alleged errors in LoEA's assessment of ecological damage.

High Court dismissed WP No.8335/2008 and disposed of WP No.19017/2009 on 28.01.2010; dismissed WP No.22683/2009 on 08.02.2010.

Whether the compensation assessed by the Loss of Ecology Authority for tannery pollution in Vellore District is valid and enforceable. Whether the High Court erred in dismissing the writ petitions seeking implementation of the compensation award and challenging the Authority's orders. Whether the polluter pays principle and precautionary principle apply to hold tanneries liable for ecological damage and health impacts. Whether the government has a residual responsibility to pay compensation if polluters cannot be identified or are unable to pay.

Appellant (Vellore District Environment Monitoring Committee) argued that the compensation awarded by LoEA in 2001 has not been recovered, and further damage has occurred since 1998, requiring fresh assessment and enforcement. Appellant (AISHTMA) argued that the LoEA's orders dated 05.05.2009 and 24.08.2009 were arbitrary and without jurisdiction, as they assessed damage beyond 1998 without proper basis. Respondents (State and LoEA) supported the compensation assessment and argued that tanneries must pay for pollution as per the polluter pays principle.

The polluter pays principle and precautionary principle are fundamental to environmental law. Polluting industries are strictly liable for the cost of reversing ecological damage and compensating affected individuals. The government has a residual responsibility to ensure compensation is paid if polluters cannot be identified or are unable to pay. The deeming fiction that pollution causes harm shifts the burden of proof to the polluter.

Nature and its elements are worshipped as Gods since time immemorial. The degradation of the natural resources and pollutions of different kinds have a cascading effect on the environment, which now is a global issue and poses a threat to the very existence of our planet. While acknowledging the economic importance of the industry, this Court shall not be a mute spectator to the environmental consequences and the loss of life and health caused by the waste generated by tanneries. The polluter pays principle and the precautionary principle are fundamental to environmental law. The government has a residual responsibility to ensure compensation is paid if polluters cannot be identified or are unable to pay.

The litigation began with a PIL in 1991 (Vellore Citizens Welfare Forum v. Union of India) leading to the constitution of the Loss of Ecology Authority in 1996. The Authority passed an award in 2001 assessing compensation. Subsequently, writ petitions were filed in the Madras High Court in 2008 and 2009 seeking implementation and challenging further orders. The High Court dismissed the petitions on 28.01.2010 and 08.02.2010. Appeals were filed in the Supreme Court via SLP(C) Nos. 23633-23634/2010 and SLP(C) No. 26608/2011, which were heard and decided by this judgment.

• Environment (Protection) Act, 1986: Section 3(3), Section 5
• Water (Prevention and Control of Pollution) Act, 1974: Sections 24, 25, 26
• Revenue Recovery Act, 1890: