1

UNIVERSITY INSTITUTE OF LAW,

PANJAB UNIVERSITY REGIONAL CENTER,
LUDHIANA

TOPIC- POLLUTER PAYS PRINCIPLE

(ENVIRONMENT LAW)

SUBMITTED TO: SUBMITTED BY:

Ms. PRATIBHA KHOSLA VASU BANSAL
BA.LL.B.(HONS.)
8TH Semester
83/16F

ACKNOWLEDGEMENT
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The success and final outcome of this project required a lot of guidance and assistance from
many people and I am extremely privileged to have got this all along the completion of our
project. All that is done only due to such supervision and assistance.
I respect and thanks Ms. Pratibha Khosla for providing me an opportunity to do the project
work on “POLLUTER PAYS PRINCIPLE” and giving me all support and guidance which made me
complete the project duly. I am extremely thankful to her for providing such a nice support
and guidance, although she had busy schedule managing the other affairs.
I am thankful to and fortunate enough to get constant encouragement, support and guidance
from parents who encouraged me in successfully completing my project work.

Thanks
Vasu Bansal

I. INTRODUCTION
“If anyone intentionally spoils the water of another… let him not only pay the damages but
purify the stream or cistern which contains the water……”
- Pluto
Most of us agree to that fact that those who cause damage or harm should pay, in one way or
another for such damage. Such damage can be to body, society or our environment.
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Polluter Pays Principle has become a popular catch phrase in recent times. 'If you make a
mess, it's your duty to clean it up'- this is the main basis of this slogan.
The primary function of the Principle is that it helps in allocating the costs and repairing the
damage, between different stakeholders, for the harm caused by them to the environment.
The principle is also revolutionary in the sense that it places the responsibility of paying the
damages to the persons who ought to pay it and also who have the ability to pay it.
The polluter pays principle is essentially based on a common-sense approach for the
mitigation of environmental degradation. It simply means that s/he who damages the
environment should bear the cost of rectifying that damage. In a broader sense, producers of
goods and other items should be responsible for any pollution which the process of production
causes and therefore must also pay for prevention or rectification of the damage caused to the
environment by such pollution. Underlying the meaning of the polluter pays principle is the
belief that when public authorities take measures to prevent potential and actual
environmental damage, the expenses incurred should be borne by the person responsible for
the pollution.

II. WHAT IS POLLUTION?

Pollution usually occurs when acts that disturb the peace of nature are carried out, unchecked.
The commonly accepted definition or meaning of pollution is
“The introduction by man, directly or indirectly, of substances or energy into the environment
resulting in deleterious effects of such a nature as to endanger human health, harm living
resources and ecosystems, and impair or interfere with amenities and other legitimate uses of
the environment.”1

1
OECD, Recommendations C (74) 224 (1974).
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In terms of regional legislation the Water (Prevention and Control) Act, 1974 defines pollution
as “such contamination of water or such alteration of the physical, chemical or biological
properties of water or such discharge of any sewage or trade effluent or of any other liquid,
gaseous or solid substance into water (whether directly or indirectly) as may, or is likely to
create a nuisance or liable to render such water harmful and injurious to health” 2
The Environment (Protection) Act, 1986 denies pollution as “presence in the environment of
an environmental pollutant”3 and further defines environmental pollutant as “any solid, liquid
or gaseous substance present in such concentration as may be, or tend to be, injurious to
environment”4
Other legislations like the Air (Prevention and Control of Pollution) Act 1981 have similar
definitions of pollution. Thus it is evident from these regional as well as international
definitions that the emphasis is on the fact that pollution must have a tendency to cause harm,
or must actually cause harm. Thus basically, pollution is a trespass as under common law. If
the trespass is so nominal that it creates no harm, it will normally be tolerated. Hence, as the
definition of pollution is commonly understood, for the pollutant to result in or cause pollution
there must be some consequent harm or threat of harm.

III. BACKGROUND OF THE PRINCIPLE

A. V. Kneese and J H Dales were the first persons to discuss this principle. They spoke about
the ways and means, especially economic to reduce pollution in the 1960s. 5 J. H. Dales
proposed in 1968, tradable discharge permits, considered to be the best economic
instruments for reducing pollution6. Further, the polluter pays principle was hinted at by the
Committee of Ministers of the Council of Europe issued a Draft Declaration of Principles on Air
Pollution Control. Article 6 of the Declaration states:
“The cost incurred in preventing or abating pollution should be borne by whoever causes the
pollution. This does not preclude aid from Public Authorities.”
2
Water (Prevention and Control) Act, 1974, No. 6, Acts of Parliament, 1974 (India) Art. 2(e)
3
Environment (Protection) Act, 1986, No. 29, Acts of Parliament, 1986 (India) Art. 2(c).
4
Environment (Protection) Act, 1986, No. 29, Acts of Parliament, 1986 (India) Art. 2(b)
5
ALLEN. V. KNEESE THE ECONOMICS OF REGIONAL WATER QUALITY MANAGEMENT, 35-119 (1964).
6
J. H. DALES, POLLUTION, PROPERTY AND PRICES, 93-97 (University of Toronto Press) (1968)
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The Organisation for Economic Co-operation and Development(OECD) held a seminar in 1971,
in Paris on environmental economics where polluter pays principle was the primary topic of
discussion. This was the first instance of polluter pays principle being discussed on an
international forum. In 1972, the Organisation for Economic Co-operation and Development
formally recommended on 26 May 1972 the polluter pays principle to be the ‘Guiding Principle
Concerning the International Economic Aspects of Environmental Policies’.
The recommendation clearly lays out the usage of the principle stating:
“The principle to be used for allocating costs of pollution prevention and control measures to
encourage rational use of scarce environmental resources and to avoid distortions in
international trade and investment is the so called "Polluter Pays Principle".
This principle means that the polluter should bear the expenses of carrying out the
abovementioned measures decided by public authorities to ensure that the environment is in
an acceptable state. In other words, the cost of these measures should be reflected in the cost
of goods and services which cause pollution in production and/or consumption. Such measures
should not be accompanied by subsidies that would create significant distortions in
international trade and investment.”

IV. THE PRINCIPLE AS AN ASPECT OF

CUSTOMARY INTERNATIONAL LAW
After the Organisation for Economic Co-operation and Development recommendations in the
1970s, there was a boom in public interest in environmental issues which resulted in pressure
on the various Governments and other institutions to introduce rules and regulations to
protect the environment.
This led to various international level discussions and conferences where nations got together
to find solutions to environmental degradation. The polluter pays principle as we know today
was first incorporated in Principles 21 and 22 of the Stockholm Declaration, 1972. Thereafter,
various documents like the Rio Declaration in its Principle 15 provided for the application of
the polluter pays principle.
The Polluter Pays principle has also been reaffirmed in the 1992 Rio Declaration, at Principle
16: "National authorities should endeavor to promote the internalization of environmental
costs and the use of economic instruments, taking into account the approach that the polluter
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should, in principle, bear the cost of pollution, with due regard to the public interest and
without distorting international trade and investment.", and is mentioned, recalled or
otherwise referred to in both Agenda 21 and the World Summit on Sustainable Development
(WSSD) Johannesburg Plan of Implementation.7
The Polluter Pays principle is today one of the fundamental principles of the environmental
policy of International Community. "Community policy on the environment [...] shall be based
on the precautionary principle and on the principles that preventive action should be taken,
that environmental damage should as a priority be rectified at source and that the polluter
should pay."8

V. INDIAN JUDICIARY AND PRINCIPLE OF

POLLUTER PAYS
"we are interested not only in the development but also in the enforcement of law"
- - Justice Christopher G. Weeramantry [Vice President of the ICJ]
The judiciary in India recognizes the Polluter Pays Principle. The judiciary has used this
principle as “precautionary principle” to provide for preventive relief to protect environment,
it has applied the “polluter pays” principle to give remedial relief to check and control
environmental degradation. Of these two principles which are the two sides of the same coin
of “sustainable development”, the “polluter pays” has been frequently used to control
environmental pollution. Thus, in a number of cases the higher judiciary has used this principle
not only to award ordinary damages/compensation to the victims of environmental
degradation but also to award exemplary damages/ compensation for the restoration of
degraded environment. Besides, the Courts have used this principle to invent the principle of
absolute liability in the case of environmental harm caused by hazardous industries.
CASE LAWS:

7
Dr. Aruna Venkat on Polluter pays principle: A policy principle
8
The Treaty Establishing the European Community, under Title XIX Environment, provides for PPP at article 174.2, and in fact the
same is also provided for the International Community as part of International Environmental Jurisprudenc
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1. MC Mehta v Union of India9,

One of the land-mark decisions of the Supreme Court, the Supreme Court enunciated a new
proposition in regard to the liability of enterprises engaged in hazardous or inherently
dangerous activities.The Court in this case transformed the concept of “strict liability”
enunciated in Rylands v Fletcher10 into “absolute liability”.
In this case, the petitioner in his earlier PIL Petition11, sought the closure or relocation of Shri
Ram Caustic Chlorine and Sulphuric Acid plants located in 76 acres industrial complex located
in a thickly populated area of Delhi. Soon after the filing of the original Petition there was a
leakage of oleum gas from the Sulphuric Acid Plant of Shri Ram Food and Fertilizers Industries
ltd affecting several people and also causing death of one person. Because of this incident, an
order for closure of Shri Ram Food and Fertilizers Ltd was issued by the Assistant
Commissioner (Factories) under the Factories Act, 1948. Aggrieved by the order, the Shri Ram
Food and Fertilizers Ltd filed a writ petition questioning the closure order and also sought an
interim permission to re-open the caustic chlorine plant. Meanwhile, those who were affected
by the leakage filed petitions for compensation, which were the subject matter of decision in
this case.
Chief Justice Bhagwati who delivered the judgment of the Supreme Court, asserting its power
under Article 32 read with Article 21 of the Indian Constitution to award compensation to the
victims of oleum gas leak, explained the principle of absolute liability for enterprises engaged
in hazardous or inherently dangerous activities thus:
“……if any harm results on account of such activity, the enterprise must be absolutely liable to
compensate for such harm and it should be no answer to the enterprise to say that it had
taken all reasonable care and that the harm occurred without any negligence on its part…If the
enterprise is permitted to carry on an hazardous or inherently dangerous activity for its profit,
the law must presume that such permission is conditional on the enterprise absorbing the cost
of any accident arising on account of such hazardous or inherently dangerous activity as an
appropriate item of its overheads…”.
The Court applied the “Polluter Pays” principle without mentioning its name. According to the
Supreme Court the amount of compensation to be paid by the hazardous industries must be
correlated to the magnitude and capacity of the enterprise because such compensation must
have a deterrent effect. Therefore, the “Polluter Pays” principle, whenever it is applied, serves
two-fold purpose. One is to restore the damaged ecology to its original status and the other is
to have deterrent effect on the polluters so that they may not enjoy “pollute and pay” dictum.
9
AIR 1987 SC 1086.
10
(1868) LR 3 HL 330.
11
AIR 1987 SC 965.
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2. Vellore Citizens Welfare Forum case12

The Supreme Court applied “Polluter Pays” principle rigorously and directed polluting
tanneries for payment of compensation to the affected persons and also for payment of cost
for restoring the damaged ecology.
In this connection, Justice Kuldip Singh, who delivered the judgment of the Court explained the
import of “Polluter Pays” principle as under:
The "Polluter Pays Principle" as interpreted by this Court means that the absolute liability for
harm to the environment extends not only to compensate the victims of 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.

3. Indian Council for Enviro-Legal Action v Union of India13,

which is called the ‘Bichhri’ case, provides a typical occasion for the application of the
“Polluter Pays” principle. Justice Jeevan Reddy, who delivered the judgment of the Court,
relying on the ratio laid down in Oleum Gas Leak case26, held that the respondents were
absolutely liable to pay compensation for the harm caused by them not only to the villagers in
the affected area but also to the environment which is necessary for its restoration. His
Lordship also held that they were bound to take all necessary measures to remove the sludge
and other pollutants in the affected areas.

4. Indian Council for Enviro-Legal Action v Union of India14,

is of extraordinary significance for students and scholars of environmental jurisprudence, for,
in this case, for the first time, the Court imposed compensatory damages on the Andhra
Pradesh State Government to compensate the crop damage caused to victim villagers by the
polluting industries. In this case because of the discharge of the untreated industrial effluents
into the Nakkavagu by the surrounding industries, the victim farmers had suffered loss due to
damage of crops on account of the pollution of sub soil surface water. The Supreme Court
ordered the polluting industrialists to pay compensatory damages to the tune of Rs 28.34
12
AIR 1996 SC 2715
13
AIR 1996 SC 1446.
14
1995 (6) SCALE 578
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lakhs. Since the industrialists paid only Rs 6,54,364, the Court directed the AP State
Government to pay the rest of the amount.

5. MC Mehta v Kamal Nath15,

The Supreme Court applied the “Polluter Pays” principle and awarded not only damages /
compensation for the restoration of damaged environment but also imposed exemplary
damages on the respondent M/s Span Motel which disturbed and degraded ecology by
construction of the motel on the riverbed of River Beas. Justice Kuldip Singh, who delivered
the judgment of the Court, ordered M/s Span Motel to pay compensation by way of cost for
the restitution of the environment and ecology of the area. His Lordship directed the NEERI,
through its director, to inspect the area, if necessary, and give an assessment of the cost,
which is likely to be incurred for reversing the damage caused by the motel to the
environment and ecology in the area.

VI. LEGAL PROVISIONS RELATING TO THE

PRINCIPLE IN INDIA
The precautionary principle and the polluter pays principle have been accepted as part of the
law of the land. Article 21 of the Constitution of India guarantees protection of life and
personal liberty. Article 47, 48A and 51A(g) of the Constitutional are as under:
 Article 47. Duty of the State to raise the level of nutrition and the standard of living
and to improve public health. - The State shall regard the raising of the level of nutrition
and the standard of living of its people and the improvement of public health as among
its primary duties and in particular, the State shall endeavour to bring about prohibition
of the consumption except from medicinal purposes of intoxicating drinks and of drugs
which are injurious to health.
 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.
Apart from the constitutional mandate to protect and improve the environment there are
plenty of post independence legislations on the subject but more relevant enactments for our
purpose are :
15
(1997) 1 SCC 388.
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 The Water Act,1974provides for the Constitution of the Central Pollution Control Board
by the Central Government and the Constitution of the State Pollution Control Boards
by various State Governments in the country. The Boards function under the control of
the Governments concerned. The Water Act prohibits the use of streams and wells for
disposal of polluting matters. Also provides for restrictions on outlets and discharge of
effluents without obtaining consent from the Board. Prosecution and penalties have
been provided which include sentence of imprisonment.
Sec.32 C (1) If a person held guilty under Sec 20 (2) and (3) of Water (Prevention and
control of pollution) Act,1974 , is punishable with imprisonment and fine up to 10,000/-
or both. If any person disposes any polluting matter into any stream or well,
then he is punishable with imprisonment up to 6 months and fine.
 The Air Act,1981 provides that the Central Pollution Control Board and the State
Pollution Control Boards constituted under the Water Act shall also perform the powers
and functions under the Air Act. The main function of the Boards, under the Air Act, is to
improve the quality of the air and to prevent, control and abate air pollution in the
country.
Sec.31 A Person whoever fails to comply with the provision of the act ,are punished
with the fine and imprisonment such fine can be extended to 5000/- for everyday.
Sce.38 Provides for the punishment with the imprisonment or with fine 10000/- if he
destroy any property.
Sec.39 If the contravention continued , the fine may extended Rs.5000/- per day.

 The Environment (protection) Act 1986-

Section 15 (1) whoever a person fails to comply with or contravenes any of the
provision of EPA, is liable for fine 1,00,000 /- or with 5 years imprisonment, or both.
The offence is continued ,an additional fine can be imposed against the offender
which may be extended to 5000/-
Sec.16 If any offence under this act has been committed by a company, every person
who is in charge will punished accordingly.

GREEN COURT: India launched a "green" court on October 19, 2010 to make polluters pay
damages as it steps up its policing of the country's environmental laws. Indian Environment
Minister said “this is the first body of its kind (in India) to apply the polluter pays principle and
the principle of sustainable development,” and also that India was only the third country in the
world after Australia and New Zealand to set up such a tribunal.
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“Anybody and everybody can approach the tribunal to claim civil damages arising out of
inadequate implementation of environment laws” said Jairam Ramesh, the environment
minister. The tribunal, which will operate around India, is to be made up of members who are
environmental experts and has powers to try all matters related to and arising out of
environmental issues. The move to launch the tribunal was the latest sign of a tougher
approach by India to improving its green track record as concerns mount about the impact of
growing industrialization on air and water quality, forests and wildlife.
The government proposes to introduce a Civil Nuclear Liability Bill to appease foreign
investors. Any legislation that attempts to dilute the Polluter Pays and Precautionary Principle
and imposes a cap on liability will be in blatant defiance of Supreme Court judgments and is
likely to be struck down. it would be against the interests and the cherished fundamental right
to life of the people of India whose protection should be the primary concern of any civilized
democratic government.

VII. CONCLUSION
The polluter pays principle has had a long journey. From being a concept propounded in the
1960s to being to internationally discussed in 1971 to being a part of various international
agreements since the Declaration of the United Nations Conference on the Human
Environment in 1972 to its strong affirmation during the United Nations Conference on
Environment and Development in 1992. Enforcement of any law requires strict sanctions to
ensure that the law is being complied with. Thus laws regarding protection of environment
were difficult to enforce as the defaulters did not fear any punishment or penalty. This gave
birth to the concept of the polluter pays principle.
The clear advantages of the polluter pays principle is that it helps in enforcing the
environmental laws and makes sure that development does the harm the environment
beyond the necessary limit. Thus the polluter pays principle goes hand in hand with the
concept of Sustainable Development.
The polluter pays principle is an extension of the strict or absolute liability principle as it does
not take into account due diligence before the potentially harmful act. Since it is a part of strict
liability, governments, firms and other factions whose activities might adversely affect the
environment will be forced to be a notch more careful in conducting tests like the
Environmental Impact Assessment (EIA) before undertaking such activities.
Therefore, in terms of feasibility, the polluter pays principle promises to help in the fight
against environmental degradation and preventing the ongoing environmental crisis.
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VIII. BIBLIOGRAPHY
 Rupin Chopra, -Environment law- Polluter Pays Principle available at www.mondaq.com
 Mr. Himanshu Chaudhary – Polluter Pays Principle in India available at
www.legalsevice.com
 Harshdeep Singh- Polluter Pays Principle : An economical or a legal principle available at
www.legalbites.in
 Siddhant Nanodkar -Polluter Pays Principle: Essential Element of Environmental Law and
Policy available at www.ijlmh.com