Supreme Court Mandates Compensation and Ecological Reversal in Vellore Tannery Pollution Case (2025)

Date of the Judgment: January 30, 2025
Citation: 2025 INSC 131
Judges: J.B. Pardiwala, J., R. Mahadevan, J.

Can industries that have polluted the environment for decades be held accountable for their actions? The Supreme Court of India recently addressed this critical question in a case concerning the persistent pollution caused by tanneries in Vellore, Tamil Nadu. This judgment not only underscores the importance of environmental protection but also clarifies the continuing liability of polluters and the responsibility of the government in such cases. The bench comprised Justices J.B. Pardiwala and R. Mahadevan.

Case Background

Vellore, a district in Tamil Nadu, has a long history of leather production, with numerous tanneries operating along the Palar River. These tanneries, while contributing significantly to the economy, have also been a major source of pollution, discharging untreated effluents directly into the river and surrounding areas. This has led to severe environmental degradation, impacting the health and livelihoods of local communities. The Palar River, once a source of drinking water for 30 towns and 50 villages, became heavily polluted, making it unfit for drinking or agricultural purposes.

The issue first came to the forefront in 1991 when the Vellore Citizens Welfare Forum filed a Public Interest Litigation (PIL) in the Supreme Court, seeking compensation for the victims of pollution. In 1996, the Supreme Court directed the Central Government to constitute an authority to assess the damage and determine compensation. This led to the formation of the Loss of Ecology (Prevention and Payment of Compensation) Authority (LoEA). The LoEA, in 2001, identified 29,193 affected individuals/families and determined a compensation of Rs. 26,82,02,328 for the period from 1991 to 1998. However, the pollution continued, and further litigation ensued, leading to the present appeals before the Supreme Court.

Timeline:

Arguments

The Vellore District Environment Monitoring Committee argued that:

• The compensation awarded earlier was insufficient and the recovery of these amounts was ineffective.
• The LoEA had wrongly compensated farmers from the interest accumulated on deposited funds instead of collecting the same from errant industries.
• Pollution continues unabated even after the initial awards, and no fresh assessment of compensation for the period beyond 1998 has been undertaken.
• The High Court failed to appreciate that pollution is still continuing, and any meaningful scheme for reversal of ecology can be implemented only when the pollution ceases.
• The tanneries are liable to reverse the damage to the environment and ecology as long as they continue to pollute, based on the “polluter pays” and “precautionary” principles.
• The tanneries are illegally sited in close proximity to the river, and their operation without the mandatory consent of the Pollution Control Board must be stopped.
• The Common Effluent Treatment Plants (CETPs) and Individual Effluent Treatment Plants (IETPs) are not effective and continue to discharge effluent into the environment, failing to achieve Zero Liquid Discharge (ZLD).

The All India Skin and Hide Tanners and Merchants Association (AISHTMA) argued that:

• The tanneries have fully paid the compensation amounts determined by the LoEA and no further amount is payable by them.
• The LoEA had directed the industries and the government to implement various schemes to prevent further damage to the environment, and the industries have diligently adhered to the suggested recommendations.
• Other major contributors to pollution, such as untreated sewage and dumping of solid municipal waste, are being ignored.
• The leather industry plays a pivotal role in the Indian economy, providing employment to lakhs of workers.
• The tanneries have set up CETPs and IETPs, adopting the best available technology, and have voluntarily accepted to set up ZLD for tanneries.
• The tanneries have made substantial investments in establishing CETPs and IETPs, and the operation and maintenance costs of these systems are substantial.
• The LoEA illegally empowered itself to re-conduct the entire exercise for the left-over cases, and the findings of the LoEA are vague and based on conjectures.
• The tanning industry has always fulfilled its liability to bring down pollution levels and should not be held liable for wrongful omissions of others, especially the LoEA and the State Government.

Submissions of the Parties

Issues Framed by the Supreme Court

The Supreme Court addressed the following issues:

1. Whether the High Court was correct in setting aside the order of the LoEA dated 05.05.2009?
2. Whether the High Court was correct in upholding the award of the LoEA dated 24.08.2009?
3. Whether the tanneries are liable to pay compensation for the continuing pollution caused by them?
4. Whether the Government is equally responsible to ensure the protection of the environment?

Treatment of the Issue by the Court

The following table demonstrates as to how the Court decided the issues:

Authorities

The Supreme Court relied on the following authorities:

Judgment

The Supreme Court analyzed the arguments and authorities to arrive at the following conclusions:

What weighed in the mind of the Court?

The Supreme Court’s decision was influenced by several key factors:

• The continuing nature of pollution despite the implementation of some control measures.
• The failure to achieve Zero Liquid Discharge (ZLD) by the tanneries.
• The impact of pollution on the health and livelihoods of local communities.
• The need to balance economic development with environmental protection.
• The absolute liability of polluters to compensate for environmental damage.
• The responsibility of the government to prevent and control pollution.
• The principles of “polluter pays” and “precautionary” principles.

The Court emphasized that the “Polluter Pays” principle implies that the liability of the polluters continues until the damage caused to the ecology is reversed. The Court also highlighted the responsibility of the Government to prevent environmental degradation and ensure the implementation of effective remedial action.

Sentiment Analysis of Reasons Given by the Supreme Court

Fact:Law Ratio

Logical Reasoning

Issue 1: Whether the High Court was correct in setting aside the order of the LoEA dated 05.05.2009?

Issue 2: Whether the High Court was correct in upholding the award of the LoEA dated 24.08.2009?

Issue 3: Whether the tanneries are liable to pay compensation for the continuing pollution caused by them?

Issue 4: Whether the Government is equally responsible to ensure the protection of the environment?

Key Takeaways

• Industries cannot escape liability for environmental pollution by merely paying compensation for a specific period. Their liability continues until the damage is reversed.
• The “polluter pays” principle is a strict liability principle, and it extends to the cost of reversing environmental degradation.
• The government has an equal responsibility to prevent environmental degradation and ensure the implementation of effective remedial action.
• The concept of “ecocide” highlights the seriousness of environmental damage, and industries must be held accountable for their actions.
• The Supreme Court has mandated the constitution of a committee to oversee the implementation of the directions and to ensure a clean and healthy environment in Vellore district.
• The judgment emphasizes the need for continuous monitoring, strict enforcement of environmental regulations, and the adoption of sustainable practices.

Directions

The Supreme Court issued the following directions:

• The State government is directed to pay the compensation amount to all the affected families/individuals within six weeks.
• The State government is directed to recover the compensation amount from the polluters.
• The State government shall constitute a committee to conduct an audit to identify, maintain, and monitor the health of the Palar River and its surrounding areas.
• The committee shall also oversee the implementation of the directions and ensure a clean and healthy environment in Vellore district.
• The committee shall submit a report to the Supreme Court every six months.
• The State Pollution Control Board and the Central Pollution Control Board shall monitor the functioning of the CETPs and IETPs and ensure that they meet the prescribed standards.
• The State Pollution Control Board and the Central Pollution Control Board shall take strict action against the tanneries that are not complying with the environmental regulations.
• The tanneries are directed to achieve Zero Liquid Discharge (ZLD) within a period of one year.
• The State Government is directed to implement a comprehensive scheme for the reversal of ecology in the Vellore district.

Conclusion

The Supreme Court’s judgment in the Vellore tannery pollution case is a landmark decision that underscores the importance of environmental protection and accountability. The Court has made it clear that industries cannot escape their responsibility for environmental damage by merely paying compensation for a specific period. The liability of polluters continues until the damage is reversed, and the government also has a significant role to play in preventing and controlling pollution. This judgment serves as a reminder that environmental protection is not just a matter of legal compliance but a fundamental duty towards future generations.