Madras HC sets aside NGT’s order asking 6 industries in Manali to create corpus fund

The direction was issued by the tribunal without any scientific basis and violated principles of natural justice, the petitioners contended; they also argued that the order was arbitrary

The Madras High Court has set aside an order passed by National Green Tribunal’s Southern Zone Bench in Chennai on July 20, 2023 directing six industries in Manali to create a corpus fund by depositing a minimum of 1% of their annual turnover for restoration of areas affected due to air pollution.

Justices S.S. Sundar and N. Senthilkumar set aside the order while allowing the writ petitions filed by Chennai Petroleum Corporation Limited, Tamil Nadu Petro Products Limited, Manali Petrochemicals Limited, NTPC Tamil Nadu Energy Company Limited, North Chennai Thermal power station and Madras Fertilizers Limited.

Though the NGT had issued a slew of other directions too while disposing of

The judges said the tribunal had also not referred to any statutory provision under which such a direction was permissible.

a suo motu petition taken up by it in 2020 on the basis of a news report, the writ petitioners were willing to comply with all directions but for the one related to creation of corpus fund by depositing a minimum of 1% of their annual turnover.

The petitioners had uniformly contended before the High Court that the direction to create the cor

pus fund was issued by the NGT without any scientific basis and in violation of the principles of natural justice as none of the six industries were given an opportunity to make their submissions on the issue of shouldering a huge liability.

They also argued that the direction to create the corpus fund was arbitrary since it had been passed without taking note of the huge amount of money that they already spend towards achieving zero pollution and other budgetary allocations made for implementation of various programmes aimed at protecting the environment.

Agreeing that the principles of natural justice had been violated by the NGT, the Division Bench said, the tribunal had also not referred to any statutory provision under which such a direction was permissible.

The judges however made it clear that either the tribunal or the law enforcement agencies such as pollution control boards could fix a liability on the writ petitioners for causing environment damages, if it was permissible in law, by initiating appropriate proceedings, following due procedures of law and giving an opportunity of hearing to the petitioners.