For green reasons, pay Rs 100 cr compensation: SC to Sterlite

The company is accused of polluting environment through its copper smelting plant in Tamil Nadu

The Supreme Court today allowed Sterlite Industries, a subsidiary of the UK-based Vedanta group, to operate their copper smelting plant in Tamil Nadu, subject  to environment restrictions. However, the court  imposed a fine of Rs 100 crore for causing ecological damage to the villages around the plant for a long period  till 2011.
 
The Madras high court had ordered closure of the plant  three years ago, but the Supreme Court had allowed it to function in an interim order a year later. In today’s detailed judgment, the bench headed by Justice A K Patnaik allowed the plant to operate, following the curbs put on it by the central and state pollution control boards.

 
The penalty for polluting the villages was intended to be a deterrent for future violations.  An amount less than that would not be enough deterrent, the judges said. The money will go to the collector of Tuticorin who will use it to restore the ecological balance, especially the water quality of the region.
 

The judges also made it clear that the penalty is not the final figure. If the company causes further damage to the environment,  penalty can be imposed on such future cause of action.  Moreover, those who are affected by the environment damage so far can move civil courts for seeking more compensation.

 
The Supreme Court stated that the high court should not have exercised its power of judicial review in this case as there are several preconditions before using that exceptional jurisdiction.
 
Closure of the plant will affect some 1,300 workers, ancillary industries, income for the port and taxes. Moreover, the industrial unit supplies its products to defence and other vital sectors, the judgment said.

The Supreme Court recalled its earlier environment judgements and stated that judicial review should be exercised only when there patent illegality, irrationality or procedural violations. The violation  should be so obvious and to such a degree that no reasonable person can approve of it. These tests have not been followed by the high court, the Supreme Court stated. The high court should also not have interfered with the decisions of the concerned statutory authorities, the judgment emphasised.

The judgment comes in the wake of an order of the pollution control board to shut down the plant following a gas leak last week. That was not part of the issues dealt with in the present judgment.