SC slaps Rs. 100 cr. penalty on Sterlite for pollution

But sets aside 2010 HC order, allows copper plant to continue

April 02, 2013 12:11 pm | Updated November 17, 2021 04:25 am IST - New Delhi

A view of the Sterlite Industries’ plant in Tuticorin, Tamil Nadu.

A view of the Sterlite Industries’ plant in Tuticorin, Tamil Nadu.

The Supreme Court on Tuesday allowed the Sterlite Copper Smelter plant to function in Tuticorin in public interest, but asked the company to pay Rs. 100 crore as compensation for polluting land and water by running it without approval for a considerable period of time.

However, this judgment will not help the company revive operations that were suspended on March 30 by the Tamil Nadu Pollution Control Board following a gas leak.

A Bench comprising Justices A.K. Patnaik and H.L. Gokhale set aside an order of the Madras High Court, which directed closure of the plants in 2010. The order was stayed subsequently and the plant was in operation till its recent closure. The Bench went by a joint report by the Central Pollution Control Board and TNPCB, and noted that it had complied with 29 out of 30 directions given by the TNPCB.

The Bench made it clear that its verdict would not come in the way of the TNPCB issuing directions to Sterlite, including one for closure of the plant, for the protection of the environment in accordance with law.

Writing the judgment, Mr. Justice Patnaik said it was for the authorities functioning under various environmental laws and rules to determine the project’s scope, and the court would not interfere with their decisions so long as the statutory process was followed.

Referring to the contention that the company had obtained stay of the High Court order through misrepresentation, the Bench said: “There is no doubt that there has been misrepresentation and suppression of material facts in the special leave petition, but to decline relief to the appellants in this case would mean closure of the plant.”

The Bench noted that the plant contributed substantially to copper production in India. Copper is used in defence, electricity, automobile, construction and infrastructure. The plant has about 1,300 employees and provides employment to a large number of people through contractors. A number of ancillary industries are also dependent on it. It generates huge revenue to the Central and State Governments in terms of excise, custom duties, income tax and VAT. It also contributes to 10% of the total cargo volume of Tuticorin port. For these considerations of public interest, it did not want to refuse relief to the company.

It fixed the compensation for damage caused to the environment from 1997 to 2012 and for operating the plant without valid renewal for a fairly long period at Rs. 100 crore. It noted that the company’s profit before tax for 2010-11 was Rs. 1,043 crore. Anything less than Rs. 100 crore would not have the desired deterrent effect on the company, the Bench said.

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