LexDELHI POLLUTION CONTROL COMMITTEE versus LODHI PROPERTY CO. LTD. ETC.
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[2025] 8 S.C.R. 362 : 2025 INSC 923 Delhi Pollution Control Committee v. Lodhi Property Co. Ltd. Etc. (Civil Appeal No(s). 757-760 of 2013) 04 August 2025 [Pamidighantam Sri Narasimha and Manoj Misra, JJ.] Issue for Consideration Whether the regulatory boards can, in exercise of powers u/s.33A of the Water Act and s.31A of the Air Act, impose and collect as restitutionary and compensatory damages fixed sums of monies or require furnishing bank guarantees as an ex-ante measure towards potential environmental damage. Headnotes† Water (Prevention and Control of Pollution) Act, 1974 – s.33A – Air (Prevention and Control of Pollution) Act, 1981 – s.31A – The Division Bench of the High Court held that DPCC (regulatory body/Board) is not empowered to levy compensatory damages in exercise of powers u/s.33A of the Water (Prevention and Control of Pollution) Act, 1974 and s.31A of the Air (Prevention and Control of Pollution) Act, 1981 on the ground that such an action amounts to imposition of penalty provided for in Chapters VII and VI of the respective Acts, and as such, procedure contemplated thereunder will be the only method for imposing and collecting compensatory damage – Correctness: Held: 1. Having considered the principles that governing environmental laws and on interpretation of ss.33A and 31A of the Water and Air Acts, this Court is of the opinion that the Division Bench of the High Court was not correct in restrictively reading powers of the Boards – The environmental regulators, the Pollution Control Boards exercising powers under the Water and Air Acts, can impose and collect restitutionary or compensatory damages in the form of fixed sum of monies or require furnishing of bank guarantees as an ex-ante measure to prevent potential environmental damage – These powers are incidental and ancillary to the empowerment u/ss.33A and 31A of the Water and Air Acts – The powers must be exercised as per procedure laid down by [2025] 8 S.C.R. 363 Delhi Pollution Control Committee v. Lodhi Property Co. Ltd. Etc. subordinate legislation incorporating necessary principles of natural justice, transparency and certainty. [Paras 2, 28] 2. The Board’s powers u/s.33A of the Water Act and s.31A of the Air Act have to be read in light of the legal position on the application of Polluter Pays principle as formulated and explained – This means that State Board cannot impose environmental damages in case of every contravention or offence under the Water Act and Air Act – It is only when the State Board has made a determination that some form of environmental damage or harm has been caused by the erring entity, or the same is so imminent, that the State Board must initiate action u/s.33A of the Water Act and s.31A of the Air Act. [Para 30] Water (Prevention and Control of Pollution) Act, 1974 – s.33A – Air (Prevention and Control of Pollution) Act, 1981 – s.31A – Board’s responsibility to choose appropriate course of action: Held: Given their broad statutory mandate and the significant duty towards public health and environmental protection the Boards must have the power and distinction to decide the appropriate action against a polluting entity – It is essential that the Boards function effectively and efficiently by adopting such measures as is necessary in a given situation – The Boards can decide whether a polluting entity needs to be punished by imposition of penalty or if the situation demands immediate restoration of the environmental damage by the polluter or both. [Para 32] Water (Prevention and Control of Pollution) Act, 1974 – Air (Prevention and Control of Pollution) Act, 1981 – 2024 amendments – Decriminalisation and Adjudicatory Officer: Held: There is no conflict between the powers of the State Boards to direct payment of environmental damages u/ss.33A and 31A of the Water and Air Acts and the powers of the Adjudicating Officer to impose penalties under Chapter VII of the Water Act and Chapter VI of the Air Act – The decriminalization of offences under these Chapters has not removed the punitive nature of actions that can be taken under them – There remains a clear distinction between the nature of directions that the State Boards can issue u/ss.33A and 31A of the Water and Air Acts for payment of environmental damage and the determination by Adjudicating Officers – The former is compensatory in nature and will be resorted to when remedial measures are being
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