Absolute liability, polluter pays and the precautionary principle

1. Absolute liability: the environmental angle

The tort side of this topic (Rylands v. Fletcher, its exceptions, the oleum gas judgment and Bhopal) is in the Law of Torts note on strict and absolute liability. For environmental law, the points to carry over are these.

• In M.C. Mehta v. Union of India, 1986 INSC 281, (1987) 1 SCC 395, after oleum gas leaked from Shriram's plant in Delhi, a Constitution Bench held that an enterprise carrying on a hazardous or inherently dangerous activity owes an absolute and non-delegable duty to the community, is liable for all harm the activity causes, and cannot plead any of the Rylands exceptions. The measure of compensation is related to the magnitude and capacity of the enterprise so that it deters.
• The rule does not need an escape or non-natural use of land, so it covers pollution that seeps into soil and water over time, which is the usual environmental harm.
• It was reaffirmed for environmental damage in the Bichhri case (below), where the Court said the rule is “more appropriate” to Indian conditions than Rylands.
• Statute followed: the Public Liability Insurance Act, 1991 imposes no-fault liability to give immediate relief to victims of accidents involving hazardous substances, and section 17(3) of the NGT Act applies the principle of no fault in accident cases before the Tribunal.

2. The polluter pays principle

The principle is that the cost of pollution, including the cost of preventing it and of repairing the damage, should be borne by the person who causes it, not by the public or the victims. It began as an economic principle (OECD, 1972) and became Principle 16 of the Rio Declaration, 1992: national authorities should promote the internalisation of environmental costs, taking into account the approach that the polluter should, in principle, bear the cost of pollution.

The leading Indian case is Indian Council for Enviro-Legal Action v. Union of India, 1996 INSC 237, (1996) 3 SCC 212, decided on 13 February 1996 by Jeevan Reddy and Kirpal JJ. Chemical units at Bichhri in Udaipur district made H-acid for export without consents and dumped thousands of tonnes of toxic iron and gypsum sludge. The poison spread into wells and soil; the village's water became unfit for drinking and its land for cultivation. The Court held:

• the units were absolutely liable under the M.C. Mehta rule;
• under the polluter pays principle the polluter must pay compensation to the victims and, in addition, the cost of restoring the environment, here the cost of removing the sludge and remedying the soil and groundwater; and
• the Central Government could recover that cost from the units under its powers in sections 3 and 5 of the Environment (Protection) Act, 1986.

Later applications:

• Vellore Citizens Welfare Forum v. Union of India, 1996 INSC 952, (1996) 5 SCC 647: polluter pays declared part of the environmental law of the country; an authority to assess compensation for the tannery pollution of the Palar river and fix the amount payable by each polluter.
• M.C. Mehta v. Kamal Nath, 1996 INSC 1482, (1997) 1 SCC 388, and its sequel M.C. Mehta v. Kamal Nath, 2000 INSC 329, (2000) 6 SCC 213: the motel that had diverted the Beas was made to pay the cost of restitution. In 2000 the Court held that in a writ petition it can award damages for restoration of the ecology and compensation to victims, but it cannot impose a fine, which is a penalty requiring trial under a statute.

3. The precautionary principle

Principle 15 of the Rio Declaration: where there are threats of serious or irreversible damage, lack of full scientific certainty shall not be used as a reason for postponing cost-effective measures to prevent environmental degradation. The idea is to act before the harm is proved, because environmental harm is often irreversible and science arrives late.

In Vellore Kuldip Singh J. stated the principle for India in three parts:

• environmental measures by the State and statutory authorities must anticipate, prevent and attack the causes of environmental degradation;
• where there are threats of serious and irreversible damage, lack of scientific certainty should not be used as a reason for postponing measures; and
• the onus of proof is on the actor, the developer or industrialist, to show that his action is environmentally benign.

The Court held that both principles are part of customary international law and, read with Articles 21, 47, 48A and 51A(g) and the 1974, 1981 and 1986 Acts, part of the law of the land.

4. Precaution and the burden of proof

January 2026 asked how the precautionary principle deals with the burden of proof. The answer is in A.P. Pollution Control Board v. Prof. M.V. Nayudu, 1999 INSC 24, (1999) 2 SCC 718, decided on 27 January 1999 by Majmudar and Jagannadha Rao JJ. A company was given permission to set up a hazardous industry within ten kilometres of two reservoirs supplying drinking water to Hyderabad, contrary to a State policy. Jagannadha Rao J. explained:

• The traditional approach assumed that the environment could absorb pollution up to a limit (the “assimilative capacity”), and the person alleging harm had to prove it. The precautionary principle replaces that with a duty of prevention where harm is uncertain.
• The burden of proof shifts to the person who wants to change the status quo: the industry must show that its activity will not harm the environment. This is a “reversal of the burden of proof”, justified because the industry controls the information.
• Scientific uncertainty must be resolved by expert bodies; the Court referred the matter to the National Environmental Appellate Authority and suggested environmental courts with expert members.

The Taj Trapezium case, M.C. Mehta v. Union of India, 1996 INSC 1534, (1997) 2 SCC 353, applied the same reversal: the onus was on the coal-using industries to show that they were not harming the Taj.

5. Problem

A pharmaceutical company wants to set up a bulk-drug unit two kilometres upstream of a reservoir that supplies drinking water to a town. It says its treatment plant meets all standards. Residents object that no study shows what happens if the plant fails. The SPCB grants consent. Advise the residents.

Issue. Whether consent can be granted where the risk to a drinking-water source is uncertain, and on whom the burden lies.

Law. Precautionary principle and reversal of the burden (Vellore, Nayudu I); right to safe drinking water under Article 21 (Nayudu II); section 20 of the NGT Act; appeal against a consent order under section 28 of the Water Act and then to the NGT under section 16 of the NGT Act.

Application. The threat (contamination of a drinking-water reservoir) is serious and may be irreversible. The company's assertion of compliance does not discharge its burden; it must show, with a proper assessment of failure risks, that the unit is benign. The Board's consent without such a study ignores the principle.

Conclusion. The residents should appeal the consent and, before the NGT, seek its suspension until the company proves safety; the Tribunal is bound by section 20 to apply the precautionary principle.

How this is examined

Short notes on these principles appear in almost every paper: polluter pays (February 2025), precautionary principle (June 2025), precaution and burden of proof (January 2026), absolute liability (August 2024). For each, give the meaning, the international source (Rio Principles 15 and 16), the leading Indian case with facts, and the statutory home in section 20 of the NGT Act.