SC upholds NGT order absolving landlord of liability for tenant’s environmental violations

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Supreme Court of India. File | Photo Credit: Shiv Kumar Pushpakar

The Supreme Court on Monday (June 8, 2026) upheld a National Green Tribunal (NGT) ruling holding that the owner of a commercial property in Gujarat could not be saddled with liability for environmental violations committed by a tenant operating from the premises.

A Bench of Justices Satish Chandra Sharma and Sanjeev Sachdeva dismissed an appeal filed by the Gujarat Pollution Control Board (GPCB) against the NGT’s November 2025 order, which had set aside the Board’s decision directing closure of the premises and the levy of environmental damage compensation of ₹25 lakh.

Before the top court, the Board assailed the tribunal’s finding that the property owner bore no responsibility for the environmental damage. It argued that the premises housed an unauthorised dye-manufacturing unit which discharged effluents into a water body in excess of the prescribed limits, and that the owner could not be completely insulated from the consequences of such violations.

Mr. Jalan maintained that he was unaware that the chemical unit operating from the premises had failed to obtain the requisite statutory clearances from the GPCB. He further stated that he had no knowledge of the Board’s October 16, 2021, order imposing interim environmental damage compensation of ₹25 lakh under Section 33A of the Water (Prevention and Control of Pollution) Act, 1974, on Mr. Somani for the violations.

According to Mr. Jalan, he became aware of the action taken by the Board against his tenant only after the electricity supply to the premises was disconnected in March 2022 following Mr. Somani’s failure to deposit the compensation amount. He subsequently lodged an FIR against Mr. Somani and his associates alleging cheating, criminal conspiracy and other offences under the Indian Penal Code, and also submitted a representation to the Board challenging the sealing of his property.

However, the Board rejected his representation on December 6, 2024 a