Environment Law Monthly Updates – December 2024

Partner: Rajat Jariwal, Associates: Prerna Singh and Shatakshi Tripathi

December 2024 witnessed several changes to the environmental law landscape. On the judicial front, the Supreme Court continued its strict monitoring of the environmental degradation in the National Capital Territory of Delhi and took preventive measures. It issued orders restricting the felling of 50 or more trees in the region without prior permission of the Central Empowered Committee (CEC).

Significant amendments were also made to the Public Liability Insurance Rules, 1991 and the Environment Relief Fund Scheme, 2008. The amendments aim to streamline the process of compensation claims by victims of industrial accidents and their consequent disbursal.

Lastly, on the regulatory front, the Punjab Pollution Control Board (PPCB) issued a notice clarifying the applicability of prior environment clearance on plywood units. The Central Pollution Control Board (CPCB) also directed Plastic Waste Processors to upload their Goods and Services Tax (GST) e-invoices on the Extended Producer Responsibility (EPR) Portal.

These key developments are discussed in detail below.

1. Judgment

1.1 Supreme Court

a. Supreme Court orders tree census in Delhi and strengthens tree felling regulations

In a significant ruling, the Supreme Court has directed the Tree Authority under the Delhi Preservation of Trees Act, 1994 (Trees Act) to conduct a comprehensive tree census in consultation with the Forest Research Institute.¹ This move aims to enhance tree protection in the city.

The Court has further mandated that the CEC must be consulted by the Tree Authority before allowing the felling of 50 or more trees. The CEC will have the authority to either reject or partially allow applications for such tree felling. Importantly, the Court clarified that no deemed permission for tree felling can be granted if the Tree Officer fails to communicate a decision within 60 days, despite such stipulation being present in the Trees Act.

The Court has emphasised that the Tree Officer must carefully evaluate each application, including conducting on-site inspections, and not merely grant permission based on compensatory afforestation. The order also mandates that the Tree Officer must specifically identify the types of trees to be planted as compensatory measures.

This ruling underscores the Supreme Court’s commitment to environmental protection and aims to ensure that tree felling decisions are made thoughtfully and responsibly, balancing development needs with environmental concerns.

2. Legislative Updates

2.1 Public Liability Insurance framework amended to facilitate environmental damage restoration

The Ministry of Environment, Forest and Climate Change (MoEF&CC) has strengthened the Public Liability Insurance framework through the Public Liability Insurance (Amendment) Rules, 2024. These amendments, notified on 17 December 2024, aim to improve the handling of claims for environmental damage caused by industrial accidents. The key changes brought through these amendments are:

• Expanded claim eligibility: Individuals with a direct and substantial connection to affected public property can now file restoration claims.
• Increased insurance limits: The maximum insurance coverage under Section 4(2A) of the Public Liability Insurance Act, 1991 has been increased to Rs. 250 crore per incident, with a maximum aggregate of Rs. 500 crore for multiple accidents within a policy year.
• Utilisation of Environment Relief Fund: A new Rule 3A outlines the process for allocating funds from the Environmental Relief Fund (ERF) towards environmental damage restoration.
• Public awareness: A new Rule 5A mandates industrial units to publicise the right to claim relief in case of an accident.
• Faster claim resolution: Several new rules have also been inserted to outline the process and timelines for service of notices and orders and the crediting of penalties to the ERF. Notably, the Adjudicating Officer appointed to adjudicate claims is expected to complete inquiries within six months.

These amendments are a proactive step towards strengthening environmental protection. The revised rules ensure better compensation for those affected by industrial accidents, encourage responsible industrial practices, and promote faster claim resolution, among other things.

2.2 The Environment Relief Fund Scheme amended to improve management and increase transparency

The Environment Relief Fund Scheme, 2008, a crucial mechanism for compensating victims of industrial accidents and restoring environmental damage, has been revamped through the Environment Relief Fund (Amendment) Scheme, 2024, notified on 17 December 2024. The amendments introduce several changes to the management and utilisation of the ERF, including specifying the sources of the funds. The ERF is now explicitly vested in the central government, ensuring greater control and accountability. Replacing the United India Insurance Company, the CPCB will manage the ERF for five years starting 1 January 2025. The ERF manager will develop and maintain an online portal for implementing the scheme and disburse funds based on orders issued by the district collector or the central government. Further, the process for using the ERF for environmental restoration has been clearly outlined.

These amendments are a welcome step towards a more effective and transparent ERF. The shift in management to the CPCB, coupled with an online portal, promises improved accountability and efficient fund distribution. Clearer guidelines for utilising the ERF for environmental restoration will further enhance the scheme’s impact. This revamped system is expected to provide faster compensation to victims and ensure timely restoration of environmental damage caused by industrial accidents.

3. Other relevant developments

3.1 Plywood units with in-house glue production now require prior environmental clearance in Punjab

The PPCB has issued a clarification regarding the requirement for environmental clearance for plywood units that manufacture their own glue.²

Plywood units that manufacture their own glue (Phenol Formaldehyde and Melamine Formaldehyde resin chemicals) for internal use must now obtain prior environmental clearance in terms of the Environment Impact Assessment Notification of 2006. This clarification resolves a previous period of uncertainty concerning the need for clearance for such units.

The MoEF&CC has also directed PPCB to conduct site inspections of plywood units to verify their manufacturing activities. Based on these inspections, PPCB will determine whether the unit requires prior environment clearance.

This move is expected to enhance environmental oversight and potentially reduce emissions from these industries.

3.2 Plastic Waste Processors required to upload valid Goods and Services Tax e-invoices on the Extended Producer Responsibility portal

The CPCB has issued instructions requiring Plastic Waste Processors to upload valid GST e-invoices for the sale of their products on the EPR portal for plastic packaging.³ This measure aims to enhance transparency and accountability in plastic waste management. This new requirement will ensure accurate tracking of plastic waste processing and facilitate the generation of EPR certificates.

^[1] Order dated 19.12.2024 in W.P. (C) No. 4677 of 1985 titled M.C. Mehta v Union of India and Ors.

^[2] https://ppcb.punjab.gov.in/sites/default/files/2024-12/Clarification%20formaldehyde%20MoeF%2013.12.2024.pdf

^[3]https://eprplastic.cpcb.gov.in/plastic/downloads/Instruction_Sheet_PWP_Sales.pdf

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