2011 (7) TMI 1109 - SC - Indian Laws

Can a party who does not comply with the court order be permitted to retain the benefits of his own wrong of non-compliance? Whether the successful party be not compensated by way of restitution for deprivation of its legitimate dues for more than fourteen years? Whether the court should not remove all incentives for not complying with the judgment of the court?

Summary

Issues Involved:
1. Abuse of judicial process to avoid compliance with a Supreme Court judgment.
2. Environmental pollution caused by chemical industries.
3. Non-compliance with pollution control regulations.
4. Determination of liability and costs for environmental remediation.
5. Finality and sanctity of Supreme Court judgments.
6. Unjust enrichment and restitution.
7. Imposition of compound interest and costs for delayed compliance.

Issue-wise Detailed Analysis:

1. Abuse of Judicial Process to Avoid Compliance with a Supreme Court Judgment:
The litigation, which began with a final judgment on February 13, 1996, has been kept alive for over fifteen years through the filing of multiple interlocutory applications to avoid compliance. The Supreme Court noted this abuse of the judicial process as a serious matter affecting the credibility of the judicial system.

2. Environmental Pollution Caused by Chemical Industries:
The petition highlighted the severe environmental degradation caused by chemical industries in Bichhri village, Rajasthan. The production of chemicals like Oleum and Single Super Phosphate by Hindustan Agro Chemicals Limited and other associated industries led to significant pollution of soil and groundwater, making it unfit for human and animal consumption and agriculture.

3. Non-Compliance with Pollution Control Regulations:
The Rajasthan State Pollution Control Board (RSPCB) reported that the industries operated without necessary clearances and continued to discharge toxic effluents, causing extensive environmental damage. Despite multiple orders from the Supreme Court, the industries failed to take remedial actions to restore the environment.

4. Determination of Liability and Costs for Environmental Remediation:
The Supreme Court applied the "polluter pays" principle, holding the industries liable for the environmental damage. The Ministry of Environment and Forests (MOEF) was directed to determine the cost of remediation, which was later fixed at Rs. 37.385 crores. The industries were ordered to pay this amount along with compound interest for the delay in compliance.

5. Finality and Sanctity of Supreme Court Judgments:
The Supreme Court emphasized the importance of finality in its judgments, noting that reopening concluded cases through repeated applications undermines the judicial system. The court reiterated that its judgments should not be disturbed unless there are compelling and exceptional circumstances, such as judicial bias or gross violation of natural justice.

6. Unjust Enrichment and Restitution:
The court addressed the principle of unjust enrichment, stating that the industries should not benefit from their non-compliance with court orders. The industries were required to pay compound interest on the remediation costs to ensure full restitution for the environmental damage caused.

7. Imposition of Compound Interest and Costs for Delayed Compliance:
The Supreme Court directed the industries to pay compound interest at 12% per annum on the remediation costs from November 4, 1997, until payment. Additionally, the industries were ordered to pay litigation costs of Rs. 10 lakhs for keeping the litigation alive and wasting judicial resources.

Conclusion:
The Supreme Court dismissed the interlocutory applications with costs, directing the industries to pay Rs. 37.385 crores with compound interest and additional litigation costs. The court emphasized the need for finality in its judgments and the importance of ensuring that polluters bear the financial burden of environmental remediation.