The Supreme Court set aside an order by the National Green Tribunal (NGT) that imposed a penalty of ₹25 crores on Benzo Chem Industrial Private Limited for alleged environmental damages, basing the penalty on the company’s revenue. The bench, comprising Justices BR Gavai and KV Viswanathan, found this approach flawed and contrary to established legal principles.
The Court highlighted that the NGT’s reasoning—deriving the company’s revenue range from the public domain (₹100-500 crores) to calculate the penalty—was arbitrary and legally untenable. It flagged three key issues: the vast difference in the revenue range; the lack of precise revenue data; and the irrelevance of revenue to environmental penalties. Additionally, the penalty was imposed without notice to the company, violating principles of natural justice.
The bench remarked, “The generation of revenue has no nexus with the quantum of penalty for environmental damages. The methodology adopted by the NGT is unknown to principles of law.” With concern, the Court observed that this was the third instance that day where NGT orders were found lacking in adherence to due process.
Moreover, on factual grounds, the Court determined that no violations were attributable to the appellant. Senior Advocate A.N.S. Nadkarni represented the company, while Advocate Feroze Ahmad appeared for other respondents, and Advocate Mukesh Verma represented the Maharashtra Pollution Control Board.
Case Details:
Title: Benzo Chem Industrial Private Limited v. Arvind Manohar Mahajan & Ors.
Order Outcome: NGT’s penalty order quashed for lack of legal and procedural basis.
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