The Supreme Court on Monday upheld an order of the National Green Tribunal which held that a landlord cannot be liable for environmental violations allegedly committed by his tenant’s chemical unit.

A bench of Justices Satish Chandra Sharma and Sanjeev Sachdeva refused to interfere with the Tribunal’s November 14, 2025 order.

The top court was hearing a plea filed by the Gujarat Pollution Control Board (GPCB) challenging an order passed by the National Green Tribunal (NGT), which set aside its order that held a Surat landlord liable for environmental violations allegedly committed by his tenant’s chemical unit.

The NGT had held that owner Jagmohan Lachiram Jalan could not be made to pay interim environmental damage compensation of ₹25 lakh for offences committed by the industrial unit operating on his rented premises.

This case was initiated after a closure direction issued by the GPCB on October 16, 202, against a company involved in dye-intermediate manufacturing operation without fulfilling mandatory consent to establish guidelines.

The inspection team had found that unit’s effluent samples exceeded permissible limits prompting the pollution board to impose penalty of ₹25 lakh.

Jalan had argued that he rented out the premises in 2020 to the director of a private company under an agreement and he had no knowledge that it was an unlicensed unit.

He the filed a police complaint against the tenant and approached the Gujarat High Court which directed the pollution control board to reconsider the representation.

In 2024, the GPCB upheld the penalty.

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