Corporate Evasion and the Limits of Liability in India’s Eco-Sensitive Zones

Authored by: Khushi Jain, 2nd Year (BA LLB Hons.), Dr. Ram Manohar Lohiya National Law University, Lucknow 

Introduction

In 2024, the Uttarakhand government cleared a 138‑room luxury resort situated 900 metres from Rajaji Tiger Reserve. Six months later elephant corridor blockage was documented. The right to life and personal liberty under Article 21 is of a wide amplitude and not confined to mere animal existence but includes the right to live with dignity. It also has the right to a healthy environment an important attribute. The principle was reasserted in MC Mehta v. Union of India.

It thus puts an obligation on businesses to ensure that their actions do not harm public health or degrade the environment by laying down ‘Precautionary principle’ and ‘Polluter Pays principle’. A citizen cannot carry on business activity, if it is health hazards to society or the public. The Supreme Court has paid significant recognition to maintain a balance between environmental interests and the fundamental rights to carry on any occupations is to be maintained.

In recent years, India’s protected ecological landscapes face a new form of threat, not from illegal logging or poaching, but from legally sanctioned corporate activity at their peripheries. Whether it is luxury tourism projects near Kerala’s Silent Valley or real estate ventures skirting the Bannerghatta National Park, a pattern has emerged. Projects which operate outside the borderlines of officially declared Eco-Sensitive Zones (“ESZs”), continue to operate free from stringent environmental liability laws that protect nearby protected areas from ecological damage.

This blog analyses India's ESZ legal framework together with corporate liability boundaries and extracts lessons from international environmental accountability frameworks to develop a effective environmental accountability system.

Contours of Protection

ESZs were conceptualized as buffer areas around national parks and wildlife sanctuaries to minimize the adverse impact of human activity on fragile ecosystems as also highlighted in the Convention on Biological Diversity. Their concept was conceived during the XXI meeting of the Indian Board for Wildlife.

The basis for their notification lies in Section 3 of the Environment (Protection) Act, 1986, which allows the central government to restrict certain activities in specified areas to protect the environment. The Ministry of Environment, Forest and Climate Change (MoEFCC) issued guidelines in 2011 to streamline the declaration and regulation of ESZs. Furthermore, the duty on the part of the State under Article 48 A and Article 51 A of the Constitution of India has been emphasized as constitutional commitments to ensure protection of natural world and compassion for living creatures.

The commercial use of natural resources is regulated in ESZ. It is only permitted if it does not affect the habitats and animals.  policies will need to accept the imperative of strictly protecting ecologically fragile habitat and regulating use elsewhere. Within these zones, certain activities such as large-scale construction, mining and the use of hazardous substances are either prohibited or require stringent environmental clearances.

Outside the Lines

The concept of a buffer becomes legally irrelevant once a corporation situates its operations just outside the notified boundary. The demarcation process itself has been criticized for being inconsistent, politically influenced and lacking in scientific rigour.

The formalistic approach to zoning gives rise to a dangerous legal fiction that environmental harm recognizes administrative boundaries. In reality, ecosystems are interconnected and dynamic. Pollution of air, water or soil can spread across borders, wildlife corridors can be disrupted by noise or traffic from nearby facilities and microclimatic conditions can be altered by construction even outside notified zones. Yet, corporations whose activities lie beyond the mapped ESZ limits are rarely held accountable under Indian environmental law, unless there is specific evidence of violation under broader statutes like the Environment (Protection) Act or the Water and Air Acts.

Such a loophole is often intentionally exploited. Industries, particularly those involved in mining, cement, energy, and tourism, strategically establish their projects just outside ESZ limits to reduce scrutiny, avoid environmental clearances and maintain legal insulation.

For instance, cement plants being set up 1.2 km from Tadoba–Andhari Tiger Reserve increased night light and traffic, disrupting tiger corridors but escaped ESZ rules.

The Jurisprudence Gap

The jurisprudential framework on ESZs primarily emerged from the Supreme Court’s monitoring of forest and wildlife matters in the T.N. Godavarman Thirumulpadcase series. It was in these proceedings that the Court endorsed the concept of ESZs as protective buffers around sanctuaries and national parks.

A watershed moment came in June 2022, when the Supreme Court in In Re: T.N. Godavarman (ESZ Directions) mandated a minimum 1-kilometre ESZ around all protected areas. The rationale was to ensure uniformity and provide a baseline of protection across ecologically critical areas. However, this order triggered significant resistance from the States, with concerns raised about its impact on local livelihoods and development. Within a few months, the Court partially modified its order, allowing States to propose narrower ESZs based on site-specific needs.

What remains missing is a substantive examination of whether the current legal model of fixed-boundary ESZs itself is sufficient to protect fragile ecosystems. The courts have not yet addressed whether corporate activities that occur just outside the ESZ, but which have measurable ecological impacts on the protected area, can be subjected to legal scrutiny or liability. Nor have they developed doctrines to account for cumulative, landscape-level environmental harm that transcends administrative borders. In Goa Foundation v. MoEF&CC , mining leases two kilometres from Mollem National Park were upheld because they were beyond the ESZ.

This gap is critical because it creates a situation where corporations can evade liability simply by locating their operations a few meters outside an ESZ even if their activities disrupt wildlife corridors, alter local hydrology, or contribute to pollution in adjacent protected areas. The judiciary’s reluctance to engage with this spatial loophole reflects a jurisprudential gap between ecological reality and legal reasoning.

To bridge this, the judiciary must adopt a more principled and ecosystem-based approach. Without addressing this gap, the promise of Article 21 remains incomplete.

Cross-Jurisdictional Analysis

A cross-jurisdictional analysis is essential in understanding corporate liability within ESZs because environmental challenges are rarely limited to national boundaries and legal systems worldwide offer varied. Such comparative insight highlights legal innovations and underscores the normative shift from zone-based protection to consequence-based accountability.

United States

NEPA requires Environmental Impact Assessments are required for any agency actions undertaken by federal agencies or with federal permissions with significant environmental impact, regardless of zoning boundaries. This consequence-oriented model creates oversight for activity outside of formal conservation boundaries.

European Union

The Natura 2000 network under the EU's Habitats and Birds Directives represents a more integrated model of ecological protection. It focuses on ecological connectivity, recognizing that species and habitats are often linked through corridors and landscapes that extend beyond designated conservation areas.

Brazil

The Forest Code has strict liability for damage within "permanent preservation areas" like riparian zones, even without formal demarcation. In 2023, Belo Sun Mining was fined USD 9 million for clearing riparian Amazon forest despite no previous zoning.

South Africa

The Constitution explicitly establishes the right to a healthy environment in Section 24, which has been interpreted by courts to include the preservation of ecological integrity. It allows communities to take actions against corporations or the government for environmental degradation or damage, whether in a designated zone or not.

Conclusion and Suggestions

The current Indian corporate liability in ESZ has an alarming disjunction between ecological science and legal design. While ESZs were conceived as dynamic protective buffers, their legal interpretation has become rigid, formalistic and vulnerable to exploitation. 

Following the analysis of enabling frameworks suitable for operationalizing ESPR, there are a few observations. First, India must re-think ESZ boundaries using scientific and ecological understanding rather than arbitrary and distance-based buffers. The current one-size-fits-all approach fails to address ecosystem-specific vulnerabilities such as wildlife corridors, breeding grounds or hydrological dependencies. Instead, the legally articulated boundaries should be flexible based on a more dynamic, data-driven approach based on topography, species distribution and ecological function.

Second, it is imperative that cumulative and transboundary Environmental Impact Assessments (EIAs) for all development projects near protected areas. Existing EIAs often examine projects in isolation, ignoring the broader ecological burden created by multiple, concurrent developments. A cumulative assessment would capture the aggregate and long-term impacts on landscapes and biodiversity, while transboundary EIAs would ensure that activities outside ESZs are not excluded from scrutiny.

Third, India should expand legal liability to include off-site ecological damage, even outside officially demarcated ESZs. Fourth, public participation and citizen-led litigation must be strengthened to democratise environmental governance. Currently, procedural hurdles and limited access to information often sideline local communities who are the first to experience ecological harm.

Fifth, India should begin to incorporate international environmental principles of ‘intergenerational equity’, ‘ecological integrity’, and ‘no net biodiversity loss’ in domestic law. These globally accepted norms would allow Indian courts and regulators to go beyond procedural compliance and prioritise outcomes that truly preserve ecological value.

Therefore, environmental protection should not be limited to lines on a map. It must evolve into a legal framework that reflects the interconnectedness of ecosystems and holds corporate actors accountable wherever harm occurs.