Gujarat High Court Slams ArcelorMittal’s “Peanuts” Compensation in Forest Clearance Delay
Court says steel giant must pay more or surrender land
10-year delay in compliance draws judicial ire
By Our Legal Correspondent
New Delhi: March 07, 2026:
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The Gujarat High Court has pulled up ArcelorMittal Nippon Steel India (formerly Essar Steel) for failing to comply with forest clearance conditions imposed in 2013. Despite holding land for over a decade without fulfilling mandatory requirements, the company offered ₹3 crore as compensation, which the Court dismissed as inadequate. The ruling highlights judicial concern over corporate accountability in environmental compliance.
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Case Background
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- Forest Clearance (2013): The Centre granted in-principle clearance for land use, subject to conditions.
- Delay: ArcelorMittal failed to meet these conditions for more than 10 years.
- Compensation Offer: The company proposed ₹3 crore to the State as settlement.
- Court’s Response: The Bench of Chief Justice Sunita Agarwal and Justice Vaibhavi D. Nanavati termed the offer “peanuts” and demanded higher compensation.
High Court’s Observations
- Accountability: Corporates cannot hold land indefinitely without fulfilling clearance conditions.
- Compensation: ₹3 crore was inadequate given the scale of delay and environmental impact.
- Options for Company: Either pay substantially higher compensation or return the land.
- Public Interest: The Court emphasized that environmental compliance is not optional.
Broader Implications
- Corporate Responsibility: Reinforces that companies must honour environmental clearance conditions.
- Judicial Oversight: Shows courts’ willingness to intervene in cases of prolonged non-compliance.
- Environmental Protection: Ensures that delays in compliance do not go unchecked.
- Government Accountability: The Gujarat government has also admitted illegal encroachment by ArcelorMittal at Hazira, intensifying scrutiny.
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Why This Matters
- For Industry: Sets a precedent that token compensation will not suffice in environmental cases.
- For Environment: Protects forests and natural resources from corporate neglect.
- For Citizens: Demonstrates judicial commitment to safeguarding public interest against powerful corporations.
Conclusion
The Gujarat High Court’s ruling against ArcelorMittal is a landmark in environmental law enforcement, signalling that delays in forest clearance compliance will attract strict judicial scrutiny. By rejecting the ₹3 crore offer, the Court has reinforced the principle that environmental accountability cannot be compromised for corporate convenience.
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