The Supreme Court on Monday, October 5, directed that no coercive action be taken against Tata Chemicals over alleged environmental damage to a marine sanctuary in Gujarat. According to reports from CNBC TV18, the order came on the company's challenge to a Gujarat High Court ruling that held it liable for damaging the Gulf of Kutch Marine Sanctuary. The Supreme Court's intervention provides temporary relief to the chemical company while it continues legal proceedings, offering crucial protection against immediate punitive steps by state authorities. As per The Hindu BusinessLine, the Supreme Court has restrained the Government of Gujarat and others from taking any coercive action against the company in the ongoing land-rights case, with the court also issuing a notice to the state government seeking its response.
On May 25, the Gujarat High Court had dismissed a petition filed by Tata Chemicals in 2006 against a District Collector's order. As reported by CNBC TV18, the company had sought recognition of its pre-existing right to discharge industrial wastewater through the intertidal zone near its Mithapur plant in Devbhumi Dwarka district, across an area of about 200 hectares. However, the High Court rejected the company's claim over legacy open wastewater channels established before 1987, describing the company as an encroacher on government land within the sanctuary. The prior Gujarat High Court order had directed the state pollution control board to engage experts to assess environmental damage and hold the company liable for ecological restoration. The dispute pertains to Writ Petition No. 26530, filed by the company before the Gujarat High Court, concerning its pre-existing rights over land at Mithapur, Gujarat, on which legacy open wastewater channels ran into the sea.
According to CNBC TV18, the court directed the Gujarat Pollution Control Board (GPCB) to appoint experts to assess the damage and determine remediation measures and compensation payable. The assessment was expected within three months. At the time of the order, Tata Chemicals said it was examining the order and would evaluate its next steps, noting that the financial implications could not yet be quantified and would depend on the GPCB's assessment. The company stated that current operations were unaffected, as the legacy channels are no longer in use and have been replaced by a closed deep-sea discharge pipeline that complies with all regulatory requirements. However, the company reported a consolidated net loss of ₹2,132 crore in Q4 FY26, a steep widening from a net loss of ₹74 crore in Q4 FY25, highlighting broader operational challenges.
As reported by The Hindu BusinessLine, shares of Tata Chemicals are trading near flat on Tuesday after touching an intraday high of ₹624.75, aided by the Supreme Court order that emerged last trading session. The stock was at ₹617.20 at 15.05, down a marginal 0.03% from its previous close of ₹617.40, having opened higher at ₹620. Total traded value stood at ₹37.41 crore on a volume of 6.04 lakh shares, with the stock part of the Nifty Smallcap 100 index. According to CNBC TV18, shares of Tata Chemicals were trading 2.16% higher at ₹620.90 on the NSE on October 5. However, the stock has declined about 18% so far this year and more than 33% over the last 12 months. The market reaction reflects investor concerns about the ongoing legal proceedings and potential financial implications of the environmental damage claims, with the stock remaining under significant pressure on a longer horizon.
