Corporate Green Policy Responsibility

Corporate Green Policy Responsibility

Intercontinental concern on environment issues and advocacy of ‘sustainable development’ replicate to sustain ecological diversity and natural resources for the future generations has been resolved in Stockholm Declaration which eventually emphasized in Rio De Janeiro Summit under ‘Agenda 21’.  The impact on economy due to depletion of natural resources, diminishing biodiversity, global warming, famine, food security and etc. has long been settled hence, the balancing framework between development and ecology becomes the strategize policy across globe in furtherance of socio-economic development programmes. Increasing dimensions of developmental models have escalated manifold complexities in the legal frameworks to define those and set necessary regulations to uphold the dispensation of justice. The Paris Summit has sent strong message regarding the perceived threat of global warming and climatic changes. Again the progressive move towards the global convergence on Corporate Social Responsibility has implored the active participation of corporate in saving the planet as well. Economic incentives such as tax deduction by way of tariff on carbon emission are being promoted by different governmental and non-governmental organizations for renewable use of natural resources. Tariff on carbon emission are being prompted with stern action to prevent least harm to the Nature.

Gujarat being a first State in India who signed MoU with World Bank in 2007 to reduce carbon emission and in exchange World Bank agreed to give financial incentives which lead to economic boost upto $7.5 millions. Post implementation of Corporate Social Responsibility, in South India, eight villages in Guntur district are bearing the brunt of toxic released from CCL Products (India) Ltd, a coffee exporting company which not only affecting the human beings but property too as also evidenced from budget came out. Under such critical situation, CSR can be beneficial for protection of environment as held in the Krishan Kant Singh v. National Ganga River Basin Authority(2014). The National Green Tribunal has even considered CSR is not only responsibility but even the statutory obligation to ensure restrain pollution. Thus CSR may embody carbon trading as one leading solution.

With this the Income Tax Department has shown enthusiasm in carbon credit in the nature of ‘an entitlement’ received to improve world atmosphere and environment by reducing carbon, heat and gas emissions. Such entitlement are credited as a capital receipt and inept from taxed as a revenue receipt. It is made available assuming character of transferable right or entitlement only due to intercontinental concern & environment. Thus, the entitlement claimed on carbon credits has no element of profit or gain and no tax levied in any way under any head of income. Indeed, the entitlement earned from the tariff on carbon emission is not liable for tax for the assessment year under consideration in terms of Sec. 2(24), 28, 45 and 56 of the Income Tax Act, 1961 and considered as bi-product so it given to assessee as credit under the Kyoto Protocol and because of international understanding.

Considering the scheme ‘cap and trade emission’ for industries introduced by the NITI Aayog in 2017 few critics says that carbon trading may cause profit for polluters or offshore carbon offsets. The unfair allocation of allowances by way of additional permits upon excess of permits provided had infringed the environmental concern and made it tool of profit. Conceptually after looking into ‘cap and trade emission’ scheme and incentive earned in the state of Gujarat is undeniable that carbon trading or carbon credit is misuse in making profit and tampered the environment. On the other hand, the credit on Auto industries is well appreciated as it actually working for environmental policy and can aid the nation to cut the loss of $ 210 billion per year due to vehicular emissions.

The dispersing incentives on use of e-vehicles as announced by Intended Nationally Determined Contributions is an evidence of expansion of carbon trading as per recent budget. Even after having dispute with United State Trade Department, Indian exporters of the carbon received subsidies ranging from 6.07 per cent to 155.03 per cent.Adjacently, the increase in consumption of coal in India is taking plethora system wherein carbon pricing in China in their carbon trade systems.

Per contra, the competition regime has accelerated the competitive ambience amongst the corporate to exploit natural resources to capture maximum market share. Price volatility in the agro-produced-markets due to climatic changes is causing harm to the livelihood of the mass myriad across the globe. The Universal approach of ‘sustainable development’ has been appreciated with the shortcomings of divergent domestic socio-economic and socio-legal contexts due to polarized economic powers across the globe. The Universal approach of ‘sustainable development’ has been appreciated with the shortcomings of divergent domestic socio-economic and socio-legal contexts due to polarized economic powers across the globe. An attempt has been undertaken in the present dispensation to make a comparative analysis of the policy-perspectives and legal frameworks along with the consequential measures of the powerful and booming economies of the developed and developing nations in the globe.