PLI Act explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
After the Jan Vishwas Act, 2023, the end of the PLI Act's penalty chapter has a different shape. Section 16, on offences by companies, is omitted. Section 17 is replaced by a salary-linked penalty on the Head of a Government Department. New section 17A credits penalties to the Environment Relief Fund, and new section 17B makes failure to pay a penalty within ninety days an offence, with provisions on companies and their officers.
This article is current as amended up to the Jan Vishwas (Amendment of Provisions) Act, 2023 (in force for this Act from 1 April 2024). That Act omitted section 16 and replaced section 17 with sections 17, 17A and 17B. Later amendments and notifications should be checked. If you face a recovery or a prosecution for non-payment, our legal dispute resolution team can help.
Section 16 is omitted. Section 17: where a Department of the Central or State Government contravenes the Act, the Head of the Department is liable to a penalty equal to one month of his basic salary, subject to a defence of lack of knowledge or due diligence. Section 17A: penalties under sections 14, 15 and 17 are credited to the Environment Relief Fund. Section 17B: failing to pay a penalty or additional penalty within ninety days is punishable with imprisonment up to three years, or fine up to fifteen lakh rupees, or both, and a company and those in charge can be held guilty.
Section 16: omitted
Section 16 of the earlier text was headed "Offences by companies" and made persons in charge of a company guilty of offences under the Act. It was omitted by the Jan Vishwas Act, 2023. Because sections 14 and 15 are now civil penalties, company and officer liability for an offence now appears only inside section 17B, in respect of failure to pay.
Section 17: penalty for contravention by a Government Department
Section 17(1). "Where contravention of any provision of this Act has been committed by any Department of the Central Government or State Government, the Head of the Department shall be liable to penalty equal to one month of his basic salary."
The proviso: he "shall not be liable for such contravention, if he proves that the contravention was committed without his knowledge or instructions or that he exercised all due diligence to prevent such contravention".
Section 17(2). "Where any contravention under sub-section (1) is attributable to any neglect on the part of, any officer, other than the Head of the Department, he shall be liable to penalty equal to one month of his basic salary." The proviso: he is not liable "if he proves that he exercised all due diligence to avoid such contravention".
Until 31 March 2024 the old section 17 treated the Head of the Department as guilty of an offence. Now the consequence is a penalty measured on salary, imposed through the adjudicating officer process in sections 14 to 15B. The same pattern appears in the Air Act and the EP Act; see sections 37, 38 and 38A of the Air Act.
Section 17A: where the penalty goes
"Where any penalty or additional penalty, as the case may be, is imposed under section 14 or section 15 or section 17, the amount of such penalty shall be credited to the Environmental Relief Fund established under section 7A."
PLI Act penalties go to the Environment Relief Fund under the PLI Act, not to the Environmental Protection Fund under the EP Act. The Fund is explained in sections 7A and 8.
Section 17B: offence for failure to pay a penalty
Section 17B(1). Where any person fails to pay the penalty or additional penalty imposed for (a) contravention or continued contravention under section 14 or 17, as the case may be, or (b) non-compliance of the directions issued under section 15, "within ninety days of such imposition, he shall be liable for imprisonment which may extend to three years or with fine which may extend up to fifteen lakh rupees, or with both".
Section 17B(2). Where an offence under sub-section (1) has been committed by a company, every person who, at the time of the offence, "was directly in charge of, and was responsible to, the company for the conduct of the business of the company", as well as the company, "shall be deemed to be guilty of such offence". The proviso: no such person is liable if he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent it.
Section 17B(3). Despite sub-section (2), where an offence has been committed by a company with the "consent or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or other officer of the company", that person is also deemed guilty.
Explanation. (a) "company" means any body corporate and includes a firm or other association of individuals; (b) "director" includes a director of the company and, in relation to a firm, a partner in the firm.
Section 3 of the Jan Vishwas (Amendment of Provisions) Act, 2023 provides that fines and penalties in the enactments in its Schedule increase by ten per cent of the minimum amount after the expiry of every three years from its commencement. The figures here are as printed.
The provisions at a glance
| Section | Subject | Rule as printed |
|---|---|---|
| 16 | Offences by companies | Omitted |
| 17(1) | Department contravenes the Act | Head of Department: penalty equal to one month of basic salary; defence of no knowledge or instructions, or due diligence |
| 17(2) | Contravention due to an officer's neglect | The officer: one month of basic salary; defence of due diligence |
| 17A | Crediting | Penalties under sections 14, 15 and 17 go to the Environment Relief Fund |
| 17B(1) | Failure to pay within ninety days | Imprisonment up to three years, or fine up to fifteen lakh rupees, or both |
| 17B(2), (3) | Offence by a company | The company, those directly in charge, and those with consent, connivance or neglect, with defences |
The Air Act has a matching offence in section 39D, and the EP Act in sections 15E and 15F.
Practical points
- Pay within ninety days of imposition, or file an appeal and plan the deposit; non-payment is an offence.
- Directors: record what you knew and what you did to prevent the contravention; the provisos turn on knowledge and due diligence.
- Government owners: a Department's contravention puts the Head of the Department on notice for one month's salary, subject to the defence.
- Do not confuse the Funds. PLI Act penalties go to the Environment Relief Fund.
An example
An adjudicating officer imposes a penalty under section 14 on Dhansiri Engineering Limited, which does not pay within ninety days. The company, and the director directly in charge of its business, face proceedings under section 17B(1) and (2). The director defends himself by proving that the offence was committed without his knowledge or that he exercised all due diligence to prevent it.
Need help with a non-payment case?
Non-payment moves a civil penalty into the criminal courts and can reach the people running the company. Our legal dispute resolution team can help you assess the position, the defences in the provisos and the steps before the ninety days run out.
Key takeaways
- Section 16 on offences by companies is omitted.
- The Head of a Government Department is liable to a penalty of one month of basic salary under section 17, with a defence; an officer who is neglectful has similar liability.
- Penalties under sections 14, 15 and 17 are credited to the Environment Relief Fund.
- Failure to pay a penalty within ninety days is punishable with imprisonment up to three years, or fine up to fifteen lakh rupees, or both.
- A company and those directly in charge, or with consent, connivance or neglect, can be held guilty, subject to the printed defences.
Read next
- Sections 14 to 15B: penalties, adjudicating officer and appeal
- Sections 7A and 8: the Environment Relief Fund
- Section 39D of the Air Act: offence for not paying a penalty
- Public liability insurance compliance for industries
Disclaimer: Based on the Environment (Protection) Act, 1986, the Air (Prevention and Control of Pollution) Act, 1981 and the Public Liability Insurance Act, 1991 as amended by the Jan Vishwas (Amendment of Provisions) Act, 2023 (in force for these Acts from 1 April 2024), the Water (Prevention and Control of Pollution) Act, 1974 as amended by its Amendment Act of 2024 (which applies only in the States and Union territories it names and in States that adopt it), and the National Green Tribunal Act, 2010 as amended by the Tribunals Reforms Act, 2021, as consulted on 3 October 2026. Later amendments, rules and notifications should be checked. This article is general information, not legal advice; check the official text before acting.