Intellectual Property Rights - Law and Practice · Biological Diversity

Finance, Offences, Penalties and Appeals under the Biological Diversity Act

Updated 11 October 2026 · Fact-checked

Under the Biological Diversity Act, 2002, contravening sections 3, 4, 6 or 7 attracts a penalty of ₹1 lakh to ₹50 lakh, set by an adjudicating officer under section 55A. Other contraventions attract fines under section 56. Appeals go to the National Green Tribunal, and funds are supported by State grants.

Understand Finance, Offences, Penalties and Appeals

This topic is the enforcement end of the Act. The earlier parts say who needs approval to access biological resources. This part says what happens if you break the rules, who decides, and where you can challenge the decision.

The main penalty is in section 55. It applies where a person or entity covered by section 3(2) or section 7 contravenes, attempts to contravene or abets the contravention of section 3, 4, 6 or 7. The penalty is not less than ₹1 lakh and may extend to ₹50 lakh. If the damage caused is more than the penalty, the penalty must be commensurate with the damage. If the contravention continues, an additional penalty of up to ₹1 crore may be imposed.

Who fixes it? Under section 55A, the Central Government may appoint an adjudicating officer, not below the rank of Joint Secretary to the Government of India or a Secretary to the State Government. The officer holds an inquiry, can summon witnesses and documents, and cannot impose a penalty without giving the person a hearing.

A separate residual penalty sits in section 56. It covers contravention of any direction or order of the Central Government, State Government, NBA or State Biodiversity Board where no punishment is separately provided. The fine may extend to ₹1 lakh, to ₹2 lakh for a second or subsequent offence, and to a further ₹2 lakh for every day of continuing default.

Companies are covered by section 57. Persons in charge of and responsible for the business, and the company, are deemed guilty. A person escapes liability by proving lack of knowledge or all due diligence. Directors, managers, secretaries or other officers are also liable if the offence was with their consent or connivance or due to their neglect.

For challenges, section 52A lets any person aggrieved by a benefit-sharing determination or order of the NBA or a State Biodiversity Board appeal to the National Green Tribunal (NGT). Section 52 (appeal to the High Court) no longer applies once the NGT Act, 2010 commenced, except for appeals already pending. Under section 53, such determinations and orders are executable as a civil court decree on a certificate. On finance, section 42 lets the State Government, after due appropriation by the State Legislature, pay grants or loans to Local Biodiversity Funds.

Key rules to remember

Penalty under section 55: ₹1,00,000 ≤ penalty ≤ ₹50,00,000; if damage > penalty, penalty = commensurate with damage; Applies to contravention, attempt or abetment of section 3, 4, 6 or 7. Continuing failure: additional penalty up to ₹1 crore.
Adjudicating officer (section 55A): Rank ≥ Joint Secretary (Government of India) or Secretary (State Government); appointed by Central Government; Must hold an inquiry and give an opportunity of being heard before imposing penalty.
Appeal against adjudicating officer's order: Appeal to NGT within 60 days of receiving the copy of the order; Section 55A(3) and (4). NGT may confirm, modify or set aside the order.
Residual fine (section 56): First: up to ₹1 lakh; repeat: up to ₹2 lakh; continuing: further up to ₹2 lakh per day; Only where no punishment is separately provided under the Act.
Offences by companies (section 57): Company + persons in charge and responsible = deemed guilty, unless no knowledge or all due diligence; Directors, managers, secretaries and officers are liable on consent, connivance or neglect. Company includes a firm or association of individuals.
Appeal against NBA/SBB determination or order: Section 52A: appeal to NGT, in accordance with the NGT Act, 2010; Section 52 (High Court, 30 days) does not apply after the NGT Act, 2010 commenced, except for pending appeals.
Execution (section 53): Determination or order, or High Court or NGT order in appeal = deemed decree of civil court on a certificate; Certificate is issued by an officer of the NBA or SBB, or the Registrar of the High Court or NGT.
Local Biodiversity Fund (section 42): State Government grants or loans after due appropriation by State Legislature; Used for the purposes of the Act.

How to solve Finance, Offences, Penalties and Appeals questions

Use this order for any case question on penalties, offences or appeals. Tie each conclusion to the facts.

1Identify the act complained of and the provision breached: section 3, 4, 6 or 7, or only a direction or order.
2Pick the penalty section: section 55 if sections 3, 4, 6 or 7 are breached; section 56 if a direction or order is breached and no other punishment exists.
3State the quantum: ₹1 lakh to ₹50 lakh, commensurate with damage if higher, and up to ₹1 crore additional if continuing.
4Name the decision maker: the adjudicating officer under section 55A, and check that a hearing was given.
5If a company is involved, apply section 57: company, persons in charge, then the due diligence defence and officers' consent, connivance or neglect.
6Give the appeal route: NGT, within 60 days for an adjudicating officer's order, and mention section 52A for NBA or SBB orders.
7Add execution under section 53 or the fund point under section 42 if the facts raise them, then conclude.

Quickest way: Breach, penalty, officer, appeal

When to use it: Use it for short case questions where you must name the penalty and the remedy quickly.

Write the breached section and match it to section 55 or section 56.
Write the amount range in one line.
Write who decides: adjudicating officer after a hearing.
Write the forum: NGT, with 60 days for adjudicating officer orders.
If a company, add one line on section 57 and the due diligence defence.

Common mistakes in Finance, Offences, Penalties and Appeals

Saying appeals lie to the High Court within 30 days.
Section 52 still appears in the Act and states 30 days.
Fix: Remember its proviso: it does not apply after the NGT Act, 2010 commenced. Appeals go to the NGT under section 52A, apart from appeals already pending before the High Court.
Treating section 55 and section 56 as the same.
Both are monetary consequences.
Fix: Section 55 covers breach of sections 3, 4, 6 and 7. Section 56 is residual, for breach of directions or orders with no separate punishment.
Quoting the wrong penalty range.
Mixing the section 55 amounts with section 56 amounts.
Fix: Section 55: ₹1 lakh to ₹50 lakh, additional up to ₹1 crore if continuing. Section 56: up to ₹1 lakh, ₹2 lakh for repeat, ₹2 lakh per day for continuing default.
Saying the penalty is capped at ₹50 lakh in every case.
Students memorise only the range.
Fix: Add that where the damage exceeds the penalty, the penalty must be commensurate with the damage.
Holding every director liable under section 57.
Students overlook the proviso.
Fix: A person in charge is not liable if they prove the contravention was without their knowledge or that they exercised all due diligence.
Ignoring the hearing requirement before penalty.
Focus stays on the amount.
Fix: State that the adjudicating officer cannot impose a penalty without giving the person an opportunity of being heard.

Worked examples

Example 1

Sahyadri Herbals Pvt Ltd, a company incorporated in India but foreign-controlled, so it is an entity covered by section 3(2), obtained a biological resource from a forest area and used it for commercial research without the approval required under section 3. The adjudicating officer, after a hearing, imposed a penalty of ₹20 lakh. The company received the order on 1 March. Advise on the legal position and remedy.

Show the solution

Provision: section 55 applies to a person or entity covered by section 3(2) or section 7 that contravenes section 3. The penalty ranges from ₹1 lakh to ₹50 lakh. Check this precondition first. A company that is not covered by section 3(2) or section 7 is outside section 55. Here the company is foreign-controlled and covered by section 3(2), so section 55 applies.
Analysis: the adjudicating officer under section 55A imposed ₹20 lakh after a hearing. That is within the range and the hearing requirement was met. If the damage had exceeded the penalty, the penalty would have to match the damage.
Remedy: under section 55A(3) the company may appeal to the National Green Tribunal. Under section 55A(4) the appeal must be filed within 60 days from receipt of the copy of the order. Counting 60 days from 1 March gives 30 April.
Conclusion: the penalty is valid on these facts, and the company can appeal to the NGT by 30 April.

Answer: Section 55 applies because the company is covered by section 3(2). The ₹20 lakh penalty is within the ₹1 lakh to ₹50 lakh range and was imposed after a hearing. The company may appeal to the NGT within 60 days of receiving the order, that is by 30 April.

Example 2

A company is penalised under the Act. Its managing director says she is not liable because the company is a separate legal person. The managing director was in charge of the business, but proves the contravention happened without her knowledge and that she exercised all due diligence. Is she liable under section 57?

Show the solution

Provision: section 57(1) deems the company and every person in charge of and responsible for its business to be guilty.
Proviso: such a person is not liable if she proves the contravention was without her knowledge or that she exercised all due diligence to prevent it.
Analysis: her argument that the company is a separate person is not a valid defence. Her actual defence is the proviso, and she has proved both limbs on the facts.
Check section 57(2): she would still be liable only if the contravention occurred with her consent or connivance or is attributable to her neglect. The facts show none.
Conclusion: the company is liable, and the managing director is not.

Answer: The company is liable. The managing director is not liable, because she proved lack of knowledge and due diligence under the proviso to section 57(1), and there is no consent, connivance or neglect under section 57(2).

Exam tips

Write the section number with each rule: 55, 55A, 56, 57, 52A, 53 and 42 are the ones examiners check.
Always say the NGT is the appeal forum, and mention that section 52 does not apply after the NGT Act, 2010 except for pending appeals.
In company cases, structure the answer as provision, facts, conclusion, and bring in the due diligence proviso.
Quote amounts exactly, and add the commensurate-with-damage rule and the continuing contravention penalty.
If asked about finance, link section 42 to State grants or loans to Local Biodiversity Funds after legislative appropriation.

Practice questions from Biological Diversity

Finance, Offences, Penalties and Appeals in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

Finance, Offences, Penalties and Appeals: frequently asked questions

What is the penalty under section 55 of the Biological Diversity Act, 2002?

It is not less than ₹1 lakh and may extend to ₹50 lakh. If the damage exceeds the penalty, the penalty is commensurate with the damage. For a continuing failure, an additional penalty of up to ₹1 crore may be imposed.

Who decides penalties under the Act?

An adjudicating officer appointed by the Central Government under section 55A. The officer must be at least a Joint Secretary to the Government of India or a Secretary to the State Government. A hearing must be given before a penalty is imposed.

Where do you appeal against an order of the NBA or a State Biodiversity Board?

Section 52A allows any aggrieved person to appeal to the National Green Tribunal in accordance with the NGT Act, 2010. The High Court route in section 52 does not apply after the NGT Act commenced, apart from appeals already pending.

What is the time limit to appeal against an adjudicating officer's order?

The appeal to the NGT must be filed within 60 days from the date the aggrieved person receives the copy of the order. The NGT can confirm, modify or set aside the order after hearing the parties.

Are directors personally liable when a company contravenes the Act?

Persons in charge of and responsible for the business are deemed guilty along with the company under section 57. They can avoid liability by proving lack of knowledge or due diligence. Directors and other officers are also liable if the contravention is due to their consent, connivance or neglect.