In exercise of the powers conferred by sections 6 and 25 of the Environment (Protection) Act, 1906 (29 of 1986), the Central Government made Environment (Protection) Rules- 1986. These Rules are made by the Central Government for working and conduct of business under the Environment (Protection) Act, 1986.
The Environment (Protection) Rules, 1986 (EPR) states that the central government can prohibit or restrict the location of industries and carrying on certain operations or processes on the basis of considerations like the biological diversity of an area, maximum allowable limits of concentration of pollutants for an area, environmentally compatible land use, and proximity to protected areas.
A recent amendment to the Environment (Protection) Rules-1986, requires all firms that operate under the EPA to conduct environmental audits. Beginning with the period April 1992- March 1993, any firm that discharges effluents or emissions must submit to the relevant state pollution control board a report that details (1) consumption of water and other raw materials, (2) air and water pollution, (3) quantities (by category) of solid and hazardous wastes generated, (4) waste disposal practices, and (5) investments in environmental protection and pollution control.