Sugar industries are among the others the backbone to economic development of the country. It contributes to food security, employment generation, revenue collection and energy security in the form of electricity production using its by-product bagasse. Indeed sugar industries plays vital role in economic development but it also adversely affect the environment simultaneously. The main source of air pollution from sugar industry is the bagasse fired boiler. The potential pollutants are sulfur dioxide, nitrogen oxide and carbon monoxide. The rapid increase in sugar production along with high rate of urbanization and subsequent increase in population has led to unprotected increase in the environmental degradation of the resources. The damage to both aquatic and terrestrial ecosystems caused by huge quantity of waste released in the form of effluent produces is certainly alarming. The drinking water from streams or rivers and using it for agricultural and domestic purposes has undergo serious health hazards on account of the sugar mill effluents, being discharged into the environment. Proper way of operation and imposing laws and regulations and maintaining those strictly can reduce pollution level. The polluter pays principle is globally recognized principle for the determination of compensation or penalty and attributing legal responsibility upon the pollutants. It is a matter of discussion and research as how sugar industries are causing environmental pollution and what are the measures taken by the government to curb such environmental threat. The National Green Tribunal (NGT or Tribunal) was established on three core principles i.e. sustainable development, precautionary measures and polluter pays principle. The decisions of National Green Tribunal are backed with polluter pays principle to deliberate on all the issues concerning environmental violations and determination of compensation. In this an effort has been made to check the accountability and effectiveness of the National Green Tribunal in its role as an environmental protector. In this study, a comparative analysis of various judicial decisions of honorable Supreme Court and National Green Tribunal evoking polluter pays principle with special reference to sugar industries in India has been done. This study relies on certain factors for the estimation and calculations of compensation. The results shows that the National Green Tribunal is not working according to the motive on which it has been established. Further it has been observed from the various cases that National Green Tribunal has many times uses only “guess works” in the determination of the compensations. The research work will help in the identification of the relevant cases related with polluter pays principle and its implementations in sugar industry.