Carbon Credits as Property in India: Legal Status, Ownership, and Enforcement under Emerging Climate Regulation
Author(s): Dr. Swarup Mukherjee
Publication #: 2512007
Date of Publication: 11.12.2025
Country: India
Pages: 1-16
Published In: Volume 11 Issue 6 December-2025
DOI: https://doi.org/10.62970/IJIRCT.v11.i6.2512007
Abstract
The legal characterization of carbon credits has become central to India’s transition from fragmented voluntary markets to a unified, government-regulated carbon trading system under the Energy Conservation (Amendment) Act, 2022 and the Carbon Credit Trading Scheme (CCTS), 2023. Although carbon credits originate as regulatory constructs, they increasingly function as commercially valuable intangible assets capable of ownership, transfer, securitization, and enforcement. This paper provides a comprehensive analysis of the property status of carbon credits in India, examining statutory frameworks, taxation treatment, judicial reasoning, and the evolving role of securities and contract law. It further explores competing ownership claims arising in compliance markets, voluntary markets, and nature-based solutions, including the rights of local communities under the Forest Rights Act. The study evaluates transferability, insolvency treatment, securitization potential, and dispute-resolution mechanisms while highlighting constitutional constraints under Articles 14, 19(1)(g), and 300A on governmental control over carbon markets. By comparing India’s emerging regime with international models such as the EU ETS, California’s cap-and-trade system, Australia’s ACCU framework, and China’s ETS, the paper identifies critical policy gaps and proposes reforms for a transparent, constitutionally compliant, and globally interoperable carbon market. The analysis concludes that recognizing carbon credits as intangible movable property—subject to legitimate regulatory oversight—is essential for ensuring legal certainty, market stability, and investor confidence in India’s rapidly evolving climate governance landscape.
Keywords: : Carbon credits, Property rights, Intangible movable property, Carbon Credit Trading Scheme (CCTS), Energy Conservation Act, 2022, Regulatory property, Carbon markets, Ownership of carbon credits, Climate governance, Market-based mechanisms, Emissions trading, MRV (Monitoring, Reporting, Verification), Community carbon rights, Constitutional law (Articles 14, 19, 300A), Securitization, Environmental law, Green finance, International carbon markets, Article 6 of the Paris Agreement.
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