Step 1: Understanding the principle of strict liability.
The principle of strict liability holds a person or entity responsible for damage caused by its activities, irrespective of intention, negligence, or fault. It is commonly applied in cases involving hazardous or dangerous activities.
Step 2: Application to environmental law.
Under the Environment Protection Act, 1986, industries engaging in activities that cause environmental harm are held strictly liable. The focus is on the harm caused, not on the intention behind the act.
Step 3: Analysis of the facts.
XYZ Ltd. caused pollution in a local river. Even if the company did not intend to cause pollution or exercised care, it remains liable for the environmental damage under the doctrine of strict liability.
Step 4: Examination of options.
(A) Incorrect, as third-party involvement does not absolve strict liability.
(C) Incorrect, because taking precautions does not negate strict liability.
(D) Incorrect, since intention is irrelevant under strict liability.
Step 5: Conclusion.
Since strict liability applies regardless of intent or fault, XYZ Ltd. is liable for the damages caused by its actions. Hence, option (B) is correct.