Manuscript Number : IJSRSET151155

Environmental audit has been incorporated as one of the business principles in almost all the industries throughout the world. In India, Regulatory authorities have mandated to submit environmental statement in Form V, which the industry is under obligation to comply. With the evolution of concepts like polluters pay, the identification of pollution generated by the industry has become imperative so that action for pollution prevention and reduction is taken at the earliest stage and at the least possible cost to the industry. The companies have introduced the internal environmental audit, however the time has come that external environmental audit be made mandatory like financial audits. This will help the industry as well as stakeholders both. In Indian coal industries, the submission of environmental statement in form V is scrupulously done as mandated by the rules since 1993 itself, the internal environmental audit has been introduced, since the time of disinvestment of 10 % share of Coal India Ltd in 2010, however the same needs to be strengthened and external environmental audit be made mandatory also to showcase the actual works done in the coal industry in respect of pollution control & prevention. It is in the interest of Coal Industry as well as stakeholders both, as more often than not coal industry has been stamped as the most polluted industry, where as the real problems lie somewhere else and it is the vested interest of everybody to put the blame on the coal industry, which does not bother to defend itself. The third party environmental auditing of the coal industry as well as the regions surrounding the coal belt be done to find the real truth of the pollution. This paper highlights the growth of environmental audit in general and in coal industry in particular and analyses the works done for mitigation of pollution in the coal industry and suggests how external environmental audit will help identify the real causes of pollution in the coal belts, most of which have been declared as critically polluted areas.