Protesters also ransacked the Collector's office, with black smoke engulfing the area, as demonstrators burnt tyres.
The region has been seeing a few dissents by local people and others against the Sterlite Copper plant here and its proposed development.
Police said almost 5000 protesters gathered near a local church and insisted on taking out a rally to the district collectorate after they were denied permission to march to the copper smelter plant.
Since the protesters were prevented from marching towards the plant, they were seen pelting stones and toppling police vehicles.
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Several shops in Tuticorin, besides Srivaikundam and Oddapidaram remained shut in support of the protest, police said. They even torched few vehicles, as a result of which, police had to resort to tear-gas shelling and lathi charge.
Police said section 144 of CrPc has been summoned in and around the Sterlite unit to give security according to the requests of the Madras High Court. The protestors included activists and villagers from Kumarattiyapuram village who have been opposing the plant for over two decades as the water in the area has been contaminated due to the plant's operations.
The latest protest turned violent as a crowd waving black flags stormed the district government headquarters and an apartment block for Vedanta employees, a company official said, declining to be named for fear of being targeted. "It's a total failure of police intelligence", Stalin said.
Actor Kamal Haasan's Makkal Needhi Maiam condemned the police action of opening fire on the protestors.
The Tamil Nadu government also issued a statement in which stated that Sterlite plant was functioning in the state for over 20 years and in 2013 the then Chief Minister J Jayalalithaa had ordered the closure of factory after people complained of irritation in their eyes after emissions from the project. Paliniswami also announced that a government job will be given to one member of the family of each victim who lost their lives in Tuesday's violence.
The company says that it has received necessary regulatory clearances from the government for the expansion of the copper plant.
The protests have been going on in the city for the past three months, but intensified in the last couple of days, following reports that the company owning the copper smelting plant was seeking renewal of its licence for another 25 years.