"The government's position is very clear, it doesn't want the plant to run," said Sandeep Nanduri, the top official of the district where the plant is located, after a meeting with senior state government officials.
Other state officials confirmed the government's position.
On Tuesday, police opened fire on protesters demanding that the smelter in the port city of Thoothukudi be shut down. In all, 13 protesters have been killed this week.
Residents and environmental activists say emissions from the plant, India's second biggest, are polluting the air and water, affecting people's health.
Earlier on Thursday, authorities cut the power to the smelter. The pollution control board of Tamil Nadu said the smelter, which was shut pending renewal of its operating license, was found last week to be preparing to resume production without permission.
On Thursday, Vedanta's Indian stock closed down 2 percent.
"The issue of renewal of consent for the year 2018-2023 has been rejected ... due to non-compliance of certain conditions," the Tamil Nadu Pollution Control Board (TNPCB) said in an order dated Wednesday.
It did not elaborate on the conditions the smelter had not met but said it "shall be disconnected with power supply and closed with immediate effect".
The agency told Vedanta it could not resume operations without permission.
The plant has already been shut for more than 50 days and had been ordered to stay closed until at least June 6, pending environmental clearances.