The government of Bengal has been ordered to pay Tata Motors a substantial amount of Rs 765.78 crore, along with 11% interest dating back to September 2016, for the closure of its Nano factory in Singur. This ruling was issued by a unanimous decision from a three-member Arbitral Tribunal, the company said on Monday.
Tata Motors is entitled to recover this sum from the West Bengal Industrial Development Corporation (WBIDC). Additionally, Tata Motors is awarded Rs 1 crore to cover the costs of the legal proceedings. Tata Motors had to abandon its plans for the Nano factory in Bengal in 2008 and relocate it to Gujarat due to ongoing protests led by Mamata Banerjee and her Trinamool Congress, who were in the opposition at the time. After assuming power, the Trinamool government offered alternative land to Tata Motors for the factory, but the company declined and requested a compensation of Rs 154 crore, which it had paid to the Left Front government for the land.
In 2016, the Supreme Court declared the Left Front government’s land acquisition in Singur as “grossly perverse and illegal” due to non-compliance with the Land Acquisition Act. Tata Motors argued that the government couldn’t change its stance in the midst of a legal dispute merely because a different political party had come into power. The court indicated that a change could be justified if there was evidence of illegal acquisition, prompting Tata Motors to initiate arbitration based on its lease agreement with the state government, which included a dispute-resolution mechanism. The Left Front had acquired agricultural land in Singur for the Nano factory, presenting the Nano project as a catalyst for industrialization and economic rejuvenation in the state.
