Tata Motors announced in an exchange filing on Monday that it has won an arbitral award of Rs 766 crore in Singur plant case. The now defunct plant was earmarked for the production of Tata Nano cars.
The company had sought the compensation from West Bengal Development Corporation Limited (WBIDC). Following years long legal battle, a three member Arbitral Tribunal ruled the matter unanimously in favour of the company. The compensation covers various cost of capital investments for the plant.
Along with the compensation, the tribunal has also allowed Tata Motors to recover Rs 1 crore towards cost of proceedings. The company added in the filing, "The claimant has been held to be entitled to recover from the respondent (WBIDC) a sum of Rs 765.78 crore with interest thereon at the rate of11 per cent annually from September 1, 2016 till actual recovery thereof."
In October 2008, Tata Motors had moved its Singur plant from Singur in West Bengal to Sanand in Gujarat. The Left Front government had announced the project in 2006 following which the construction had started in 2007. A land of 1,000 acre was allocated for the project. However, due to fierce protest against land acquisition by the opposition, led by current West Bengal Chief Minister Mamata Banerjee, the company was forced to abandon its plan in the state.
Following the move, the battle over the status of land acquisition for the plant moved to courts. In August 2016, Supreme Court said that the land acquisition for the plant was illegal. As per reports, the lease agreement had a clause which entitled the company of compensation if the land acquisition was deemed illegal.
The latest order by Arbitral board comes as a significant victory for the Tata Group company.