Tata Motors to Receive Rs 766 Crore with Interest from Bengal for Singur Nano Factory Closure
The Bengal government has been ordered to pay Tata Motors a whopping amount of Rs 765.78 crore with 11 percent interest from September 2016 for the closure of its Nano factory in Singur, according to a three-member Arbitral Tribunal. The unanimous decision in favor of the company was announced today.
Tata Motors released a statement to the National Stock Exchange stating, “With regard to the automobile manufacturing facility at Singur (West Bengal), this is to inform that the aforesaid pending Arbitral proceedings before a three-member Arbitral Tribunal has now been finally disposed of by a unanimous Award dated October 30, 2023 in favor of TML whereby Tata Motors has been held to be entitled to recover from the respondent (WBIDC) a sum of Rs 765.78 crore with interest thereon @ 11% p.a. from September 1, 2016 till actual recovery thereof.” The statement also mentioned that Tata Motors is entitled to recover an additional sum of Rs 1 crore towards the cost of the proceedings.
The closure of the Nano factory in Bengal in 2008 was a result of continuous protests led by Mamata Banerjee, who was then in the Opposition, and her Trinamool Congress. When the Trinamool government came to power, they offered alternative land to Tata Motors for a factory, but the company declined and requested a compensation of Rs 154 crore, which they had paid to the Left Front government for the land acquisition.
In 2016, the Supreme Court deemed the Left Front government’s decision to acquire land in Singur as “grossly perverse and illegal” due to non-compliance with provisions of the Land Acquisition Act. Tata Motors argued that the government cannot change its stance in the middle of a lawsuit simply because a different political party came into power.
The Left Front had acquired agricultural land in Singur for the Nano factory, signaling a shift in their policy to industrialize the state and revive its struggling economy.
