Kiran Raj

The Supreme Court Division Bench of Justices Surya Kant and Joymalya Bagchi has set aside the Calcutta High Court’s decision directing restoration of 28 bighas of land in Singur to a private manufacturing company, holding that such relief could not flow from the 2016 Kedar Nath Yadav v. State of West Bengal precedent. The Court clarified that its 2016 ruling, which quashed the Tata Nano project acquisition, constituted a targeted remedy for dispossessed cultivators and was not a general entitlement for commercial entities that had accepted the acquisition and compensation for over a decade. Allowing the State of West Bengal’s appeal, the Bench held that the High Court erred in granting restoration to the respondent company, which had acquiesced in the acquisition and raised its claim belatedly.

The dispute originated from the 2006 land acquisition by the State of West Bengal for the Tata Motors “Nano” project in Singur, covering over 1,000 acres. The respondent company had purchased 28 bighas between 2001 and 2002 to establish a ceramic insulator manufacturing unit. Following government approval, it built a full-fledged factory and commenced industrial operations. However, in July 2006, the Land Acquisition Collector issued notifications under Sections 4 and 6 of the Land Acquisition Act, 1894, including the respondent’s land. Despite filing objections under Section 5-A, the respondent’s plea for exclusion was rejected. An award was passed assessing total compensation at ₹14.54 crore, which the company accepted without protest.

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In 2010, Tata Motors withdrew from Singur. Subsequently, in Kedar Nath Yadav v. State of West Bengal (2016), the Supreme Court quashed the entire acquisition, citing procedural violations and ordered restoration of land to original landowners and cultivators. After this decision, the respondent sought restoration of its industrial land, arguing that the judgment’s directions applied to all affected landowners. The Calcutta High Court agreed, holding that no distinction could be made between cultivators and business entities, and directed the District Magistrate to hand over possession of the land and existing structures. The State appealed against this order before the Supreme Court, arguing that the restoration relief was never meant for industrial undertakings that had already accepted compensation.

The Supreme Court observed that the Kedar Nath Yadav judgment was premised on protecting “the weakest sections of society,” namely poor agricultural workers dispossessed of their livelihood. It recorded: “What, however, cannot be lost sight of is the fact that when the brunt of this ‘development’ is borne by the weakest sections of the society, more so, poor agricultural workers who have no means of raising a voice against the action of the mighty State Government... it is the onerous duty of the State Government to ensure that the mandatory procedure... is followed scrupulously.”

The Court stated that this classification “carried decisive legal significance,” as relief grounded in structural incapacity could not be extended to commercial enterprises with financial capacity and institutional sophistication. It further recorded that “Respondent No.1 falls squarely outside the protective framework envisaged... Unlike marginal farmers facing potential destitution... Respondent No.1 operated a 60,000 square feet manufacturing facility employing over 100 workers.”

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The Bench reasoned that orders quashing acquisition proceedings operate either in personam or in rem, and benefits cannot accrue to non-parties unless the entire process is declared void on grounds common to all. Since the respondent had accepted compensation and remained silent for a decade, it could not now claim benefits secured by others. The Court also noted that the relief under public interest litigation was designed for cultivators unable to individually approach courts, not for financially capable entities. Considering the passage of nearly two decades and changes to the land during restoration to farmers, the Court concluded that practical restoration was no longer feasible.

Allowing the appeal, the Supreme Court set aside both the Division Bench and Single Judge orders of the Calcutta High Court. It dismissed the writ petition filed by the respondent company. The Bench directed: “Respondent No.1 is permitted to remove any remaining structures, plant, and machinery from the Subject Land within three months... or request the Appellants to put the same for public auction.” The Court added that “the Land Acquisition Collector shall calculate compensation for structures after deducting salvage value... however, recovery of any excess payment shall not be effected.” It also ordered the State to “resume possession of the Subject Land after fresh demarcation” and to complete the entire process within four months.

Advocates Representing the Parties

For the Petitioners: Mr. Harin P. Raval, Sr. Adv. Mr. Ashok Kumar Panda, Sr. Adv. Mr. Raja Chatterjee, Adv. Mr. Chanchal Kumar Ganguli, AOR
For the Respondents: Mr. Sridhar Potaraju, Sr. Adv. Ms. Tatini Basu, AOR Mr. Sankha Subhra Ray, Adv. Mr. Kumar Shashank, Adv.

Case Title: State of West Bengal & Others v. M/s Santi Ceramics Pvt. Ltd. and Another
Neutral Citation: 2025 INSC 1222
Case Number: Civil Appeal (Arising out of SLP (C) No. 33701/2018)
Bench: Justice Surya Kant and Justice Joymalya Bagchi