Tata Motors has achieved a major legal victory by securing an arbitral award of INR 766 crore as compensation for their investments in the now-defunct Singur plant, originally designated for Tata Nano car production.
The arbitration arises from a longstanding dispute between Tata Motors Limited (TML) and the West Bengal Industrial Development Corporation Limited (WBIDC). This dispute revolved around TML’s demand for compensation from WBIDC, covering various aspects of capital investments associated with the automobile manufacturing facility in Singur, West Bengal. The arbitration proceedings, pending for an extended period, were recently concluded with a unanimous award issued on October 30, 2023, favoring Tata Motors.
Tata Motors stated, “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 the claimant (TML) is entitled to recover from the respondent (WBIDC) a sum of INR 765.78 crore with interest thereon @ 11% p.a. from September 1, 2016, until actual recovery thereof.”
Additionally, the company indicated, “The Claimant (TML) has also been held to be entitled to recover from the respondent (WBIDC) a sum of INR 1 crore towards the cost of the proceedings.”
As per the award, Tata Motors is eligible to recover a total of INR 765.78 crore, along with an annual interest rate of 11%, beginning from September 1, 2016, until the full recovery from WBIDC.
This development marks a significant milestone for Tata Motors, affirming their successful pursuit of compensation for the capital investments linked to the Singur plant. The award not only validates their claim’s merit but also has substantial financial implications that will bolster the company’s ongoing operations and initiatives.
