Supreme Court: While considering this appeal whereby the State of West Bengal had challenged restoration of 28 Bighas of land in Singur to Santi Ceramics (respondents) pursuant to directions laid down in Kedar Nath Yadav v. State of W.B., (2017) 11 SCC 601, the Division Bench of Surya Kant* and Joymalya Bagchi, JJ., the Court held that the respondent cannot claim the benefit of the Court’s directions in Kedar Nath Yadav (supra). Having accepted monetary settlement without challenge and remaining passive during litigation spanning several years, the respondent cannot now seek benefits from relief secured by others.
The Court stated that permitting industrial entities to claim restoration benefits from litigation they chose not to pursue would establish an undesirable precedent. Such an approach would incentivize strategic inaction, encouraging parties to remain dormant during protracted litigation only to emerge as claimants after favourable outcomes are secured by others. This would undermine both the targeted nature of remedial relief and the fundamental principle that legal benefits flow from active pursuit of remedies, not passive opportunism.
Background:
The respondent purchased the Subject Land in the year 2001- 2002 with the objective of establishing a manufacturing facility for the production of ceramic electrical insulators. The Subject Land at the time was statedly an agricultural land. Land Reforms Officer, Hooghly, granted approval on 09-04-2003 for its conversion to industrial use, thereby enabling the formalization of commercial operations on the premises. Following the approval, the Respondent established a manufacturing unit, replete with necessary infrastructure, plant and machinery and commenced industrial operations.
In 2006, pursuant to TATA Motors’ decision to establish its Tata Nano car manufacturing facility in Singur, Hooghly District, the Appellants had initiated acquisition spanning over 1000 acres (Singur Project). On 21-07-2006 the Land Acquisition Collector, Hooghly (LAC), issued notifications under Section 4 of the Land Acquisition Act, 1894 (1894 Act), initiating acquisition proceedings for the Singur Project. The Respondent filed objections seeking exclusion of its operational manufacturing unit from the acquisition. The objections were rejected by LAC, whereupon the Appellants issued a declaration under Section 6 of the 1894 Act. Pursuant to the declaration, the LAC passed the award for the Subject Land quantifying total compensation at INR 14,54,75,744, comprising INR 5,46,75,744 for land value and INR 9,08,00,000 for structures. The said compensation was duly deposited, and the Appellants thereafter took possession of the acquired land, which was thereupon handed over to TATA Motors.
However, Tata’s Singur project was soon embroiled into controversies generating widespread protests by affected farmers against displacement from their holdings. The acquisition, impacting fertile agricultural land, highlighted the tension between industrial development and farming communities. Eventually, the matter reached before Supreme Court in Kedar Nath Yadav (supra). Subsequently, in 2010, TATA Motors abandoned the Singur Project and withdrew from the site, with the Appellants regaining possession of the acquired land.
Decision and Direction in Kedar Nath Yadav (Supra):
In this case, the Supreme Court quashed the acquisition proceedings on the following grounds:
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Violation of Section 5-A procedures as the LAC mechanically rejected objections without proper consideration and failed to conduct an effective inquiry.
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Non-application of mind by the authorities as both the LAC and State Government failed to objectively consider the objections and recommendations as mandated under the 1894 Act.
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Procedural defects in compensation proceedings as awards were passed without following due process under Section 11 of the 1894 Act
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Disproportionate impact on agricultural communities as the acquisition affected fertile agricultural land and displaced poor agricultural workers who lacked the means to challenge governmental action.
The Court directed restoration of land to the original landowners/cultivators by the State within a period of twelve weeks.
Respondent till then had no grievance and did not challenge the acquisition of the Subject Land before any forum. However, as soon as the judgment in Kedar Nath Yadav (supra), was delivered, the Respondent also submitted a representation in 2016, to the Appellants stating that the Subject Land had not been returned within the prescribed period of twelve weeks as postulated in Kedar Nath Yadav (supra), and sought the handing over of the possession of the land, structures, and plant & machinery. The Appellants, however, did not restore the possession to Respondent.
The Respondent approached the Calcutta High Court seeking restoration of possession along with monthly compensation of INR 5,00,000 from December 2016 onwards, alleging pecuniary loss on account of being deprived of the use of its industrial property. The High Court allowed the petition stating that the Court’s direction in Kedar Nath Yadav (supra) applied to all landowners without distinction between ‘cultivators’ and ‘business entities. The High Court’s Division Bench dismissed appeal by the State vide the Impugned Judgment, holding that the expression “landowners/cultivators” in Kedar Nath Yadav (supra) ought to be construed widely to include all persons whose lands were acquired, whether they used it for industrial or cultivation purposes, with no separate class created while granting restoration.
Court’s Assessment:
The Court had to consider whether the ruling in Kedar Nath Yadav (supra), which directed restoration of acquired land to original landowners/cultivators, extends to Respondent, which is an industry.
To answer the afore-stated issue, the Court had to look into the intended scope and beneficiaries of Kedar Nath Yadav (supra) and whether Respondent fell within that ambit; procedural principles governing the applicability of judicial orders quashing acquisition proceedings to parties who did not participate in the original litigation; and legal consequences of long delay in questioning the acquisition and acceptance of compensation without demur.
The Court noted that the ruling in Kedar Nath Yadav (supra) to quash the acquisition and direct restoration was predicated upon systematic procedural failures under Section 5-A of the 1894 Act; however, the Court’s approach in fashioning this remedy was informed by considerations that extended beyond procedural compliance alone. Identification of “poor agricultural workers” as the “weakest sections of society” established the jurisdictional boundary of relief in Kedar Nath Yadav (supra).
“The remedial framework in Kedar Nath Yadav (supra) was anchored in its recognition that the acquisition disproportionately affected vulnerable communities lacking financial resources and institutional access to challenge governmental action. This determination stemmed from an understanding that certain segments of society remain disadvantaged in asserting their rights against the State”.
The Court further pointed out that by grounding relief in structural incapacity rather than extending automatic restoration to all affected parties, the Court in Kedar Nath Yadav (supra) prevented undermining finality in land acquisition proceedings while ensuring protection for the genuinely defenceless. Extraordinary judicial intervention is warranted when systemic barriers prevent certain classes from accessing ordinary remedies, not when parties possess adequate means to vindicate their rights. Relief conceived to prevent impoverishment among the disadvantaged cannot extend to commercial enterprises with financial capacity and institutional sophistication.
Therefore, the Respondent fell outside the protective framework envisaged by the Court in Kedar Nath Yadav. Unlike marginal farmers facing potential destitution from loss of their sole livelihood, Respondent operated a 60,000 square feet manufacturing facility employing over 100 workers since 2003, having purchased and converted agricultural land for commercial purposes. The reasoning in Kedar Nath Yadav (supra) does not enure to the benefit of Respondent. The restoration remedy was conceived for disadvantaged farming communities, not as general restitution for all affected parties.
The Court further added that orders quashing acquisition proceedings may operate either in personam or in rem. Where the Court quashes acquisition on grounds personal to individual objectors—such as vitiated consideration of their specific objections under Section 5-A—the relief operates in personam and benefits only those parties who contested the matter before judicial forums. On the other hand, where the Court declares the entire process void ab initio on grounds going to the root of acquisition—the relief operates in rem. It is thus clear that the benefits of quashing do not accrue to persons who were not parties unless the Court has struck down the entire acquisition on fundamental grounds applicable to all.
The acquisition attained finality qua Respondent through its own inaction. Respondent remained silent for an entire decade from 2006 to 2016, making no attempt to challenge the acquisition despite the award being passed on 25-09-2006. Once the proceedings conclude in the award and possession is taken without challenge, the Court would not entertain any belated grievance from the interested person. In stark contrast, affected farmers brought their plight before the High Court through PIL in November 2006 itself— challenging procedural violations at the earliest opportunity. Hence, Respondent cannot now seek parity and question what had been conclusively settled.
Additionally, the temporal dimension presents a further bar. Nearly two decades have elapsed since the acquisition. Following Tata Motors’ withdrawal of the project in 2010, the acquired land vested back with the Appellants free from all encumbrances. Having accepted monetary settlement without challenge and remained passive during litigation spanning several years, it cannot now seek benefits from relief secured by others. The confluence of Respondent’s commercial status, nature of the relief, and the practical impossibility of restoration due to intervening modifications collectively defeats this claim.
Therefore, the Court allowed the appeal and permitted Respondent to remove any remaining structures, plant, and machinery from the Subject Land within three months from the date of this judgment, in the presence of officials designated by the District Magistrate, Hooghly.
[State of W.B. v. Santi Ceramics (P) Ltd., 2025 SCC OnLine SC 2220, decided on 13-10-2025]
*Judgment by Justice Surya Kant
Advocates who appeared in this case:
Mr. Ashok Kumar Panda, Sr. Adv., Mr. Raja Chatterjee, Adv., Mr. Chanchal Kumar Ganguli, AOR, For Petitioner(s)
Mr. Sridhar Potaraju, Sr. Adv., Ms. Tatini Basu, AOR, Mr. Sankha Subhra Ray, Adv., Mr. Kumar Shashank, Adv., Ms. Nandini Sen Mukherjee, AOR, For Respondent(s)