Tata Motors Requests Compensation from West Bengal under Indemnity Clause

The counsel for Tata Motors, Samaraditya Pal told the HC of Calcutta that the state of West Bengal had entered a compensation and indemnity clause with them due to which the industrial development corporation of West Bengal or the lessor had to compensate Tata Motors or the lessee.

During his case, Pal said he was making a clear distinction between the Government and the State. Pal said that the state of West Bengal had entered valid agreements with the company and were therefore honour bound to them, whilst arguing regarding the petition filed by Tata Motors, challenging the 2011 Singur Act’s constitutional validity.

According to him, the clause of indemnity will makes it compulsory for the lessor to compensate Tata or the lessee, if the latter in not able to open their small car facility in West Bengal at Singur. This clause covers relocation loss, overall loss by the company and capital expenditure.

Pal added that the lessor agrees for indemnifying the lessee according to losses incurred, referring to the signed agreement between the State and Tata Motors. He also argued that the site was first attacked with the help of a PIL filed in March 2007. Meanwhile, the state continued to defend their acquisition of the land.

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