The State Of West Bengal vs M/S Santi Ceramics Pvt. Ltd

2025 INSC 1222 REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

Civil Appeal No. __________ / 2025 (Arising out of SLP (C) No(s). 33701/2018)

The State of West Bengal and Others ...Appellants

versus

M/S Santi Ceramics Pvt. Limited and Another …Respondents

JUDGMENT

SURYA KANT, J.

Leave granted.

2. The instant appeal has been preferred by the State of West

Bengal against the judgment dated 11.10.2018 passed by a

Division Bench of the High Court of Calcutta (High Court) in

MAT No. 1260/2017 (Impugned Judgment). By way of the

Impugned Judgment, the High Court has upheld the order of the

learned Single Judge in W.P. No. 29621/2016, directing the State

to restore 28 Bighas of land (Subject Land), including all

structures erected thereon, to M/s Santi Ceramics Private

Limited (Respondent No.1).

3. Signature Not Verified The controversy arises in the aftermath of this Court's judgment Digitally signed by ARJUN BISHT Date: 2025.10.13

in Kedar Nath Yadav v. State of West Bengal1, whereby the 14:07:42 IST Reason:

1 AIR 2016 SC 4156.

Page 1 of 20 land acquisition proceedings for establishing the manufacturing

plant of TATA Motors’ then flagship car “NANO” were quashed. To

explicate, in 2006, pursuant to TATA Motors' decision to

establish this facility in Singur, Hooghly District, West Bengal,

the Appellants had initiated acquisition spanning over 1000

acres (Singur Project). The acquisition encompassed

agricultural lands and lands converted for non-agricultural

purposes. The instant appeal concerns restoration of the Subject

Land, which formed part of the acquisition. The High Court has

accorded restoration in favour of Respondent No.1 on ground of

parity with cultivators to whom such a relief was granted by this

Court in Kedar Nath Yadav (supra).

A. FACTS

4. To appreciate the genesis of the dispute at hand, it is necessary

to examine the factual matrix, which is set out below:

4.1. Respondent No.1 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. Upon application by Respondent No.1, the District Land and 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.

Page 2 of 20 4.2. Following the approval, Respondent No.1 established a manufacturing unit, replete with necessary infrastructure, plant and machinery, and commenced industrial operations. This trajectory of events took a decisive turn on 21.07.2006 when 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.

4.3. In response, Respondent No.1 filed objections under Section 5- A(1) of the 1894 Act on 21.08.2006, 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 on 30.08.2006. Pursuant to the declaration, the LAC passed the award for the Subject Land on 25.09.2006, 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.

4.4. The Singur Project soon evolved into a matter of considerable public interest and legal controversy, 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. Among the various affected parties, one Kedarnath Yadav approached the High Court through a Public Interest Litigation (PIL) in W.P. No. 23836 (W) of 2006, challenging the acquisition proceedings. Several similar writ petitions were filed by other affected parties, which were then

Page 3 of 20 clubbed together and dismissed by a common judgment dated 18.01.2008, rendered by a Division Bench of the High Court. The acquisition was upheld after holding that it was in public interest and for public purpose.

4.5. Subsequently, in 2010, TATA Motors abandoned the Singur Project and withdrew from the site, with the Appellants regaining possession of the acquired land. Parallelly, the dismissal of the petitions by the High Court was assailed before this Court, culminating in the judgment dated 31.08.2016 in Kedar Nath Yadav (supra). While both judges on the Bench delivered separate opinions with divergent reasoning, they concurred on quashing the acquisition proceedings on the following grounds:

i) Violation of Section 5-A procedures as the LAC mechanically

rejected objections without proper consideration and failed

to conduct an effective inquiry;

ii) 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;

iii) Procedural defects in compensation proceedings as awards

were passed without following due process under Section 11

of the 1894 Act; and

Page 4 of 20

iv) 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.

4.6. Consequently, this Court directed restoration of land to the

original landowners/cultivators by the State within a period of

twelve weeks.

4.7. Respondent No.1 till then had no grievance and did not challenge

the acquisition of the Subject Land before any forum. However,

as soon as this Court delivered judgment in Kedar Nath Yadav

(supra), Respondent No.1 also submitted a representation on

28.11.2016, to the Appellants stating that the Subject Land had

not been returned within the prescribed period of twelve weeks

as postulated by this Court 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 No.1.

4.8. Aggrieved, Respondent No.1 filed Writ Petition No. 29621/2016

before the High Court, seeking restoration of possession of the

Subject Land along with all structures and machinery.

Respondent No.1 also claimed monthly compensation of INR

Page 5 of 20 5,00,000 from December, 2016 onwards, alleging pecuniary loss

on account of being deprived of the use of its industrial property.

4.9. The High Court allowed the petition vide judgment dated

24.04.2017 and reasoned that:

i) This Court's direction in Kedar Nath Yadav (supra) applied

to all landowners without distinction between ‘cultivators’

and ‘business entities’, and Respondent No.1 could not be

excluded merely for being a corporate house; and

ii) The intact structures should be returned with the Subject

Land as ‘land’ under the 1894 Act included attached

structures.

4.10.The High Court accordingly directed the District Magistrate,

Hooghly to deliver possession within six weeks while declining

the prayer seeking compensation for delay.

4.11.The appeal against the afore-cited decision was dismissed by the

Division Bench 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

Page 6 of 20 cultivation purposes, with no separate class created while

granting restoration.

4.12.Being aggrieved, the Appellants have preferred the instant

appeal. It may be noted that this Court, vide order dated

04.02.2019, granted an interim stay on the operation of the

Impugned Judgment, which continues to operate till date.

B. CONTENTIONS ON BEHALF OF APPELLANTS

5. Mr. Harin P Rawal and Mr. Ashok Kumar Panda, Learned Senior

Counsel appearing for the Appellants, strenuously argued that

the High Court committed a grave error in extending restoration

to Respondent No.1. It was contended that this Court's decision

in Kedar Nath Yadav (supra) was designed with specific

protective intent for vulnerable agricultural communities who

lacked resources to challenge governmental action. Respondent

No.1, operating as an industrial manufacturing concern with

substantial assets, fell entirely outside this protective framework

and could not invoke the same judicial safeguards extended to

disadvantaged segments of the society.

6. It was further highlighted that Respondent No.1 raised no

grievance against the acquisition of Subject Land before or after

the award had been passed by the LAC. Learned Senior Counsel

Page 7 of 20 pointed out that the acquisition attained finality in 2006 and

was first questioned by Respondent No.1 only in 2016, after this

Court's judgment in Kedar Nath Yadav (supra).

7. Our attention was also drawn to Respondent No.1's voluntary

acceptance of INR 14,54,75,744 as compensation without

demur, and it was contended that the same constitutes a clear

acquiescence to the acquisition process. Learned Senior Counsel

submitted that this conduct, combined with the principle of

estoppel, precluded any afterthought claim for restoration of

property for which full consideration had already been received

and retained. It was emphasized that permitting such claims

would open the floodgates for numerous commercial entities

seeking similar relief, thereby transforming a narrowly tailored

remedy into a general relief scheme with catastrophic fiscal

implications for the Appellants.

C. CONTENTIONS ON BEHALF OF RESPONDENT NO.1

8. Per Contra, Mr. Sridhar Potaraju, Learned Senior Counsel

appearing on behalf of Respondent No.1, vehemently opposed the

instant appeal by challenging the Appellants’ interpretation of

Kedar Nath Yadav (supra). He asserted that the judgment

contained no artificial distinction between different categories of

Page 8 of 20 landowners, with the terminology “landowners/cultivators”

encompassing every person whose land was subjected to the

procedurally flawed acquisition. Learned Senior Counsel

emphasized that the original notifications under Section 4 of the

1894 Act addressed all affected persons uniformly as “owners of

land,” offering identical packages without regard to their

agricultural or commercial status.

9. It was further contended that Respondent No.1 was a bona fide

manufacturing enterprise that had proactively filed

comprehensive objections under Section 5-A accompanied by

detailed inventories of assets, which had been summarily

rejected without proper consideration. Drawing reference to the

compensation structure where INR 9,08,00,000 was specifically

allocated for structures, it was argued that this demonstrated

governmental recognition of structural entitlement. Learned

Senior Counsel, thus, urged that the appeal represents an

attempt to deny legitimate dues through selective application of

binding precedent and accordingly, prayed for the dismissal of

the instant appeal.

D. ANALYSIS

10. Having heard learned senior counsel for the parties and after

perusal of the material on record, we are of the considered view

Page 9 of 20 that the short question that falls for our consideration is:

whether this Court's ruling in Kedar Nath Yadav (supra), which

directed restoration of acquired land to original

landowners/cultivators, extends to Respondent No.1 as well?

11. That being said, our determination of this question necessitates

the analysis on following counts:

i) The intended scope and beneficiaries of this Court's decision

in Kedar Nath Yadav (supra) and whether Respondent No.1

also falls within that ambit;

ii) The procedural principles governing the applicability of

judicial orders quashing acquisition proceedings to parties

who did not participate in the original litigation; and

iii) The legal consequences of long delay in questioning the

acquisition and acceptance of compensation without demur.

12. Turning to the first aspect, this Court's judgment in Kedar Nath

Yadav (supra) arose from a contentious acquisition initiative

that sparked widespread resistance and prolonged litigation

challenging the State's exercise of its power. The Court’s ultimate

determination to quash the acquisition and direct restoration

was predicated upon systematic procedural failures under

Page 10 of 20 Section 5-A of the 1894 Act. However, its approach in fashioning

this remedy was informed by considerations that extended

beyond procedural compliance alone.

13. Crucially, 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. In para

63, this Court specifically observed:

63. In this day and age of fast paced development, it is completely understandable for the state government to want to acquire lands to set up industrial units. 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, as is the case in the instant fact situation, it is the onerous duty of the state Government to ensure that the mandatory procedure laid down under the L.A. Act and the Rules framed there under are followed scrupulously otherwise the acquisition proceedings will be rendered void ab initio in law. Compliance with the provisions of the L.A. Act cannot be treated as an empty formality by the State Government, as that would be akin to handing over the eminent domain power of State to the executive, which cannot be permitted in a Page 11 of 20 democratic country which is required to be governed by the rule of law. …….” [Emphasis Supplied]

14. This Court's identification of “poor agricultural workers” as the

“weakest sections of society” established the jurisdictional

boundary of relief. Subsistence farmers dependent entirely on

inherited land face destitution when acquisition bypasses

mandatory safeguards—they possess no alternative livelihood,

lack resources to navigate administrative procedures or afford

prolonged litigation. The remedy provided by this Court

addressed this structural vulnerability.

15. Notably, the aforesaid classification carries decisive legal

significance. By grounding relief in structural incapacity rather

than extending automatic restoration to all affected parties, this

Court 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.

Page 12 of 20

16. Against this backdrop, we have no hesitation in holding that

Respondent No.1 falls squarely outside the protective framework

envisaged by this Court. Unlike marginal farmers facing potential

destitution from loss of their sole livelihood, Respondent No. 1

operated a 60,000 square feet manufacturing facility employing

over 100 workers since 2003, having purchased and converted

agricultural land for commercial purposes.

17. The origin of the litigation further reinforces this distinction, as

the proceedings before the High Court commenced through a PIL

specifically initiated to prevent poor farmers from losing their

fertile agricultural land. The express objective of PIL was to

safeguard cultivators whose livelihoods faced extinction through

large-scale acquisition. Extending such relief to industrial

entities like Respondent No.1 would thus defeat the remedy's

foundational intent.

18. In view of the above analysis, we hold that the reasoning in

Kedar Nath Yadav (supra) does not enure to the benefit of

Respondent No.1. The restoration remedy was conceived for

disadvantaged farming communities, not as general restitution

for all affected parties.

Page 13 of 20

19. Beyond this distinction, we are constrained to add that even the

established procedural principles preclude Respondent No.1’s

claim. 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.2

20. It may be apposite to observe here that the objections under

Section 5-A raise issues personal to each landowner. Upon

rejection of such objections, the aggrieved party must approach

judicial forums to challenge the same and mere filing of

objections does not exhaust remedies available in law. To further

simplify, claimants who do not file objections or pursue judicial

challenge cannot contend that Section 5-A inquiry is vitiated, nor

2 Abhey Ram v. Union of India, (1997) 5 SCC 421, para 9-12.

Page 14 of 20 can they seek quashing of Section 6 declaration on that ground. 3

It is trite law that in the event objections are not pursued

through litigation, the notification becomes conclusive proof of

waiver.

21. Applying these principles, the cause of cultivators and farmers

affected by the Singur Project was espoused before the High

Court, inter-alia, on grounds that it disproportionately affected

vulnerable agricultural communities and fertile land, with

procedural violations including vitiated Section 5-A inquiry and

non-application of mind by authorities. Respondent No.1 filed

objections under Section 5-A on 21.08.2006, which were

rejected. Despite possessing financial resources and institutional

access, it never pursued the appellate remedies available under

the 1894 Act. It accepted the entire compensation amount of

INR 14,54,75,744 without protest and remained passive while

cultivators pursued litigation for years. Having chosen not to

contest the acquisition through available statutory mechanisms,

Respondent No.1 now seeks the same relief that was granted to

disadvantaged communities through PIL—a classic free-rider

problem that judicial remedies cannot encourage.

3 Delhi Administration v. Gurdip Singh Uban, (2000) 7 SCC 296, para 42-47. Page 15 of 20

22. Turning to the third aspect, the acquisition attained finality qua

Respondent No.1 through its own inaction. Respondent No.1

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.4 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 No.1 cannot now seek parity and question

what had been conclusively settled.

23. Insofar as reference to the PIL jurisdiction in Kedar Nath Yadav

(supra) is concerned, we are afraid the same may not be

applicable to the facts of the instant case. We say so because PIL

enables representation of similarly situated vulnerable persons

who lack means to approach courts individually. When

cultivators challenged the Singur acquisition through PIL, all

farmers/cultivators across the acquisition were represented. Having failed to pursue legal remedies when available,

Respondent No.1—a party possessing financial resources and

4 Municipal Corporation of Greater Bombay v. Industrial Development Investment Co. Pvt. Ltd., (1996) 11 SCC 501, para 19.

Page 16 of 20 institutional access to statutory remedies falls outside this

representative framework designed for disadvantaged

communities.

24. 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. Pursuant to the judgment in Kedar Nath Yadav

(supra), extensive survey operations were undertaken to restore

land to cultivators. Learned Senior Counsel for the Appellants

have informed this Court that structures originally on the

Subject Land were modified during these restoration efforts to

enable demarcation and distribution of individual holdings to

farmers. After nearly two decades and such modifications

undertaken to restore land to farmers, the relief cannot be

granted.

25. For the foregoing reasons, we hold that Respondent No.1 cannot

claim the benefit of this Court's directions in Kedar Nath Yadav

(supra). 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 its commercial status, nature of the relief, and the Page 17 of 20 practical impossibility of restoration due to intervening

modifications collectively defeats this claim.

E. CONCLUSION AND DIRECTIONS

26. 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.

27. In view thereof, the instant appeal is allowed and the Impugned

Judgment dated 11.10.2018 passed by the Division Bench as

well as the judgment dated 24.04.2017 of the learned Single

Judge of the High Court are hereby set aside. Consequently, the

Writ Petition filed by Respondent No.1 insofar as it pertained to

challenge to the acquisition of Subject Land is hereby dismissed.

However, considering that Respondent No.1 has claimed to have

had standing structures on the Subject Land at the time of

acquisition, we issue the following directions:

Page 18 of 20

i) Respondent No.1 is permitted 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; or

ii) Alternatively, Respondent No.1 may request the Appellants to put the structures, machinery and other movable and immovable articles belonging to it for public auction. In such event, Respondent No.1 shall be entitled to the auction proceeds after deducting expenses incurred on the auction process. Respondent No.1 shall not then claim any compensation from Appellants.

iii) The LAC shall calculate the compensation for structures after deducting the salvage value of materials removed by Respondent No.1 from the compensation already paid for such structures. However, recovery of any excess payment made to Respondent No.1 shall not be effected by the Appellants.

iv) Since Respondent No.1 was granted possession of the Subject Land pursuant to the Impugned Judgment which has been set aside, the Appellants are directed to carry out fresh demarcation to identify the precise boundaries of the acquired area. Thereafter, the Appellants shall resume possession of the Subject Land, subject to compliance with the other directions.

v) The assessment exercise under clauses (ii), (iii) & (iv) shall be completed within four months from the date of this judgment.

Page 19 of 20 28. Ordered accordingly. Pending applications, if any, also stand

disposed of in the above terms.

………..........................J. (SURYA KANT)

………..........................J. (JOYMALYA BAGCHI) NEW DELHI;

Dated: 13.10.2025

Page 20 of 20