Yogesh Kumar & Pankaj Doval, TNN | Jul 24, 2013
“…If further enhancement is granted, the (Maruti) management may have to take a decision to discontinue the plant at Manesar,” said counsels P S Patwalia and Abhishek Manu Singhvi while appearing for the company before the Supreme Court.
The higher compensation was awarded by the Punjab and Haryana High Court in 2011, and this had been contested by the landowners — who wanted higher award — and Haryana State Industrial and Infrastructure Development Corporation (HSIIDC) in the Supreme Court. While the landowners wanted the enhanced compensation amount — granted by the high court — to be sweetened further, HSIIDC had contested the higher claim.
When contacted, a spokesperson for Maruti Suzuki refused to comment. Attempts to reach top officials of the company, including chief operating officer (administration) S Y Siddiqui, did not yield any result. The 2011 order, based on which HSIIDC raised a Rs 500 crore-plus demand on Maruti, had raised the compensation amount from Rs 28.15 lakh to Rs 37.40 lakh (per acre), leading to the huge recovery notice on the country’s top carmaker.
The apex court has now asked the parties to approach the HC again with their respective pleas while ordering HSIIDC to pay the enhanced compensation to the landowners and/or their legal representatives, along with all statutory benefits, within a period of four months.
Simultaneously, it also said that Maruti is free to take up the matter when it comes up for a fresh hearing at HC. “Maruti shall be free to file an appropriate application before the high court for its impleadment or grant of leave to act as intervenor in the appeals filed by the parties. If such an application is filed, the same shall be decided on its own merits.” What could be troubling for Maruti is the fact that the Supreme Court found “merit” in the landowners’ plea that they should be paid a compensation even higher than the Rs 37.40 lakh awarded by the High Court in 2011.
The counsel for the landowners had said that the High Court judge had committed “serious error” by not considering various facts that could have seen the compensation amount go much higher —even more than double — to the Rs 37.40 lakh amount awarded. “By making deduction of 50% towards development cost and granting annual increase of 12/15% (cumulative), market value of the land will be much higher than Rs 37.40 lakh per acre.”
Manesar is one of the most crucial facilities for Maruti, as well as for the global operations of Japanese parent Suzuki. Against the carmaker’s first factory premises in India which came up at Gurgaon in the early eighties, the Manesar facility is relatively new and adopts modern processes for making cars. Maruti currently churns out 5 lakh cars annually from the Manesar set-up, which is set to eventually rise to 7.5 lakh.