Calcutta, March 5: The state government has decided to offer 5 acres in Rishra to the condom factory whose land in Singur it had taken over and handed to Tata Motors.

The peace move, coming after Padmasagar Export Company Private Limited had lost the first round of its court battle against the acquisition, is being seen as a reflection of a nervous government’s eagerness to avoid further lawsuits over Singur land.

The alternative plot, about 25 km from Calcutta, will be the first allotted from the state’s newly prepared land bank, land reforms commissioner P.K. Agarwal said.

Padmasagar had bought the 4-acre plot in Singur’s Singherbheri mouza, about 50 km from Calcutta, obtained no-objection certificates from government departments and begun building the condom factory in 2005.

It had completed four-fifths of the construction when, in September last year, it was asked to pack up to make room for the Tatas. The factory was to begin commercial operations by the end of October.

The company moved Cal- cutta High Court against the government, but Justice J. Biswas dismissed its petition saying the acquisition process was valid. Padmasagar then appealed before the division bench of acting Chief Justice B. Bhattacharya and Justice K.K. Prasada.

Today, when the matter was called for hearing, advocate-general Balai Ray and company counsel Pradosh Mallik told the court that negotiations were on for an out-of-court settlement. With both lawyers praying for time, the court decided to hear the matter again on March 12.

Legal circles aren’t surp- rised at the administration’s placatory gesture towards a company that has lost its case against the government.

“The government is feeling shaky following a series of strictures from the courts on various issues. So, it wants to settle the dispute out of court to avoid further controversy,” advocate Supradip Roy said.

The company lawyer would not comment except for saying, “Negotiations for a settlement are going on.”

Padmasagar had formal- ised a joint venture with a Ma-laysian company in August 2004 and begun construction a year later.