The history of acquiring immovable property goes back to the Bengal Regulation 1 of 1824, which was enacted by the British East India Company. Subsequently, there were multiple enactments by different presidencies which were replaced by the Act of 1870. This Act too was amended in 1894, and existed until “The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013” (also refers as ” The Land Acquisition Act 2013 “) replaced it.
The preamble to the Land Acquisition Act 2013 reads:
…to ensure, in consultation with institutions of local self-government and Gram Sabhas established under the Constitution, a humane, participative, informed and transparent process for land acquisition for industrialisation, development of essential infrastructural facilities and urbanisation with the least disturbance to the owners of the land and other affected families and provide just and fair compensation to the affected families whose land has been acquired or proposed to be acquired or are affected by such acquisition and make adequate provisions for such affected persons for their rehabilitation and resettlement and for ensuring that the cumulative outcome of compulsory acquisition should be that affected persons become partners in development leading to an improvement in their post acquisition social and economic status and for matters connected therewith or incidental thereto.
Subsequent to the Act, Bill No. 20 of 2014 was introduced by the present government in the Lok Sabha. The bill became a subject matter for controversies and agitations, as the amendments proposed in the Bill were termed anti-farmers. The government seems to be softening up while going forward with the amendments.
One needs to go deeper into the provisions of the Act to understand the far-reaching negative implications of the Act on vital developments of the country. The Atomic Energy Act, 1962; The Land Acquisition (Mines) Act, 1885; The Metro Railways (Construction of Works) Act, 1978; The National Highways Act, 1956; The Petroleum and Minerals Pipelines (Acquisition of Right of User in Land) Act, 1962; The Relinquishing and Acquisition of Immovable Property Act, 1952; The Coal Bearing Areas Acquisition and Development Act, 1957; The Electricity Act, 2003; The Railways Act, 1989; among other Acts, were incorporated under the Fourth Schedule of this Act. According to Section 105(1), subject to subsection (3), the provisions of this Act shall not apply to enactments relating to Land Acquisition specified in Schedule 4.
Subsection (3) of The Land Acquisition Act 2013 specifies that:
The Central Government shall, by notification, within one year from the date of commencement of this Act, direct that any of the provisions of this Act relating to the determination of compensation in accordance with the First Schedule and rehabilitation and resettlement specified in the Second and Third Schedule, being beneficial to the affected families, shall apply to the cases of land acquisition under the enactments specified in the Fourth Schedule, or shall apply with such exceptions or modifications that do not reduce the compensation or dilute the provisions of this Act relating to the compensation or rehabilitation, and resettlement as may be specified in the notification, as the case may be (emphasis added).
In short, to establish any atomic energy plant, or to construct a metro railway, or for making a national highway or for laying out a petroleum or gas pipeline, or erecting power transmission lines, the government would be required to pay an award in rural areas of the market value of the land multiplied by the factor specified, plus the value of assets attached to the land and building/s, and a solatium. The final award in urban areas is similarly determined.
Thus, on an approximation, the government should be ready to cough up up to about five times the market value of the land under acquisition for undertaking any project, besides providing for the rehabilitation, resettlement and entitlement for the landowners and families whose lives are wholly dependent on the land acquired, as well as the infrastructure and amenities.
The powers relating to the rehabilitation and resettlement of this Act shall also apply when a private company purchases land equal to or more than such limits in the rural or urban areas, as may be prescribed by the appropriate government, through private negotiation with owners of the land, the cost of which can be quantified into a monetary amount, which the collector shall allow to deposit into the account in complete satisfaction of the obligation.
One can image the scenario in the areas earmarked for laying petro or gas pipelines, or putting up an industrial corridor, or making national highways, if some shrewd players register the land at manifold the current market value. As per the prescribed formula of the Act of 2013, this will escalate the compensation to unacceptable heights.
The government needs to seriously make an endeavour in order to understand how much land it needs to acquire for the aforesaid vital infrastructure, and, in view of non-regulation of speculation activities, what are going to be the implications on all such upcoming projects.
SHRIDEV SHARMA’s note to readers: The above extends from my study of the Act, to better understand its objectives, its implementation and impact on the Real Estate industry, the government and society at large. It is not, and does not attempt to be an analysis. To read the complete text of the Act, and news about related events, please see Related Links.