Land acquisition: India

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Acquisition of farm land for industrialisation and urbanisation, state-wise; Graphic courtesy: “The Times of India” ; Sep 7, 2011

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Contents

Land Acquisition Act, 1894

What is the history of the Land Acquisition Act, 1894?

1894 land act gives govt sweeping powers By Anon, The Times of India, 2013/04/22

The earliest law on land acquisition was the Bengal Regulation I of 1824 enacted to promote British commercial interests. This was replaced by Act I of 1850, by which the provision for land acquisition was extended to Calcutta town. By 1857, various laws on land acquisition were consolidated as Act VI and it was made applicable to the whole of British India. All such land acquisition Acts enacted before 1870 had the drawback of protracted arbitration and legal wrangling leading to delays and heavy costs. Finally, the Act of March 1894 replaced all previous laws on land acquisition and was meant to acquire land for public purpose and companies. This Act made the collector’s award of compensation final unless altered by a decree of a civil court in a regular suit.

How does the 1894 Act operate?

The government, at the Centre or state-level, is free to acquire any land provided it is for a “public purpose” such as providing public services, improving transport and communication facilities and so on. The state could even acquire land for a non-state body like a company. The government has to give notice to the land owners and compensate according to the “market value” of the property. The land owners can challenge the acquisition, but the government can overrule the objection on the grounds of “public purpose”. Once that is done, the acquisition itself cannot be questioned. The owners can only challenge the compensation decided by the government. In case of urgency, the Act allows the government to acquire the land without hearing any objections to the acquisition.

What have been the major amendments to the Act over the years?

After notifying the acquisition, the government often took too long to declare the “public purpose” for which it was being acquired. Land owners suffered due to such delays as market value would be decided according to the date on which the government publicized its intention to acquire the land. Hence, through an amendment in 1967, the period for justifying the public purpose was fixed at three years. In 1984, Parliament slashed this to one year. The 1984 amendment also ensured that the rate of interest for delayed payment was increased from 4% to 9% for the first year and 15% for the remaining period. It also stated that if land is acquired under the “urgency” clause, 80% of the probable compensation would have to be paid at the time of taking possession.

What consensus have political parties reached on the new Bill?

It appears that the land acquisition Bill which was introduced in Lok Sabha on September 5, 2011 will probably get passed. Major political parties seem to have reached a consensus on several contentious issues. Firstly, it will become mandatory to get consent from owners of 80% of the land. Also, the compensation will be four times the land’s market value in rural areas and double the value in urban areas.

The act might also include provisions to give 50% compensation to the original sellers if their land is purchased after the introduction of the bill. Apart from this, the government might consider the proposal of leasing the land rather than making it a change of ownership.

Land acquisition laws in the states

The Times of India, Jul 17 2015

In their land, states have own rules

States are devising their own plans for acquiring land for infrastructure and other critical projects as they wait for the logjam over the controversial Land Bill at the Centre to be resolved.While some states have demanded that they be given the freedom to formulate their own land acquisition law, a clutch of states have pressed ahead with their own plans. UP for example has ac quired more than 3,000ha of fertile land for its expressway without a murmur of dissent.At the same time, in West Bengal the land procurement price is five times of the market rate. The land owner also has the right to say no.

“We've a model land policy whereby there's no forcible land acquisition. It includes negotiation over land price, direct purchase of land by investor and rehabilitation of the land loser,“ CM Mamata Banerjee said on Wednesday .

When UP Expressway Industrial Development Authority set out to acquire land for the expressway , the state government decided to avoid the contentious “acquisition“ process almost entirely .“It was decided to purchase land through a mutual agreement. Land owners were offered four times the circle rates in rural areas, and twice the rates in urban parts,“ said Navneet Sehgal, chief executive, UPEIDA.

Maharashtra changed its rules for a substantial hike in the compensation value for land which now attracts compensation ranging from 2.5 to five times its market value. Claiming the most balanced land acquisition policy in the country , Punjab CM Parkash Singh Badal urged the Centre to take a cue. Land is acquired with “consent of owners“ and farmers are paid market price plus displacement allowance in Punjab.Neighbouring Haryana's policy lays down a minimum floor rate. A farmer offering an acre for acquisition gets anything between Rs 12 lakh and Rs 32 lakh, depending on the area.Jharkhand CM Raghubar Das on Wednesday informed the PM that Jharkhand has already framed its regulations.Congress-ruled Assam opposes the central land acquisition bill and plans to draft a separate new land acquisition Bill for the state.

Rajasthan was among the first few states that initiated to frame its own land acquisition Act. It proposed scrapping of some key measures, notably those requiring consent of landowners. Goa has adopted the new land acquisition act.

Maharashtra, 2015

The Times of India, Jun 29 2015

Graphic courtesy: The Times of India, Jun 29 2015

Priyanka Kakodkar

Maha eases farm land rules for industry

As part of its Make in Maharashtra push for business, the state government has further eased the rules for industrial expansion on agricultural land. In addition to hiking building rights on farm land, the government has also dropped the requirement to convert agricultural land to non-agricultural use. Officials say the move will cut the red tape around industrial growth on the outskirts of cities, especially for the small and medium scale sector. “The conversion of land use was a process which would take up to two years,“ points out industries secretary Apurva Chandra.

Since the mid-1990s, com panies have been allowed to set up industrial units on agricultural land after informing the collector. However, since farm land is classified as a no development zone, they were given minimal building rights with FSI of up to 0.2. If industries sought to build more, they needed the permission of the urban development department to convert the land into a non-agricultural zone. “Industries no longer need to approach the state government for a zone change. To avail of the additional space, they just need to pay the premium fee to the collector. This is a major delegation of responsibility from the state to the collectors,“ said urban development secretary Nitin Kareer.

The state government, in a notification earlier this month, had allowed industries nine times the earlier build ing rights on agricultural land. To exploit this additional space, they merely need to pay a fee worth 30% of the land rate to the district collector.

However, critics warn that dropping the zonechange clearance will remove a crucial level of scrutiny and could pave the way for the reckless expansion of industry on farm land. “The zone change requirement was put in place to prevent fertile agricultural land from being diverted. How will the state ensure that industry does not come up on fertile land?“ asks Debi Goenka from the Conservation Action Trust. Housing activist Chandrashekhar Prabhu warned that industries could pay to acquire additional building rights on farm land and then fail to use it. “This could result in speculation.How will the state ensure that the land is actually used to set up industry?“ he asks.

The same benefits also apply to public educational and medical institutes as well as highway amenities coming up on farm land. These were also granted additional building rights on farm land earlier this month. The new rules will apply to areas including the Mumbai metropolitan region, Pune, Nagpur, Sangli, Kolhapur, Nasik, Ahmednagar, Aurangabad, Ratnagiri and Raigad. Also, Jalgaon, Amravati and Chandrapur.


The Andhra model, 2015: Land Pooling

The Times of India, Aug 09 2015

Naidu proves land pooling is better than land acquisition

Andhra Pradesh chief minister Chandrababu Naidu has found a way around the problem to build a new capital city on 34,000 acres of farmland. His strategy has been to make all farmers stakeholders in the new capital, so that they voluntarily “pool“ their land with the city development agency . Once the city is developed in a decade, they will get back almost 30% of their pooled land as ultra-expensive city land. This ena bles them to see the new city as a road to prosperity, not deprivation (as hap pened in Singur or POSCO's mining area in Odisha).

Naidu also offers farmers a monthly payment per acre as high or higher than the going leasing rate for farmland. Farm loans up to Rs 1.5 lakh will be waived. Landless labourers will get a monthly pension of Rs 2,500. Low-cost canteens and skilldevelopment centres have been opened to train farmers in new occupations. The employment guarantee scheme is supposed to provide work every day of the year. All these benefits put together will cost a tiny fraction of the cost of acquisition, so the government also gains hugely .

The new capital is being built in the fertile Krishna-Godavari area where land today costs one to two crore per acre.Naidu has persuaded farmers that, when the city develops, land will be worth Rs 8-9 crore per acre. Prices are far higher in Hyderabad. So, farmers have surrendered their land voluntarily , expecting a windfall when they get back developed land. Till then, they have a reliable cash flow from monthly government payments, plus opportunities for skilling and taking up other work.

This drives home the point that farming is not very attractive. Many farmers want to quit provided they get favourable terms. Pastoral romantics claim that farmers are wedded to agriculture, especially in fertile multi-cropped areas. That romantic view has been punctured spectacularly in the Krishna-Godavari belt, among the most fertile areas in India.

Naidu will give owners of double-cropped land 1,000 sq yards of residential and 200 sq yards of commercial land for every acre of pooled farmland. In addition they will get an annuity (paid in monthly instalments) starting at Rs 30,000 per year and rising by Rs 3,000 annually for 10 years.

Owners of triple-cropped land will get a better deal: 1,000 sq yards of residential land and 450 sq yards of commercial land for every acre pooled. They will also get an annuity starting at Rs 50,000 per year, rising by Rs 5,000 annually for a decade. After 10 years the city will be fully developed, and all farmers will have become city landlords, workers or businessmen. Around 400 farmers with 700 acres of land have opposed pooling and gone to the courts, claiming they will get a better deal under the 2013 acquisition law. Naidu has offered them free choice between pooling and acquisition, confident that most will ultimately prefer pooling. Against all odds, he has converted a problem into a solution.

Pooling can be used wherever land prices shoot up after development. It may not work for railway lines, that don't increase local land values much. But it will work for most other projects. Other states must study Naidu's example, and adapt pooling for their own use. The key to success is that the scheme is voluntary, and makes farmers stakeholders in development.

Administrative charges

2017: Not to exceed 2.5% of total compensation

Dipak Dash, Centre caps administrative charge for land acquisition, December 31, 2017: The Times of India


The Centre has put a cap on payment of administrative charges to states for helping in land acquisition for highway projects at 2.5% of the total compensation amount in its bid to end arbitrary fixing of these charges. The highways ministry has told states that if they don’t accept the capped norm, it will be difficult for highway building agencies to take up projects in their territory.

The administrative charge is over and above the compensation that agencies such as NHAI and the road transport ministry pay to the state governments. At present, 13 states levy administrative charges, which include Bihar, Kerala, Gujarat, Jharkhand, Madhya Pradesh, Maharashtra, West Bengal and Chhattisgarh. Uttarakhand has agreed to levy the charge as capped by the Centre.

“The project executing entities of the ministry have been advised to restrict the payment of administrative charges up to 2.5% of the compensation amount in respect of all ongoing and future NH projects,” highways secretary Y S Malik said.

Court rulings

SC: Can’t quash acquisition if owners delay accepting compensation

AmitAnand Choudhary, February 12, 2018: The Times of India


In a landmark judgment that will aid public authorities in ensuring land acquisition for public purposes is not thwarted by vexatious litigation, the Supreme Court has held that land acquisition by a government agency could not be quashed on account of delay on the part of owners in accepting compensation within five years due to reasons such as lingering court cases.

A bench of Justices Arun Mishra, A K Goel and M M Shantanagoudar said land owners should not be allowed to take the benefit of Section 24 (2) of the Land Acquisition Act to reclaim land on the ground that they were not paid compensation within the stipulated time as payment was delayed because of litigation.

The Section has been contentious as it affected plans of governments to develop public infrastructure as the land could at some stage be returned to the owners under a clause relating to the payment of compensation within five years. With pendency of land cases tending to be long, those challenging the award could get the land back. Now, the court has ruled that if an award is unconditionally tendered, the legal obligation would be seen to have been discharged.

Section 24(2) says that in case of land acquisition proceedings initiated under the Land Acquisition Act, 1894, where an award has been made five years or more prior to the commencement of the 2013 Act but physical possession of the land has not happened or compensation not been paid, the proceedings shall be deemed to have lapsed. The appropriate government, if it so chose, would have to initiate proceedings of such land acquisition afresh.

Explaining the provision, the bench said, “Section 24(2) does not intend to cover the period spent during litigation and when the authorities have been disabled to act under it due to the final or interim order of a court or otherwise, such period has to be excluded from the period of five years as provided in the section.

“Once the amount of compensation has been unconditionally tendered and it is refused, that would amount to payment and the obligation under the Act stands discharged and that amounts to discharge of obligation of payment under section 24(2) of the Act of 2013 also, and it is not open to the person who has refused to accept compensation to urge that since it has not been deposited in court, acquisition has lapsed. Claimants/land owners after refusal cannot take advantage of their own wrong and seek protection under the provisions of Section 24(2).”

The court passed the order on a petition filed by Indore Development Authority (IDA) challenging a high court order which had declared land acquired by it as lapsed after the owners refused to accept compensation within five years. The court accepted the contention of IDA’s counsel Sanjay Kapur who said the authority’s obligation to pay the amount was discharged when it offered money to land owners. The merit in a challenge must stand or fall in court but cannot be a lucrative industry for an unworthy litigant and be a device providing for fruits to the avaricious, the court said.

SC, 2018, asks P&H HC to rethink hiking payment to ₹2cr per acre

Dhananjay Mahapatra, SC: Rethink hiking per acre payoff from ₹12L to ₹2cr, May 25, 2018: The Times of India


At a time when compensation to farmers for land acquisition gets political overtones, the Supreme Court has asked the Punjab and Haryana high court to reconsider its decision to enhance market value of acquired land at Hansi in Hisar district from Rs 12 lakh to Rs 2 crore per acre, an increase of nearly 17 times.

In 2005, the Haryana government notified acquisition of 229 acres of land in Hansi for residential projects and the compensation per acre was fixed at Rs 12 lakh. The Reference Court enhanced it to Rs 48.4 lakh per acre. The state accepted the award but landowners moved the HC for further enhancement. The HC in 2016 enhanced the rate to Rs 2 crore per acre saying the land was situated at prime location and possessed immense potentiality. The Haryana government challenged it in the SC.

Additional advocate general Alok Sangwan argued before a bench of Justices Kurian Joseph and Mohan M Shantanagoudar that the HC erred by classifying the land as commercial when in reality it was agricultural land. He also produced sale deeds pertaining to land situated in the midst of the acquired land, which had fetched between Rs 4 lakh and Rs 8 lakh per acre.

Appearing for land owners, counsel Neeraj Kumar Jain and Manoj Swarup termed the HC order as ‘equitable’ and challenged production of sale deeds by the state government saying these did not reflect the true market value of the land in question. They cited the sale of land by Haryana Urbad Development Authority in favour of government departments at a far higher rate than those depicted in the sale deeds.

Justice Shantanagoudar said: “Having gone through the material on record and after considering the arguments of the advocates, we are of the opinion that the Reference Court, as well as the HC, have not considered the sale deeds produced on behalf of the state for determination of compensation.”

“A chart of the sale deeds on record filed before us by the advocates appearing on behalf of the state reveals prima facie the value of certain land involved in those sale deeds. The site plan of village Hansi depicts such sold patches as being in the middle of the acquired land. The lands in all the sale deeds shown alongside the plan are in close proximity and adjoining to the land acquired under the Section 4 of notification of the present case,” the bench said.

“There is no reason as to why the HC, while coming to its conclusion, has not referred to the sale statistics. If the sale statistics are to be ignored, the HC should have furnished reasons for doing so... In our considered opinion, the method of granting compensation on the basis of cumulative increase as done was not permissible in the facts of the case, in view of the sale deeds produced. The method of working out compensation without considering the evidence on record cannot be said to be justifiable,” the SC said.

Defence personnel, properties of

The Times of India Feb 16 2015


A Subramani

Court orders return of 7.83 acres in Chennai

Govt can't acquire properties of freedom fighters:HC

Ruling that moveable and immoveable properties held by freedom fighters and defence personnel should never be acquired by government for any purpose, the Madras high court has ordered return of 7.83 acres of land, worth several crores now, at Maraimalai Nagar, near chengalpet, to children of a freedom fighter. “Could the selfless sacrifices of such stalwarts as Mahatma Gandhi and others get obliterated overnight by a simple piece of unconsidered land acquisition? Freedom fighters, defence personnel and their family members are shouldering the security of 125 crore-strong population of India. Therefore, their assets -moveable and immoveable properties -should not be disturbed at any cost,“ said Justice C S Karnan in an order.

Freedom fighter Subbiah was among five beneficiaries for whom 50 acres of land was allotted a year after Independence. As his share Subbiah got 7.83 acres by a 1948 order which de-reserved a portion of reserved forests at Kattankulathur near Maraimalai Nagar. Subbiah died in 1973. In 1974, the lands were acquired for the Maraimalai Nagar neighbourhood scheme, which envisaged developing residential plots to house about 1 lakh people.

Fourteen years later, in 1986, a compensation of `2.68 lakh for the acquired land was announced, and deposited in a civil court as the sum could not be apportioned among the four children of Subbiah. Till date the family has not received any compensation, his son S Balasubramaniam said. After many rounds of litigation and contempt proceedings, he filed a petition in the HC saying the acquired land was still under their physical possession and that even 29 years after acquisition the land remained vacant. Lands acquired for residential purposes had been used for industrial and commercial purposes, as is evident from the fact that a car company had been allotted some portions, he said. CMDA counsel, however, claimed that copies of several communications furnished in court were bogus and said the petitioners were trying to mislead the court. He said CMDA was in possession of the land and that vacant lands were meant for public facilities such as parks and power poles.

Rejecting the submissions, Justice Karnan said the order of acquisition could not be sustained because it had come against a 1948 order of allotment. Neighbourhood schemes are not of more paramount importance than freedom fighters, he said, adding that the family of Subbiah was cultivating the land for the last 66 years. “It will be extremely painful to dislodge them at this juncture,“ he said.

The judge also pointed the acquired properties had been utilized for industrial and commercial purposes “which is against the purpose for which the land had been originally acquired.“ He then directed CMDA and other authorities to reconvey the lands to the blood relatives of the freedom fighter within two months.

Expenditure of government on compensation

2012- 2018

Dipak Dash, Govt payout to acquire land for NHs rises 4.5 times in 4 years, December 14, 2018: The Times of India

The sums spent by the government on compensation for land acquired for national highways, 2012- 2018
From: Dipak Dash, Govt payout to acquire land for NHs rises 4.5 times in 4 years, December 14, 2018: The Times of India


UPA-Era Law Pushes Up Average Cost Per Hectare From ₹80L To ₹3.6Cr

Government payout for acquiring a hectare of land for building and expansion of National Highways has increased four-and-a-half times in the past four years and more than half of NHAI’s total expenditure between 2014 and 2018 has been on accounts of procuring land parcels.

The spike in expenses has been due to the implementation of the land acquisition law enacted during UPA-II. NHAI started compliance of the law from January 1, 2015.

“As per the information gathered from NHAI, the average cost of land acquisition was about Rs 80 lakh per hectare before January 1, 2015, which has now gone up to about Rs 3.6 crore per hectare. Out of a total expenditure of Rs 1,52,000 crore during the period of last four years (April 2014 to March 2018), NHAI has spent Rs 81,000 crore on land acquisition as against an expenditure of about Rs 41,000 crore on civil works,” a manual of guidelines for land acquisition prepared by road transport and highways secretary Y S Malik said.

Sources said NHAI has been facing a big challenge as it has the largest share of land procured by government for developmental works. There have been instances of district collectors hiking the circle rate abnormally, which has left the highway authority with no option but pay higher amounts to get land. As per the law, the authority acquiring land has to pay the compensation— either the circle rate or average of sale deeds, whichever is higher.

Since the Centre bears the entire cost of acquiring land, the states are hardly concerned. Rather it suits them as those surrendering their land get handsome compensation. The higher payout has been one of the reasons why people are now more willing to give their land for highway projects.

The ministry has come out with detailed guidelines to streamline the process and address the ambiguities relating to land acquisition and how each stakeholder starting from consultants who prepare detailed project reports to engineers involved in the project can make the process of developing highways effective and less cumbersome.

Housing, Land acquisition for

SC: relief to Noida homebuyers

Some facts; Graphic courtesy: The Times of India

The Times of India May 15 2015

Finally, SC gives relief to Noida homebuyers

In a huge relief to thousands who have booked flats in Greater Noida West (also called Noida Extension) and adjoining Noida, the Supreme Court dismissed petitions by farmers from 65 villages who had challenged the UP government's decision to acquire their land for construction of residential clusters. Homebuyers in the area were staring at uncertainty because of continuing litigation. The Allahabad high court's October 21, 2011 judgment on this issue was chal lenged in the apex court by farmers, and the administrative authorities of Greater Noida and Noida.

A bench of Chief Justice H L Dattu and Justices A K Sikri and Arun Misra dismissed all the appeals, freeing the land acquisition from all litigation. Those who have booked flats in Noida Extension and adjoining Noida will have to shell out more to acquire the property .

Out of the 471 writ petitions, the HC had disposed of 346 with directions for payment of 64.7% additional compensation and ordered that petitioner farmers should be allotted developed plots to the extent of 10% of their acquired land.

This accounted for the major portion of the land under development for residential units. With the Supreme Court upholding the HC order, construction activity in these areas can go ahead unhindered, provided the government pays the enhanced compensation to farmers.

The HC had dismissed 20 writ petitions relating to acquisition of land in villages of Nithari, Sadarpur, Khoda, Sultanpur, Chaura Sadatpur and Alaverdipur in Noida terming them as defective.

In 25 other petitions, the HC had quashed land acquisitions through six notifications issued till 2010 relating to villages Devla, Yusufpur Chaksahberi and Asdullapur in Greater Noida and directed the government to restore the land to villagers, subject to deposit of compensation already received by them.

However, the HC had directed the Greater Noida authorities and real estate developers not to carry on development and not to implement Master Plan 2021 till the observations and directions of National Capital Region Planning Board (NCRPB) were incorporated in Master Plan 2010 to the satisfaction of the board. The HC had also directed the UP chief secretary to appoint officers not below the rank of principal secretary to conduct a thorough inquiry regarding the acts of Greater Noida in implementing Master Plan 2021 without approval of NCRPB, its decision to change the land use, allotments made to builders and indiscriminate proposals for land acquisition.

The HC had directed the state to take appropriate action on the matter based on the inquiry report.

Process cumbersome, breeds corruption

SC: Lengthy land acquisition process breeds corruption

From the archives of The Times of India 2007, 2009

Dhananjay Mahapatra | TNN

New Delhi: The woefully long land acquisition process, often marred by arbitrary exclusion and deletion of areas, breeds touts, middlemen and corruption, the Supreme Court has said and asked the government — “Can a large number of citizens be not spared of this traumatic experience?”

The case in hand was Bangalore Development Authority’s controversial ‘Arkavarthi Town or Layout’ in which a former CM and now a cabinet minister in the UPA was spared the blushes by the division bench of the High Court. The division bench had not only upheld the Layout scheme, but also expunged stinging remarks against the politician by the single-judge bench, which had set aside the land acquisition proceedings.

Though the apex court upheld the scheme after giving it a tweak here and there and providing better compensation, a Bench comprising Chief Justice K G Balakrishnan and Justices R V Raveendran and D K Jain did find evidence that there were degrees of arbitrariness in acquisition. It said the manner in which the village lands were included and then deleted from the notification waxed the view that there was no proper survey or application of mind while formulating the Arkavarthy development scheme.

“If large areas are notified and then large extents are to be deleted, it breeds corruption and nepotism among officials,” said the Bench, adding it also created hostility, mutual distrust and disharmony among the villagers, dividing them on the lines of ‘those who can influence and get their lands deleted’ and ‘those who cannot’. “Touts and middlemen flaunting political connections flourish, extracting money for getting lands deleted from acquisition notification. Why subject a large number of citizens to such traumatic experience? Why not plan properly before embarking upon acquisition process,” asked Justice Raveendran, who authored the judgment for the bench.

Shrine land

Can be acquired for public use

Rajesh Kumar Pandey, Govt can take shrine land for public use: HC, Dec 24, 2016: The Times of India


The Allahabad high court held that the government can acquire land where religious prayers are held and convert it for the “benefit of the public at large“.

However, the court, disposing of a writ petition filed by the Church of North India Trust Association, observed that the demolition of a church on Christmas Eve would be “too harsh“ and stayed its demolition for a month. It directed the NHAI to demolish or shift the church and graveyard after that period.The body had challenged the acquisition of land belonging to the Memorial Church in Shikohabad district.

See also

Consumer protection: India

Homebuyers and the law: India

Housing: India

Insolvency, bankruptcy: India

Land acquisition: India

Real Estate (Regulation & Development) Act (RERA)

Real estate: India

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