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Land Acquisition: Public realm, private gain

One of the most politically contentious issues in recent times has been the government’s right to acquire land for ‘public purpose’.  Increasingly, farmers are refusing to part with their land without adequate compensation, the most recent example being the agitation in Uttar Pradesh over the acquisition of land for the Yamuna Express Highway.

Presently, land acquisition in India is governed by the Land Acquisition Act, an archaic law passed more than a century ago in 1894.  According to the Act, the government has the right to acquire private land without the consent of the land owners if the land is acquired for a “public purpose” project (such as development of towns and village sites, building of schools, hospitals and housing and state run corporations).  The land owners get only the current price value of the land as compensation.  The key provision that has triggered most of the discontent is the one that allows the government to acquire land for private companies if it is for a “public purpose” project.  This has led to conflict over issues of compensation, rehabilitation of displaced people and the type of land that is being acquired.

The UPA government introduced the Land Acquisition (Amendment) Bill in conjunction with the Rehabilitation and Resettlement Bill on December 6, 2007 in the Lok Sabha and referred them to the Standing Committee on Rural Development for scrutiny.  The Committee submitted its report on October 21, 2008 but the Bills lapsed at the end of the 14th Lok Sabha.  The government is planning to introduce revised versions of the Bills.  The following paragraphs discuss the lapsed Bills to give some idea of the government’s perspective on the issue while analysing the lacunae in the Bills.

The Land Acquisition (Amendment) Bill, 2007 redefined “public purpose” to allow land acquisition only for defence purposes, infrastructure projects, or any project useful to the general public where 70% of the land had already been purchased from willing sellers through the free market.  It prohibited land acquisition for companies unless they had already purchased 70% of the required land.  The Bill also made it mandatory for the government to conduct a social impact assessment if land acquisition resulted in displacement of 400 families in the plains or 200 families in the hills or tribal areas.  The compensation was to be extended to tribals and individuals with tenancy rights under state laws.  The compensation was based on many factors such as market rates, the intended use of the land, and the value of standing crop.  A Land Acquisition Compensation Disputes Settlement Authority was to be established to adjudicate disputes.

The Rehabilitation and Resettlement Bill, 2007 sought to provide for benefits and compensation to people displaced by land acquisition or any other involuntary displacements.  The Bill created project-specific authorities to formulate, implement and monitor the rehabilitation process.  It also outlined minimum benefits for displaced families such as land, house, monetary compensation, skill training and preference for jobs.  A grievance redressal system was also provided for.

Although the Bills were a step in the right direction, many issues still remained unresolved.  Since the Land Acquisition Bill barred the civil courts from entertaining any disputes related to land acquisition, it was unclear whether there was a mechanism by which a person could challenge the qualification of a project as “public purpose”.  Unlike the Special Economic Zone Act, 2005, the Bill did not specify the type of land that could be acquired (such as waste and barren lands).  The Bill made special provision for land taken in the case of ‘urgency’.  However, it did not define the term urgency, which could lead to confusion and misuse of the term.

The biggest loop-hole in the Rehabilitation and Resettlement Bill was the use of non-binding language.  Take for example Clause 25, which stated that “The Government may, by notification, declare any area…as a resettlement area.” Furthermore, Clause 36(1) stated that land for land “shall be allotted…if Government land is available.”  The government could effectively get away with not providing many of the benefits listed in the Bill.  Also, most of the safeguards and benefits were limited to families affected by large-scale displacements (400 or more families in the plains and 200 or more families in the hills and tribal areas).  The benefits for affected families in case of smaller scale displacements were not clearly spelt out.  Lastly, the Bill stated that compensation to displaced families should be borne by the requiring body (body which needs the land for its projects).  Who would bear the expenditure of rehabilitation in case of natural disasters remained ambiguous.

If India is to attain economic prosperity, the government needs to strike a balance between the need for development and protecting the rights of people whose land is being acquired.

Kaushiki Sanyal

The article was published in Sahara Time (Issue dated September 4, 2010, page 36)

  1. Col S Chand
    October 3rd, 2010 at 12:25 | #1

    Sir, Main issues: What is current cost of the said land and definition of Public purpose are rightly stated as main issues. But no one wants to tackle these. Herewith a comprehensive view:
    Amending the existing Act of 1894 binds us to a format that limits our ideas. Think anew. Remember the basic fact that land is required for infrastructure development and NOT for agriculture. The Haryana Model touted by some only pays on the basis of agricultural production and is faulty. Market Price has to be for intended use & is the crucial issue. Consider the following:-
    • The word compensation must go; one is NOT being compensated for a loss. Compensation amounts to discretionary “bakshish”. Not real cost.
    • Land can be acquired /purchased for any purpose by paying the true market value.
    • Presently the Country is openly cheated as States get only 30% of entitled stamp duty on sale of land as it is undervalued by 70% in the sale deeds which is paid in black (cash)! Face this one fact and you will largely eliminate corruption, black money transactions & the country’s problems due to dishonest politicians, babus & judges. Circle rates MUST include this ‘black’ factor and inflation and revised six monthly as value of land is dynamic.
    • Local authority can take 10 % of land as “mujrai”, only once, free of cost as is done during consolidation proceedings of Revenue land to cater for internal roads, basic/primary schools, PS, POs and exchanges.
    • All subsidized allotments of land must go. Even schools, colleges and hospitals are fully commercial set-ups making huge profits from cheap land ‘acquired’ at the cost of the farmer.

    POINTS FOR PROPOSED LAND PURCHASE/LEASE ACT 2010
    The New LAND PURCHASE/LEASE ACT must state:
    I. The purposes for which land can be purchased by any Govt. authority. Suggest the following:
    • Defense.
    • Power.
    • Nuclear establishments.
    • Industrial Areas.
    • Dams.
    • Irrigation facilities.
    • Highways.
    • Railways.
    • Space research & Establishments.
    • Any other purpose of National importance only as specified in the Act or Rules and notified in the Gazette after approval by the Lok Sabha and ascertaining the view of the affected people.
    II. The purchase to be approved by the specified authority according to the delegated financial powers (to be stated in the Act) only after the complete plan for the project is prepared ensuring optimum use of land and so certified by a group of experts in the field/project for which land is to be purchased. The plan must include the details of the land including Khasra Nos and Revenue Maps (Aks Sijhra) duly certified by the local revenue officials. Fertile, irrigated land or orchards, plantations and land yielding two crops are NOT to be included in the project unless absolutely necessary. Detailed reasons for inclusion of such land to be given. However, projects may include 30% land for future expansion.
    III. Intention to purchase the land must be notified in the print media, including vernacular, with full details, as well as to the owners of the property, as recorded in the Revenue records, through registered post at the time of approval of the project.
    IV. The notification (at III above) must state the rate at which land will be purchased being the current market price (Circle Rate) plus 10 % p.a. as inflation factor for 60 years (being the expected life span). (To be increased along with increase in hike of dearness allowance to Govt. servants.)
    V. Circle Rates to be calculated on the basis of latest auction rates of land or through private deals plus 70% as the cash (black) factor, whichever is greater. Circle Rates to be revised every six months as on 1st Jan and 1st Jul. Circle rates to be published every six months and objections if any invited within 30 days.
    VI. Owners to file objections within 30 days of publication/issue of notice stating the objection to the price and location of the project and giving their offer/objection with detailed reasoning.
    VII. Owners offer to be negotiated by a team of experts; negotiation proceedings to be video-taped, and finalized within 15 days.
    VIII. Purchase/transfer deed executed within next 30 days, land demarcated, possession taken and payment made to the owner and the acquisition/transfer promulgated through the print media.
    IX. Project to be completed within the period specified in the project report (not more than five years).
    X. Owner to have option to buy back the land at the prevailing market rate if project not started in the specified period.
    XI. Government will NOT purchase land/property whatsoever for any private entity or developer for any project other than those mentioned in I above.
    XII. The concerned authority may also take on lease any land or structure for a period not exceeding 5 years at a time at rates to be decided by the local authority on the basis of the cost of similar land/structure. The rent should give 12 % net return to the owner estimated on the certified details to be provided by the owner of the property and duly verified by local/Revenue authority.

    Points for Rules
    “Government Land Pool”
    It is recommended that a register of all Govt. owned properties be maintained at each District HQ. Such land/properties be called “Government Land Pool” that may be further divided into Defense Land Pool, Central Land Pool, State Land Pool etc for proper management and accounting, and notified in the Gazette immediately. No Govt. should have any power to sell, dispose of or transfer any land/property from “Government Land Pool” to a private party. (Similar to non-transfer of Wakf Properties as notified in the Central/State Wakf Acts).
    For any project the use of land in the Govt. Land Pool (GLP) should be considered first; the project report must include a certificate that availability/use of GLP has been considered. This is to facilitate ascertaining the actual requirement of land for the intended project. All effort should be made to exchange such land with affected owners plus a cash settlement on the basis of 25 % value of the land intended to be taken over in exchange for the land from “Government Land Pool” to have a consolidated area for the project.
    No Govt. department or ministry should be allowed to use any such land for commercial purposes. Surplus land, i.e. acquired over and above the actual requirement must be surrendered back to the original owners within 5 years.
    To decongest the metros and growing cities/towns all Government offices should be located on the outer periphery of the city/town but well connected by transport. These should be multi storied with adequate parking for the next 10 years perspective.
    There should be minimum discretionary power to administrative authorities in purchase, exchange or transfer of land. All deals must be transparent and progress reported in the media on day to day basis.
    Note : Language of the Act and Rules should be simple. Kindly remember that we may be dealing with poor tribals & villagers many of whom are illiterate.

  2. Subhendu Panda
    November 23rd, 2010 at 17:01 | #2

    Excellent writeup,just would like to add one more point
    LAND ACQUIRED BY GOVERNMENT BUT NOT PUT TO ANY USE SHALL BE RETURNED TO THE ORIGINAL OWNERS.

  3. Devraj Nagar
    November 27th, 2010 at 10:01 | #3

    Nice piece of work by Col Chand but nothing has been catered for those people who have lost their land earlier. For example, if you see the “south Extn ” area of south Delhi, the cost of land there has been very high but you will surprise to note that this land was acquired at 10-20 paisa per sq fit and it was not very long ago. So the change in land acquisition must not only save future victims but also the past victims. Also see the condition of original native of those villages of Delhi, NOIDA and all other cities where land of the villagers has been acquired. They are living in a pitiable condition with no means of livelihood and even dwelling for the very next generation. People say they had eaten away and wasted the money they got in compensation but I want to open their eyes to the fact that got a very meagre amount for their hundreds of years of source of livelihood and would have continued to earn a respectful livelihood even for the future. It was the Government who snatched away their land and gave that land to others who had their property at their native place and hence prospering and riping the fruit of escalation of property prices in such prime areas. Let the land (even if occupied by other migrants) be returned to the original owners with the rent being paid by these migrants to the original owners. It is often asked as to why did the original owners not applied mind to better make use of the money they got, I want to ask, why don’t the bigger companies apply their mind to complete their project in whatever land they get through mutual selling/buying process and why do they want more and more land to complete their projects.
    If you go to any builders project and even if you see their advertisements, you will find that they shamelessly advertise that their project has only 10-15% of covered area and 85-90% is open. Is it not ridiculous to take the scarce land at a meagre amount and put it to illicit use. If it to be kept open then why don’t you return it to farmers for cultivation purpose. Every farmer also want to cultivate more and more land but why doesn’t the government acquire the land of such builders and give it to the farmers.

    So, I request all right thinking persons to prevent the government from snatching to land from real owners and give it to manipulators and unscrupulous elements to give maximum benefit to the corrupt political leaders and higher Officers.

    Rest in next.

  4. Devraj Nagar
    December 4th, 2010 at 00:49 | #4

    dear sir,
    Nothing is moving in the direction of welfare of public in general and farmers in particular. The way the land is being snatched away from farmers only reminds one of the centuries back feudal practices. It is more dis heartening to see that this is done in UP by and under the ageis of the C M who claims to be a Dalit and has enthroned only on this single agenda of uplifting the poor. There is no poor more than the farmers but she has started acting in favour of the rich and business houses. She also shamelessly blames the center for the present land acquisition bill. Agreed, the center id to be blamed but is the center acquiring the land in in UP and giving to the builders and industrialists when they can buy it directly from the farmers at the market rates. It seems something like when there is a provision of death sentence in Cr PC should the judge award death sentence to everyone. It is earnest request that all right and logically thinking people of India come together to the aid of farmers and exert pressure on all the governments to not only amend the law logically but also refrain from any land acquisition till such time.

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