Business Standard

Land acquisition given a makeover with case law

The new Act is an effort to address the historical injustice while speeding up procedures

Kumkum Sen 

The Land Acquisition Act, 1894, is a colonial law enacted by the British government which survived and continued post-independence. This Act authorised the government to acquire the land from privately held person for public use, at a reasonable price.

Even after independence, the Indian government continued with the 1894 Act. In many instances there have been issues of acquiring land for private firms leading to protests over displacement and compensation. The fact remains that land acquisition is unavoidable, infact, given that land is essential for projects, transportation, housing and the cost of private land is exceptionally high.

Several efforts were made in the past to amend the Act in the favour of land-owners. Some provisions were amended, but failed to provide relief to the deprived and also increased the cost of investors.

There was a unanimous in the economic and political front that the 1894 Act suffered from various shortcomings. It had become obsolete and was not able to address the Indian needs for growth and progress.

Why is the regulation of land such an important issue and difficult exercise in most jurisdictions particularly in India? Existing occupancy and ownerships, disputed claims, multiple approvals, as also resettlement and compensation requirements create major roadblocks in the process. Hence the right to fair compensation and transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, was passed by Parliament in 2013 to repeal the 1894 Act.

The new Act is an effort to address the historical injustice while speeding up procedures. It expressly provided that no land can be acquired in scheduled areas without the consent of the gram sabhas. It ensures special enhanced benefits for those belonging to scheduled castes and scheduled tribes and also provides that no one shall be dispossessed until and unless all payments are made and alternative sites for the resettlement and rehabilitation have been prepared.

The new Act redefines 'public purpose' as land acquired for defence purposes, infrastructure projects, or for any project useful to the general public and stipulates mandatory consent of at least 70 per cent of affected people for acquiring land for public private partnership projects and 80 per cent for acquiring land for private companies going ahead this may create further problems than otherwise.

The new Act applies retrospectively to cases where no land acquisition award has been made. Also in cases where the land was acquired five years ago but where no compensation has been paid or no possession has taken place, then the land acquisition process has to be started afresh in accordance with the provisions of the new Act.

To ensure there remains no gap in interpretation of essential clauses of the repealed as well as repealing act, the Supreme Court has fairly provided initial interpretations to remove any probable ambiguity.

The first such case was of Pune Municipal Corporation and Anr. vs Harakchand Misirimal Solanki and Ors wherein the Court clarified that where land acquisition proceedings have been initiated under the 1894 Act but no award under Section 11 of the 1894 Act is passed, then the provisions of 2013 Act would determine amount of compensation to be awarded. However, where the position is otherwise, then such proceedings would continue under the 1894 Act as if the Act has not been repealed.

The land of the respondents-tenure holders being survey No. 619/70, etc, admeasuring 50,000 bighas situated in revenue village Chhatarpur, stood notified under Section 4 of the Act 1894 on November 25, 1980, for public purposes, namely, the "planned development of Delhi" and objections under Section 5A were invited from the persons interested within 30 days of the said notification.

Respondents-persons interested, filed their objections under Section 5A of the Act 1894. However, without considering and disposing of the same, declaration under Section 6 of the Act 1894 was made on June 7, 1985. Notices under Sections 9 of the 1894 Act were also issued on December 30, 1986 to the persons interested. It was at this stage that the tenure holders filed writ petitions before the high court challenging the acquisition proceedings contending that proceedings could not be continued without disposing of the objections filed by them under Section 5A of the Act 1894. Admittedly, the award No. 15/1987-88 was made by the land acquisition collector on June 5, 1987.

The court also held that if the acquisition proceedings are initiated under 1894 Act and an award has been made five years or more prior to the commencement of the 2013 Act and either of the two contingencies - physical possession of the land has not been taken or the compensation has not been paid - such acquisition proceedings would be deemed to have lapsed. Further, on the lapse of such proceedings, if the appropriate government still chooses to acquire the land which was the subject matter of acquisition under the 1894 Act then it has to initiate the proceedings afresh under the 2013 Act.

Furthermore, in the case of Union of India & Ors. vs Shiv Raj & Ors the Supreme Court dealt with the disposal of objections the 1894 Act. In this acquisition proceeding, the issue was that the objections were heard by one collector and the report was submitted by his successor.

The Supreme Court held that the very officer, who records the hearing of the objector, must also submit the report and in case his successor decides the case without giving a fresh hearing, the order would stand vitiated having been passed in violation of the principles of natural justice. The court also upheld the ratio laid down in the Pune Municipal Corporation Case which clarified the interpretation of five years period on the issue of applicability of new Act.

The above case has given the Act the clarity of application which it lacked.



Kumkum Sen is a partner at Bharucha & Partners Delhi Office and can be reached at kumkum.sen@bharucha.in

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First Published: Sun, June 15 2014. 21:14 IST
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