The Land Acquisition Act, 2013

Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 is also called land acquisition act 2013 and was brought to replace Land Acquisition Act of 1894, enacted during British era. However the act was mired into controversies mainly because of lack of specific definition of public purpose, thereby, extending even it to the extent of establishment of business-cum-leisure tourism infrastructure center like villas, golf course, hotels and banquet halls.

The new act seeks to establish a cohesive national law that dealt with the compensation, rehabilitation and resettlement issues arising out of process of land acquisition. The aims and objectives of the act are:

• The acquisition process is carried out in consultation with local self government and gram sabhas, thereby, ensuring least disturbance is caused to the owners of the land and other affected families.
• To ensure that fair compensation is provided to the affected families.
• Make adequate provisions for the rehabilitation and resettlement.
• In case of compulsory acquisition, endeavor should be made that the affected persons are made partners in development so as to ensure a smooth rehabilitation process for them post acquisition.

What is the scope of the 2013 act?

The act is applicable to all the land acquisition whether done by the central or state governments except the state of Jammu & Kashmir. The provisions of the Act does not apply to acquisitions under 13 existing legislations including the Special Economic Zones Act, 2005, the Atomic Energy Act, 1962, the Railways Act, 1989, etc. The Act is applicable when:

• Government acquires land for its own use, hold and control, including land for Public sector undertakings.
• Government acquires land with the ultimate purpose to transfer it for the use of private companies for stated public purpose.
• Government acquires land for immediate and declared use by private companies for public purpose.

Salient Provisions of the 2013 Act

Definition of Public Purpose

Section 2(1) of the act defines ‘public purpose’ as the project which involves land acquisition for strategic purposes or national security and defence of the country. For example-naval, military, air force, and armed forces of the Union, including central paramilitary forces etc. Other domain which falls under pubic purpose are-elaborate mention of infrastructure projects, projects for housing for lower income groups or landless or to persons residing in areas affected by natural calamities or to persons displaced or affected by reason of the implementation of any scheme undertaken by the Government.

Consent clause

When government acquires the land directly for ‘public purpose’ consent of the land owner is not required. However, when the government acquires the land for private companies, the consent of at least 80% of the project affected families shall be obtained through a prior informed process. In case of acquisition of land for public-private project then the consent of at least 70% of the affected families should be taken.

Emergency acquisition

 Under this the land acquisition can be expedited if it relates to national defense, security and rehabilitation of affected people from natural disasters or emergencies.

Limits on acquisition

The act does not allow acquisition of land under multi cropped area. The act also mandates that in case of acquisition of multi cropped area under exceptional circumstances, an equivalent area of cultivable wasteland shall be developed by the state for agricultural purposes. In case of acquisition of other agricultural land, total acquisition should not exceed the limit as specified by an appropriate authority. These limits shall not apply to linear projects which include projects for railways, highways, major district roads, power lines, and irrigation canals.

Compensation

It will be four times the market value of land in rural areas and twice in urban areas. The market value of the land will be set as higher of: minimum land value, if any, specified in the Indian Stamp Act, 1899 or; average of the sale price for similar type of land being acquired, ascertained from the highest fifty per cent of the sale deeds registered during the preceding three years in the nearest vicinity of the land being acquired.

Land Acquisition, Rehabilitation and Resettlement Authority

It is established to adjudicate matters arising out of the implementation of this law. It will be established by the state government as a “One Person” Land Acquisition, Rehabilitation and Resettlement Authority with powers of civil court. He must be either qualified to be a District Judge or must have seven years law practice experience.

Social Impact Assessment

Before the acquisition process starts the government has to carry out a social impact study along with consultation involving local authorities viz. Gram Sabha, Municipality. The purpose of the study is to make public the intended ‘public purpose’, the people affected, extent of acquisition etc. The report is submitted to an expert committee who can after due consideration can also disapprove the project. But he government can override the disapproval of the committee.

Provision for SC/STs

Their land will be acquired only under exceptional circumstances and that too with the prior consent of Gram Sabha or Autonomous District Councils in fifth schedule. Moreover, development plan have to be launched within 5 years to ensure their livelihood is not affected. Also, one-third compensation will be provided before acquisition and rest after the process is completed.

Land left unused after acquisition

Land acquired for one purpose cannot be used for another purpose under section 99. However if the land is rendered useless for the originally notified purpose, the appropriate government may use it for another purpose. If the land acquired is not utilized within a period of five years from the date of taking possession, it shall be redelivered to the original owner.

Criticisms of the Law

The key criticism of the above law is as follows:

Complex procedure for acquisition

 Social impact assessment study along with approval from the expert committee etc is a long and infeasible process, according to many business leaders. It is primarily because committee clearances in India are inextricably intertwined with red-tapism and bureaucratic hassles. Also improper land records in India compounded the problem. Therefore by the time all the clearances are actually obtained, the project may lose its relevance or the project cost may significantly rise, so many businesses may simply decide to give it up.

High cost of acquisition

The law has made the compensation too high, thus, stifling investment sentiment in the country. Consequently various infrastructure projects failed to take off.

Consent of affected families

 Act stipulates to take the consent of affected families also for land acquisition. The term ‘affected families’ has been defined very capaciously, so it would be a challenging task to find all affected families and to obtain their consent for acquiring land.

Exemption to 13 acts

The government gave exemption to 13 acts only for a year i.e. upto 1st January 2015.After one year the government has to bring amendments to withdraw this exemption but the government was not able to do so. Thus, unless it is done the legislation cannot be implemented effectively.

Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement (Amendment) Bill, 2015

The 2015 bill was amended twice and second amendment bill was passed by the Lok Sabha but got stuck in the Rajya Sabha. But before this amendment bill was brought, the government promulgated an ordinance in December, 2014. Apart from bringing other changes, it was dome primarily to include those 13 acts under the legislation which were exempted under land acquisition act 2013 as discussed above. The ordinance route was resorted as the government was not able to bring the necessary amendment due to frequent disruptions in parliament and lack of majority of the government in the Rajya Sabha. The changes brought by the 2015 second amendment bill as passed by the Lok Sabha are discussed below:

Exemption from certain provisions of LARR act, 2013

First, mandatory consent clause of 80% people in case of private projects and 70% in case of PPP projects is not applicable to the newly defined five categories of land use in the 2015 bill. They are: (i) defense, (ii) rural infrastructure, (iii) affordable housing (iv) industrial corridors (v) infrastructure projects including Public Private Partnership (PPP) projects where the government owns the land. Second, the government may also permit to exempt above categories of land use from Social Impact Assessment clause and from the restrictions of acquisition of multi cropped land clause of LARR act 2013.

Earlier exempted 13 acts brought land acquisition bill, 2015

The Bill brings the compensation, rehabilitation, and resettlement provisions of these 13 laws in consonance with the LARR Act, 2013.

Return of unutilized land

Under the LARR Act, 2013, if the acquired land remains unutilized for five years then it has to be returned to the original owners. New provision says that the period after which unutilized land will need to be returned will be: (i) five years, or (ii) any period specified at the time of setting up the project, whichever is later.

Land acquisition for private hospitals and private educational institutions

LARR act, 2013 allowed acquisition of land for private hospitals and educational institutions. However the new bill has removed this clause.

Title of private ‘company’ changed to private ‘entity

LARR act 2013 was applicable to the private companies as defines in the companies’ act 1956 or under the Societies Registration Act, 1860. Now the bill substituted private entity in place of private company. A ‘private entity’ is an entity other than a government entity, and includes a proprietorship, partnership, company, corporation, non-profit organization, or other entity.

Changes to rehabilitation and resettlement

 LARR 2013 calls for employment for at least one member of the family. But the amendments change this provision to ensure compulsory employment to at least one member of such an ‘affected family of a farm laborer’.

Offences by the government

Under the 2013 Act, if an offence is committed by a government department, the head of the department will be held guilty unless he can show that he had exercised due diligence to prevent the commission of the offence.  The Bill removes this section.  It adds a provision to state that if an offence is committed by a government employee, he can be prosecuted only with the prior sanction of the government.

Changes to Land Acquisition, Rehabilitation and Resettlement Authority

 The Act provides for the establishment of a Land Acquisition, Rehabilitation and Resettlement (LARR) Authority which may be approached in case a person is not satisfied with an award under the Act. The amendments state that the LARR Authority must hold its hearing in the district where the land acquisition is taking place, after receiving a reference from the Collector and giving notice of this reference to all concerned parties.

Change in the time taken for acquiring land

Under the 2013 Act, the minimum time required to complete the acquisition process is 50 months. The changes proposed in the Bill reduce this time to 42 months.

Discussion

The amendment of LARR Act, 2013 was based on the premise that it would help stalled infrastructure projects. However, according to economic survey data 2015, out of more than 80 % projects stalled only 8% of them were due to issues in land acquisition. Rest were stuck due to lack of funds or other bottlenecks operating in the economy. Therefore, the amendments brought were criticized to be hasty and without any proper consultations.

Second, it is important to understand that the land is not purchased but acquired which shows that the owner is not willing to part away from his land. So doing away with the consent clause defies all logic especially when the five categories of land use defined can be extended to comprise any projects under the sun. There is no rationale that why some projects require consent and other does not require consent. Critics argue that this amendments seems to be more pro-corporate rather than pro-people.

Third, the social impact assessment clause which was the most important tool to make the citizens understand about the overall modalities of the implementation has been repealed. It is way beyond understanding even though the government can override the disapproval of the expert committee overseeing SIA for any land acquisition. The concerns of the delay due to SIA requires hitting the root of the problem that is cutting red tapism etc. rather than eliminating SIA, the solution to informed consent of land acquisition process. Fourth, the threshold of the accountability of the government employees has been raised by requiring the prior sanction of the government.

There is no doubt that the process of land acquisition should be smooth so as to ensure smooth setting up of development and infrastructure projects. But it is important to look into the valid concerns of the public especially farmers otherwise it will lead to protests and increased dissatisfaction among the public.