Land Acquisition for major economic projects has shot to national attention lately and captured media space and informed discourse. DK Ojha explains the salient features of the new Land Acquisition Act and recommends that land requirement should be indicated in advance for speedier implementation.
Definitions of ´public purpose´, widespread misuse the of ´urgency clause´, compensation, lack of transparency in the acquisition process, participation of communities whose land is being acquired and virtually no R and R package, weak implementation and ineffective administration has warranted fresh application and interpretation in the light of the dynamic context of an emerging economy and a nation in transition.
Stakeholder management of big-ticket infrastructure projects involves a never ending task of balancing and integrating multiple relationships and multiple objectives. It is important to understand concerns of stakeholders and come up with an innovative approach to resolve issues involving them. The earlier Land Acquisition Act 1894 has been amended several times to make it more objective in dealing with land acquisition and other related issues, but could not address the issues holistically.
The new law recognises the land owner and other livelihood losers equally for the purposes of compensation and rehabilitation and resettlement (R and R), and that is why the acquisition process is through peaceful people participation, avoiding clashes of interest and protests against the project.
Right to fair compensation and transparency in land acquisition, R and R Act 2013: The new Act has introduced many changes over and above the existing 1894 law on land acquisition. As the acquisition and R and R are interrelated - acquisition, compensation, R and R has been combined into one single Act. It mandates a Social Impact Assessment (SIA) of the proposed acquisition by an independent body for all acquisitions. SIA will involve the representatives from Gram Sabha, Panchayats and Municipal Corporations and will carry out the assessment on the suitability of the purpose, minimal acquisition, families to be displaced etc. The SIA has to be completed within six months of its commencement. For projects undertaken by private companies or through public-private partnerships, the Act requires the consent of 80 per cent of the affected people which will put a check on forcible acquisitions.
It guarantees higher compensation to the land losers and adopts the market value method to compute compensation. The possibility of abuse of the ´urgency clause´ has been considerably reduced by limiting its application to the requirement ´for the defence of India or national security or for any emergencies arising out of natural calamities.´
The claim for compensation of ´affected family´ has been endorsed by providing a broad definition to the term which includes sharecroppers, agricultural labourers, tenants whose primary source of livelihood stands affected. The Act also recognises the role of self-government institutions and Gram Sabhas and provides for consultation with the same at the time of preparing the SIA and at the time of issuing the preliminary notification for acquisition. Central to this Act is the identification of the public policy elements and the role of the executive, industry, judiciary and civil society in achieving the fine balance between equity and efficiency in this vexatious question of our political economy.
The title of the old law conveyed that its primary purpose was to expedite the acquisition of land. However, the principle objective of the new Act is fair compensation, thorough resettlement and rehabilitation of those affected, adequate safeguards for their well-being and complete transparency in the process of land acquisition. The title has been amended to reflect this. It points out to the essentiality of inclusive growth.
Scope of the New Law
LA and R and R Provisions of the new Law is application when:
Compensation: Given the inaccurate nature of circle rates, the Bill proposes the payment of compensations that are up to four times the market value in rural areas and twice the market value in urban areas. While the objective is to ensure that people losing land should be adequately compensated, this will assure acquirers of the land of the acquisition process and thereby rule out problems of unwarranted claims and issues of inadequate compensation.
R and R: This is the very first law that links land acquisition and the accompanying obligations for resettlement and rehabilitation. It clearly outlines the benefits (such as land for land, housing, employment and annuities) that shall accrue in addition to the one-time cash payments.
Retrospective operation: To address historical injustice, the Bill applies retrospectively to cases where no land acquisition award has been made. Also in cases where the land was acquired five years ago but no compensation has been paid or no possession has taken place then the land acquisition process will be started afresh in accordance with the provisions of this act.
Multiple checks and balances: A ´comprehensive, participative and meaningful´ process (involving the participation of local Panchayati Raj institutions) has been put in place prior to the start of any acquisition proceeding. Monitoring committees at the national and state levels to ensure that R and R obligations are met have also been established. Special safeguards for tribal communities and other disadvantaged groups: No land can be acquired in scheduled areas without the consent of the Gram Sabhas. The law also ensures that all rights guaranteed under such legislation as the Panchayat (Extension to Scheduled Areas) Act 1996 and the Forest Rights Act 2006 are taken care of. It has special enhanced benefits for those belonging to Scheduled Castes and Scheduled Tribes. Safeguards against displacement: The law 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.
It also lists the infrastructural amenities that have to be provided to those that have been displaced.
Compensation for livelihood losers: In addition to those losing land, the Act provides compensation to those who are dependent on the land being acquired for their livelihood.
Consent: In cases where PPP projects are involved or acquisition is taking place for private companies, the Act requires the consent of no less than 70 per cent and 80 per cent respectively (in both cases) of those whose land is sought to be acquired. This ensures that no forcible acquisition can take place.
Caps on acquisition of multi-crop and agricultural land: To safeguard food security and to prevent arbitrary acquisition, the Act directs states to impose limits on the area under agricultural cultivation that can be acquired.
Return of unutilised land: In case land remains unutilized after acquisition, the new Act empowers states to return the land either to the owner or to the State Land Bank. Exemption from income tax and stamp duty: No income tax shall be levied and no stamp duty shall be charged on any amount that accrues to an individual as a result of the provisions of the new law.
Share in appreciated land value: Where the acquired land is sold to a third party for a higher price, 40 per cent of the appreciated land value (or profit) will be shared with the original owners.
The right to fair compensation and transparency in land acquisition, R and R Act 2013 takes care of the various shortcomings and anomalies present in the Land Acquisition Act of 1894 from the point of view of the affected people who own the land or whose livelihood is dependent on it. However, the impact of the new Act on the Industry and economy as a whole also needs to be taken into account. Based on the propositions of required quantum of consent and Social Impact Assessment, it can be inferred that the process of land acquisition under the new law will be much slower. Further, because of propositions of R and R, higher rates and compensation even for livelihood losers land acquisition is set to become much more expensive. Thus the financial viability of the projects is likely to be affected due to anticipated delays and substantial rise in the cost of the land. In light of this, the PSUs in need of land for their upcoming projects, must reformulate their policies. Optimal use of land should become a top priority and the process for land acquisition and R and R needs to start much earlier. This would lead to balanced growth of infrastructure development and better stakeholder´s participation. Governments and the PSUs need to put in place a perspective plan that details their long term strategies by fixing milestones and timeframes for accomplishing goals in respect to their anticipated land requirements for future infrastructure growth.