The acquisition of land by governments for development and industrialisation has become a contentious political issue in recent years. Many have criticized the Land Acquisition Act, 1894, as a draconian piece of legislation which has been used to forcibly acquire land without paying adequate compensation. Given the increasing chorus of protests over such issues as displacement and rights over land, the government is planning to introduce an amendment to the 1894 Act.
The Land Acquisition (Amendment) Bill, 2007 was passed by the Lok Sabha on 25th February 2009 (the last day of the session) but the bill lapsed with the dissolution of the 14th Lok Sabha.
The Amendment attempts to expand the rights of those whose land is being acquired while restricting the types of projects for which governments can acquire land. It also provides for a separate authority to settle disputes over land acquisition. A companion piece of legislation (the Rehabilitation and Resettlement Bill, 2007) attempts to specify the benefits that displaced people will receive.
Highlights of the Bill
- The Land Acquisition (Amendment) Bill, 2007 amends The Land Acquisition Act, 1894.
- For acquisition resulting in large-scale displacement, a social impact assessment study must be conducted. Tribals, forest dwellers, and those with tenancy rights are also eligible for compensation.
- Acquisition costs will include payment for loss or damages to land, and costs related to resettlement of displaced residents.
- While determining compensation, the intended use of land and value of such land in the current market is to be considered.
- The Bill establishes the Land Acquisition Compensation Disputes Settlement Authority at the state and central levels to adjudicate disputes resulting from land acquisition proceedings.
Key Issues and Analysis
- The Bill bars the jurisdiction of civil courts on all matters related to land acquisition. It is unclear whether there is a mechanism by which a person may challenge the qualification of a project as ‘public purpose.’
- The Settlement Authority is a judicial body but could be entirely staffed by members without judicial qualifications or experience.
- When acquired land is resold, the original acquirer is to distribute 80% of the capital gains to the original owners or their heirs. This implies that every acquirer must track the original owners and their heirs in perpetuity. Also, the resale price of land may be difficult to compute when it is part of a larger deal in which a company is taken over.
- Companies have to offer part of compensation as shares or debentures. Unlike shares, debentures do not provide the land owner with a share of the profits of the project.
- The Bill makes special provisions for compensation if land is acquired under ‘urgency’. The term ‘urgency’ is not defined.