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In the sphere of land acquisition, where private property shifts hands, the Land Acquisition Act, 1894 continued to be the applicable law till very recently. With the enactment of the Right to Fair Compensation and Transparency in Land Acquisition Act, 2013 (hereinafter “the Act”), the earlier master Act was repealed by s. 114 of the Act. The new Act received Presidential assent on the 26th of September, 2013 and came into force with the coming into force of a new year, on the 1st of January, 2014.

The Land Acquisition Act, 1894 which was in force for more than a century, was a colonial piece of legislation, originally designed for British India. This Act was later on adopted for the rest of the nation, after independence.[1]With changing times and scenarios, the applicability of this Act assumed the form of a monstrous problem, as the provisions modeled according to the times gone by were exploitative of the farmers and the landowners.

The new Act purports to bring about transparency in the domain of land acquisition along with providing fair and just compensation to the families affected by the acquisition of their land. This objective of the new Act is evident from the Preamble to the Act,[2] which is starkly different from the Preamble of the Land Acquisition Act, 1894.[3] The new Act has expansive provisions which attempt to clarify the large ambiguous segments in the old Act.

  1. 1.                  PUBLIC PURPOSE

Land may be considered to be a scarce commodity with limited supply, making the ownership rights sacrosanct. The acquisition of private land for public purposes is a well established power of the sovereign.[4] The concept of land acquisition is referred to as eminent domain in America, but although the terminology used might be different, the essential requirement of the existence of a public purpose is common.One of the most debatable issues under the Land acquisition Act 1894 was the interpretation of ‘public purpose’ around which disputes concerning acquisition revolve. A conjoint reading of s. 3(za) and s. 2(1) displays the manner in which the Act elaborately defines “public purpose”.

This may be considered to be an attempt to perform a clean-up act of the mess created by the old Act, as a large number of cases related to the old Act revolved around the interpretation accorded to this ambiguous phrase. The Standing Committee stated that the definition in the old Act was scattered and the new Act attempts to streamline it.

1.1       Open issues

The gaping flaw which still remains is the non-exhaustive nature of the definition of public purpose. By making the definition inclusive in nature, the State has been given a wide window to exercise discretion regarding the definition. The State continues to be the intermediary in this field, exercising its discretion and in effect, the Act does not bring about any major improvement over the Act of 1894 in the interpretation accorded to public purpose. The use of phrases such as “for planned development or improvement” to lay down a definition of public purpose can be twisted and moulded in a manner which suits the State, and leaves a lot to be desired. A narrow and restrictive definition as contemplated in the Land Acquisition (Amendment) Bill, 2007 would have served the purpose better.


The Act attempts to minimize the social backlashes by conducting a social impact assessment before the act of acquiring land. The possible effects of such acquirement can thus be gauged. The involvement of the local bodies such as Panchayats and Gram Sabhas is a new development. The Preamble itself lays down this objective of the Act to bring about transparency and to provide fair and just compensation, by developing a consultation mechanism with the members of these local bodies. Section 4 of the Act uses the word ‘shall’. Thus, it mandates that the social impact assessment be conducted in consultation with the Panchayat, Municipality or the Municipal Corporation. The report is also supposed to be presented before these bodies in accordance with the provisions of the Act. The members of these bodies are also to find representation in the Expert Group which shall be constituted for the review of this report.

2.1       Open Issues

As is the case with every step, there also exists the possibility of a negative impact of giving this power to the members of local bodies. The scope for corruption in the form of bribery and influence over the members of the local bodies is a serious possibility, for not only getting an assessment in favour of land acquisition, but also against it.The Act also stops short of laying down the procedure to be followed in case the local bodies do not approve of the project. This raises a question over whether this representation and consultation of the local bodies is a mere formality or can they actually make their voice and grievances heard. The fact that the State can go on with the acquisition despite a negative report of the Expert Committee clearly indicates that the final say lies with the State itself.


A major problem related to the Land Acquisition Act, 1894 was the reckless manner in which the urgency clause of the Act was used by the Government to acquire agricultural land for non-agricultural purposes. The Apex Court relied on the report of the National Commission on Farmers in the case of Raghbir Singh Sehrawat v. State of Haryana,[5] to observe that such recklessness could imperil the food security of the nation. The new Act has special provisions to prevent the land acquisitions from turning into a threat to the food security of the nation. The Act specifically prohibits the acquiring of irrigated multi-cropped agricultural land. Though exceptional circumstances may justify such acquirement, s. 10(3) requires that an equivalent area of cultivable wasteland be developed for agricultural purposes.

3.1       Open issues

Although, these special provisions do exist, the exclusion of single crop lands does not bode well for the food security. The Apex Court’s fear seems real as the land acquisitions threaten to circumvent the mandate of s. 31 read with Schedule III of the Food Security Act, 2013, prohibiting the transfer of agricultural land for non-agricultural purposes.

  1. 4.      CONSENT

The concept of acquiring the consent of the affected families is also new in the field of land acquisition. The Act of 2013 requires the consent of eighty percent of the affected families in the cases of acquisition for private companies and seventy percent in the case of public private partnership projects.

4.1       Open issues

The importance being given to the voice of the land owners is a positive step, but the requirement of such a high percentage of affirmative responses is unreasonable. This requirement may end up making the land acquisition process lengthy and may jeopardise projects of strategic importance.

  1. 5.      COMPENSATION

While the old Act left the calculation of compensation to the discretion of the Collector based upon certain factors provided in ss. 23 and 24 of the old Act, the new Act has well marked out guidelines for compensation calculation. While the amount of compensation under the new Act is much more than the old Act due to the multiplication factor provided for in the Schedule to the Act, it also provides for a solatium fund under s. 30. The Act further looks towards the welfare of the people who have been displaced twice, by providing additional compensation in cases of double displacement.

5.1       Open issues

The hype regarding the compensation to be paid is well founded. The sliding scale provided for in Schedule I of the Act, a determination to be made by the appropriate Government again ends up creating an ambiguous situation where State discretion trumps again.


Finally, the most important and major difference between the two Acts are the provisions related to Rehabilitation and Resettlement which have also been incorporated in the new Act. The Act links the land acquisition and the obligations that arise out of it in the form of the need for resettlement and rehabilitation of the affected people. The 2013 Act contains five detailed chapters and two Schedules explaining the processes related to the Rehabilitation and Resettlement of people.

6.1       Open issues

The major flaw in the attempted rehabilitation and resettlement of the affected families is that the Act only makes provisions for monetary compensation and has no provisions for providing the individuals with employment opportunities.[6] In such a scenario, the Act cannot be considered to be bringing rehabilitation in its ambit. It is only restricted to resettlement.[7]

  1. 7.      CONCLUSION

The Act can be considered to be an attempt to end the exploitative regime of the Act of 1894. Though the Act has made an attempt to bring about certain welcome changes, it continues to have loopholes and its proper implementation is imperative. Presently, the Act is like an arrow which has just been shot. Whether or not it will hit the bull’s eye remains to be seen.

[1]Government of India, 10th Law Commission Report on the Law of Acquisition and Requisitioning of Land, p. 3, 1958.

[2]An Act to ensure, in consultation with institutions of local self-government and Gram Sabhas established under the Constitution, a humane, participative, informed and transparent process for land acquisition for industrialisation, development of essential infrastructural facilities and urbanisation with the least disturbance to the owners of the land and other affected families and provide just and fair compensation to the affected families whose land has been acquired or proposed to be acquired or are affected by such acquisition and make adequate provisions for such affected persons for their rehabilitation and resettlement and for ensuring that the cumulative outcome of compulsory acquisition should be that affected persons become partners in development leading to an improvement in their post acquisition social and economic status and for matters connected therewith or incidental thereto.

[3]An Act to amend the law for the Acquisition of Land for public purposes and for the companies.

[4]Supra note 1atp. 1.

[5](2012) 1 SCC 792.