Economic growth and job creation require efficient usage of land resources. It is important that a fair and transparent process for purchase and for acquisition of land is followed. For the purchase of land, a key concern is the authenticity of land titles, and the government has drafted a Land Titling Bill for this purpose.
End uses Projects permitted to acquire
It defines public purpose to include infrastructure projects (as defined by the finance ministry, with some exclusions);projects related to
- agriculture, agro-processing and cold storage
- industrial corridors
- mining activities
- national investment and manufacturing zones
- government administered or aided educational and research institutions
- sports, healthcare, transport and space programmes.
It also enables the government to include other infrastructural facilities to this list after tabling a notification in Parliament. The significant difference from the current Land Acquisition Act, 1894, is that land cannot be acquired for use by companies unless they satisfy any of the above end-uses.
Consent of Land Owners
If the land is acquired for use by a private company, 80% of land owners need to give consent. If it is for use by a public private partnership (PPP), 70% of the land owners have to agree to the acquisition. The rationale of having differential consent requirements based on ownership—including the lack of any such requirement if the land is for the use of the government or a public sector undertaking—is not clear.
Compensation
Three factors are taken into account:
- Circle rate according to the Stamp Act
- The average of the top 50% of sale deeds registered in the vicinity in the previous three years
- The amount agreed upon, if any, in case of purchase by a private company or PPP.
The higher of these three amounts is multiplied by a factor, which varies from 1 in urban areas to a number between 1 and 2 in rural areas, depending upon the distance from the urban centre. To this amount, the value of any fixed assets such as buildings, trees, irrigation channels etc is added. Finally, this figure is doubled (as solatium, i.e. compensation for the fact that the transaction was made with an unwilling seller). The justification given for the multiplier ranging from 1 to 2 is that many transactions are registered at a price significantly lower than the actual value in order to evade taxes
Rehabilitated and Resettled
The R&R entitlements for each family includes a house, a one-time allowance, and choice of (a) employment for one person in the project, (b) one-time payment of Rs 5 lakh, or (c) inflation adjusted annuity of Rs 2,000 per month for 20 years. In addition, the resettlement areas should have infrastructure such as a school, post office, roads, drainage, drinking water, etc.
Social Impact Assessment
Every acquisition, regardless of size, needs a social impact assessment, which will be reviewed by an expert committee, and evaluated by the state government. Then a preliminary notification will be issued, land records will be updated, objections will be heard, rehabilitation and resettlement survey carried out, and a final declaration of acquisition issued. The owners can then claim compensation, the final award will be announced, and the possession of the land taken. The total time for this process can last up to 50 months. The big question is whether this time frame would hinder economic development and the viability of projects?
Disputes and Settlement
The Bill provides for an Authority to adjudicate disputes related to measurement of land, compensation payable, R&R etc, with appeals to be heard by the High Court. There are several restrictions on the land acquired. The purpose for which land is acquired cannot be changed. If land is not used for five years, it would be transferred to a land bank or the original owners. Transfer of ownership needs prior permission, and in case of transfer in the first five years, 40% of capital gains have to be shared with the original owners.
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