Land Acquisition Act 1894

Land Acquisition Act
1894
• Land acquisition is the process by which the
government acquires private property for
public purpose.
• Till 2013, land acquisition in India was

governed by Land Acquisition Act of 1894 .
• Under the 1894 Act, the government could acquire
any land as it wishes to, in the name of "public
purpose“. The term “public purpose” was
ambiguous and open to executive-discretion. So,
poor peoples’ land was acquired at throwaway
prices in pretext of development projects.
• Sometimes such projects never started, and the

same cheap land was resold at higher price to real
estate
developers, without building anything for “public
purpose”.
• No safeguards: There is no real appeal mechanism
to stop the process of the acquisition. A hearing
(under section 5A) is prescribed but this is not a
discussion or negotiation. The views expressed are
not required to be taken on board by the officer
conducting the hearing.
• Silent on resettlement and rehabilitation of those

displaced: There are absolutely no provisions in the
1894 law relating to the resettlement and rehabilitation
of those displaced by the acquisition.
• Urgency clause: This is the most criticised section of

the Law. The clause never truly defines what
constitutes an urgent need and leaves it to the
discretion of the acquiring authority.
• Low rates of compensation: The rates paid for
the land acquired are the prevailing circle rates in
the area which are notorious for being outdated
and hence not even remotely indicative of the
actual rates prevailing in the area.
• Litigation: Even where acquisition has been

carried out the same has been challenged in
litigations on the grounds mentioned above. This
results in the stalling of legitimate infrastructure
projects.
L.A.R.R
Act,
2013
• The Right to Fair Compensation and Transparency in Land
Acquisition, Rehabilitation and Resettlement Act, 2013, which
came into force from 1 January 2014.
• 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 Bill 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.
• Retrospective operation: To address historical injustice it

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
land acquisition process will be started afresh
1. COMPENSATION : Compensation in rural areas would be calculated by
multiplying market value by two and adding assets attached to the land or
building and adding a solatium. In urban areas it would be market value
plus assets attached to the land and solatium.
ILLUSTRATION
Suppose the market value of a piece of land in rural area is 10,00,000.
Multiplying it by 2 ----- 10,00,000 x 2 = 20,00,000
Adding value of assets (2,00,000) attached to land ------ = 22,00,000
Adding 100% solatium, the final compensation = 44,00,000
A piece of land of market value 10,00,000 in urban area -----

Adding value of asset (2,00,000) attached to land ------ = 12,00,000
Adding 100% solatium , the final compensation = 24,00,000
*Compensation for livelihood losers: In addition to those
losing land, the Bill provides compensation to those who
are dependent on the land being acquired for their
livelihood. To qualify for benefits under this Act the time
period has been reduced to three years of dependence (on
the acquired land) from five
*Fishing rights: In the case of irrigation or hydel projects,
affected families may be allowed fishing rights in the
reservoirs.
*Share in appreciated land value: Where the acquired land
is sold to a third party for a higher price, 40% of the
appreciated land value (or profit) will be shared with the
original owners.
 CONSENT: Consent of up to 80 per cent of people
required for private projects. For PPP projects, the
approval of 70 per cent of the same is mandatory
Multi-cropped, irrigated land cannot be acquired

unless it is for defence or emergency caused by natural
calamity
Land should be returned to original owner or the State

Land Bank if not used in five years for the purpose for
which it is acquired
 The government will not acquire land for private

companies for private purpose
 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.
 The Bill also proposes amenities like schools, health

centres and civic infrastructure in places where project-
affected people are resettled
The urgency clause should be exercised in the rarest of
rare cases like national defense or for resettlement
purposes.
The Social Impact Assessment (SIA) has to be carried

out in consultation with the representatives of the
Panchayati Raj Institutions (PRIs)
Reports prepared under the Social Impact Assessment are
to be shared with these representatives.
PROCEDURE FOR THE LAND ACQUISITION
1.INVESTIGATION PROCESS
 When a local authority or a company requires a land,
an application is required to be made by it to the
revenue authority,accompanied with a copy of the plan
showing survey nos., purpose of acquisition and the
reason for the particular site to be chosen and the
provision made for the cost of the acquisition.
 After the government has been fully satisfied about the
purpose, the least area needed, and other relevant
facts as provided under land acquisition rules, it will
issue a notification under Section 4 of the act that the
particular land is required for public purpose.
2. Objection and Confirmation
Objections are invited from all persons interested in land within
thirty days from the date of notification.
The objections will be valid on one or more of the following
grounds:
* i. That the purpose for which the land is proposed for acquisition
is not a public purpose.
* ii. That the land is not or less suitable than another piece of land
for the said purpose.
* iii. That the area under acquisition is excessive.
* iv. That the acquisition will destroy or impair historical or
artistic monuments or will desecrate religious buildings,
graveyards and the like.
3. Claim and Award
The collector will issue notices under Section 9 to all persons
interested in the acquisition
to file their claim reports.
In determining the compensation the market value of the land is
determined at the date of notification. The rise and fall in the
value during the period of transaction and notification is taken
into consideration.
Compensation is also payable when:
I. Part of the property is proposed for acquisition in such a
manner that the remainder
depreciates in value.
ii. When the land notified for acquisition has standing crops
or trees.
iii. If the person interested has to change his place of
residence or business then the excess rent payable for
the new premises is also considered for compensation
 After necessary inquiries the collector declares his award
showing true area of the land, total amount of compensation
payable and apportionment of compensation if there are
more than one owners or claimants.
4. Reference to Court
Any person interested to whom the award is not satisfactory
can submit a written application to the court.
This application should be made within six weeks from the
date of declaration of the award.
LAND ACQUISITION BILL
The new government
passed an ordinance
on Land Acquisition
on 29th December
2014 introducing
major changes to the
2013 Act.
*LARR Act-2013 established an extremely complex and impractical
land acquisition process.
*Holdouts: Jholachhap NGOs would instigate 20-25% of the affected

families to stage holdout- promising them it’ll fetch them even
higher prices. and Given the 70-80% consent requirement, the
project will never kickoff.
*Litigation: because local (and therefore corruption) Patwari and

Tehsildars never maintain proper land records of who owns how
much land.
*This raised the land prices, red tapism and thus the overall project
cost.
*Neither the farmer could sell its land and move to urban areas, nor
the entrepreneur could buy the land and move towards rural areas.
Pros
The existing Act kept 13 most frequently used
acts for Land Acquisition for Central Government
Projects out of the purview. These acts are
applicable for national highways, metro rail,
atomic energy projects, electricity related
projects, etc. The present amendments bring all
those exempted from the 13 acts under the
purview of this Act for the purpose of
compensation, rehabilitation and resettlement.
Therefore, the amendment benefits farmers and
affected families.
The proposed changes in the Land Acquisition Act
would allow a fast track process for defence and
defence production, rural infrastructure including
electrification, affordable housing, industrial
corridors and infrastructure projects including
projects taken up under Public Private Partnership
mode where ownership of the land continues to be
vested with the government.
As per the changes brought in the Ordinance,

multi-crop irrigated land can also be acquired
for purposes like national security, defence, rural
infrastructure including electrification, industrial
corridors and building social infrastructure.
Cons
The original Land Acquisition Act, 2013 had a

consent clause for acquiring land – industrial
corridors, Public Private Partnership projects, rural
infrastructure, affordable housing and defence. But
after the central government changed, it exempted
these five categories from the rule of acquitting
land in the Bill tabled on February 24.
Social assessment which was mandatory before

acquitting land has also been exempted in the Bill
tabled in the Lok Sabha.
• *As per the existing law, land will be given back
to the farmer if it remains unused for five years.
The proposed amendment says the land will be
returned only if the specified project on the
land fails to complete the deadline.
• *Also whether the land is fertile or not will also
not be taken into consideration while acquiring
it for these five specific sectors.
*Bureaucrats will be punished if found guilty of
violating any clause of the existing Land Act.
However, the new clause makes government
sanction necessary to prosecute civil servants.
THANKS

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Land Acquisition Act

• Till 2013, land acquisition in India was

• Sometimes such projects never started, and the

• Silent on resettlement and rehabilitation of those

• Urgency clause: This is the most criticised section of

• Litigation: Even where acquisition has been

• Retrospective operation: To address historical injustice it

A piece of land of market value 10,00,000 in urban area -----

Multi-cropped, irrigated land cannot be acquired

Land should be returned to original owner or the State

 The government will not acquire land for private

 The Bill also proposes amenities like schools, health

The Social Impact Assessment (SIA) has to be carried

*Holdouts: Jholachhap NGOs would instigate 20-25% of the affected

*Litigation: because local (and therefore corruption) Patwari and

As per the changes brought in the Ordinance,

The original Land Acquisition Act, 2013 had a

Social assessment which was mandatory before

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