COMPARATIVE ANALYSIS OF LAND ACQUISITION ACTS IN INDIA: A CASE-BASED APPROACH

Transcription

1 COMPARATIVE ANALYSIS OF LAND ACQUISITION ACTS IN INDIA: A CASE-BASED APPROACH Prof. R. Nallathiga 1, Prof. A. Abhyankar 2, A. Gurnani 3, A Goyal 3, M. Umredkar 3 Abstract Land acquisition is essential for the development of a country in order to provide employment, social infrastructure, physical infrastructure and other public amenities. In India, Land Acquisition has been brought out by a set of legislations: (i) the Land Acquisition Act, 1894, which was imposed during the British rule (ii) the Land Acquisition, Rehabilitation and Resettlement Bill, 2013 brought out by the United Progressive Alliance (UPA) Government, which was different in several aspects as compared to 1894 Act; (iii) the Land Acquisition, Rehabilitation and Resettlement Ordinance, 2015 brought out by the National Democratic Alliance (NDA) government, which has changed many clauses of the 2013 Act. This paper makes a comparative analysis of the Land Acquisition Acts in India through a discussion of the various provisions and also the case analysis of the effect of differences of the Act provisions for three different development projects requiring land. The case analysis points to the need for addressing ground level issues in order to make land acquisition successful. Keywords: Eminent domain, Land Acquisition, Development Projects, Comparative Analysis 1 Associate Professor, School of Projects Real estate and Infrastructure Management,. National Institute of Construction Management and Research, Pune 2 Associate Professor, School of General Management, National Institute of Construction Management and Research, Pune 3 PGP Students of REUIM, National Institute of Construction Management and Research, Pune

2 1. Introduction Eminent domain law is the essential power of the State to take hold of citizen s private property, take away it, or the seizure of a citizen's rights in property with due monetary compensation, but without the property owner's consent. It is considered to be one of the most controversial and politically superficial instruments of exercising State power which is used in several parts of the world (Bedi and Gangwani 2015). However, implementing the eminent domain law is not easy task and it is very tough to deal with ground level issues (Nielson 2011). The execution of eminent domain (or, compulsory acquisition of land) by the State often results in various social, cultural, economic and psychological pains for the affected communities i.e. land and property owners. Such acquisition and the consequent displacement not only leads to loss of economic assets, habitat and livelihood but also disrupts the communities, social relationships, cultural identities, local markets for goods as well as labour, consequently placing the ousted in a spiral of impoverishment (Jojan et al 2013). In view of such painful consequences, a legal rule representing eminent domain needs to restrict its application only to the cases of compelling public interest and further minimise (or, compensate suitably for) the socio-economic costs of land acquisition and consequent displacement of property owners. Moreover, it is also necessary that such rule also include provision for a fair reconstruction of standards of living, community relations and production systems enjoyed by the affected persons prior to land acquisition so that the community moves on an ascent path (rather than a descent path) (Cernea 1999). Depending on how the eminent power is used, it can clear the way for rapid economic growth, technological progress and infrastructure development; otherwise, it can infringe upon property rights, the economic interests of poor and vulnerable groups, and fundamental principles of justice (Gupta 2014). In India, the legal foundation for eminent domain was established by colonial era law - the Land Acquisition Act 1894, which continued to prevail and served the purpose until 2000s. The Land Acquisition Act, 1894 allowed government to acquire private land for public purposes after paying a government-fixed compensation to cover the losses incurred by landowners from surrendering their land to concerned public agency. This act was criticized for its tough nature i.e., the State was authorized to acquire the land even without the willingness of

3 land owners to part with it. Yet it survived over a very long time due the simple process and also due to undeveloped land markets in an agrarian dominant economy. In the last few years, the Government of India has understood the need for bringing up new acts rather than making small changes so that land acquisition can be achieved while protecting some of the rights of its own citizens. In the process, the Land Acquisition Act has been modified and brought out in the form of a new legislation Land Acquisition, Rehabilitation and Resettlement (LAR&R) Bill, 2013; it has been further been subject to some more changes and to be brought out as Land Acquisition, Rehabilitation and Resettlement (LAR&R) Ordinance, The implications of the changes in land acquisition act are not fully understood by various stakeholders both legally and operationally. Therefore, this case paper attempts to bring out the major legislative changes in the form of a comparative analysis of the provisions of these acts in the next section. The implications of the changes in the provisions are then brought out in the form of select cases, each of which brings out these changes in a comparative manner. Finally, the case paper concludes with the implications of the Land acquisition act changes with reference to the case projects and also spells out the major learnings. 2. Eminent Domain Acts in India: A Comparison The Land Acquisition Act, 1894 (LAA 1894) is the first eminent domain act that came into being under the British rule. This act was sought to be replaced by the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (RFCT LAR&R 2013)), which was promulgated by the United Progressive Alliance (UPA) government after extensive consultations and several rounds of discussion of first legal draft prepared in The next being the Right to Fair Compensation for Land Acquisition, Rehabilitation and Resettlement (Amendment) Bill, 2015 which is now in the parliament seeking some amendments to the RFCT LAR&R In the current section of the paper, we will discuss the features of all these three eminent domain/land acquisition acts of India Land Acquisition Act, 1894

4 Land Acquisition Act 1894 (LAA 1894) is a well drafted and well served piece of legislation that served land acquisition purpose for more than a century. In general land acquisition is composed of three macro-processes (Mahalingam and Vyas 2011): First, affected parties and their land ownership are to be identified. Second, fair processes by which stakeholders are notified of the acquisition and are given a chance to voice their views followed by the declaration. Finally, an acceptable compensation package to be arrived upon and distributed. On the face of it, the LAA 1894 seems to take all these three issues into consideration (GoI 1985). The Act contains a definition of persons interested in the project which is intended to be used to determine groups affected by the acquisition of the land, essentially the owners of property i.e., farm or non-farm land. A detailed land acquisition process consists of public authorities required to notify land owners prior to acquiring the land and giving the affected stakeholders with an opportunity to contest both the acquisition of land (on the grounds, for instance, that a particular parcel of land is not wholly or in part needed for the project, that due process was not followed, or the purpose of acquisition is not for public good), and determining the amount of compensation that is to be paid to them. Here again, LAA 1894 defines several ways by which compensation can be awarded-including a consideration of the market value of land, assets present on the land, income derived from the land and a solatium for compulsory acquisition (GoI 1985), which is based on the commonwealth experience. However, there are several shortcomings in the practical implementation of the Act (Raghuram, Bastian and Sundaram 2009): First, there is no clear basis as to how affected parties can be determined and the existing definition is imprecise. Very often, only the minimum subsets of landowners who are affected are identified. Encroachers, sharecroppers, landless labourers and so on, who have an interest in the land, are not compensated. Several people practising agriculture are not legally registered and are thus not eligible for compensation, leading to widespread unrest. Second, the process of acquisition is very time-consuming and can take up to three years even if implemented without undue resistance. Further, although the

5 broad steps of the land acquisition process are outlined in the Act, an enormous amount of discretion is vested upon the district collector and deputy collector (or tehsildar), who effectively adjudicate on several objections related to the acquisition as well as on the compensation to be provided. This often leads to decisions and awards that are ad hoc and are not readily accepted by the local community. Finally, no clear formula is given as to how compensation must be calculated. Government officials often consider the least value derived from all possible compensation approaches and as a result the final compensation arrived at is often an order of magnitude lower than that expected by landowners. The real value of this compensation is further reduced due to the time lag between determining the compensation and awarding it to project-affected parties. Project-affected stakeholders then need to seek recourse to the judiciary. The unfairness of the compensation amount has been demonstrated in several cases, where, the courts have ruled that the government pay compensation more than three times the original amount, to affected parties. Nevertheless, the process of obtaining such an award is extremely lengthy and in the interim, affected groups are effectively uncompensated and landless Land Acquisition, Rehabilitation and Resettlement Act, 2013 The RFCT LAR&R 2013 had introduced some significant changes to India s land acquisition law. The primary among them is the vastly increased compensation for the land owners, who were also recognised as urban and rural land owners. The law therefore distinguished the operation of differential forces of land markets operating in urban and rural setting while determining land value. Therefore, the cash award required was raised to be at least four times the estimated local market value of land in rural areas, and at least twice in urban areas. The act also mandates that all affected parties be paid a Rehabilitation and Resettlement (R&R) package in addition to the cash compensation for lost assets so that the displacement costs are met by projects. The scope of Affected parties was also expanded to the persons and families whose primary source of livelihood was the land that is being taken, which therefore includes

6 the intended beneficiaries as tenants of property, sharecroppers and agricultural workers who were employed on the seized land (Bedi and Gangwani 2015). The stipulated R&R package for affected community includes a variety of entitlements, including transportation and resettlement allowances, a monthly stipend for one year, and a job for one family member which can be exchanged for a lump sum payment. The compulsory R&R benefits may add up to the cash value of nearly Rs. 6.5 lakhs for every affected family (Bedi and Gangwani 2015), which were ignored so far. There are, in addition, conditional benefits to be provided to affected families, such as the provision of constructed housing (with different built space entitlement for rural and urban areas) when there is loss of homestead, some land-for-land in the case of irrigation and urbanisation projects, and a share of capital gains if the land is resold undeveloped. Even industries buying land on the open market will have to meet R & R obligations if the procured area is 100 acres or more (50 acres in urban areas). The RFCT LAR&R Act 2013 requires that a Social Impact Assessment (SIA) be conducted to identify the affected families and calculate the social impact when land is acquired. A committee of independent experts examines the SIA and approves the social impact assessment of the project, an administrative committee reviews if it serves the public interest and also if the benefits outweigh the costs, and the disputes are to be referred to a specially constituted body instead of civil courts. Multi-cropped land is proposed not to be acquired except under special circumstances, and, even under such, land acquisition must not exceed 5% of the cultivated area in the district. The RFCT LAR&R Act 2013 required that if land acquired under it remained unutilised for five years, it would be returned to the original owners or the government land bank. The Ordinance states that the period after which unutilised land will need to be returned will be five years, or any period specified at the time of setting up the project, whichever is later. The RFCT LAR&R Act 2013 also states that the Land Acquisition Act, 1894 would continue to apply in certain cases where an award was made under the LAA However, if such as award was made five years or more before the enactment of the RFCT LAR&R Act 2013, and the physical possession of

7 land has not been taken or compensation has not been paid, the LAR&R Act 2013 provisions would apply (GoI 2013). The Ordinance also states that while calculating this time period, any period during which the proceedings of acquisition were held up: (i) due to a stay order of a court, or (ii) a period specified in the award of a Tribunal for taking possession, or (iii) any period where possession has been taken but the compensation is lying deposited in a court or any account, will not be counted Land Acquisition, Rehabilitation and Resettlement Bill, 2015 The RFCT LAR&R Bill 2015 is still under the process of becoming a law and it seeks to make some amendments to the earlier act of It has been passed by the Lok Sabha but yet discussion of its controversies is going in Rajya Sabha to get passed. It has same lines as that of RFCT LAR&R 2013 Act but with some major modifications. The modifications are as below (Chopra 2015). The RFCT LAR&R Act 2013 exempted 13 laws (such as the National Highways Act, 1956 and the Railways Act, 1989) from its purview. However, the RFCT LAR&R Act 2015 required that the compensation, rehabilitation, and resettlement provisions of these 13 laws be brought in consonance with the RFCT LAR&R Act 2015, within a year of its enactment, through a notification. The Ordinance also brings the compensation, rehabilitation, and resettlement provisions of these 13 laws in consonance with the RFCT LAR&R Act The RFCT LAR&R 2015 Ordinance creates five special categories of land use to be exempt from the provision of public consent: (i) defence, (ii) rural infrastructure, (iii) affordable housing, (iv) industrial corridors, and (v) infrastructure projects including Public Private Partnership (PPP) projects where the central government owns the land. The RFCT LAR&R Act 2013 requires that the consent of 80% of land owners is obtained for private projects and that the consent of 70% of land owners be obtained for PPP projects. The new Ordinance exempts all the five categories mentioned above from

8 this provision of the Act. In addition, the Ordinance permits the government to exempt projects in these five categories from the following provisions, through a notification: The RFCT LAR&R Act 2013 excluded the acquisition of land for private hospitals and private educational institutions from its purview. The new Ordinance removes this restriction. While the RFCT LAR&R Act 2013 was applicable for the acquisition of land for private companies, the new Ordinance changes this to acquisition for 'private entities'. A private entity is defined any entity other than government entity, and could include a proprietorship, partnership, company, corporation, non-profit organisation, or other entity under any other law. It therefore expanded the scope of purpose from strictly public agency to lenient public-like private body. The compulsion of the current government to make such change lies in its drive to propel economic growth through large scale industrial and urban development. However, taking such legal short-cuts may only harm the citizenry and may become detrimental in the long term. Table 1 makes a comparison of the three acts. Table 1: Comparison of LAA 1894, RFCT LAR&R 2013 and RFCT LAR&R 2015 Parameter LAA 1894 RFCT LAR&R 2013 RFCT LAR&R 2015 Public Purpose Includes several uses such as infrastructure, development and housing projects. No Change as such Excludes acquisition of land for private hospitals and private educational institutions. Also includes use by companies under certain conditions. Consent From affected people No such clause applicable Consent of 80 % of displaced people required in case of Consent for five categories of projects is exempted

9 acquisition for private companies and 70 % for public-private partnerships. 1. Defence 2. Affordable Housing 3. Rural Infrastructure 4. Industrial Corridor 5. Infrastructure The consent for the other projects remains same as that of 2013 Act. Social Impact Assessment (SIA) No provision SIA has to be undertaken in every acquisition. Exemption of SIA for above mentioned five categories of Consent and also limits on irrigated land. Compensation Based on the Two times of market Same as 2013 Act. market value. value for urban areas & four times of market value in rural area. Market Value Based on the Higher of: (a) value Same as 2013 Act. current use of land. Explicitly prohibits using the intended use of land while computing market value. specified for stamp duty, and (b) average of the top 50% by recorded price of sale of land in the vicinity. Solatium 30% 100% 100% Rehabilitation and Resettlement No provision R&R necessary for all affected families. Minimum R&R entitlements to be provided to each family. With R&R award for each affected family includes mandatory employment to at least one member of such an affected family of a

10 employment to the farm labourer. members of the affected family. Food Security No provision Multi-crop land to be acquired only as a last resort. States to impose limits on the area of agricultural/ multi-crop land that can be acquired in a State. If agricultural land is acquired, the state has to cultivate an equivalent area of land elsewhere. No limit on multi-crop land to be acquired for above said five categories. Source: Based on LAA 1894, LAR&R 2013 and RFCT LAR&R Comparative Analysis of Land acquisition Provisions: A Study of Three Cases In this section, a comparative analysis of land acquisition and R&R under the three legislations is carried out with the help of three cases: the first being Tata Nano Project in Singur; the second being Noida Development; and third being Koyambedu Market, Chennai. While first two cases are examples of failures of land acquisition and the third case is an example of success. These cases can also help us to understand further reforms in Land Acquisition Acts. We introduce these three projects first and later we compare Land Acquisition Acts considering these projects.

11 3.1 Case 1: Tata Nano Project, Singur This case is based on Divya Gupta (2014). In the second half of 2006, the West Bengal government acquired 997 acres of prime agricultural land in Singur are of West Bengal state (Refer figure 1) in order to enable M/s Tata Motors, a leading industry house in India, to build a factory for manufacturing Nano car, its new model touted as small and cheap car. In order to do so, the State government used its power of eminent domain under the aegis of the 1894 Land Acquisition Act. The West Bengal government subsequently decided to acquire the area required for the car factory and offer compensation to the farmers and other land owners whose lands were being acquired as required by the 1894 Act. The local community of Singur was incensed by this action, and put up resistance led by farmer households against forced acquisition and displacement. This resistance soon snowballed into a protest movement, which the main opposition party, the Trinamool Congress (TMC) subsequently galvanised. The state government subsequently offered to improve the terms of compensation, including 25% compensation for tenant farmers engaged in cultivation of acquired plots. No plans were offered to compensate agricultural workers claiming to have lost employment on acquired lands. Local outbreaks of violence occurred, and the protests acquired national and international media attention. Eventually, two years later, after being frustrated with the protests and non-acquisition, M/s Tata Motors decided to withdraw from West Bengal, and took the Nano car manufacturing factory to Sanand, Gujarat.

12 Figure 1. Image showing Location of Singur with respect to Kolkata A household survey in 12 Singur villages, which were acquired for Tata Car Factory, was conducted by Ghatak et al. (2013). The results of the study show that most of the land was acquired from marginal landowners, and from those engaged in cultivation on the acquired plots. For most affected owners, more than half the land they owned in 2005 was acquired. A significant fraction of landowners were under-compensated owing to misclassification of their plots in the official land records, besides inability of the latter to incorporate other sources of plot heterogeneity. Acquisition of land resulted in 40% lower income growth for owners and half that for tenants. Agricultural workers that were directly affected experienced significant reductions in employment earnings compared with unaffected agricultural workers, who in turn, experienced smaller earnings growth compared with non-agricultural workers. Hence, land acquisition in Singur imposed significant economic hardships on a large fraction of affected owners, tenants and workers. A large fraction of owners were under-compensated relative to market values. Tenants were under-compensated and agricultural workers were not compensated at all. Singur case clearly expressed the ground level hurdles that need to be overcome for successful land acquisition (Nielson 2011). Table 2 makes comparison of acts with reference to land acquisition in this case. Table 2. Effect on M/s Tata Nano Project considering various LARR Acts

13 Parameter LAA, 1894 RFCT LAR&R, 2013 RFCT LARR, 2015 Public Purpose No effect of this clause would have affected No effect of this clause would have affected No effect of this clause would have affected Consent of affected purpose As there was no provision of consent, it reduced the time for This would have increased the time for acquisition but later It would have the same effect as that of 2013 Act acquisition but this was the main cause of Tata Nano Plant s Failure. people wouldn t have complained about forceful acquisition of their land Social Impact Assessment (SIA) Since there was no provision of this clause, it was also the reason of This would have certainly helped Tata s project, as all It would have been same as 2013 act. failure of Tata Nano Plant. As people who were affected later on rose up together in a group along with the Political support. the parameters would have already looked upon to avoid any problem at later stage Compensation Market prices of the lands were determined by land records of already sold lands. But the records were misclassified in order to save Stamp Duty. Due to this many farmers were under compensated, which was also the reason of The compensation in this act is much higher which would increase the cost of the project, but certainly it would lead to satisfaction of owners of acquired land. And it would lead to the success of the project. It would have been same in case of 2013 Act.

14 failure this project. Market Value The market values were misclassified, this lead to under compensation of many farmers which lead to dissatisfaction among these farmers and then they rose up together, which caused the project to go in vain Solatium This was low only 30% of the market value. As already stated market value was misclassified, the farmers didn t get proper solatium which in turn affected the project s success. R&R The affected families were not provided with job security and the shelter of their livelihood which created a more hurdles in the project which lead to failure of project. Food security Many lands where multi crops were The market price in this case would be higher which increase the cost of the project but certainly it would beneficial during the operation stage of the project 100% solatium will certainly cost more for the project during the acquisition stage. But the chances of project getting successful will be much higher. Providing Job security to the members of affected family and shelter for their livelihood would increase project cost and also some portion of employment would be unqualified for the project thereby creating project hurdle. Only 5% of multi cropped land can be Same as 2013 Act. Same as 2013 Act. Same as 2013 Act Same as 2013 Act as the

15 cultivated were acquired; this reduced the production of many crops which affected the supply of these crops across the state. Thus food security to the people was reduced. Moreover the cost of multi cropped land was more so it increased acquisition cost. acquired under this act which would help to ensure the Food security for all the people across the stat and help to ensure the lower cost of acquisition. project doesn t fall under the 5 exempted categories. 3.2 Case 2: NOIDA Development This case is based on the publication of Patil (2012). Over the past ten years, the National Capital Region (NCR) has been rapidly developing; New Delhi and its vicinities in the NCR particularly witnessed high growth. New Okhla Industrial Development Authority (NOIDA), which is located on the eastern side of Yamuna River, has also been experiencing rapid development as a commuter town of the capital, as can be seen by many industrial complexes being built one after another. Figure 2 shows location of Noida.

16 Figure 2. Location of Noida with respect Delhi NOIDA Development Authority prepared a plan for Greater Noida (Development Plan) covering a total area of hectares. The land use of village Shahberi has been shown in the Development Plan as Industrial was acquired for the purpose of industrial development by Greater Noida Industrial Development Authority (GNIDA). This area has been described, as Phase I of Greater Noida. The Land use specified in the Development Plan is shown in Table 3. Table 3. Land area for different uses in Noida Land Use Land Area Percentage of land Residential Industrial Commercial Institutional Green areas Transportation SEZ These farmers, who were unilaterally evicted from their land without being given an opportunity to file objections, waged a campaign against the acquisition, and of course celebrated the judgment. However, about 6,500 people, who had booked flats to be built in the district, were disappointed by the loss of their long-awaited dreams. Further, residents of other villages in Greater Noida (Noida Extension), where land acquisitions were conducted concurrently with Shahberi Village, also filed similar suits. This situation has raised developers and builders fears of bankruptcy and of failure to reimburse deposits to those who booked flats and houses in this area. While reports heat up on how financial institutions, who provide companies with funds for construction and buyers with housing mortgages, will address this issue, there are concerns over what judgment the High Court and the Supreme Court will deliver next. The Supreme Court set aside land acquisition (156.3 hectares) carried out in 2009 at Shahberi Village Uttar Pradesh State (UP), Greater Noida, Gautam Budh Nagar District

17 by the UP government and Greater Noida Industrial Development Authority (GNIDA), which is an UP government body. Based on this judgment, land was returned to the original owners (most of them are farmers). This situation occurred because the land acquisitions were originally carried out by the UP State government headed by Bahujan Samaj Party (BSP) as a part of the Greater Noida s Industrial Development Plan, pursuant to the emergency clause (Article 17) stipulated in the LAA 1894, whereby procedures for residents objections (Article 5A) were dispensed with. The grounds for the judgment of the Supreme Court were: (1) such urgency was not likely to be present, and (2) GNIDA changed the purpose of land use from industrial use to residential use without the prior approval of the State government. Table 4 shows comparison of land acquisition acts with reference to land acquisition in Noida. Table 4. Effect on Noida land acquisition considering various LARR Acts Parameter LAA, 1894 RFCT LAR&R, 2013 RFCT LAR&R, 2015 Public Purpose This clause was violated by GNIDA because they acquired land for industrial purpose and then gave it to land developers. So, this was the first stage where Nodia s land acquisition Same as 1894 Act. Same as 1894 Act but if land developers fall under any public entity they may sail through. starting crumbling Consent of affected purpose As there was no provision of consent, it reduced the time for acquisition but people who were affected were not considered during the acquisition, who rose up at later stage to fight for their right as the land was mis-used as This would have certainly reduced the risk of acquisition. If the consent by the people was supportive in nature then it would have led to It would have the same effect as that of 2013 Act unless it was brought under the exempt purposes of new bill.

18 per the LAA,1894. the success of the project. Social Impact Since there was no such This clause would It would have Assessment (SIA) provision for Assessing have certainly been same as the social impact, the restricted the 2013 act unless authority who handed over authority to hand it was brought the land to the developers over the land to under the became were linen, developers nand exempt without considering the prevented from purposes of society as a whole. any such new bill. scandalous land acquisition. 3.3 Case 3: Koyambedu Market, Chennai This case is based on the documentation retrieved from the CMDA (2009). The Koyambedu Wholesale Market Complex has been established by Chennai Metropolitan Development Authority (CMDA) with an objective of decongesting the central business district. The market is located out of the congested areas of Chennai. But at the same time, it is easily accessible to the city s residents. As highlighted the market complex is located adjacent to Chennai Mofussil Bus Terminus (CMBT) and it is connected to both the Central and Egmore railway stations and Chennai International Airport through highways. The market complex development has been planned in three phases over an area of around 295 acres. In the first phase, the wholesale market for perishables has been developed over an area of around 60 acres. Koyambedu Wholesale Market Complex has around 3154 shops where vegetable, fruit and flower is sold and is one of the largest markets in Asia (Figure 3 shows the location). The market has four discrete blocks; two for vegetable and one each for fruit and flower market. Approximately one lakh people visit the market complex daily for trading purpose, subsequently more vehicles also enter the market, which increases significantly during peak festival seasons. The developed market complex has good infrastructure facilities including well designed shops in various sizes; truck bays, wide

19 heavy duty roads for easy movements of goods. The market is provided with adequate power and water supply, proper sanitation facilities, drainage and sewerage facilities. Figure 3. Location of Koyambedu Market with respect to Chennai The general guidelines for land acquisition within the LAA 1894 were followed and CMDA went beyond them, and the process was completed in 28 months. Cash compensation was provided to land losers on the basis of the market value of the land, standing crops, a solatium of 30% and interest charges of 12% for the period between notification and acquisition. Furthermore, the affected families were rehabilitated and resettled in new location. About 424 sale deeds were considered and all but two were rejected on the grounds of being artificially priced. Even out of these deeds, the lowest was picked to form the basis of compensation, leading to some dissatisfaction amongst the affected parties. However, since project authorities had built houses in nearby locations, allowed encroachers to resettle and provided employment opportunities in the project, protests and resistance were minimal. Table 5 shows comparison of land acquisition acts with reference to land acquisition in Koyambedu. Table 5. Effect on Koyambedu Market project considering various LARR Acts Parameter LAA, 1894 LARR, 2013 RFCT LARR, 2015 Public No effect of this clause No effect of this No effect of this

20 Purpose would have affected. clause would have affected. Compensati Cash compensation along It would have on with the interest was paid to increased the cost for the affected people, but it acquisition, as the cost less as compared to compensation is 2013 and 2015 acts because twice the market the compensation is equal to value for urban the market value. areas. Market The market price was There is a Value calculated by checking probability that the recent sale deeds in that cost of acquisition area, though the clause says would be high, as the to calculate the market price clause states the of land by considering market price is to be current land use. This was calculated as higher the main reason for the of acquisition to be successful. 1. Value in Stamp Duty papers or 2. Average of top 50% of sale deed value in that area. Solatium A solatium of 30% was This would have given to the affected increased the cost of families. It cost less as acquisition, as compared to 2013 and 2015 solatium is 100% Acts R & R Even though there was no The R&R costs were provision of this clause, the borne but not in line authority had built houses with the new Act. for the affected people and The costs would gave them employment in have remained same clause would have affected. It would have been same in case of 2013 act Same as 2013 act Same as 2013 Act Same as 2013 Act.

21 the project. This turned out to be major dimension for the success of the project. or more as that of 1894 Act. 4. Conclusion The above cases can be now summarised for comparison of the application of various Land acquisition acts and show some broad directions. Tata Nano project s land acquisition case clearly indicates the reason of its failure. This failure was due to improper market rate consideration of lands which led to less compensation paid to farmers. The other reason being, no consent was obtained from the farmers whose land was acquired, they got angry due to this and protested against the government. As this case falls under LAA, 1894 there was no R&R for the affected people. Moreover, the food security issue was not given any consideration during the acquisitions which lead to reduced supply of various food grains. A lot of lessons were learned by the government from this case, which helped them to formulate LAR&R, If this case would have fallen under LAR&R, 2013 or LAR&R, 2015 it would have cost more to Tata group, but would have certainly led to its success. Also, it was a lost opportunity as the employment in West Bengal would have increased to a great extent considering various ancillary industries associated to Tata Nano Project. NOIDA development case clearly shows that how the State government and its agencies misuse the LAA 1894, which led to resistance from farmers. Flat purchasers, developers and the financial institutions that have financed the residential projects also suffered in the process as greedy investors. The main cause of failure of this project is public purpose clause was violated and urgency clause was wrongly used for acquiring land. If this case would have fallen under LA&RR, 2013 and LA&RR, 2015 it would have the same effect as that of LAA But in the case of 2013 and 2015 acts, as the public consent and SIA are made necessary, the authority appointed for the same would certainly have helped for the success of the project in its original design of

22 industrial development. It was one of the lessons for various State governments, which look upon short-term gains from misusing the law and statutory procedures. It is very clear from the Koyambedu Market case that even though there were no provisions for R&R as it falls under Land Acquisition Act, 1894, the authorities provided R&R which increased the cost of acquisition but reduced the hurdles during the acquisition stage. One more peculiar thing that can be noticed from this case is though this case falls under LAA, 1894 but it replicated that as if it has come under LAR&R Act, 2013 in some aspects. This is one of the case from which various lesson can be learned. It also proves that if any project which falls under LAR&R, 2013 or LAR&R, 2015, its probability of success in terms of Land Acquisition is high. The authorities played a witty role in acquisition which helped them get through acquisition successfully. However, the new Acts would have increased the costs of project to some extent under new provisions. The important conclusion about the Land Acquisition Acts in India and its transformation is that the Government was on learning curve by including stakeholders, increasing compensation and making R&R mandatory. But this learning is getting reduced with very painful escape routes sought in new bill of The transformation from 1894 to 2013 to 2015 is turning out to improve the success of large development projects. It is already understood that land acquisition becomes an impediment if it is not handled carefully and properly thereby affecting project success (Nallathiga 2009). Although changes to eminent domain act are needed as per the need of the hour, they need to strike a balance between gainers and losers ; also, what is more important is that the implementation of the Acts at ground level from the spirit with which they have been prepared. More and more amendments will make the bill to land nowhere due to political oppositions and this political conflict may also affect the project success.

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