New legal regime gets under way

Sudhanshu Ranjan | Updated on March 12, 2018 Published on October 23, 2011

The state acted as a property dealer in Greater Noida, but that does not mean it should be divested of its role in land acquisition.

The exercise of eminent domain has been a contentious issue between courts and the governments.

The courts have ruled against land acquisition in Uttar Pradesh and West Bengal, in effect, preparing the ground for implementation of the proposed Central law on land acquisition even as it awaits passage in Parliament.

Recently, the Allahabad High Court quashed the compensation of land in three villages — Asdullapur, Shahberi and Devla - while instructing the Greater Noida Development Authority to pay a higher compensation in villages that had challenged land acquisition by the state.

Earlier, the Calcutta High Court upheld the Singur Land Rehabilitation and Development Act, which quashed the land acquired by Tata Motors and paved the way for its return to farmers.

Under the proposed law, the Land Acquisition, Rehabilitation and Resettlement Bill, 2011, it is clarified that land acquisition refers to the forcible acquisition of land from an unwilling seller and is distinct from a land purchase from a willing seller.

Earlier, the Supreme Court annulled land acquisition in the Shahberi village in Greater Noida. So, one thing is clear — land acquired from reluctant farmers is liable to be quashed.

When the Supreme Court set aside the land acquisition in Shahberi, it said that food security was a major challenge. It laid down that the doctrine of ‘eminent domain' would have to be read with Articles 14 and 21 of the Constitution and the Directive Principles of State Policy.

Article 39 of the Constitution mandates that the State shall direct its policy towards securing that the citizens have the right to an adequate means of livelihood and that the ownership and control of the material resources of the community are so distributed as best to subserve the common good.


The power of eminent domain has been recognised as an essential attribute of sovereignty. It means the legal capacity of the State to acquire the private property of individuals for public purposes. The Supreme Court held in Kameshwar Singh v. Bihar (1951) that though the existence of this power is recognised, Constitutional provisions act as safeguards subject to which the right may be exercised.

On the issue of compensation and the right to property, the government and courts have been on a collision course. The courts have sided with property rights of the individual, forcing the Centre to dilute these rights through Constitutional amendments. However, it should be noted that the Centre had then sought to push ahead with zamindari abolition, whereas now land acquisition is often seen to benefit private interests.

So, the first amendment, made when the Constitution was hardly a year old, amended Article 19 of the Constitution and inserted provisions for securing Constitutional validity for the zamindari abolition laws. The Fourth Amendment overturned the Supreme Court ruling in West Bengal v. Bela Banerjee (1954) by providing that no acquisition shall be called into question on the grounds that the compensation was not adequate.

The Seventeenth Amendment further circumscribed the fundamental right to property under Article 31. The concept of “estate” was expanded to overcome the Supreme Court's decisions and those of the Kerala High Court.

Ryotwari estates were specifically included in Article 31A as the Supreme Court held in Karimbil Kunhikonam v. Kerala (1962) that ryotwari estates did not fall within the ambit of Article 31A.

At the same time, the state was restrained from acquiring any self-cultivated land within the ceiling fixed by law till compensation not less than the market value was paid. When the court persisted in its interpretation of the word “compensation”, Parliament substituted it with the word “amount” by the Constitution (Twenty-Fifth Amendment) Act, 1971.

The proposed Bill recognises the state's right to acquire for ‘public purpose', but again this term has been defined so broadly that it leaves wide scope for misuse as has been the case so far.

It includes, among other things, provision of public goods and services by private companies or public-private partnerships; these require the consent of 80 per cent of project-affected people.


The definition of ‘public purpose' should have been narrowed down to the minimum, little scope for discretionary interpretation. The Land Acquisition Act, 1894 did not define the term ‘public purpose', and so, it was left to the courts to interpret it.

Even in 1971, when the right to property was a fundamental right, the Supreme Court, in Jage Ram v. State of Haryana (1971), rather surprisingly, took a very wide view of the term and left it to the state governments to define the terms. Prior to this, the courts had protected the right to property, which led to several Constitutional amendments.

The logic behind ‘public purpose' is that the state would always act in the larger public interest.

However, recent experiences have belied this assumption. Land acquisition in Greater Noida was set aside because the land use was changed without any justification to benefit builders. The state acted like a property dealer.

For over two decades, the state has been using its power to acquire land for use by private industries whose aim is to earn profit above all else.


The second shortcoming of the Bill is that it has retained the urgency clause of 1894 Act. Section 5 of the Land Acquisition Act, 1894 provides for public hearing and objections are invited under it. But this public hearing can be suspended under urgency clause of Section 4(17).

If it is done, then the state acquires the land without hearing the land owner under Section 9 and if the owner refuses to accept the price of his/her land, then the money is deposited in the account of ADM (Land Acquisition) which s/he can collect any time in the future.

In Greater Noida, the urgency clause was invoked without any justification as there was no natural calamity or disaster or immediate threat to the national security. Further, the Bill does not provide for adequate compensation as the market rate is not defined.

It seeks to pay four times of the market rate; the earlier draft had proposed it at six times. The market rate is quite unrealistic as most of the payments are made in cash to save on stamp duty. If it is decided on the basis of circle rate decided by the DM, then also it is very low.

The state should not be totally divested of its role in acquisition; instead, its accountability should be enhanced.

If the private sector is given full freedom to purchase land from farmers, there is every possibility that the poor will be lured or coerced into selling for a pittance.

(The author is a senior TV journalist and columnist. blfeedback@thehindu.co.in.)

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Published on October 23, 2011
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