REBUILDINGS LIVES- AT THE STAKE OF INDUSTRIES THE LAND BILL

Gujarat National Law University: Whether its direction for speeding up acquisition for Vandalur bus terminus in Chennai or industry setup in Sayane in Maharashtra, expansion of Coimbatore airport or the development of Karamana-Kaliyikkavila Road, the sudden rush to speed up acquisition seems to be majorly driven by the passing of Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Bill, 2013 (“land bill”) by Parliament. The land bill which awaits the assent from the president is expected to hit the ongoing process of acquisitions where no compensation or no possession or where process of acquisition is incomplete due to retrospective application. In such case, the acquisition proceedings will start afresh which will further delay the developmental process and make the projects unviable. It is argued by the industries that this situation could have been easily avoided by applying only the compensation, resettlement and rehabilitation provisions to such acquisitions.

The land bill which replaces 119 year old law which witnessed in last two decades incidents of protest, legal disputes and violence due to the persistent forced land acquisition by the state government.  The Act of 1894 was grossly misused by the state government through urgency clause, unfair determination of compensation, and the law had no provision for rehabilitation and resettlement adding to the woes of the people. It was the whip by the dictum of Supreme Court calling use of the 119 year old law as fraud added fuel into fire of demand replacing the current legal framework for acquisition of land in India. The aggressive demand by especially civil society for law which ensures fair compensation, transparency, rehabilitation and resettlement of people affected by the acquisition laid the passing of the present land bill with the similar anticipation. But on the contrary the land bill has been widely debated and criticized rather being much appreciated by the business community accusing of being lopsided and hindering the industrialization in India.

The land bill seeks to level the scores with industries against the poor farmers who have been deprived of their land at marginal costs and left with literally no home to live under the 1894 Law.  The new law will come at a time when industries in India are struggling with the slow down.

The land bill moves from traditional acquisition to somewhat similar concept to purchase of the land wherein consent of affected persons will be prerequisite to acquire the land. It is being debated the provisions such as requirement of 80 % consent of the affected family in acquisition for private projects and 70 % consent of the affected family in acquisition for PPP projects will delay the project adding to the cost of projects. The compensation to affected persons four times the market value in case of acquisition of rural land or two times the market value in case of acquisition of urban land  are burdensome provisions and will increase the property prices across India.

Each acquisition under the land bill will go through a long drawn process and may take half a decade to complete. The process under the bill includes social impact assessment which will be review by expert committee, and later examined by the state government, then the issue of preliminary notification, followed by the process of rehabilitation and resettlement and finally the declaration.  Considering inflation the timelines will add to the cost of the project ultimately can be a burden on the project promoters. This way the bill will not only create entry barriers for the private players but also expected to affect the prospective buyer’s especially landless lower middle class as the burden of cost of acquisition may possibly pass on by the realtors on to landless lower middle class or middle class as other prospective buyers or investors will switch for alternative option of investment rather getting to expensive and risky investment. More than the real estate projects the bill can prove to be pain in the neck for large infrastructure projects as the bill to apply in acquisition of certain defined areas.

The land bill ignores the ground realties especially the bill has no provision for creating awareness among the affected persons about the benefits under the land bill or creating of counseling houses or care centre to assure that no violence takes place. Although, some provisions such as for schedule tribes, resettlement and rehabilitation, mandatory and time bound SIA, food security, exemptions from tax and stamp duty, the choice of annuity and subsistence allowance ensures social economic justice to affected persons.

The land bill makes the acquisition process lopsided as it is cumbersome and expensive and largely farmer friendly. The success of the bill fairly depends upon the use by the state governments as it leaves space to mishandling at various places for instance no consent requirements in case of government projects and can even back fire the state government with protest and accompanied violence.

The industries usually insist on government to acquire land first and then prefer to buy the land from government as majority of land titles in India are unclear, the passing of land titling bill and amendments to 1908 law on registration will play an important role for large availability of clear land, speedy settlement of title disputes, and award of compensation.

At times when India Inc is struggling with the slowdown and realty sector facing the real brunt of it, the land bill might delay the gratification also close the development doors for longer time, the bill which awaits the assent of president poses series of serious question, importantly “Is it the right time for such a lopsided bill”. Whether the bill will attain balance between economic growth and social economic justice to those who are affected by the acquisition. It will also be interesting to see how many acquisitions take place after this bill.

The writer is Mr. Anand Ramadhar Shrivas, (CCEL) Research Fellow Real Estate Laws, at Gujarat National Law University, Gandhinagar.