Land Acquisition Act 1894

The Land Acquisition Act of 1894 is a legal Act in India which allows the Government of India to acquire any land in the country.

Generally, every parcel of land belongs to some individual or group of individuals and they have legal rights to own the land. These individuals are free to use their land according to their will or to sale their land for monetary or other advantages.
However, at times land is needed for some community purpose i.e. it serves needs of the society as a whole like roads, canals, government offices, military camps etc.
“Land Acquisition” literally means acquiring of land for some public purpose by government/government agency as authorised by the law from the individual landowner(s) after paying some compensation in lieu of losses occurred to land owner(s) due to surrendering of his/their land to the concerned government agency.

Purpose of Land Acquisition Act

Acquisition of land by the government for public purpose or for the companies is governed by the Land Acquisition Act, 1894.

The word “Public Purpose”, as defined in the Act mentioned above refers to the acquisition of land for putting up educational institutions or schemes such as housing, health or slum clearance, apart from the projects for rural planning or formation of sites.

“Appropriate Government” would mean the Central Government if the purpose for acquisition is for the Union and for other purpose it is the State Government. It is not necessary that all the acquisition has to be initiated by the government alone. Local authorities, societies registered under the Societies Registration Act, 1860 and Co-Operative Societies established under the Co-operative Societies Act can also acquire the land for developmental activities through the government.

Certain procedure has been envisaged under the statute, which has to be mandatory followed before acquiring the land for public purpose, as discussed below:

History of Land Acquisition Act

In India in 1824 British government for the first time enacted regulation I of 1824(for land acquisition).its application was throughout the whole of the Bengal provinces immediately subject to the presidency of fort William.
The rules empowered the government to acquire immovable property at a fair and reasonable price for construction of roads, canals or other public purpose. In 1850 some of the provisions of regulation I of 1824 were extended to Calcutta through Act I of 1850, with a view to confirm the title to lands in Calcutta taken for public purpose. At that time railways were being developed and it was felt that legislation was needed for acquiring land for them also.
Building act XXVII of 1839 and act XX of 1852 were introduced to obviate the difficulties to particular cities of Bombay and madras.
Act VI of 1857 was the first full enactment, which had application to the whole of British India. It repealed all previous enactments relating to acquisition and its object.
Subsequently act x of 1870 came in to effect which was further replaced by land acquisition act 1894 in order to purge the flaws of act x of 1870.
“LAND ACQUISITION ACT-1894” is a well defined, self contained efficient act for facilitating land acquisition process.
After independence in 1947 Indian government adopted “land acquisition act-1894” as a tool for land acquisition.
Since then various amendments have been made to the 1894 act from time to time. Despite these amendments the administrative procedures have remained same.

Content of the Legislation

Notification

The process of acquisition begins with the issuance of Preliminary Notification, as envisaged under Section 4(1) of Land Acquisition Act, 1894.

The notification has to be essentially published in the Official Gazette and in two daily newspapers circulating in that locality of which at least one shall be in the regional language. Further, it is also necessary that the notification has to be affixed in conspicuous places of that locality.

Filing of objections

The main objective of issuing preliminary notification is to call for objections, if any, against such acquisitions from the owners or others who are having certain interest over the property and giving them an opportunity to raise their claims against the move of the government for acquiring their lands. The persons aggrieved by such notification shall file their objections within thirty days from the date of 4(1) notification.

Final declaration

After receipt of objections, the concerned authority shall consider those objections and if found unsatisfactory, then a final declaration rejecting the claims will be issued.

Section 6 of the amended Act provides that the final declaration shall be issued by the authority within a period of one year from the date of issuance of preliminary notification under section 4(1) of the Act.

However, prior to the amendment, the time stipulated under the Act for final declaration was three years from the date of publication of the preliminary notification. The final declaration has to be published as required under section 6(2) of the Act.

Award

Section 11 of the Act provides that after receiving the objections, the authority will have to hold an enquiry. However, it is necessary that actual extent of land proposed to be acquired and the value of the land has to be assessed before starting the enquiry, as required under sections 8 and 9 of the statute.

On completion of the enquiry, award will be passed to that effect and published by the competent authority. After passing the award, the Collector/Deputy Commissioner shall send notice to the owners or their representatives who were not present personally at the time of passing of the award.

Time limit

Once the enquiry is concluded, it is the duty of the competent authority to pass the award within two years from the date of publication of the declaration under section 6, as envisaged under section 11 A of the Act. If the authority fails to adhere to the time schedule prescribed under the Act, the entire proceedings initiated for land acquisition will lapse. After passing of the award, the Deputy Commissioner or any other competent authority may take possession of the land immediately, which shall thereupon vest absolutely with the government, free from all claims, whatsoever.

Special powers

Section 17 of the Act confers special powers with the concerned authority wherein passing of award may be dispensed with and yet permits to take possession of the land notified for acquisition.

Further holding of enquiry can also be waived, as envisaged under section 5 A of the Act. However, such powers can be exercised only in case of urgency.

After passing of the award, the person whose land has been proposed to be acquired can give his consent for such acquisition and agree to receive the compensation.

Objections can also be raised against the measurement of the land, enhancement of compensation or apportionment of the compensation by filing a written application before the Deputy Commissioner, as provided under section 18 of the Act, requesting the authority to refer the matter to the court for determination of the grounds raised in the application. An application to that effect has to be filed by the person who was personally present when the award was passed, within six weeks from the date of the award passed by the Collector.

In other cases, the application will have to be made within six weeks from the date of receipt of the notice issued under section 12(2) or within six months from the date of the award passed by Deputy Commissioner, whichever is earlier.

Compensation

Provision for settlement of dispute pertaining to apportionment of the compensation amount is available under section 30 of the Act. In such a situation, the Deputy Commissioner should refer the matter to the Court.

The claimant will be entitled to the compensation which is determined on the basis of the market value of the land determined as on the date of Preliminary Notification.

According to section 34, if there is delay in payment of compensation beyond one year from the date on which possession is taken, interest at the rate of 15 per cent per annum shall be payable from the date of expiry of the said period of one year on the outstanding amount of compensation till the date of payment.

The government, under section 16 of the Act is at liberty to withdraw from acquisition of land except in cases provided under section 36.

However, if the possession of land has been taken, then the government will have no authority to withdraw from such acquisition.

Procedure for the Land Acquisition

1. Investigation

• When a local authority or a company requires a land, an application is required to be made by it to the revenue authority.
  
• The application should be 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.
  
• One of the revenue officers is appointed as the Collector to hold an inquiry under Section 5-A of the Act.
  
• After notification the owner is prohibited from selling his property or disposing of it and prevented from carrying out any works of improvements for which no compensation will be paid if executed without prior permission from the Collector.
  

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.
    
• The Collector after hearing the objections will submit his report to the Government who will finally declare the land for acquisition under the Section 6 of the Act.
  
• After notification the Collector proceeds with the claim. He has the site marked out, measured and a plan of the same is made.
  

3. Claim and Award

• The Collector will issue notices under Section 9 to all persons interested in the acquisition to file their claim reports.
  
• The Collector is not to be a party to the proceedings, is to possess an expert knowledge on valuation, and offers a fair price to an owner and checks that the public funds are not wasted.
  
• The claim filed should contain the names of the claimants and co-shares if any rents or profits for last three years and a valuation report of the land from an architect or an engineer.
  
• The Government can abandon the acquisition proceedings by simply canceling the notification. However, in that case compensation has to be paid under Section 48(2).
  
• 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.
    
• Matters which are not taken into consideration for the purpose of land acquisition are:
  
  • i. The degree of urgency which has led to the acquisition.
    
  • ii. Any disinclination of the person interested to part with the land.
    
  • iii. Any increase in the land value likely to accrue from the use to which it will be put when acquired.
    
• • 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.
  
• The collector has to make the award under section 11 within a period of two hears from the date of notification.
  

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.
  

5. Apportionment:

• In apparent of the compensation each of the claimants are entitled to the value of his interest, which he has lost, by compulsory acquisition.
  
• Thus it is required to value a variety of interest, rights and claims in the land in terms of money.
  

Authorities and agencies involved

• Union Government
  
• State Government
  
• Public authorities/agencies like DDA, NOIDA, CIDCO
  
• Companies like Reliance, TATA (for SEZs)
  

i. Procedure involved for acquisition of land for companies are dealt with under Chapter VII, which requires an agreement to be entered into by the company with the appropriate government and the same has to be published in the Official Gazette.

The government cannot initiate acquisition proceedings without issuing proper notice to the owners in any of the prescribed mode of service provided under the Act and provide them sufficient opportunity.

If any of the provisions envisaged in the Act is violated or mandatory procedures are not followed, then the entire acquisition proceedings would become totally void.

The shortcomings of the acts

• 1. The legal procedure to be followed for acquiring land is cumbersome dilatory and costly, resulting in inordinate delay.
• 2. Very often land owners contest in law whether the purpose which land is intended to be acquired is a ‘public purpose’.
• 3. land owner claim ‘ Potential Value’ or ‘Opportunity Value’ for their land on the material date ,which is most common basis for determining the compensation , puts the heavy strains on the finance of the public authority and severely restricts the scale of their development and redevelopment operations.
• 4. The failure to agree upon a ‘fair price’ often results in legal procedure of appeal, hearing and litigations in court of laws, which hold of taking possession of land for long periods.
• 5. The land acquisition act also requires an additional payment of solatium or contingent losses over and asses the above values.
• 6. Land owner always plead for enhancing the compensation on the other hand they are reluctant to pay betterment levy.
• 7. Technique of valuation of real property, which facilitate the assessment of compensation to be paid for the lands and buildings are not well developed,
• 8. Assessment of the compensation to be paid and betterment to be collected are often hampered, as records of sales and purchases of lands and buildings and ‘registers of title’ are not kept accurate and up to date.

Inferences

The land acquisition act must be comprehensively reviewed and revised to make acquisition procedure simple. As it is in many countries like [Singapore, Sri Lanka, Hong Kong, and South Korea], the determination of public purpose should be matter of executive discretion and should not be contestable at law. The only way which accumulated unearned increment and potential developed values could be removed from the compensation calculus would be the peg land values to some earlier date, there after adjustment for increase in the cost of living index should be applied. Finally improvement required in the procedure system that allows development works to be under taken on the time without the delays. The provisions be made for providing rehabilitation or adjustment of displaced land holders either in the scheme itself or otherwise.

Major reason why people do not want to part with the land. There is a considerable difference between the market value and the value that the Land Acquisition Officer pays.

External links

• Free Legal Advice/Discussion Board on Indian Laws
• Full text of the act