Jaitirth Rao In The Indian Express
The Supreme Court’s judgment in the Noida land acquisition case has raised concerns because some have interpreted it as being against the spirit of economic reform. It is this columnist’s contention that far from being anti-market, this judgment is pro-freedom, pro-market, pro-citizens and against the machinations of an emerging tyrant state in India.
In 1978, the short-lived Janata government was at the forefront in amending our Constitution to remove the right to property as a fundamental right of Indian citizens. B.R. Ambedkar, Benegal Rau, K.M. Munshi, Alladi Krishnaswami Aiyar and Rajendra Prasad had correctly included property as a fundamental right knowing full well that if tyrant kings (the executive branch of government in modern times) are allowed to arbitrarily seize property, then free citizens will inexorably be turned into servile subjects. The prevalent mood in the 1970s was tragically of the socialist persuasion. The judiciary was accused of ruling in favour of rich mahants and zamindars like Golak Nath. It was assumed that the fundamental right to property was a privilege of the rich. Ironically, when this right was removed as a fundamental right, the sufferers have not been rich individuals or corporations. Instead, in state after state, the government has used its sovereign right of eminent domain to acquire land from the poor, re-zone the land and sell/ lease it to rich capitalists and corporations at subsidised prices. Those who had warned in 1978 that the constitutional amendment was dangerous and anti-people have been proved to be prescient. Whenever rights of citizens are abridged by the state claiming to act on behalf of the poor, as night follows day it must follow that this abridgement will sooner or later be used to oppress the poor and the weak.
The state’s sovereign right of eminent domain is supposed to be exercised to acquire land for “public purposes”. Public purposes have always implied the creation of public goods like roads, railway tracks, canals, reservoirs, sewage farms, etc. To argue that factories (that primarily benefit their owners), flats (that benefit builders and new home-buyers), shopping malls (that benefit builders) and so on are “public goods” is an insult to the language and vocabulary of just laws. And yet, this is how the Government of West Bengal argued in Singur and Nandigram and the Government of UP has argued in Noida. In Bengal, the tribunal of the people rejected this. (A cynic would argue that this is in keeping with the hoary Bengali leftist tradition of deciding disputes in the streets and not in courts.) In UP, our courts have come to the rescue of property owners (in this case poor farmers). Our Supreme Court’s judgment is entirely in keeping with the spirit of the dissenting judgments of Justice Sandra Day O’Connor (and two others) and a separate dissenting judgment of Justice Clarence Thomas of the US Supreme Court in the case of Kelo vs City of New London.
Justice Thomas was quite clear that the right of eminent domain can be used only for public goods — not “to take from Peter to give to Paul”, or in Indian terms to take from farmers and give to factory owners or real estate developers. In Kelo vs City of New London, the wealthy “Paul” was the well-known pharmaceutical giant Pfizer Corporation. The poor “Peter” was a humble American citizen named Kelo who owned a plot of land and a home in the city of New London. The political leaders of New London were tempted by Pfizer’s grandiose plans to “develop” a so-called depressed neighbourhood. Pfizer promised to create 3,169 new jobs and increase municipal revenues by $1.2 million per year. The fact of the matter is that while hapless Citizen Kelo’s house has been seized by the politicos of the City of New London, Pfizer has merrily walked away from its commitments. Ergo: no jobs, no tax revenues for the city. The parallel with the seizures of enormous parcels of land from Kelo’s brethren in India to create shining new SEZs which are yet to come into being is obvious.
Criticising the majority judgment in the US case, Justice O’Connor said: “Any property may now be taken for the benefit of another private party, but the fallout from this decision will not be random. The beneficiaries are likely to be those citizens with disproportionate influence and power in the political process, including large corporations and development firms.” Justice Thomas went one step further when he wrote as follows: “Allowing the government to take property solely for public purposes is bad enough, but extending the concept of public purpose to encompass any economically beneficial goal guarantees that these losses will fall disproportionately on poor communities.” Even though these learned justices may never have visited India, it is indeed quite uncanny as to how they have anticipated the behaviour of the Indian state. Claiming that factories, apartment blocks and shopping malls are “economically beneficial”, property is being transferred from the poor to the rich. The justices referred to this as the “reverse Robin Hood” phenomenon.
There is no point in hiding behind the usual smokescreen of blaming colonial laws. The issue in India rests with the illegitimate definition of public purpose and the Machiavellian manner in which re-zoning (which drives up land prices) is done after the land has been acquired from powerless citizens at absurdly low rates. The proposed new law with endless arguments about whether forcible acquisition for a factory or a mall is in order after 70 or 80 per cent of the land has been acquired by the powerful corporation/ developer is a deliberate attempt to confuse the issue in order to continue to support crony capitalist behaviour. The only fair solution is to have an extremely narrow definition of public purpose and to re-zone land usage before so-called development activities are started, not afterwards. Better still, restore property as a fundamental right so that citizens can go to courts to fight an executive branch which is hand-in-glove with “citizens with disproportionate influence”.
The writer is an entrepreneur based in Mumbai
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NEW DELHI: The Supreme Court on Tuesday slammed the authorities for taking advantage of the “colonial law” on land acquisition to divest farmers of their prime agricultural land benefitting the rich and paying “pittiance” to common men. The apex court said a “sinister campaign” has been launched by various state governments to take adavantage of the law against the poor people for taking away the land and giving it to builders where multiplexes, malls, posh residential complexes are developed which are beyond the reach of common men.
“Do you think judges live in fools’ paradise”? snapped a bench of Justices GS Singhvi and AK Ganguly when senior advocate PP Rao responded to a question that the residential complexes were being developed for the “needy”. “You are building hotels, malls, commercial complexes, townships where common men have no access. Does it come under the perception of public purpose for which the land have been acquired?”
The bench questioned the change by Uttar Pradesh government in land use in Greater Noida and said “this is not the plan for which the land is acquired. How different notifications came out for changing the use of land”. The sharp remarks were made by the bench during the hearing on petitions filed by Greater Noida Industrial Development Authority and real estate developers and builders, including Supertech and Amrapali, challenging the Allahabad high court order which had quashed the notifications for land acquisition in Greater Noida adjoining the national capital.
- Supreme Court slams U.P. over land acquisition (hindu.com)
- Allahabad High Court sets aside acquisition of land (hindu.com)
- Supreme Court stays return of land to unwilling farmers in Singur (hindu.com)
- Land of dreams (bbc.co.uk)
- India farmer land protest spreads (bbc.co.uk)
- 2 policemen, farmer killed as U.P. hostage drama turns violent (hindu.com)
- Rahul Gandhi: The Noida Excavator or Just Ash-Bone Collector! (neerajbhushan.com)
V. VENKATESAN in New Delhi – FRONTLINE
The 117-year-old Land Acquisition Act cries out for reform, but there is resistance to introducing positive changes.
The Land Acquisition (Amendment) Bill, which seeks to amend the Land Acquisition Act, 1894, has had a long period of gestation. The Union Ministry of Rural Development initiated the process of amendment way back in October 1998. But it took around 10 years for the government to bring the Bill before Parliament.
The 1894 Act was long used for acquisition of land for public purposes and also for companies. However, it was widely felt that the Act required changes in order to strike a balance between the need for land for development and other public purposes and the need to protect the interests of persons whose lands are acquired.
The Land Acquisition (Amendment) Bill, 2007, was thus introduced in the Lok Sabha by the then Rural Development Minister, Raghuvansh Prasad Singh, on December 6, 2007 (Bill No.97 of 2007). It was then referred to the Standing Committee on Rural Development. The committee submitted its report to Parliament on October 21, 2008, and official amendments to the Bill were cleared by the Group of Ministers in December 2008. It was rechristened the Land Acquisition (Amendment) Bill, 2009, and passed by the last Lok Sabha on the penultimate day of its tenure, February 25, 2009 (Bill No.97-C of 2007). The government tabled the Bill in the Rajya Sabha on February 26, 2009, but could not ensure its passage before the House adjourned. The Bill lapsed after the constitution of the current Lok Sabha and the return of the United Progressive Alliance (UPA) to power in May 2009.
It is indeed surprising that the Bill, on which there are intense disagreements between the government and civil society, came close to enactment in 2009. It is equally paradoxical why the UPA-I government hastily secured the Bill’s passage in the Lok Sabha when it knew that it was near-impossible to do so in the Rajya Sabha, where it lacked a clear majority, and that the House was about to adjourn. Records of the Lok Sabha debates of February 25, 2009, reveal that the government sought the Bill’s passage in the absence of a substantial section of the Opposition and amidst protests from the remaining members in the House against some of its provisions.
The Lok Sabha debates of February 25, 2009, may only be of academic interest as the UPA-II government has promised to consider the criticisms against the Bill since then before introducing a revised Bill during the next session of Parliament. Nevertheless, the debates are worth revisiting, if only to understand the flaws in the Bill as originally conceived.
Raghuvansh Prasad Singh had claimed, while seeking members’ support to the Bill, that the Bill was pro-farmer and pro-poor. The government felt that the Bill’s salient features, specifically the abolition of the provision enabling the government to acquire land for companies, would make it acceptable to the MPs. According to the Bill, the government will acquire 30 per cent of the land for a private company only after the company has purchased directly 70 per cent of the land it requires. The Bill also promised to compensate farmers dispossessed of their land on the basis of the market price before their displacement. The Bill also promised to return the land to the owner if it was not used for the purpose for which the acquisition was made.
But these salient features paled into insignificance in the face of mounting criticism against the Bill. The Standing Committee had recommended that the 1894 Act should be repealed and new comprehensive legislation enacted in its place. The reason for this recommendation was that the 2007 Bill sought to make exhaustive amendments to the Principal Act, which might create confusion and legal complications. The committee rejected the government’s contention that the Parent Act with the proposed amendments must continue as a large number of very old cases involving the Act were still pending in various courts. However, this has not found favour with the government.
The Standing Committee felt that the Principal Act defined “public purpose” in a detailed manner and did not provide any discretion to the government. The committee, therefore, opposed Section 5(v)(f)(iii) of the Bill, which includes ‘any other purpose useful’ to the general public for declaring a project as public purpose. The committee feared that such discretion would enable the government to give benefit to a particular person or company. The revised Bill retains this controversial provision without addressing the committee’s concerns.
The committee found that the criteria of government acquiring land for a private company where 70 per cent of the land has been acquired by the company (that is, the body which requires land for setting up public welfare projects) were contradictory. It is because resettlement and rehabilitation (R&R) would be taken care of by the government for 30 per cent of the population (residing on land acquired by the government) and by the company for the 70 per cent.
As the social impact assessment study would be done only for families residing on land acquired by the government, the committee felt that benefits provided to these families would be governed by criteria that would not apply to families whose land had been acquired by the company. This would result in contradictions and frictions among families living in the same area. The committee, therefore, unanimously opposed the 70:30 criteria. The government ignored this concern, too, while revising the Bill in 2009.
The committee felt that the Principal Act, while defining ‘public purpose’, included housing without qualifying it. Such a definition, it said, was too liberal and included the acquisition of land for private companies for the purpose of building high-income group residential premises. Therefore, it recommended that the word ‘housing’ should be replaced by ‘housing for lower and middle-income groups’.
But the Bill, as revised by the government in 2009, includes housing “for such income groups as may be specified from time to time by the appropriate government” as part of its definition of public purpose. It is clear that such a definition defeats the very objective of the committee’s recommendation.
The determination of the market value of the land being acquired is another contentious issue. The committee had recommended that the highest price of sale deed, as indicated in the sale deeds of the last three years, plus 50 per cent of the highest price should be the criterion for assessing and determining the market value of the land being acquired. The committee felt that in tribal areas, since the land could not be purchased by non-tribal people, tribal people usually do not get adequate compensation when land is acquired and market price fixed.
Therefore, the committee recommended that in tribal areas the criterion for fixing market price should be the highest price of a sale deed of the adjoining non-tribal blocks/village for the last three years plus 50 per cent. The government ignored this recommendation, too, in the revised Bill.
The National Advisory Council (NAC), in its 13th meeting held in New Delhi on May 25, recommended that compensation for those who would lose land should be six times the registered sale deed value, including solatium. The assignees of government land should also be entitled to the same compensation, it suggested. Those who lost land should be offered the option of receiving all or part of their compensation in the form of annuities, it suggested.
The committee further found that sometimes the government acquired land for a public purpose and later used it for a purpose different from the originally intended one, resulting in the price of the land appreciating several times. Whereas the people residing in the surrounding areas benefited greatly by the project set up on the acquired land, the persons who lost their land to the project did not get any portion of the resultant hike owing to the acquisition.
The committee, therefore, felt that some share of the resultant hike owing to land acquisition should also go to the persons on whose land the specific project was set up. It thus recommended that the Bill have provisions to give some extra monetary benefits to the affected person/family in such cases. The revised Bill ignored this recommendation too.
During the Lok Sabha debate in February 2009, some members questioned the government’s claim that most of the recommendations of the Standing Committee had been accepted while preparing the revised Bill. Sandeep Dixit of the Congress reminded the government that there was a consensus that both the Land Acquisition (Amendment) Bill and the R&R Bill would be merged. The merger was considered necessary because drafting differences in the two Bills caused confusion with regard to similar provisions.
The NAC also recommended a single comprehensive law that discouraged forced displacement and minimised adverse impact on people, habitats, the environment, food security and biodiversity. It also recommended that the law should ensure that the process explored all possible options of acquiring more barren and less fertile and waste land before acquiring agricultural land.
It should also define comprehensively project-affected persons/families and provide for a just, timely compensation, resettlement and rehabilitation package through a humane, participatory, informed, consultative and transparent process, allowing for effective and fair implementation.
The NAC also made other significant proposals. Those who lost livelihoods (and not just land), too, should be compensated, it proposed. Another proposal was that agricultural workers, artisans, fisher-folk and forest gatherers, if they lost their livelihoods because of the acquisition of land, should be entitled to a grant amounting to 10 days’ minimum wages a month for 33 years.
Yet another proposal was that if land was acquired for a public purpose and not used within five years, private property that was acquired should be returned to its original owners. But the Bill provides for the reversion of the unutilised land only to the appropriate government (in the case of government-acquired land) and not to private owners. Here, the government apparently shared the Standing Committee’s view that “public purpose” was very vast and the appropriate government would be at liberty to use the acquired land for any purpose coming within the definition of public purpose.
But the government ignored another important but related recommendation of the Standing Committee. The committee had recommended a safeguard against acquisition of excess land at the notification stage so that the question of barring the government from transferring the acquired land for a purpose other than the public purpose did not arise.
The government’s sincerity in revising the 2009 Bill in the light of the recommendations of the Standing Committee, the NAC and civil society groups is now on test.
- The Land Acquisition (Amendment) Bill, 2007 (indialawyers.wordpress.com)
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27 May 2010 Sanjay K Singh Economic Times
NEW DELHI: The state can acquire land even if owners have not been issued a notice, the Supreme Court has ruled. The apex court added that land acquisition will not be illegal even if there are discrepancies in the notice served to affected owners under the provisions of the Land Acquisition Act.
“Section 9 of the act (Land Acquisition Act, 1894) provides for an opportunity to the ‘person-interested’ to file a claim petition with documentary evidence for determining the market value of the land and in case a person does not file a claim under Section 9 even after receiving the notice, he still has a right to make an application for making a reference under Section 18 of the act.”
“Therefore, scheme of the act is such that it does not cause any prejudicial consequence in case the notice under Section 9(3) is not served upon the person interested,” said a vacation bench comprising Justice B S Chauhan and Justice Swatanter Kumar.
The court said: “The land vests in the state free from all encumbrances when possession is taken under Section 16 of the act. Once land is vested in the state, it cannot be divested even if there has been some irregularity in the acquisition proceedings. In spite of the fact that Section 9 notice had not been served upon the person interested, he could still claim the compensation and ask for making the reference under Section 18 of the act. There is nothing in the act to show that non-compliance thereof will be fatal or visit any penalty.”
The court rejected the plea which had said that the provisions of Section 9 of the act was mandatory in nature and non-compliance thereof would vitiate the award and all other consequential proceedings.
Zeroing in on Section 9 of the act, the bench said, whether the provision is mandatory or directory, depends upon the intent of legislature and not upon the language for which the intent is clothed.
“The issue is to be examined having regard to the context, subject matter and object of the statutory provisions in question. The court may find out as what would be the consequence which would flow from construing it in one way or the other and as to whether the statute provides for a contingency of the non-compliance of the provisions and as to whether the non-compliance is visited by small penalty or serious consequence would flow therefrom and as to whether a particular interpretation would defeat or frustrate the legislation and if the provision is mandatory, the act done in breach thereof will be invalid,” remarked Justice Chauhan writing the verdict for the bench.
It said, “failure of issuance of notice under Section 9(3) would not adversely affect the subsequent proceedings including the award and title of the government in the acquired land. So far as the person interested is concerned, he is entitled only to receive the compensation and therefore, there may be a large number of disputes regarding the apportionment of the compensation. In such an eventuality, he may approach the district collector to make a reference to the court under Section 30 of the act”.