Summary

Land Acquisition, Human Rights and

Corporate Governance; Emerging Concerns

60 years down the independence; Indian economy is in transition phase. A sea change has

taken place in its policy framework with respect to different sectors of economy. But, the land

remains a fundamental need for all economic activities. The recent people's resistance against the

acquisition of agricultural land across the nation has initiated a great debate. Apart from the

common man being at the centre of debate, the respective State Governments, Political parties and

civil societies are actively participating in this discourse. The discourse arose due to this phase of

massive industrialization; transforming an essentially agrarian economy into an industrial power

and concerns mainly with location of industries, compensation and employment of the displaced

person. The very relationship between agriculture and industrialization is being questioned1.

Nevertheless, it is quite bizarre to note that neither the Government nor any of the political parties

are serious enough to discuss the efficacy of colonial legislation i.e. Land Acquisition Act, 1894.

The Land Acquisition Act, 1894 remained only the important legal instrument of acquiring land

for private companies in India even after 60 years of independence.

The Land Acquisition Act seems to be very special as much legislations are based on it; facilitating

awaited industrialization, giving a solution to unemployment2, widening the divide between urban

and rural3, threatening environment and propagating disguised unemployment4etc.

The Colonial legislation had been enacted in a different regime, for very specific purposes which

1S. Morris., India Infrastructure Report 2001: Issues and Regulation and Industry Structure, (Oxford University Press,

New Delhi, 2001). 2R Seshsayee. ‘How can land acquisition be made human?’, Economic Times, 16 June 2007. 3S. Morris. and Sekhar Rajiv, India Infrastructure Report, (Oxford University Press, New Delhi, 2004). 4S. Morris and Pandey Ajay; ‘Towards Reform in Land Acquisition Frame Work in India’ Economic and Political

weekly, June 2007, p 2083.

suited Britishers most. But, the irony of Indian democracy is that a successful attempt to provide

a legal framework for land acquisition had not been made for a long time. In first decade of 21st

century it was sincerely considered to remove 120 years old land acquisition law, and finally The

Right to Fair Compensation and Transparency in land Acquisition, Rehabilitation and

Resettlement Act, 2013 was passed to ensure justice in the matter of land acquisition.

History lends perspective, even as, and perhaps because, it repeats itself. Land Acquisition Law,

whether in 2013 or in 1894, are but links in the long chain of institutional arrangements and

conveniences, to address the specific issues of the day. Some of these issues have not gone away

in a century and a half.

The Land Acquisition Act, 1894 replaced all previous laws relating to land which was enacted for

acquiring privately owned land by the state for public purposes. The succession of events which

led to the enactment of this Act clearly showed that it was need of the time. Mining, plantation,

establishment of railway lines, manufacturing industries, beginning of major irrigation works,

roads and buildings all needed land which again was already under various forms of state

controlled and customary tenurial systems that existed from the pre-colonial period. This enabling

Act empowered the state to acquire any privately owned as well as common land property for

public purpose5.

Even after independence and the adoption of the Indian Constitution, the1894 Act continued to be

in force, albeit with periodic amendments6. The new Nation State built new cities Jamshedpur,

Chandigarh, Bhillai and so on as part of the Nehruvian vision of modernity. The State also

expanded its economic reach by focusing on heavy industries and linked infrastructure, for which

available land was a pre-requisite. ‘Eminent Domain’ theory or the justification of State’s

acquisition of land, even if involuntary, for ‘public purpose’ and for ‘compensation’, continued,

this time, as an essential attribute of sovereignty itself, control over territory being a marker of

sovereignty in International Law7. Combined with the needs of modernity, the rhetoric of the

‘commanding heights of the State’ or of ‘dams as the ‘temples of modern India’ also finds

prominence in land acquisition.

5 Vikas Nandal, ‘Land Acquisition Law in India: A Historical Perspective’, International Journal of Innovative

Research & Studies, Vol. 3, Issue 5, p. 466 < http://www.ijirs.com/vol3_issue-5/33.pdf> accessed on 30th January,

2015. 6 The Land Acquisition Act, 1894 has been amended in 1919, 1921, 1923, 1933, 1962, 1967 and 1984. 7 Usha Ramanathan, ‘A Word on Eminent domain’, <http://www.ielrc.org/content/a0902.pdf> accessed on 30th

January, 2015.

Present Position of Land Acquisition Law

In the last twenty five years, democracy has further ‘deepened’, bringing newer voices, especially

marginalized castes and regional parties. In post liberalization India, civil society and private

industry also wield influence. Coalition politics is an unavoidable political reality. The State too

is far from the uniform behemoth apart from the Executive, Legislature and the Judiciary (held

together and yet distinct within the tangle of ‘Separation of Power’ theories), there are numerous

Centre-State (and now, some local), debates around federalism. Within the emerging federalism,

since various matters pertaining to ‘land use’ were anyway part of the State List in the Constitution,

debates around land acquisition too have gradually shifted to the states.

Since 1991, and particularly in the last decade, while the State has remained the predominant actor,

the private sector has also become significant, the latter’s role in economic growth being

acknowledged by the State in policy decisions, including facilitation in land acquisition for ‘public

purposes’. This development too, is not entirely new. The 1894 Act had envisaged such

applications as well. The moot question however is whether the degree of such acquisitions has

significantly increased in the last few years, given the rise of private enterprise and its wider

acknowledgement by the State in economic growth. Eminent Domain still holds in such cases; the

acquisition has to be for a ‘public purpose’ and ‘compensation’ has to be paid.

The Judiciary has become even more powerful arbiter of such decisions, also stemming from the

rise of Public Interest Litigation (PIL) as a legal tool since the 1980s. Where the political landscape

is variegated enough to contain multiple competing voices, the term ‘public purpose’ too has

become a subject of multiple renderings, where each voice has an opinion on what ‘public purpose’

is, and more significantly, what isn’t. A fiscal argument is beginning to open as well, in imagining

the taxation and redistributive machinery (within the newer debates on fiscal federalism, such as

the proposed Goods and Services Tax structure), to be tied to land use, and that in turn being

possibly used to justify newer forms of ‘public purpose’ by newer private actors.

The Current wave of people's resistance must be taken in a right spirit so as to transform the Land

Acquisition Act, 1894 in line with the democratic and egalitarian spirit of the Indian Constitution

which fosters a sustainable future of the country, much awaited ‘The Right to Fair Compensation

and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013’ was enacted

to meet out the problems relating to compensation, resettlement and rehabilitation of displaced

people, calculation of market value.

By implementing The Right to Fair Compensation and Transparency in Land Acquisition,

Rehabilitation and Resettlement Act, 2013; the government claims to provide panacea for all the

ills related with land acquisition for Public Purpose, aimed at minimizing displacement, providing

adequate rehabilitation packages, and to expedite implementation of the rehabilitation process.

Research Problem; Hypothesis

The earlier legislation dealing with acquisition of land in India was the colonial Land

Acquisition Act, 1894. The jurisprudence that has developed over the years on this

subject has made the citizen, a subject. The colonial mindset that was all pervasive under

the Act is still reflected in practice and even the judiciary in some cases has inadvertently

furthered this notion. Thus, it becomes imperative to scrutinize the law and test it, against

the contemporary democratic values.

The underlying assumption behind land acquisition in India is the public purpose

justification. To acquire land by virtue of the power of eminent domain, the government

must satisfy that, the acquisition is for public purpose and there shall be compensation.

The statutory design is that, if the acquisition is for public purpose the government can

acquire the lands. Therefore the question of public purpose question is an important aspect of it.

This crucial phrase which would determine the validity of acquisition of land in question. If land

is to be acquired for industrial development resorting to eminent domain and

consider it as public purpose, then a broader interpretation of the term public purpose is

necessary. If a broader interpretation is given to public purpose one has to be sure about

drawing the line between the public purposes and the non-public purposes. It is of utmost

importance that the executive and the judiciary tread a clear line, otherwise the difference

between public purpose and non-public purpose stands dissolved. In the quest of

economic development a too liberal interpretation of the expression public purpose can

devoid the people of their inherent right to hold their property, therefore it is incumbent

on the government to balance the conflicting claim of the citizens and the society.

Another, concerns related with the compulsory acquisition regime is the issues relating to

adequate compensation, compulsory social impact assessment and resettlement and

rehabilitation of the displaced persons. The Act of 1894, only provides for monetary

compensation, which can never be an adequate substitute. Further, relief under the Act is

provided only to the owners of the acquired land and it completely ignores peasants and

workers whose lives are also dependent on the land acquired.

The work in the course also investigates the dimension of corporate governance and role of

corporations in land acquisition process. The work also investigates in cursory way the role of

ladies in the land acquisition process. Keeping in view the Land Acquisition Act, 1894 could not

meet the expectations of Indian People for fair land acquisition process and assuming that The

Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and

Resettlement Act, 2013 shall prove a good replacement the researcher aims to investigates the

dimensions of compensation, corporate governance, rights of internally displaced people or project

affected persons, role of ladies in land acquisition, rehabilitation and settlement of affected persons

due to land acquisition process.

Literature Review

Nothing is created in vacuum. The researcher is humbly grateful to all the authors of past on the

subject. The primary source for the work is Land Acquisition Act, 1894 which played long innings

in the history of India for the land acquisition. Bela Banerjee’s and K.T. Plantation’s by the Indian

Supreme Court has been locus classicus on the subject. The Right to Fair Compensation and

Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 has replaced the

Act of 1894 and made it more meaningful has also been a primary document on the subject for

research.

Research Methodology

The research adopted basically is doctrinal in nature, and the emphasis is to analyze the statutory

provisions, with the help of the opinions of jurists and policy framers available in current Law and

journals in India and abroad and on internet websites. The judicial interpretation which is helping

in the emergence of a new corporate jurisprudence is a major area of analysis. For the purpose of

primary data scholar would endeavored to collect views of legal, social, political luminaries in

various professions as academics, and practitioners of law. The effort of the scholar is in toto; an

observation on various events/incidents would also be used as a primary data for the purpose of

the study.

Keeping in view the nature of the problem analytical method has been adopted. In accordance with

this method apart from the material from decided cases attempts have been made to use facts and

information already available and analyze them to make a critical evaluation of the problem. While

analyzing specific controversial issues, which often arise, conceptual methodology has been

adopted which is generally used to develop new norms or to re-interpret existing ones. A uniform

mode of citation and referencing based on OSCOLA is adopted.

Limitation and Ambit of the Work

The present work is aimed at studying the land acquisition with keeping in mind the social concern.

The primary objective has been to correlate the law as it stands to the practice actually followed,

and to test it against contemporary developments. The work sets out the

historical and theoretical framework of land acquisition and public purpose requirement.

The theory itself has been critically analyzed, keeping in view the development of law

through judicial pronouncements and a comparative analysis with laws of other countries.

For the sake of convenience the work has been divided into several chapters focusing on

different aspect of the law, which would be discussed in the foregoing pages. The work makes a

very cursory study regarding inter-relationship of corporate governance and land acquisition. The

work also is very limited with relation to ladies as a stakeholder of land acquisition process.

Framework of the Study

The work for simple and sane understanding has been divided in following chapters:

Chapter I: Introduction

Chapter II: Right to Property vis- a- vis Land Acquisition

Chapter III: Constitutional Validity of Land Acquisition

Chapter IV: Land Acquisition and compensation

Chapter V: Land Acquisition; Rights of Displaced Person & Corporate Governance

Chapter VI: Internal Displacement; Rehabilitation and Resettlement & Gender Justice In Land

Acquisition

Chapter VII: Conclusion and Suggestions

The first chapter introduces the subject and highlights the research problem, hypothesis, literature

review, research methodology and framework of study.

Second chapter deals with the concept of property, its emergence in civil world and the concept

for preservation, protection and proprietorship of property. The notions and theories of property

are detailed out in the chapter. The chapter especially focusses on right to property under the Indian

Constitution. The chapter also interlinks the right to property with land acquisition process and

therein bring out and analyze legal intricacies. This chapter presents a travelogue of right to

property and its tussle with acquisition by Government for public purposes. In the journey we felt

that it has been a topsy-turvy journey in which we made certain changes in Indian Constitution.

Like Indian citizens lost right to property as fundamental right while Supreme Court made an

attempt to make a balance in the right to property, eminent domain and land acquisition process.

Supreme Court rendered radical judgments to concretize the process of compensatory acquisition

of land and property. Article 31A, 31B & 31C and 300A were added. Twenty five years of first

phase were devoted to settle the dust and it continues till date and shall continue as the core of the

land acquisition issue is that individual and state both are bargaining for more power for

themselves.

Third chapter is aimed to analysis of Indian Constitution in reference to right to property of

individual. In this chapter relevant Constitutional provisions shall be considered in the light of

decided case laws relating to property rights, limits of executive organs of the state as well as

legislative actions. The judiciary appears to have misread the mood in the country particularly after

the 1984 amendment. Prior to that the mood of nation building probably made the Judges feel that

development was not possible unless acquisition was done freely and with public purpose given

the widest possible scope. But to continue with such an approach in the period of globalisation

where land acquisitions were done to promote corporate interests with the State becoming an estate

agent of the companies, is quite another thing. To disregard, in the manner done, the intent of the

1984 amendment indicates how powerful the urge was among industrialists to grab the lands of

farmers. As a result, large tracts of lands throughout the country mainly of small farmers, have

been forcibly acquired and people displaced. '’There were mass protests against displacement

everywhere but the superior judiciary remained unmoved, doggedly anchored to their notions of

“development” unresponsive to the distress of farmers, tenants and agricultural labourers and the

decline of agriculture. During this period of globalisation from 1990 onwards the Union

Government withdrew credits from agriculture and followed conscious anti-farmer policies

rendering agricultural production un-remunerative. In this context the compulsory acquisition of

lands using Land Acquisition Act, 1894 which was the draconian statute of the crudest blow. The

Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and

Resettlement Act, 2013 has been introduced to set out the problems in deciding compensation and

other remedies for compulsory acquisition, keeping in mind Constitutional goal and pace with

development. The judiciary must understand that there is grave unrest in rural India and if it is to

relate to the rural poor at all it cannot go by the Constitution Bench's decision of the earlier period.

Times have changed. The rural economy is in ferment. With rural ferment everywhere, the time

has come for the Supreme Court to heed the dissent of Subba Rao, J. in Somawanti case as set out

above and the observations of the Supreme Court in National Textile Workers' Union v. P. R.

Ramakrishnan8; “we cannot allow the dead hand of the past to stifle the growth of the living

present. Law cannot stand still; it must change with the changing social concepts and values”.

Fourth chapter deals with the concept of compensation, rights of land owners and persons

interested. The chapter especially focusses on right to compensation under the Indian Constitution.

The chapter also deals with valuation and calculations of market value of land, buildings and

attached properties for the purposes of land acquisition. This chapter is mainly focused on

compensation and its protection under Indian Constitution, judicial approach and development of

concept of compensation, relevant principles of compensation mean general rules whose

application enables us to determine the market value. The problem of valuation is the

determination of present market value in relation to lands and buildings. The tops-turvy journey

of Indian Supreme Court has been swaying in between the idea of ‘Social Justice’, ‘Distributive

Justice’, land reforms and Zamindari abolition by compensatory acquisition of land. But in doing

so the achievement of Indian Supreme Court has that one size fit all type of computation formula

for calculation of compensation cannot be applied to each and every case. The Judiciary has

discussed all pros and cons of various types of valuation method. However due to variety of

properties and allied attachments one type cannot be applied to each case uniformly.

Fifth chapter is aimed to find out the issues relating to development induced displaced and,

rationale of displacement and compulsory acquisition of land. In this chapter there shall be an

attempt to analyse International and National scenario of development induced displaced people.

8 (1983) 1 SCC 228, 255, para 9

Analysis of present law ‘The Right to Fair Compensation and Transparency in Land Acquisition,

Rehabilitation and Resettlement Act, 2013, is the key issue in relation to displacement of land

owners. This chapter dealt with the problems and trauma of land owners and development induced

displaced people their rehabilitation and resettlements keeping in mind human right issues and

protection to their culture and heritage of origin. International and national attempts in making

peace full acquisition of lands for development purposes are also not as much as required helpful

to Government as well as land owners. The Right to Fair Compensation and Transparency in Land

Acquisition, Rehabilitation and Resettlement Act 2013, enacted by Parliament to provide just and

fair compensation to those whose land is taken away for constructing roads, buildings or factories,

had come into force from January 1, 2014 replacing the 120-year-old legislation. The new Act has

very much protective provisions for scheduled cast and scheduled tribes, it has also provisions for

the protection of culture and heritage of displaced tribes during rehabilitation and resettlement.

The provisions relating to social impact assessment definitely aimed to take care of affected

family, land looser and all those whose right get affected due to acquisition of land, but the same

time it may be time taking and harass investors. Recently NDA Govt. to remove this problem

brought ordinance for the amendment, to make the provisions investors friendly, with all these,

The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and

Resettlement Act, 2013, may prove better replacement of colonial law of land acquisition and

protection of displaced person.

Chapter six deals with internally displaced people in the process of land acquisition for public

purposes. The chapter finds out the legal issues involved in rehabilitation and settlement of

internally displaced people. The chapter also makes an attempt to pinpoint the focus on tribal

community which is the worst sufferers of development. The chapter investigates the issues

relating with displaced tribal ladies in the land acquisition process. The chapter also aims to

critically analyse the legal and constitutional protections in this regard available to internally

displaced people. The development and displacement go hand in hand. LARR Act, 2013 has made

a sea change in the land acquisition process. Constitution and various legislations provides

adequate safeguards to forest dwelling Scheduled Tribes. However all these legal framework and

enforcement agencies demand one idea to implement that in idea of inclusive growth where

development induced displacement is abysmally low and fairly compensated and displaced are

rehabilitate and settled with minimum friction and alteration from their natural habitat and with

their ethnic indigenousness in a plural society like India.

Finally, in Chapter seven on the basis of research from different available sources and there

analysis up to my competence and academic understanding, concluding observations and humble

suggestions have been made in the seventh chapter keeping in mind following questions and

observations.

The instant work initially aimed to find out the answers of the following questions, and other

observations based on past and present laws relating to land acquisition, its impact on socio-

economic structure of nation:

1. What is the Scope of existing Laws?

2. What is public purpose for which land acquisition will be justified?

3. How much need and public purpose could be fulfilled through existing laws?

4. What can be consideration for acquisition of land and property?

5. What amounts to adequate compensation?

6. Whether adequate procedural safeguards are available to the persons against whom action

is being taken?

Since the old colonial legislation had least public concern especially for farmers and those whose

livelihoods are dependent on the land being acquired, through new Act, Government acquires land

for its own use, hold and control. Government acquires land with the ultimate purpose to transfer

it for the use of private companies for stated public purpose (including PPP projects but other than

state or national highway projects), Government acquires land for immediate and declared use by

private companies for public purpose.

In public purpose context, Sec 2 (1)9 clearly defines purpose for which land acquisition is allowed.

The doctrine of eminent domain gives to the state an enormity over land and related resources and

also over the lives of people, it is well established, that takings of property by the state should be

subject to due process of the law. It is heartening to note that so far as the issue of paying

compensation is concerned, the judicial decisions have reflected the spirit of the due process law.

The issue of determination of compensation should not be left at the absolute discretion of the

legislature and the executive. The judiciary should have a vital say in the determination, because

9 The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013.

if legislature or the executive were to fix compensation without the possibility of judicial review,

it may result into potential under valuation.

Further, the question of public purpose itself is not subject to judicial review. The moratorium on

questioning public purpose holds both at the Constitutional level as well at the statutory level in

relation to the Land Acquisition Act. Therefore, the public purpose requirement may be made open

to judicial review.

Sec. 2 clause 1 enumerates a list to justify need and public purpose could be fulfilled through

existing law10:

For strategic purposes relating to naval, military, air force, and armed forces of the Union,

including central paramilitary forces or any work vital to national security or defence of

India or State police, safety of the people; or

For infrastructure projects, which includes the following, namely:

i. All activities or items listed in the notification of the Government of India

in the Department of Economic Affairs (Infrastructure Section) number

13/6/2009-INF, dated 27 March 2012, excluding private hospitals, private

educational institutions and private hotels;

ii. Projects involving agro-processing, supply of inputs to agriculture,

warehousing, cold storage facilities, marketing infrastructure for agriculture

and allied activities such as dairy, fisheries, and meat processing, set up or

owned by the appropriate Government or by a farmers' cooperative or by an

institution set up under a statute;

iii. Project for industrial corridors or mining activities, national investment and

manufacturing zones, as designated in the National Manufacturing Policy;

iv. Project for water harvesting and water conservation structures, sanitation;

v. Project for Government administered, Government aided educational and

research schemes or institutions;

vi. Project for sports, health care, tourism, transportation of space programme;

vii. Any infrastructure facility as may be notified in this regard by the Central

Government and after tabling of such notification in Parliament;

10 Sec. 2(1) The Right to Fair Compensation, Transparency in land Acquisition, Rehabilitation and Resettlement Act,

2013

Project for project affected families;

Project for housing, or such income groups, as may be specified from time to time by the

appropriate Government;

Project for planned development or the improvement of village sites or any site in the urban

areas or provision of land for residential purposes for the weaker sections in rural and urban

areas;

Project for residential purposes to the poor or landless or to persons residing in areas

affected by natural calamities, or to persons displaced or affected by reason of the

implementation of any scheme undertaken by the Government, any local authority or a

corporation owned or controlled by the State.

When government declares public purpose and shall control the land directly, consent of the land

owner shall not be required. However, when the government acquires the land for private

companies, the consent of at least 80% of the project affected families shall be obtained through a

prior informed process before government uses its power under the Act to acquire the remaining

land for public good, and in case of a public-private project at least 70% of the affected families

should consent to the acquisition process.

The Act includes an urgency clause for expedited land acquisition. The urgency clause may only

be invoked for national defense, security and in the event of rehabilitation of affected people from

natural disasters or emergencies.

Under sec. 8 of The Right to Fair Compensation and Transparency in Land Acquisition,

Rehabilitation and Resettlement Act, 2013, government shall ensure there is legitimate and bona

fide purpose for the proposed acquisition which necessitate the acquisition of the land identified.

In respect to consideration for acquisition of land and property, since much of the disgruntlement

seems to stem from perceptions of inadequate compensation as much as from abuse of process,

the story about compensation, initiated in the late 19th century law, is far from over either.

In KT Plantation’s case, the Supreme Court recently read compensation into the requirements of

law under Article 300A of the Constitution. Compensation, in previous decisions, has been held

to be ‘just equivalent of what the owner has been deprived of’ (Bela Banerjee’s case11), ‘something

not illusory’.

11 AIR 1954 SC 170.

According to sec. 28, in determining the amount of compensation to be awarded for land acquired

under ‘The Right to Fair Compensation and transparency in land Acquisition, rehabilitation and

Resettlement Act, 2013’ the collector shall take into consideration:

i. Firstly, the market value as determined under sec. 26 and the award amount in accordance

with the first and second schedules.

ii. Secondly, the damage sustained by the person interested by reason of the taking of any

standing crop and trees which may be as the land at the time of the collector’s taking

possession thereof.

iii. Thirdly, the damage (if any) sustained by the person inserted, at the time of the collector’s

taking possession of the land, by reason of severing such land from his other land.

iv. Fourthly, the damage (if any) sustained by the person interested, at the time of collector’s

taking possession of the land by reason of the acquisition injuriously affecting his other

property movable or immovable, in any other manner or his earnings.

v. Fifthly, in consequence of the acquisition of the land by the collector, the person, interested

is compelled to change his residence or place of business, the reasonable expense (if any)

incidental to such charge.

vi. Sixthly, the damage (if any) bonafide resulting from diminution of the profit of the land

between the time of the publication of the declaration under sec. 19 and the time of the

collector’s taking possession of the land; and

vii. Seventhly, any other ground which may be in the interest of equity, justice and beneficial

to the affected families.

The government undertakes a large number of development activities which require land. This

land is acquired from land-owners under various land acquisition laws. The most prominent and

widely used of these laws is the Land Acquisition Act, 1894 enacted during the colonial period.

The power of the government under the Land Acquisition Act is absolute and the landowner has

no choice to opt out or refuse to part with land. This is the reason why people who are dependent

on land for their subsistence are so agitated about the prospects of its acquisition. As long as the

scale of acquisition was small and confined to public sector activities, the protest of affected

persons did not cause concern to the government or attract the attention of civil society though

considerable work was done by sociologists and anthropologists by way of its impact on the

displaced persons. However, the amendment carried out in 1984 to extend the acquisition to the

requirement of land for private companies, large-scale foreign capital investment in various

projects resulting from neo-liberal transformation of economy since 1990 and enactment of Special

Economic Zone (SEZ) Act, 2005 have increased the scale and spread of acquisition enormously.

The dismal record of rehabilitation of displaced persons has created such widespread resentment

against acquisition of land that the government has been forced to use massive force in some places

to take possession of land its tremendous human cost. At other places, the project implementation

is held up on this account. It has also not escaped the attention of the government that most of the

acquisition is concentrated in the raw material rich central India which is also the area affected by

the Naxalite movement. The prospects of loss of livelihood and habitat, social destabilization, and

a bleak future, thereafter have attracted the affected tribal population in this belt to the movement.

This period has also witnessed civil society’s heightened concern for the survival with dignity of

the tribal population which has had a very raw deal in the paradigm of development pursued by

the government since independence. These factors have pushed the government to review the Land

Acquisition Act, 1894 and policy of compulsory acquisition of land for development and

regulatory purposes.

This process of acquisition is unfair to the persons losing land and livelihood on several counts

which also explains there, strong opposition to it. The absolute power vesting in the government

to acquire any private land, justified as an essential attribute of the state sovereignty called the

eminent domain, is in serious conflict with democratic ethos and humane governance. The consent

of affected persons should be necessary before they are deprived of their land and livelihood. The

Act is also unjust because while it grants unrestricted power to the government for acquisition of

privately owned land, it does not cast any obligation on it to rehabilitate persons so affected and

to provide alternative land and livelihood to them. The acquisition of land has to be justified on

the ground that it serves a 'public purpose' i.e., the larger good of society. But the ‘public purpose’

is not precisely defined in the Act and the illustrations of such purpose contained in it are stretched

to include acquisition of land even for profit-making private companies. The provision for payment

of compensation also suffers from many inadequacies. This benefit is available to ‘persons

interested’ in the land who are identified on the basis of their interests in land as reflected in the

land records. These records usually mention the names of owners/ holders of title but fail to record

others who are using land for livelihood as a tenant, share cropper, agricultural labourer, artisan

etc. In this manner, those who lose livelihood or right of use for cultivation on the basis of oral

contract/arrangement as a result of acquisition of land are denied any compensation. The land for

which compensation is admissible is also restrictedly interpreted to cover only that for which valid

property rights exist. But people in villages whether landed or landless extensively use common

lands, water bodies, forests etc. usually called the 'common property resources' which are shown

in land records under the name of the government or one of its agencies. These resources provide

numerous benefits to them. But the loss of access to this land does not entitle them to any

compensation as they have no property rights over these lands or documents authorizing their use.

The compensation in respect of such lands accrues to the government. In this manner, landless

persons even though losing access to common lands get no compensation. The tribes are the most

adversely affected in this manner as they are overwhelmingly dependent on forests.

The amount of compensation awarded to the land-owners is also inadequate because the

assessment of ‘market value’ is carried out on the basis of registered sale/purchase documents

preceding the acquisition. These documents deliberately show an amount lower than the actual

amount for which land is purchased or sold with a view to reduce tax liability of the parties

involved. Besides, the amount accruing as compensation is too insufficient to purchase alternative

land of the same productive potential in the vicinity of the resettlement site. It is particularly low

in tribal areas where there are restrictions on transfer/sale of tribal land and, therefore, such sale

deeds are usually not available. Even this limited compensation is paid with great delay while the

acquired land is taken possession of quickly and by force. The compensation is also paid in cash

rather than in the form of land and is quickly spent in meeting consumption needs in the absence

of any employment after displacement or in construction of the house due to failure of proper

resettlement in the new colony. Therefore, the acquisition of land virtually makes the land-owners

landless and pushes them to destitute labour market. Most people do not have the knowledge and

resources to seek a ‘reference’ of their case for enhancement of compensation. It has also been

observed that the land is acquired in excess of what is actually needed and, therefore, considerable

part of such land unutilized leading to its misuse and encroachment. In the absence of any legal

provision for resettlement and rehabilitation, the persons displaced by acquisition of land are

forcibly shifted to an alternative site where even the minimum amenities are not provided. The law

of acquisition does not even spare persons who have already suffered displacement once from the

trauma of repeated displacement. Their land can also be acquired, if needed for a public purpose.

The acquisition of land and resulting displacement with no tangible rehabilitation of those

displaced leaves the affected persons in a state of shock, helplessness and multiple

impoverishment.

The history of the displaced people in various parts of the country in the last 60 years has taught

them that they can only look forward to displacement and the destruction of access to other

resources without the possibility of a role in the new society. Perhaps these agitations are a warning

to the government, that this developmental path is not acceptable to the people who are therefore

demanding a mid-course correction. This is true of agitations in states like Chhattisgarh, Jharkhand,

Biliar, West Bengal and Orissa.

In the travelogue of right to property and its tussle with acquisition by Government for public

purposes. In the journey we felt that it has been a topsy-turvy journey in which we made certain

changes in Indian Constitution. Like Indian citizens lost right to property as fundamental right

while Supreme Court made an attempt to make a balance in the right to property, eminent domain

and land acquisition process. Supreme Court rendered radical judgments to concretize the process

of compensatory acquisition of land and property. Article 31A, 31B & 31C and 300A were added.

Twenty five years of first phase were devoted to settle the dust and it continues till date and shall

continue as the core of the land acquisition issue is individual and state both are bargaining for

more power for themselves.

The judiciary appears to have misread the mood in the country particularly after the 1984

amendment. Prior to that the mood of nation building probably made the Judges feel that

development was not possible unless acquisition was done freely and with public purpose given

the widest possible scope. But to continue with such an approach in the period of globalisation

where land acquisitions were done to promote corporate interests with the State becoming an

estate agent of the companies, is quite another thing. To disregard, in the manner done, the intent

of the 1984 amendment indicates how powerful the urge was among industrialists to grab the

lands of fanners. As a result, large tracts of lands throughout the country mainly of small farmers,

have been forcibly acquired and people displaced. '’There were mass protests against

displacement everywhere but the superior judiciary remained unmoved, doggedly anchored to

their notions of “development” unresponsive to the distress of farmers, tenants and agricultural

labourers and the decline of agriculture. During this period of globalisation from 1990 onwards

the Union Government withdrew credits from agriculture and followed conscious anti-farmer

policies rendering agricultural production unremunerative. In this context the compulsory

acquisition of lands using this draconian statute was the crudest blow of them all.

The way forward is for the judiciary to compel all acquisitions for companies to follow the Part

VII route and to reverse the decision in Somawanti case12and hold that irrespective of the

contribution by the Government, all acquisitions for companies must follow Part VII. The reason

for this approach is not difficult to comprehend. The State Governments today have come under

corporate control so completely that they are only too eager to spend large sums of State funds to

assist corporations in the acquisition of lands using the Act. The judiciary must understand that

there is grave unrest in rural India and if it is to relate to the rural poor at all it cannot go by the

Constitution Bench's decision of the earlier period. Times have changed the rural economy is in

ferment. With rural ferment everywhere, the time has come for the Supreme Court to heed the

dissent of Subba Rao, J. in Somawanti case as set out above and the observations of the Supreme

Court in National Textile Workers' Union v. P. R. Ramakrishnan13; “we cannot allow the dead

hand of the past to stifle the growth of the living present. Law cannot stand still; it must change

with the changing social concepts and values”.

The researcher also focused on compensation and its protection under Indian Constitution, judicial

approach and development of concept of compensation, relevant principles of compensation mean

general rules whose application enables us to determine the market value. The problem of

valuation is the determination of present market value in relation to lands and buildings. The tops-

turvy journey of Indian Supreme Court has been swaying in between the idea of ‘Social Justice’,

‘Distributive Justice’, land reforms and Zamindari abolition by compensatory acquisition of land.

But in doing so the achievement of Indian Supreme Court has that one size fit all type of

computation formula for calculation of compensation cannot be applied to each and every case.

The Judiciary has discussed all pros and cons of various types of valuation method. However due

to variety of properties and allied attachments one type cannot be applied to each case uniformly.

In reference to the problems and trauma of land owners and development induced displaced

people their rehabilitation and resettlements keeping in mind human right issues and protection to

their culture and heritage of origin, position of tribes and Scheduled caste are not satisfactory.

Some of the identified interlinked potential risks intrinsic to displacement14 are:

12 AIR 1963 SC 151. 13 (1983) 1 SCC 228, 255, para 9. 14 Michael Cernea, ‘Why Economic Analysis is Essential to Resettlement: A Sociologist's View.’ In Michael Cernea

(Ed.) The Economics of Involuntary Resettlement: Questions and Challenges (Washington, DC: World Bank 1999).

i. Landlessness.

ii. Joblessness.

iii. Homelessness.

iv. Marginalization.

v. Food Insecurity.

vi. Increased Morbidity and Mortality.

vii. Loss of Access to Common Property.

viii. Social Disintegration15.

International and national attempts in making peace full acquisition of lands for development

purposes are also not as much as required helpful to Government as well as land owners. The Right

to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act

2013, enacted by Parliament to provide just and fair compensation to those whose land is taken

away for constructing roads, buildings or factories. The new Act has very much protective

provisions for scheduled cast and scheduled tribes, it has also provisions for the protection of

culture and heritage of displaced tribes during rehabilitation and resettlement. The provisions

relating to social impact assessment definitely aimed to take care of affected family, land looser

and all those whose right get affected due to acquisition of land, but the same time it may be time

taking and harass investors. Recently NDA Govt. to remove this problem brought ordinance for

the amendment, to make the provisions investors friendly, with all these, The Right to Fair

Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013,

may prove better replacement of colonial law of land acquisition and protection of displaced

person.

The development and displacement go hand in hand. The Right to Fair Compensation and

Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, has made a sea

change in the land acquisition process. Constitution and various legislations provides adequate

safeguards to forest dwelling Scheduled Tribes. However all these legal framework and

enforcement agencies demand one idea to implement that is idea of inclusive growth where

development induced displacement is badly low and fairly compensated and displaced are

15 Descriptions of the first seven risk factors are drawn from Michael Cernea, Risks, Safeguards and Reconstruction

(2000) The description of the eighth risk, social disintegration, is from Michael Cernea, Public Policy Responses to

Development-Induced Population Displacements (Washington, DC: World Bank Reprint Series: Number 479 1996).

rehabilitated and settled with minimum friction and alteration from their natural habitat and with

their ethnic indigenousness in a plural society like India.

Here as it was aimed to find the position in reference to corporate social responsibility, companies

acquires land for their maximum use and maximization of profit, which directly or indirectly

affects the interest of development induced people, in terms of livelihood, culture and heritage of

habit and habitants of acquired land. The last decade has witnessed a tremendous agitation for

embracing Corporate Social Responsibility (CSR), and Transparency (absence of corruption), in

the development of energy and mining projects especially in emerging markets. This is seen as a

way of not only encouraging sustainable development, but also mitigating social risks that have

profound impact on a project’s bankability (acceptance for funding) and its rate of return16. It has

also been seen on a wider scope, as a way around the age long problem of infrastructure decay,

environmental degradation, Companies that are socially responsible in making profits also

contribute to some, although obviously not all, aspects of social development. Every company

should not be expected to be involved in every aspect of social development. That would be

ludicrous and unnecessarily restrictive. But for a firm to be involved in some aspects, both within

the firm and on the outside, will make its products and services (for example financial services)

more attractive to consumers as a whole, therefore making the company more profitable. There

will be increased costs to implement CSR, but the benefits are likely to far outweigh the costs.

The Companies Act, 2013 Section 135(1) provides that, “Every company having net worth of

rupees five hundred crore or more, or turnover of rupees one thousand crore or more or a net profit

of rupees five crore or more during any financial year shall constitute a Corporate Social

Responsibility Committee of the Board consisting of three or more directors, out of which at least

one director shall be an independent director.” So all companies having a net worth of Rs. 500 or

turnover of Rs. 1000 crores or more or net profit of Rs. Five crore or more are under obligation to

perform CSR activities. Most of the top notch companies listed on BSE, NSE, NYSE, LSE as

well as small public and private companies even SMEs will come in its ambit.

Although there is no such provision in The Right to Fair Compensation and Transparency in Land

Acquisition, Rehabilitation and Resettlement Act, 2013. The main tenets of The Right to Fair

16 Bede Nwete, ‘The Equator Principles: How Far will it Affect Project Financing?’ (2005) 2 International Business

Law Journals 173-188 <at:http://news.bbc.co.uk/2/hi/africa/3123939.stm.> accessed on 4th February, 2015.

Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013

included measures for limiting the government’s acquisition for private profit and the use of

urgency clause in acquiring land. The proposal called for return of landowners in case the land is

not utilized in the stated land use within period of five years. Recent development through the

ordinance on land acquisition snatches away the rights of farmer by omitting steps like social

impact assessment, impact on food security, and consent of 80% land owners. This inevitably, may

be negative development and against the interest of Farmers, although in other case, it is necessary

for the required development of economy. Therefore, government should always keep in mind the

interest of farmers in acquiring lands of farmer’s particularly agricultural land.

Underlying the entire need for land acquisition and the introduction of an The Right to Fair

Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013,

to facilitate land acquisition for more rapid economic growth, while protecting the interests of those

whose lands are acquired is the notion that high investments and the resultant increase in economic

activity are a desirable end in itself. Any distortions generated by the process of growth can be

addressed through other policy interventions to support “inclusive growth”. The Act therefore talks

about the need to develop stakeholders from the affected families. This whole approach however

does not ask what these affected families want. It does not seek to identify a path forward starting

from these families and their economic activities and skills. The women in the tribal systems, due

to their multiple objectives, have a special role in the family as well as their society. Any approach

which yields “sustainable inclusion” of these agents should be based on locally available resources,

their skill sets, their capacities and expertise, and their needs. Identification of projects for these

areas therefore needs to adopt a “people to company” approach rather than a “company to people”

approach.

The Act and the underlying approach towards “inclusive growth”, however, do not work on the

same premise. It wants to accelerate the growth process through industrialisation and also

simultaneously protect the interests of the affected families in terms of providing resources for

establishing a new livelihood regime. In the need to attract investment, this approach gives primacy

to the investor over the existing users of the resource called land, i.e. it adopts a “company to

people” approach. The company in essence determines its needs and the affected people are sought

to be accommodated or eased out with some protection. As discussed, the extent of protection

offered by the Act can be significantly different for different economic systems, especially given

the lack of adequate monetisation in at least some of these systems. Therefore, if its professed

intent to provide some assurance of minimum protection to the livelihoods of the affected families

is to be achieved, the Act needs to recognise the heterogeneity in economic systems and its

consequent effects on the individuals in the system.

On the basis of such deep analytical work following suggestions may be humbly submitted:

1. The LARR Act, 2013 should not restrict itself to the quantitative rural-urban division, but

take into account the different organisations of production to formulate a land acquisition

policy to suit them accordingly.

2. The Act should have special provision for the protection preservation of culture and

heritage of tribal population so the ethnic indigenousness of tribal community and their

worth in plural democracy could be proved.

3. The Act should restrict land acquisition of fertile land for factories and production houses

as we all know that India is the biggest populace and we need consistently and shall need

always grains and cereals.

4. The Act should restrict acquisition for institutions, mandi, Govt. offices, and research

centers within urban areas as multiple institutions will devour all fertile land and create

unbalanced growth.

5. The Act should promote acquisition of barren land of remote and backward areas for the

development and fulfill the need of particular area so as to use the unused land to its

optimum level.

6. Policies for tribal areas need to be distinctly different from those in non- tribal areas. While

cash for land may work in monetised systems, for tribal systems providing land for

cultivation and not cash is important.

7. Social Impact Assessment is one of the strong point of new Act, it should not be disregarded

as by the Ordinance NDA Govt. made an attempt to avoid it.

8. Social Impact Assessment should be done by the appropriate Government in the Pre-

notification stage and should be examined by independent multi-disciplinary expert group

and must include member of judiciary or law professional having 10 years’ experience.

9. For rehabilitation and resettlement, providing cash once again would be unsuitable - there

must be mechanisms within the Act for actual resettlement. Concrete Resettlement policy

and administrative setup must be established

10. Since the cohesion and sustainability of a family can be different in different economic

systems, the Act should work with individuals rather than families when determining

compensation for loss of livelihood.

11. All the individuals of the affected families, both male and female, who are willing and

capable to perform productive activities must be treated as surplus generating people who

must be given employment. In the case of providing rehabilitation and resettlement bene-

fits, women must be recognised and accepted as the head of the household to receive

various benefits since they bear all the responsibility for survival of the family.

12. In order to accelerate the process of industrialisation, developmental programmes with an

integrated approach should be considered for violence-ridden tribal areas.

13. Understanding people’s needs correspond to their living natural environment and the

locally available resources, suitable projects are to be chosen by the people themselves to

satisfy their needs and improve upon them, own these projects, and become part of them

and make them successful.

14. The projects should be such that the present need-based skills, capacity and expertise of the

local people and the future demands of the evolving modern system should be in tandem

with each other to generate development in a holistic sense. If such programmes are not

considered, especially for tribal areas, the already disturbed tribal economy becomes further

unstable. This, in turn, creates more and more obstacles to the process of industrialisation

by generating a “violence-counter violence” cycle and in the process derails the much

publicised notion of growth through industrialisation.

15. The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and

Resettlement Act, 2013 has no provision to require corporate social responsibility of

companies acquiring land. There should be special provision in The Right to Fair

Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement

Act, 2013, for CSR.

16. There should be different category for agricultural land and it should be treated differently.

17. There should be special protection for farmers of either category or cast i.e. SC, ST, OBC

or General.

To conclude, the Act is a step forward as it finally attempts to address the different concerns of

affected families in the process of initiating new projects in the country. Accelerating the process

of growth through industrialisation and facilitating the affected persons to become parties in this

process are articulated as the twin objectives of the Act. The expectation behind this planned action

is that industrialisation centered development leads to displacement and there is a need to

reintegrate the displaced people into development again. However, the Act has bulldozed all

inherent heterogeneity to arrive at an easy solution. It is now increasingly recognised that while

there can be universal overall principles of inducing growth, in practice these principles need to be

packaged in forms suitable for a particular reality. The package must be devised by the people and

for the people.