The Supreme Court will soon decide whether states can avoid using the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act of 2013 (or LARR) when acquiring private properties for public projects.
The Supreme Court case relates to an appeal filed by the Tamil Nadu government against a Madras high court order from July 2019. The high court had struck down an attempt by the Tamil Nadu government in 2014 to exempt the application of the LARR to three state laws that have provisions for the acquisition of land. These provisions are similar to the British-era Land Acquisition Act of 1894, which the LARR had repealed and replaced.
The colonial law had allowed governments to forcefully acquire land from people and pay them arbitrary amounts as compensation. This had led to land conflicts across India and demands for a fair and people-friendly legislation. The LARR was enacted by parliament and brought in force across the country from January 1, 2014. It introduced provisions like seeking consent, justifying acquisition through social impact assessments, compensating at least twice the land prices, and compensating non-landowners.
However, since 2014, three states – Tamil Nadu, Maharashtra and Karnataka – took legislative routes to exempt the LARR and instead use local laws similar to the 1894 law to acquire land for infrastructure and industrial projects such as the Chennai Metro and the Nanar Oil Refinery in Maharashtra.
The President of India assented to the legislative actions of the three states to revive state legislations, indicating the Union government’s approval of the practice.
The appeal in the Supreme Court is batched with a petition filed by landowners in Tamil Nadu against a law passed by the state two weeks after the high court order to again revive the state land acquisition legislations. This was also assented to by the president.
On February 23, the court reserved judgement in the petition. The Centre is not a party to the case. The state of Tamil Nadu’s counsels include – other than the state Advocate General – the Attorney General for India, K.K. Venugopal, and his predecessor and senior advocate Mukul Rohatgi.
The outcome of the case would provide clarity if states, with the approval of the president, can use Article 254 of the constitution to revive or create their own land acquisition laws that are contrary to the LARR, and do not carry its entitlements such as public’s right to give consent and participate in acquisition processes. And it would adjudicate on the argument of landowners that the usage of state land acquisition laws instead of LARR is a violation of Article 14 of the constitution, which guarantees the fundamental right to equality before law.
The Supreme Court case signifies how state governments have begun to treat land within their jurisdiction as “assets or stocks that can be offered to businesses by subsidising legal requirements,” said Kanchi Kohli, a senior researcher at the Centre for Policy Research. “What is at stake with the SC is not just the law, but the ethical premise and social justice ramifications of undoing participatory democracy that are upheld through requirements of prior informed consent.”
“Normally Article 254 is used to resolve peculiarities unique to states, to expedite the implementation of a law, in other words administrative expediency,” said Muhammed Khan, Additional Advocate General of Chhattisgarh in the Supreme Court who was the officer on special duty to the Minister for Rural Development when the LARR was drafted.
“This is the first time that we are seeing a central government actively encouraging states to bypass its own law in toto,” he said.
Tamil Nadu’s revival act
In 2014, soon after the LARR was brought in force in the country, the Tamil Nadu assembly passed an amendment to the law.
The amendment inserted a new section 105A that said that provisions of the LARR would not apply to acquisitions carried out under three state laws:
- the Tamil Nadu Acquisition of Land for Harijan Welfare Schemes Act, 1978,
- the Tamil Nadu Acquisition of Land for Industrial Purposes Act, 1997
- the Tamil Nadu Highways Act, 2001.
The latter two laws account for a majority of land acquisition in the state, according to a report on LARR by the Centre for Science and Environment titled ‘Dilution by Design‘.
Indeed, the state used the laws for high-profile projects such as the Salem Expressway and Chennai Metro, both of which faced opposition by landowners who either did not want the project at all or complained about low compensation.
In its amendment, the state said it would issue a notification, within one year, to extend provisions of LARR related to compensation and rehabilitation to acquisitions carried out under these laws. The state however did not issue these notifications.
The amendment was assented to by the President of India on 1 January 2015. Since land acquisition is a subject on the ‘concurrent list’ of the constitution, Article 254 requires states to obtain the assent of the President of India for laws that deviate from the LARR.
In the following months, as the state issued land acquisition notifications under the state laws, over 240 writ petitions were filed in the Madras high court’s Chennai and Madurai benches challenging the revival of state laws.
In July 2019, a division bench of the court of Justice S. Manikumar (now Chief Justice of the Kerala high court) and Justice Subramonium Prasad (presently in the Delhi high court) issued a scathing common judgement striking down the revival of state laws.
The judgement said that as per Article 254 of the constitution, the state laws were “repugnant” to the LARR and were hence rendered “void and dead letter” on the day the LARR was passed by parliament on September 26, 2013. The state government could not have revived these laws through an amendment to the LARR, the court said. The only way these laws could be revived, the order said, was if the state assembly enacted them afresh and then sought the assent of the President of India.
Just two weeks after the high court judgement, the Tamil Nadu assembly enacted The Tamil Nadu Land Acquisition Laws (Revival of Operation, Amendment and Validation) Act, 2019 .
The Act revived operation of the three state laws retrospectively from September 26, 2013.
The Act said that provisions related to the calculation of compensation to landowners and the terms of rehabilitation of displaced people would be as per the LARR. But it did not extend any other provisions of the LARR. The Act also carried a validation clause that exempted “any judgement, decree or order of any court” from applying to the three state laws from September 26, 2013, until the day the Act was notified.
The law was passed by the state legislative assembly on July 20, 2019, just one day after it was introduced in the house. It received the assent of President Ram Nath Kovind on December 2, 2019.
The Supreme Court case
Other than passing the revival law, Tamil Nadu also filed an appeal against the high court order before the Supreme Court of India. In September 2019 – coincidentally one day after the sixth anniversary of the passage of the LARR – a bench of Justices A.M. Khanwilkar and Dinesh Maheshwari stayed one paragraph of the high court order that had quashed all land acquisitions carried out under state laws after September 26, 2013.
The bench said that the matter required “deeper consideration” and that it would be disposed of it in November 2019 “in view of the urgency pointed out by the learned Attorney General”. The bench then barred the Madras high court from hearing any petitions on the subject.
But no hearings were held until December 2020. Records of proceedings show that the court condoned delays by the state in filing affidavits on several occasions through 2020.
Meanwhile, after Tamil Nadu had passed its Revival Act in July 2019, several landowners approached the Madras high court challenging it. In September 2020 the court adjourned sine die hearings in the petitions stating the Supreme Court’s restraint on hearing any petitions on the subject.
The landowners then approached the Supreme Court invoking its jurisdiction under Article 32 of the constitution. In December 2020, the court issued notices but did not stay the operation of the state laws. It allowed the state to carry out all land acquisition proceedings under the laws except for passing final orders and taking possession of land. On February 23, it reserved its decision in the landowners’ petition.
In the Supreme Court, the state of Tamil Nadu has put up a spirited defence led by a battery of lawyers including the Advocate General for Tamil Nadu Vijay Narayanan, senior advocate and current Attorney General K.K. Venugopal and former Attorney General Mukul Rohatgi.
The court will first decide whether the revival law of 2019 was valid, and based on that take up the appeal against the high court order.
The landowner petitioners have argued that by reviving the state land acquisition laws, the state has violated Article 14 of the constitution, which guarantees the fundamental right to equality before the law. The petitioners contend that a citizen in Tamil Nadu who faces proceedings under a state land acquisition law would not be treated equally with another citizen whose land may be acquired under the LARR for a public project not covered by the state laws, such as a hospital or educational institute.
Growth at ‘very fast rate’
States have given different reasons for using their state legislations instead of the LARR.
When the LARR was a Bill, states led by regional parties – including Tamil Nadu – had opposed it saying that since land is a state subject under the constitution, the Centre should not pass a law on land acquisition and instead leave it to states, said Khan, the Chhattisgarh additional advocate general.
“They justified the old act as a pre-independence legislation which was carried forward, but that, in independent India, the centre could not pass a law. This was not entirely correct because while land may have been a state subject, acquisition fell in the concurrent list,” he said.
In the statement of objections and reasons of the amendment Bill in 2014, the Tamil Nadu government said that its exemptions were similar to the exemptions already provided by the LARR to acquisition under central laws like the National Highways Act and the Coal Bearing Areas Act.
Karnataka exempted six laws including the Karnataka Industrial Areas Development Act of 1966, under which it acquires land for industrial estates, industrial land banks and single-unit industries in the state.
“The State of Karnataka is facing difficulties in acquiring land under the provisions of the Principal Act,” the state government wrote in the statement of objects and reasons to the amendment Bill.
The state government further said, “The State of Karnataka aims to grow at very fast rate [sic].” It said “various mega projects” had been proposed but which require “land be made available immediately, otherwise there will be high escalation in the costs and also the benefits of development will be delayed considerably harming the interest of general public.”
It takes an estimated four years to acquire land under LARR, said the report by the Centre for Science and Environment.
“Even if it takes half the time, what is the guarantee that the project would still be feasible and have a good return on investment? It is an issue for affected people also,” said Ishani Sonak, lead author of the report.
“In order to reduce the time taken, states can look at other methods like private purchases, leasing or pooling of land. In developed countries, that is how the government takes land for public projects. But purchases are always more expensive than acquisition, which is why states would rather acquire it under their own laws but not under the LARR,” she said.
Maharashtra revived laws including the Maharashtra Industrial Development Act of 1961, which it has invoked since 2014 to acquire land for the Delhi-Mumbai Industrial Corridor and the proposed Nanar Oil Refinery. Maharashtra did not offer an explanation in its amendment, which was assented to by the president and published in the state gazette on April 26, 2018.
The Maharashtra amendment, like Tamil Nadu’s, said that within one year the state would issue a notification to extend LARR’s provisions on compensation and rehabilitation to acquisition under state laws. But it extended this deadline several times and has still not issued the notification.
In the Madras high court, Tamil Nadu had argued that since it was promising to pay compensation and offer rehabilitation at par with the LARR, there was no difference left between its state laws and the LARR (even though the state laws do not contain the rest of the LARR’s sections). The government also argued that its laws were for specific purposes, such as for building highways and industrial areas, and that acquisition of land was “incidental” to these purposes.
“Payment of compensations is no match to right to consent,” said Kohli of the Centre for Policy Research. “It also does not give a role to project affected people to democratically participate in a process to determine whether the acquisition is to fulfil ‘public purpose’.”
“Consents and SIAs are processes that allow for decentralised, informed and deliberative decision making, and it appears that both central and state governments are finding democracy cumbersome,” she said.
“SIAs are also a way to find out how many people are actually affected by a project. But state governments do not realise that and instead focus on project timelines,” said an LARR researcher who works closely with state governments on its implementation. “We tell officials that a good SIA can benefit the project in the long run and avoid future litigation and conflicts.”
Ignoring lessons from history
By bypassing provisions for consent and social impact assessments, states are also going against lessons learnt from forceful acquisitions that used to be conducted under the 1894 Act.
A study of successful land acquisitions published in 2009 by the 3iNetwork and the Infrastructure Development Finance Company had found that an important factor behind successful land acquisitions was that developers sought “social consent to operate” from the communities. The authors defined this as “securing free, prior and informed consent of affected communities to part with their resources and also the consent to do business in their community.”
Social impact assessments are not isolated from compensation and rehabilitation. They have, time and again, helped communities seek compensation that reflect the actual price of land. The process also reveals the number of affected people and their unique needs, which can be met through rehabilitation packages.
The state laws also ignore other provisions of the LARR such as its expansion of the definition of affected to include landless workers who depend on land but do not own it, special allowances to affected people from Scheduled Castes and Scheduled Tribes, and provisions to restrict acquisition of multi-crop farmland in the interests of food security.
The LARR was brought in at a time when acquisitions under the old law were leading to discontent among land losers, who led protracted protests, filed court cases and stalled investments worth crores.
However, since 2014, several states have diluted the law, and these too have been assented to by the president.
“The union government has systematically allowed states to violate the LARR,” said Madhuresh Kumar, national convener of the National Alliance for People’s Movements, an umbrella group of land movements in the country.
“The LARR has always been under threat. Governments rarely apply it in full in any of the projects. They selectively apply only the monetary provisions. Impact assessment, options assessment, are ignored. All they are interested in is giving cash and taking land,” he said.
Nihar Gokhale is an associate editor at Land Conflict Watch, an independent network of researchers studying land conflicts, climate change and natural resource governance in India. He can be reached on firstname.lastname@example.org.