Author Name:   sid201291

the article deals with the position of law over the acquisition of agricultural and non agricultural land. it also dealt with manner of calculating the amount of compensation on acquisition...

Compensation on Acquisition of Agricultural and Non- Agricultural Land: A Comparative Study

The land acquisition act of 1894 was created for the purpose of facilitating the government to acquire privately held land for public purposes. The word "public purpose", as defined by the act, refers to the acquisition of land for putting up educational institutions or schemes such as housing, health or slum clearance, apart from the projects for rural planning or formation of sites. The word "government" refers to the central government if the purpose for acquisition is for the union and for all other purposes it refers to the state government. It is not necessary that all the acquisition has to be initiated by the government alone. Local authorities, societies registered under the societies registration act, 1860 andco-operative societies established under the co-operative societies act can also acquire the land for developmental activities through the government.

2.1 History
Regulation I of the land acquisition act was first enacted by the British government in the year 1824. Its application was throughout the whole of the Bengal provinces immediately subject to the Presidency of Fort William. The rules empowered the government to acquire immovable property at, what was deemed to be, a fair and reasonable price for construction of roads,canals or other public purposes. In 1850 some of the provisions of regulation I of 1824 were extended to Calcutta through Act I of 1850, with a view to confirm the land titles in Calcutta that were acquired for public purposes. At that time a railway network was being developed and it was felt that legislation was needed for acquiring land for the purposes of the railways. Building act XXVII of 1839 and act XX of 1852 were introduced to obviate the difficulties pertaining to the construction of public buildings in the cities of Bombay and Madras. Act VI of 1857 was the first full enactment, which had application to the whole of British India. It repealed all previous enactments relating to acquisition and its object. Subsequently act X of 1870 came in to effect which was further replaced by land acquisition act 1894, a completely self contained act, in order to purge some of the flaws of act X of 1870.

After independence in 1947, the Indian government adopted “Land Acquisition Act-1894” as a tool for land acquisition. Since then various amendments have been made to the 1894 act from time to time. Despite these amendments the administrative procedures have remained same.

2.2 Principles Of Compulsory Acquisition:
Principles for legislation on compulsory acquisition should include:

• Protection of due process and fair procedure. Rules that place reasonable constraints on the power of the government to compulsorily acquire land strengthen the confidence of people in the justice system, empower people to protect their land rights, and increase the perception of tenure security. Rules should provide for appropriate advance consultation, participatory planning and accessible mechanisms for appeals, and should limit the discretion of officials.

• Good governance. Agencies that compulsorily acquire land should be accountable for the good faith implementation of the legislation. Laws that are not observed by local officials undermine the legitimacy of compulsory acquisition. Good governance reduces the abuse of power and opportunities for corruption.

• Equivalent compensation. Claimants should be paid compensation which is no more or no less than the loss resulting from the compulsory acquisition of their land. Laws should ensure that affected owners and occupants receive equivalent compensation, whether in money or alternative land. Regulations should set out clear and consistent valuation bases for achieving this.

3: Constitutional Sanction
The constitutions of many countries provide for both the protection of private property rights and the power of the government to acquire land without the willing consent of the owner. There is, however, great variation. Some countries have broadly defined provisions for compulsory acquisition, while those of other countries are more specific.

Constitutional frameworks that have broadly defined provisions concentrate on basic principles and often simply assert the power to compulsorily acquire land as the single exception to fully protected private property rights. For example, the constitution of the United States of America mandates that: “No person...shall be deprived of...property, without due process of law; nor shall private property be taken for public use without just compensation.” (Article V). Similarly, Rwanda’s constitution states: “Private property, whether individual or collective, shall be inviolable. No infringement shall take place except for the reason of public utility, in the cases and manner established by the law, and in return for fair and prior compensation.” (Title II, Article 23).

Such constitutions leave the details of compulsory acquisition to other legislation and, in some instances, to the interpretation of the courts. Other constitutional frameworks specify in detail the mechanisms by which the government can compulsorily acquire land. They tend to include a specific list of the purposes for which land may be acquired. For example, Ghana’s constitution includes provisions detailing exactly what kinds of projects allow the government to use its power of compulsory acquisition, and specifies that displaced inhabitants should be resettled on suitable alternative land (Chapter Five, Article 20). Chile’s constitution identifies the purposes for which land Compulsory acquisition of land and compensation may be compulsorily acquired, the right of property holders to contest the action in court, a framework for the calculation of compensation, the mechanisms by which the state must pay people who are deprived of their property, and the timing and sequence of possession (Chapter III, Article 19, §24).

Most countries supplement the constitutional basis for compulsory acquisition, whether broadly or specifically defined, with extensive laws and regulations. National or sub-national laws usually describe in detail the purposes for which compulsory acquisition can be used, the agencies and officials with the power to compulsorily acquire land, the procedures to be followed, the methods for determining compensation, the rights of affected owners or occupants and how grievances are to be addressed. The regulations that accompany these laws may be particularly important as they often provide the acquiring agency with instructions on how to carry out compulsory acquisition during all phases of the process.

The laws governing compulsory acquisition are part property law and part administrative law which dictates governance procedures. Principles of administrative justice and good governance often require that such powers are bound by legal rules which allow for hearings and appeals, and are subject to judicial review.

4: Compulsory Acquisition: What Rights To Be Compensated?

Compulsory acquisition is commonly associated with the transfer of ownership of a land parcel in its entirety. This may occur in large scale projects (e.g. construction of dams or airports) as well as in smaller projects (e.g. construction of hospitals or schools). However, compulsory acquisition may be also used to acquire part of a parcel, e.g. for the construction of a road. In some cases, the acquisition of portion of a land parcel may leave the remainder of the land intact. The remainder may be large enough for continued use by the owner or occupant despite its reduced value; or it may be so small that the person can no longer use it to maintain a living. In other cases, a new road may cut through the middle of the parcel, leaving the remainder divided into several unconnected pieces, some of which may be without access routes. In some countries, the governing legislation may allow the landowner to require the acquiring agency to acquire the whole parcel.

The use of specific portions of a land parcel may be also acquired for easements or servitudes to provide for the passage of pipelines and cables. Rights acquired usually include the right to enter the parcel to make repairs. The rights acquired may be granted temporarily or permanently, and may be transferable to others. People may be deprived of some enjoyment of their land even if it is not acquired. For example, the construction of a highway may cause the value of neighboring parcels to decrease because of the increased noise. Traditionally such losses have not been regarded as being eligible for compensation but legislation is increasingly providing for at least some compensation in such circumstances. A project may also increase the values of neighboring parcels.

Some equivalence may be provided through changed tax burdens: people whose land declined in value may pay less property taxation while others may find their tax bill has increased to reflect the higher land values. People may also suffer a loss when governments impose new and significant restrictions on the uses to which land may be put. Such zoning or land use controls may substantially reduce the usefulness or value of particular parcels.

The payment of compensation for such losses where the land has not changed hands is not widely adopted. However, some countries do provide for compensation in such cases. The actions (known as “regulatory takings” or “planning compensation”) are complex and their treatment is beyond the scope of this guide.

Compulsory acquisition is not limited to contexts in which the state seeks to acquire land that is privately owned. Full private ownership of land does not exist in some countries, and the state is the owner of all land. In other countries, the state retains ownership of substantial areas of land. A range of private occupancy, lease or use rights may be permitted over such state-owned land.

Compensation has to be provided for valuation of land that is privately owned, as well as of private rights in state-owned land, and of customary and informal rights.

5: Procedure For Compulsory Acquisition:

Compulsory acquisition is a power of government, but it is also the process by which that power is exercised. Attention to the procedures of compulsory acquisition is critical if a government’s exercise of this power is to be efficient, fair and legitimate. Processes for the compulsory acquisition of land for projectbased, planned development are usually different from processes for acquiring land during emergencies or for land reforms. Yet other processes may exist for electricity companies and others to acquire easements or servitudes. In general, a well designed compulsory acquisition process for a development project should include the following steps:

1. Planning: Determining the different land options available for meeting the public need in a participatory fashion. The exact location and size of the land to be acquired is identified. Relevant data are collected. The impact of the project is assessed with the participation of the affected people.

2. Publicity: Notice is published to inform owners and occupants in the designated area that the government intends to acquire their land. People are requested to submit claims for compensation for land to be acquired.

The notice describes the purpose and process, including important deadlines and the procedural rights of people. Public meetings provide people with an opportunity to learn more about the project, and to express their opinions and needs for compensation.

3. Valuation and submission of claims: Equivalent compensation for the land to be acquired is determined at the stated date of valuation. Owners and occupants submit their claims. The land is valued by the acquiring agency or another government body. The acquiring agency considers the submitted claim, and offers what it believes to be appropriate compensation. Negotiations may follow.

4. Payment of compensation: The government pays people for their land or resettles them on alternate land.

5. Possession: The government takes ownership and physical possession of the land for the intended purpose.

6. Appeals: Owners and occupants are given the chance to contest the compulsory acquisition, including the decision to acquire the land, the process by which the land was acquired, and the amount of compensation offered.

7. Restitution: Opportunity for restitution of land if the purpose for which the land was used is no longer relevant.

5.1 Principles Of Compulsory Acquisition Of Land
• The land and land rights to be acquired should be kept to a minimum. For example, if the creation of an easement or servitude can serve the purpose of the project, there is no need to acquire ownership of the land parcel.

• Participatory planning processes should involve all affected parties, including owners and occupants, government and non-governmental organizations.

• Due process should be defined in law with specified time limits so that people can understand and meet important deadlines.

• Procedures should be transparent and flexible, and undertaken in good faith.

• Notice should be clear in written and oral form, translated into appropriate languages, with procedures clearly explained and advice about where to get help.

• Assistance should be provided so owners and occupants can participate effectively in negotiations on valuation and compensation.

• The process should be supervised and monitored to ensure that the acquiring agency is accountable for its actions, and personal discretion is limited.

• The government should take possession of the land after owners and occupants have been paid at least partial compensation, accompanied by clearly defined compensation guarantees.

6: Compensation:
Compensation, whether in monetary terms or the replacement of land, is an essential requirement of compulsory acquisition. As a direct result of government action, people lose their homes, their land, and at times their means of livelihood. Compensation is to repay them for these losses, and should be based on principles of equity and equivalence. The principle of equivalence is crucial to determining compensation: affected owners and occupants should be neither enriched nor impoverished as a result of the compulsory acquisition. Financial compensation on the basis of equivalence of only the loss of land rarely achieves the aim of putting those affected in th same position as they were before the acquisition; the money paid cannot fully replace what is lost. In some countries, there is legal provision recognizing this in the form of additional compensation to reflect the compulsory nature of the acquisition. In practice, given that the aim of the acquisition is to support development, there are strong arguments for compensation to improve the position of those affected wherever possible.

The calculation of compensation is based on the value of the land rights and improvements to the land, and on any related costs. The determination of equivalent compensation can be difficult, particularly when land markets are weak or do not exist, when land is held communally, or when people have only rights to use the land. Many factors can lead to inadequate compensation. Legislation should ensure fair processes for determining valuation and compensation. While the public interest in keeping costs as low as possible is important, this concern should not deprive people of the equivalent compensation they need in order re-establish their lives after the loss of their land.

6.1 Procedure For Valuation And Compensation
During the valuation phase, the acquiring agency and the people whose land is being acquired gather information and evidence to support their arguments for the compensation values they believe to be equitable. This work is triggered by the notice of intention to compulsorily acquire land. The notice of intention should set a deadline by which each affected owner or occupant submits a claim for compensation.

Responsibility for the valuation of land varies from one country to another. In some countries the work is done by or for the acquiring agency while in other countries the valuations are the responsibility of independent commissions. The notice of intention should set a deadline by which each affected owner or occupant submits a claim for compensation. At some point after notice has been given, the project’s valuers must enter the land to inspect it and all improvements in order to determine their value. Owners and occupants should hire their own valuators, or find other ways to determine the value of their land.

7: Conclusion:
In the end the author would like to state that, my hypothesis is partially correct and partially incorrect, as:

1. Author`s first hypothesis is correct, which says that, there is a same process of acquisition for agricultural land as well as non- agricultural land. As in both the cases, whole authority to decide as well as all the powers of taking action lies in the collector. Further the government follows the same procedure of acquisition of land, no matter whether it is Agricultural or commercial or residential. The land acquisition act, 1894 only deals with the acquisition of private properties and does not specify regarding its character, as of agricultural, commercial or residential. So the Act does not make any distinction in providing the procedure for acquisition of land, whether agricultural or non- agricultural.

2. Whereas the second hypothesis is incorrect, which provides that, mode of ascertaining the value of compensation on acquisition of agricultural and non- agricultural is same. Whereas the actual position of law is that, the compensation and award on acquisition of agricultural land is determined on the basis of yielding capacity of the land, whereas in case of non- agricultural land it is determined on the basis market value of the land. As per Section 23 of the Act, the compensation on acquisition of agricultural land is determined by a formula, i.e. total yielding capacity in a year of a land multiplied by 12, which signifies the total yielding capacity of land for 12 years.

But in acquisition of non- agricultural land no such formula is provided, it just says that acquisition will be held on the current market price of the land.
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Books Referred:
· Law of acquisition of land in India by B.L. Bansal & R. Aiyer
· Land laws, Hemant goel, New era law publication
· Land laws under the constitution of India, Dr. N. Maheshwara Swamy, Asia Law House, Hyderabad, 1st Edition 2006

· Durga Das Basu, Indian Constitutional Law, Kamal Law House, 3rd Ed., 2011, Vol.1, Kolkata
# Acquistionand transfer of immovable property in India, www.jstor.org, last viewed on 20th January,
# Public ownership of urban land, P. T. KIVELL,
# Transactions of the Institute of British Geographers, New Series, Vol. 13, No. 2 (1988),pp. 165-178, www.jstor.org, last viewed on 8th February, 2012
# Id Ft. 1
# Id Ft. 2
# Land laws, Hemant goel, New era law publication
# Durga Das Basu, Indian Constitutional Law, Kamal Law House, 3rd Ed., 2011, Vol.1, Kolkata
# Id Ft. 7
# Id, Ft. 3
# Bangalore City Cooperative Housing Society Ltd. Vs. State of Karnataka and others - Feb 2 2012 SC Judgment
# Law of acquisition of land in India by B.L. Bansal & R. Aiyer
# Collector, Distt. Gwalior and Anr. Vs. Cine Exhibitors P. Ltd. and Anr.- 1/11/2012, SC judgment
# Compulsory acquisition of land and compensation, Paul Munro-Faure, Food and Agriculture organization of the United Nations, 2009
# Madan Puri and Ors. Vs. Union of India (UOI), MANU/PH/2701/2011
# Id, Ft. 11
# Id Ft. 12
# Bheru Singh and Ors. Vs. State of Madhya Pradesh and Anr., - 01.02.2012, SC Judgment
# Compulsory acquisition of land and compensation, Paul Munro-Faure, Food and Agriculture organization of the United Nations, 2009
# Id Ft. 17
# Bangalore Development Authority Vs. The Aircraft Employees Cooperative Society Ltd. and Ors - 24.01.2012, SC Judgment
# Id Ft. 16
# Compulsory acquisition of land and compensation, Paul Munro-Faure, Food and Agriculture organization of the United Nations, 2009
# Id Ft. 22
# Id Ft. 19
# Topara Rajender and Others Vs. Govt. of A.P.,rep. by its Secretary to Govt., Irrigation & Cad (Project Wing) Department At Secretariat Hyderabad and Others MANU/AP/1003/2011
# Ram Bhagat and Others Vs. State of Haryana and Others, MANU/PH/4191/2010
# Land Acquisition Act Need for an Alternative Paradigm, Mohammed Asif, Economic and Political Weekly, Vol. 34, No. 25 (Jun. 19-25, 1999), pp. 1564-15, www.jstor.org, last viewed on 8th February, 2012
# Public ownership of urban land, P. T. KIVELL, Transactions of the Institute of British Geographers, New Series, Vol. 13, No. 2 (1988),pp. 165-178, www.jstor.org, last viewed on 8th February, 2012
# Bangalore City Cooperative Housing Society Ltd. Vs. State of Karnataka and Ors., 2012 judgement SC
# Id Ft. 26
# Id Ft. 25
# Urban-rural relations, demand politics and the 'new agrarianism' in northwest India: the Bharatiya Kisan Union, Jim Bentall and Stuart Corbridge, Blackwell Publishing ,
# Transactions of the Institute of British Geographers, New Series, Vol. 21, No. 1 (1996),pp. 27-48, www.jstor.org, last viewed on 8th February, 2012
# Bangalore Development Authority Vs. The Aircraft Employees Cooperative Society Ltd. and Ors - 24.01.2012, SC Judgment
# Land Acquisition Act Need for an Alternative Paradigm, Mohammed Asif, Economic and Political Weekly, Vol. 34, No. 25 (Jun. 19-25, 1999), pp. 1564-15, www.jstor.org, last viewed on 8th February, 2012
# Id Ft. 28

The  author can be reached at: sid201291@legalserviceindia.com

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