Key points
- Compensation is market value multiplied by a factor of one to two in rural areas (one in urban areas), plus value of assets, plus 100% solatium, plus interest.
- Acquisitions for private companies and PPP projects need consent of 80% or 70% of affected families respectively.
- Under Section 24(2), an acquisition under the 1894 Act lapses if, five years before 2014, neither possession was taken nor compensation paid, as interpreted in Indore Development Authority (2020).
The process
A social impact assessment and public hearing, a preliminary notification under Section 11, objections under Section 15, a declaration under Section 19, a rehabilitation and resettlement scheme, the award under Section 23 within 12 months of the declaration, and possession after payment. Urgency acquisitions under Section 40 dispense with some steps for defence and natural calamity cases.
Compensation
Market value is the highest of the circle rate, the average of the top half of registered sale deeds in the vicinity in the preceding three years, or the consented amount. Rural land is multiplied by a factor up to two; urban land is not. Buildings, trees, crops and wells are valued separately. Solatium of 100% is added, plus 12% interest from notification to award. Rehabilitation entitlements include housing, employment or annuity and transport allowance for displaced families.
Challenging the acquisition
Objections are first raised under Section 15. Writ petitions in the High Court lie against acquisitions that are mala fide, without public purpose, in breach of the procedure or discriminatory. Compensation disputes go to the Land Acquisition, Rehabilitation and Resettlement Authority under Section 64, with appeal to the High Court.
Delhi
Much Delhi litigation concerns older 1894 Act acquisitions by the DDA and the lapse provision of Section 24(2). After the Constitution Bench ruling in Indore Development Authority v. Manoharlal (2020), lapse requires that both possession was not taken and compensation was not paid or deposited for five years or more before 1 January 2014.
Frequently asked questions
Can I refuse to give my land?
For government projects, no, if the procedure is followed; your remedies are objections and compensation. For private and PPP projects, the consent thresholds give affected families a real say.
Is the compensation taxable?
Compensation under the 2013 Act is exempt from income tax under Section 96 of the Act, and CBDT has clarified that the exemption applies regardless of whether the land is agricultural.
Related practice area: Constitutional Law & Writ Petitions
This article is for general information and does not constitute legal advice. Laws, rules and limitation periods change and depend on the facts; please take advice on your own situation before acting. Reading this article does not create a lawyer-client relationship with Akhtars Legalitarian.