In 2013, following the passage of the new law on land acquisition – The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act – there was a flood of litigation.

This was largely anticipated as the law gave a very large class of acquisition victims the right to retrospectively have their acquisition set aside. Litigants rushed to avail themselves of these provisions, and several were successful. Even the Supreme Court has upheld the release of land under this retrospective clause (Section 24 (2) of the 2013 Act) in several cases, beginning with its now seminal judgment in the Pune Muncipal Corporation vs Harikchand case (2014).

However, there still continued to exist a smaller class of aggrieved individuals: whose land had been taken, and procedural requirements satisfied (in letter if not in spirit) under the 1894 law on land acquisition.

The 2013 Act, despite the best intention of its framers, could not accommodate these cases as return of the land could be permissible only if the process of acquisition was incomplete in some form (vis-à-vis the non-payment of compensation or the victims’ physical dispossession from the land).

It is in this context that the recent judgment of the Supreme Court, which quashed the acquisition of land in Singur, West Bengal, under the 1894 Act, stands apart from its other decisions under the 2013 law.

By its order, which runs to almost 200 pages, the Supreme Court has given a new lease of life to matters which otherwise would have had little chance of succeeding. It is also a stark reminder of how grim and inhumane proceedings under the 1894 law used to be. And how this was calmly accepted by the administration as the cost of doing business.

Landmark ruling

Though a remarkable pronouncement for several reasons, there are two which deserve immediate attention.

First, it sets aside the acquisition under the old law, that is, the 1894 Act. Practitioners in this area of law will attest to the fact that this is a rare occurrence. The judiciary has traditionally been reluctant to interfere in acquisition proceedings. The old law did not provide for any effective form of recourse or review other than a proceeding for enhancement of compensation. This acted as a severe disincentive to litigate even if the process was visibly flawed.

Second, it emphasises the importance of fair compensation and transparent procedure. This is important. The 1894 law had but one safeguard: the right to have objections heard (Section 5A).

While working on the 2013 law, we heard testimonies from a wide spectrum of stakeholders who professed that this protection had been observed in a perfunctory or superficial manner.

In the case of Singur, the learned judges echo this sentiment when they state, “the inquiry held under Section 5A is a farce and eyewash; neither the collector nor the state government considered the matter with objectivity as mandated”. This renewed emphasis gives those victims not covered by the 2013 law the chance to apply the same standard in their cases and seek parity.

Separately, on the question of compensation, the view taken by the learned bench is also ground-breaking. Justice Gowda has held that “the inquiry, as contemplated under Section 11 of the Land Acquisition (1894) Act, is a quasi-judicial exercise of power on the part of the Collector in awarding just and reasonable compensation to the landowners/cultivators. That has not been done in the instant case”.

This is a departure from the traditional position of applying the prevailing circle rate with a marginal increase by way of compensation. One of the foremost criticisms under the 1894 law was that compensation never reflected the true value of the land (as it was based on under-reported value of sales). This was also why the 2013 law provided for a multiplier to accommodate the shortfall (two to four times the market value).

It is here where the judgment’s value as a precedent primarily arises. On both procedure and compensation, the language of the judgment is sufficiently broad to hold the acquiring authority to a higher standard and to enable the State to consider market rates when paying compensation.

Unfortunately, the two judge bench could not agree on whether the purpose for which the land was acquired was genuinely in public interest. Though unsurprising (as it is a matter of interpretation), it is problematic as several of the pending challenges under the 1894 law question the nature of “public purpose” behind their acquisition. The judicial trend was never to interfere with what the executive termed to be “public purpose” (in 2008, the Calcutta High Court had declined to uphold the challenge) or to substitute judicial discretion for that of the administration. However, this does not in any way diminish the import of the decision.

In sum, this judgment will now operate as a valuable precedent in cases not covered by the 2013 law.

A more just acquisition

The judgment also has a place in history.

Singur, along with Bhatta Parsaul in Uttar Pradesh, was a major catalyst for the change in the land acquisition law. The excesses committed by the state machinery in acquiring land for development are now well known and documented.

In fact, the pillars on which the 2013 law rests are specifically designed to ensure that a second Singur can never take place. There can be no acquisition without the consent of the majority (70%-80% of affected families depending on the nature of the proposed activity). The acquisition has to be preceded by a Social Impact Assessment to determine if indeed the project qualifies as a “public purpose”.

Compensation that is paid must be a minimum of two times the highest prevailing market value (and up to four times if the land is in a rural area). In addition to this, all families dependent on the land for their livelihood (especially landless labourers) must be rehabilitated and resettled before possession of the land can be taken by the acquiring authority. This undoubtedly makes acquisition difficult but also more just.

For a Central government eager to bring back the provisions of the 1894 law through state laws there is a lesson here: to refrain from making the same mistakes.

Khan is an advocate and a National Media Panelist of the Congress party. He is the co-author (with Jairam Ramesh) of the book, Legislating for Justice: Making of the 2013 law on land acquisition.