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LATEST NEWS UPDATES | Money doesn’t make the landowner fonder by EAS Sarma

Money doesn’t make the landowner fonder by EAS Sarma

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published Published on Aug 7, 2011   modified Modified on Aug 7, 2011

The country’s first legislation on land acquisition, rehabilitation and resettlement is out as a first draft. Here is a sharp critique of the bill

THE GOVERNMENT has made public the new Draft National Land Acquisition and Rehabilitation & Resettlement Bill, 2011, which FW has run in these columns over three days. This is what I think of it. In terms of the definition of public purpose, the Bill is more colonial and draconian than its older counterpart. The sops provided in the new Bill for Scheduled Tribes defeat the constitutional rights that the Fifth Schedule (Clause 5) has conferred on tribals in the notified areas. In principle, no land should be acquired in the Scheduled Areas. The Bill is regressive and should undergo major changes before it can be made people-friendly. In its present form, it provides enormous scope for rent-seeking among politicians and bureaucrats and leads to large-scale human rights violations.

The 1984 Land Acquisition Act is in itself a draconian law enacted by the colonial rulers at that time in the name of invoking the state’s Eminent Domain to forcibly acquire private lands in the name of public purpose. The compensation offered to the displaced persons under this Act is necessarily below the market price as the price is determined by the local officials on the basis of the sale and purchase prices obtained from land transactions that have taken place in the vicinity. The latter always represented gross undervaluation by the parties to the transaction to avoid paying the registration charges. In other words, the compensation amounts paid under the Act failed to capture the real value of the land. In most cases, the authorities routinely invoked the urgency clause to dispossess voiceless citizens but the process of payment of compensation remained tortuous and time-consuming.

We have a case in Visakhapatnam, Andhra Pradesh, where several farmers were dispossessed from their lands submerged under the waters of the Tandava Reservoir Project thirty years ago but they are yet to receive compensation. The Act unfortunately never stipulated that no land should be taken without payment of compensation. People have sentimental association with the land inherited by them from their forefathers. In the case of the Mangalore SEZ, Gregory Patrao, whom I had the benefit of meeting a couple of years ago, showed me his village and his ancestral house, explaining that his house was the weekly meeting place for his community for offering prayers till a church was built. The church itself was built hundreds of years ago. In other words, for Gregory Patrao, the sentimental value of the house was immeasurable, irrespective of whatever public purpose the government had cited to displace him and irrespective of the price tag attached to the land. He refused to accept it the cash packet the government dangled. He was forcibly evicted from the house, which was demolished to accommodate the SEZ.

Those that own and manage the SEZ will appropriate large chunks of the land acquired to locate their palatial residences and lead lives of such high quality that the displaced families could never aspire for. The so-called rehabilitation colony proposed for the displaced families near Mangalore is a sight that anyone with a sense of dignity would abhor. Do we want such incidents to happen in a civilised democracy? The Ministry of Rural Development (MRD), which is ensconced in air-conditioned rooms of Krishi Bhavan in New Delhi, is perhaps far too disconnected with the ground reality to appreciate the finer concerns of the citizens of this country, as far as land acquisition is concerned. The recent landmark order pronounced by Supreme Court on the need for the authorities to exercise self-restraint in depriving citizens of their land assets should force the MRD to rethink on this. There are a few fundamental issues that need to be addressed by the MRD before considering a new land acquisition law. These are as follows.

The Bill provides a highly distorted and warped view of development. It makes one believe that industrialisation is an end in itself and everything else is subsidiary to it. The Indian Constitution envisages a development process that springs out of what the people want in terms of what is good for them. The choices with regard to development projects should lie with the people, not the government. Once this basic premise is accepted, the question of someone at the top imposing a project on the local community against its will and forcibly acquiring land should not arise. Unfortunately, the Preamble to the Bill starts with this warped objective, rendering the remaining parts of it highly regressive.

Industrialisation cannot be an end in itself. Indiscriminate industrialisation cannot contribute to balanced development. For example, the Ministry of Environment and Forests (MOEF) has cleared more than 2,00,000 mw of base load power generation capacity as a part of the laissez fair approach of the government. Whereas the most optimistic electricity demand estimates of the Central Electricity Authority do not justify such a large incremental capacity nor is it good from the point of view of protecting the environment. Should the state invoke its Eminent Domain authority to dispossess people of their land by calling such unwanted projects infrastructure facilities for public purpose? This argument holds well in the case of mining projects, ports, SEZs and so on. In most cases, the developers expect the state to give many other concessions including hefty tax sops. This has become one of the most important factors promoting corruption and black money in India. Should the state’s Eminent Domain be invoked to promote corruption?

Private companies invest in projects to earn profits. They rarely do it to promote public welfare. Any industrial activity will incidentally provide goods for public use. Can the definition of public purpose be stretched to include all such activities that enable the developers to realise returns for their personal benefits? The Preamble to the Bill starts with the statement that it primarily aims to ‘balance the need for facilitating land acquisition for industrialisation, development of essential infrastructure facilities and urbanisation, while at the same time to meaningfully address the concerns of farmers and those whose livelihoods are dependent on the land being acquired’. Other than industrialisation, is there no development activity that the government should pursue? To take an extreme case, if the proportion of agricultural or forest land falls below a threshold limit, will it not become necessary for the state to invoke its Eminent Domain authority to acquire the land belonging to an industrial house to accommodate either agriculture or forestry? Should not the Bill, if it were to be equitable, provide for acquiring industrial land to accommodate traditional fishing communities and artisans?

CLAUSE 5 of the Fifth Schedule to the Constitution requires the Governor in each state to review all laws and adapt them to suit the interests of the Scheduled Tribes before extending their application to the notified Scheduled Areas. This implies special constitutional rights conferred on the tribals. Even though more than six decades have gone by after Independence, India has failed to carry out such a review. The land acquisition law should have been reviewed in accordance with this provision and an adapted version of it should have been kept ready. Those that have drafted this new Bill are perhaps unaware of this far-reaching constitutional requirement. By providing an innocuous clause (Clause 13) in Schedule II to the Bill, the drafters perhaps thought they had done all that was necessary to dole out charity to the tribals. They should know that the Constitution has provided a statutory entitlement and a price tag attached to rehabilitation can never be compensation for it.

A disturbing feature of land acquisition as revealed in the case the Outer Ring Road (ORR) in Hyderabad is that selective acquisition was resorted to and many influential persons were left out. The less influential received compensation fixed by the government and later, the more influential exploited the incremental value of their land adjacent to orr to realised enormous windfall benefits. Cash compensation for land acquired has been found by many research workers to have led to highly undesirable socioeconomic outcomes. Usually, an agricultural family that has lost its land as a result of acquisition is rarely in a position to buy alternate land elsewhere, because part of the cash compensation goes into artificially-boosted consumption and the purchase value of alternate land is far higher than the compensation amount itself. This usually leads to undesirable occupational displacement of the affected family.

Against the above background, I offer the following comments and suggestions. In the new Bill, invoking the Eminent Domain of the state should be a last resort, limited to a highly restricted definition of public purpose, after the state satisfies itself that the land requirement computed by the requisitioning agency conforms to stringent land use norms, both in terms of the area and the use. In order to translate this intention into a tangible legal provision, acquisition in excess of a few acres (say, 10 acres) in a rural area should have the legislature’s prior approval. No land should be acquired for a company that has been set up to earn profits. Even when limited land is acquired for, say, a government hospital or a school, the land so taken from the owner should be treated as on long lease with the rental indexed to the market value variation in the area, computed on the basis of its potential future value rather than on existing value.

The definition of public purpose in the Bill is open-ended. It is more draconian than its counterpart in the old Act. The relevant definition in the Bill will enable the state to include any profitable private land acquisition proposal within its ambit, rendering the concept of right to property contemplated in Article 300A dysfunctional. This right was a fundamental right (erstwhile Article 31) replaced in 1977 by Article 300A in the 44th Constitution Amendment. The amendment itself was regressive, as it was introduced to accommodate large psus with an insatiable appetite for land. Indiscriminate land acquisition was the outcome of this. Later, this has helped influential private players take advantage of the loophole provided. Politicians and bureaucrats in nexus with private players have exploited this provision on a large scale.

There should be a ban on acquisition of land belonging to tribals in all Scheduled Areas as it will deprive them of their rights. The decision to set up a development project in the Scheduled Areas should lie with the tribal Gram Sabhas, Panchayats and Tribal Advisory Councils. Even if such a project is to be set up, it should be owned and managed by the tribals. Thus, the question of land acquisition should not arise in Scheduled Areas. In the rest of the country, the choices about setting up projects should emerge from discussion and debate among the local communities. It may so happen that the local communities have more people-friendly approaches than what the Bill envisages.

A major sop in the new Bill is the rehabilitation and resettlement package, as though it would undo the trauma caused by forcible land acquisition and the human rights violations involved. Proposing a package without addressing the fundamental issues is not acceptable. The Bill in its present form is people-unfriendly and is, therefore, unacceptable. It should be revamped totally. Land acquisition involves deprivation of people’s right to property and consequent human rights violations. These are not choices that should be left entirely to democratic processes. They need to conform to the norms set out in the Constitution. The Bill fails the test.

EAS Sarma is currently convenor of the Forum for Better Visakha, also is the former finance secretary Government of India based in Visakhapatnam.
eassarma@gmail.com

Tehelka, 6 August, 2011, http://www.tehelka.com/story_main50.asp?filename=Ws060811Money.asp


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