Supreme Court Flags Disparity In National Highways Act Acquisitions Compared To Other Land Acquisitions, Urges Centre To Examine

The Supreme Court has raised concerns over the deep structural flaws in determining the land acquisition compensation acquired under the National Highways Act, 1956. The Court said that land owners whose lands were acquired under the 1956 Act faces significant disadvantage when compared to land owners whose lands were acquired under different laws. The Court noted that under the National Highways Act, compensation disputes are decided by government officers like Collectors or Commissioners, not judicial authorities, who are often burdened with administrative duties and lack judicial training to decide complex valuation issues. The land aquisition matters are statutorily referred to arbitration as per the NH Act."The Collectors or Commissioners of the Revenue Districts/Divisions are notified to act as arbitrators.These officers are generally pre-occupied with their multiple administrative responsibilities and they also do not have the desired experience of a judicially trained mind to adjudicate the complex issues like determination of market value of the land or other statutory benefits to which the affected parties are now entitled to.."Also, the appeals against the award are to be decided within the limited framework of the remedies under the Arbitration and Conciliation Act, 1996. In contrast, under the Land Acquisition Act, 1894 (Old Act) and the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (new Act), such disputes are decided by judicial courts with the expertise and independence to fairly determine market value. They also have more liberal appellate remedies.“It may, thus, be seen that the land owners, whose land is acquired under the 1956 Act, vis-à-vis the land owners whose lands are acquired now under the New Act (2013), have been treated as separate classes, apparently without any intelligible differentia. This leads to grave heartburn among the land owners of the first category, namely, those whose lands are acquired under the 1956 Act.”, the court noted. To address the issue of differential treatment to the landowners whose lands were acquired under the 1956 Act, a bench of Chief Justice Surya Kant, and Justices Joymalya Bagchi and Vipul M Pancholi suggested the Union Government to revisit the legislative scheme” and consider bringing parity in the method of compensation determination, keeping in view Article 300A of the Constitution, which protects the right to property."While there seems to be a lot of legislative wisdom discernible from the mechanism encapsulated under the 1956 Act, to the effect that the acquisition under this Act must take place in a time-bound and expeditious manner so that the development of National Highways is not hampered or delayed. Though such a legislative policy is laudable, prima facie, it seems that this object can be kept intact while ensuring the land owners that they will be entitled to assessment of compensation for the acquired land in the same manner as is determined for the land owners whose lands are acquired under the Old Act or under the New Act, even when such acquisition is also for infrastructural development.”, the Court said, while also asking the Attorney General for India to look into this aspect.The Court also directed a copy of this order to be circulated to the Solicitor General of India. Background The bench heard the batch of SLPs that arose from the Punjab and Haryana High Court's judgment, which declared Sections 3G and 3J of the National Highways Act, 1956, unconstitutional. These provisions constitute the statutory framework for determining compensation through arbitration when landowners dispute the amount awarded. Under the Act, compensation disputes are decided by arbitration conducted by officers notified by the Central Government, usually District Collectors or Commissioners, and the awards can be challenged only under Sections 34 and 37 of the Arbitration and Conciliation Act, 1996, where judicial review is very limited. After the High Court struck down these provisions, the arbitral mechanism under the 1956 Act stood invalidated, creating uncertainty for pending cases. In the present matter, 21 landowners had filed Section 34 petitions before the Additional District Judge. When the High Court delivered its judgment, they withdrew their petitions, believing the arbitral framework had ceased to exist. Subsequently, the Supreme Court stayed the High Court judgment, temporarily reviving the arbitration mechanism. This left the landowners remediless, as any fresh challenge would be barred by limitation. It was in this situation that they approached the Supreme Court seeking restoration of their withdrawn petitions. While restoring their Section 34 petition in exercise of its inherent powers under Article 142 of the Constitution, the bench highlighted the ambiguity under the 1956 Act, which positioned the landowners in a detrimental situation when compared to the Old ...

Supreme Court Flags Disparity In National Highways Act Acquisitions Compared To Other Land Acquisitions, Urges Centre To Examine

Yash Mittal

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Supreme Court Flags Disparity In National Highways Act Acquisitions Compared To Other Land Acquisitions, Urges Centre To Examine

Yash Mittal

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