The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (RFCTLARR, hereafter referred to as LARR 2013) was the culmination of decades of struggle by people’s movements against arbitrariness, injustice and land grab. It appeared that people’s voice was finally reaching the portals of power. And although the Act did not cede the power of eminent domain in favour of the people, there were, nevertheless, some rather progressive elements there.
The task for the new government was to implement it in right earnest and to iron out the difficulties encountered therein. Much to the contrary, yet very much in the ambit of the expected, has happened. All indications in the run up to the Lok Sabha elections of 2014 were that the LARR 2013, which was perceived by the corporate world as being ‘anti-growth’ and ‘anti-investment’, would be amended on the double by the new dispensation at the centre. And in fact the new Rural Development Minister called a meeting of Revenue Ministers of the states to review the LARR 2013 on June 27th, a mere 40 days since assuming power.2 By 31st December 2014 it stood amended through an Ordinance!! By any standards, the amendments are regressive and anti-people, anti-farmer and anti-agriculture. All in all, the amendments in the Ordinance 2014 make the LAQ 1894 look benign in comparison.
At the outset, let us clarify our usage of the term ‘farmer’ or ‘anti-farm’ or ‘agriculture’ in connection with land acquisition. The ambit of the land acquisition Act – old or new – is limited to private land holding only. Forests, coasts, rivers, pasturelands, wastelands, lakes and water bodies – appropriately termed Common Property Resources (CPR) – are not covered by this Act. Not only are they not covered by the LA Act, they are also not covered by any policy directive or legal instrument formulated by any government of independent India even today. Pastoralists, fisherfolk, tribals, landless agriculturalists, saltpan workers – all communities that depend on these CPRs are hence left out of the provisions of this Act.
Comparison of some key features of the 2013 LARR Act and the Ordinance 2014
|CATEGORY||LARR 2013||ORDINANCE 2014|
|Definition of Private Companies||The Act defines private companies as per the Companies Act, 1956. The provisions of the Act apply to private companies “with a public purpose”.||Private company is replaced with “private entity”. A private entity being “any entity other than a Government entity or undertaking and includes a proprietorship, partnership, company, corporation, non-profit organization or other entity under any law for the time being in force”.|
|Types of projects the Act applies to||Sec. 2 (1) (b) (i): Private hospitals, private educational institutions were not exempt from the provisions of the Act viz. consent and SIA||Removes private hospitals and private educational institutions from the provisions of consent and SIA|
|Types of projects the provisions dealing with Social Impact Assessment and Consent apply to||The process of obtaining consent, conducting a Social Impact Assessment and determining public purpose are applicable to public projects, PPPs where the ownership of the land continues to vest with the government, and private companies with a public purpose (Section 2 and Sections 7-9)||
The process of obtaining consent and conducting SIA are not applicable to the following projects:
1. such projects vital to national security or defense of India and every part thereof, including preparation for defense; or defense production;
2. rural infrastructure including electrification
3. affordable housing and housing for the poor people;4. industrial corridors
5. infrastructure and social infrastructure projects including projects under PPP where the ownership of the land continues to vest with the government.*
|Types of projects food security provisions apply to||The measures to safeguard food security including the prohibition on acquisition of irrigated and multi-cropped land except in rare and demonstrably unavoidable circumstances is applicable to public projects, PPPs where the ownership of the land continues to vest with the government, and private companies with a public purpose (Section 10)||The measures to safeguard food security are not applicable to land acquisition for the following projects 1 to 5 as above|
|When land acquired under the LAA, 1894 is said to have lapsed||Where land acquisition proceedings were initiated under the LAQ, 1894 where an award was made five years or more prior to the commencement of this Act and physical possession has not been taken or compensation has not been paid the proceedings will be deemed to have lapsed. Fresh proceedings should commence under the provisions of this Act.||In cases where proceedings have been delayed due to an injunction or stay issued by a court, or where possession has been taken but compensation is lying deposited in a court or any account, proceedings will not be deemed to have lapsed.|
|Punishment for Offenses||If any offense is committed under this Act and it is proven that it has been committed with the connivance or consent or can be attributed to neglect on part of any officer, that officer will be liable to be proceeded against.||Proceedings against government official will require the sanction of the appropriate government.|
|Power to Remove Difficulties||If any difficulties arise in implementing this Act the Central Government may, by order, make such provisions, not inconsistent with the Act, to remove difficulties, provided that no power shall be exercised after the expiry of two years from the commencement of this Act.||The Central government has the power to make such orders up to five years from the commencement of this Act.|
|Transparency before parliament||Notifications pertaining to compensation and R&R needed to be tabled before the houses of parliament||Omitted|
What do these mean?
Overturning the very purpose of the new Act
The raison de etre of the new Act was the blatant injustice to farmers and others dependent on land in the process of land acquisition. In that sense, there were a few provisions that were at the core of the popular demands which got reflected in the new Act.
Firstly, the Act, for the first time responded to the public outcry over the arbitrariness involved in the unexplained term ‘public purpose’. Many battles have been waged on this issue. Hence, the term public purpose, in this Act, was applied to explicitly stated items (in Section 2), which were:
Box 1 ‘Public purpose’ projects exempt from consent and SIA requirements
a) For strategic purposes relating to naval, military, air force, and the armed forces of the Union, including central paramilitary forces or any work vital to national security or defence of India or State police, safety of the people; or
b) For infrastructure projects, which includes the following, namely: -
i) All activities or items listed in the notification of the Government of India in the Department of Economic Affairs (Infrastructure Section) number 13/6/2009-INF, dated the 27th March, 2012, excluding private hospitals, private educational institutions and private hotels;
ii) Projects involving agro-processing, supply of inputs to agriculture, warehousing, cold storage facilities, marketing infrastructure for agriculture and allied activities such as dairy, fisheries, and meat processing, set up or owned by the appropriate Government or by a farmers’ cooperative or by an institution set up under a statute;
iii) Projects for industrial corridors or mining activities, national investment and manufacturing zones, as designated in the National Manufacturing Policy;
iv) Project for water harvesting and water conservation structures, sanitation;
v) Project for Government administered, Government aided educational and research schemes or institutions;
vi) Project for sports, health care, tourism, transportation or space programme;
vii) Any infrastructure facility as may be notified in this regard by the Central Government and after tabling of such notification in Parliament;
c) Project for project affected families;
d) Project for housing for such income groups, as may be specified from time to time by the appropriate Government;
e) Project for planned development or the improvement of village sites or any site in the urban areas or provision of land for residential purposes for the weaker sections in rural and urban areas;
f) Project for residential purposes to the poor or landless or to persons residing in areas affected by natural calamities, or to persons displaced or affected by reason of the implementation of any scheme undertaken by the Government, any local authority or a corporation owned or controlled by the State.
Secondly, ‘prior and informed consent’ and Social Impact Assessment (SIA) became mandatory elements for all projects not covered under the ‘public purpose’ rubric. The eminent domain powers in the Act of 1894 made the government undertake land acquisitions without any form of consultation with the people who were to be displaced. The new Act therefore introduced the consent requirement, albeit with a caveat. The consent requirement was necessary for PPPs where the ownership of the land continues to vest with the government, and private companies with a public purpose. It was, however, not applicable to public sector undertakings and for ‘public purpose’ (mentioned above). Gram sabha consent was also introduced for the first time in this Act, along with the introduction of a new category called ‘affected families’, i.e. consent, not only of land owners only, but all such families that derived their sources of livelihood/income, directly or indirectly, from the said land. In other words, the participation of the people and their voice in ‘development’ was legislated.
Along with this, there was also the requirement of a Social Impact Assessment for all projects which mandated the consent requirement. The SIA was introduced with the objectives of ascertaining the impacts of the project on the area, its environment and ecology, on the natural resources of the area, and on the people residing therein, the extent of livelihood generation for the local population (to be displaced from land-based occupations), and whether the land being acquired was absolutely the minimum requirement for the project. Moreover, such an exercise would also help to ascertain the number of ‘affected families’.
Two of these most crucial elements of the new Act stand amended by the Ordinance. Amendment 3(i) of the ordinance does away with both these requirements i.e. consent and SIA, for “private hospitals and private educational institutions” (which were earlier not exempt from these provisions). 3(ii) exempts projects listed in section 10 A which is newly introduced. Section 10A is part of a new chapter, III A, which is essentially a listing of projects which will be exempt from the provisions of consent and SIA over and above those contained within the definition of ‘public purpose’ (Box 1). The list of projects which are covered by the ‘consent’ and SIA requirement would be shorter that the one exempting projects from them!! The new exemptions include:
Box 2 Section 10(A) of Chapter III A of the Ordinance exempting further areas from consent and SIA requirements
a) Such projects vital to national security or defence of India and every part thereof, including preparation for defence; or defence production;
b) Rural infrastructure including electrification;
c) Affordable housing and housing for the poor people;
d) Industrial corridors; and
e) Infrastructure and social infrastructure projects including projects under public private partnership where the ownership of land continues to vest with the Government.
At another level, it poses serious threat to the socio-economic fabric of the country. Land / private property have not been granted the status of fundamental right as in other countries. Eminent Domain powers were a colonial imposition for exploitative use of land by the colonial power. The retention of eminent domain powers was to safeguard society from the pitfalls of zamindari system that was prevalent in India till land reforms were initiated by the post-independent state. In other words, the eminent domain powers were granted to the state to be used on the side of the poor and marginalised, the last among the least.3 The history of the implementation of the LAQ in post-independent India has been anything but. The LARR 2013 was thus a correction of a wrong (although it does not do away with the eminent domain powers of the state). The Ordinance is reversing this and moving towards facilitating the transfer of and consolidation of massive amounts of land in the hands of a few corporate / industrial houses and big industrialists.
Likewise ‘Consent’ and SIA were achievements of decades of struggle by farmers, people’s organisations, social movements. Removing these eases the road for corporate houses and big industry. Again, the terms here e.g. ‘projects vital to national security or defence of India’ or ‘rural infrastructure’ or ‘affordable housing’ are fluid and lend themselves to flexible interpretations to suit then current convenience. Food shortages can also endanger national security. Ports are also vital for the defence of India. Which can be included and which can be exempt? This will perforce have to be decided by the judiciary. Which will take 10, 15, 20 years. Perhaps more. In effect, a zero-sum game for big industry with deep pockets.
New element in the Ordinance
The Ordinance has added one new aspect viz. substituting the words ‘private company’ in the Act with ‘private entity’. This new term, ‘private entity’, has been defined as: “any entity other than a Government entity or undertaking and includes a proprietorship, partnership, company, corporation, non-profit organisation or other entity under any law for the time being in force” (Section 3(ii)(yy)).
The government’s power to acquire land was restricted, earlier, to companies registered under the Companies Act. This amendment removes this restriction and empowers the government to acquire it for anyone or anything as per its will, choice or discretion, including an individual (this has not been spelt out explicitly but is implied). This level of arbitrariness was perhaps not there even in the LAQ 1894. This must be looked at in conjunction with the changes in the definition of Company introduced in the new Companies Act, 2013 (see Annexure 3). There is an addition here: one-person company, private company, small company and dormant company. In other words, the employment potential of the upcoming industry had to be weighed against the displacement of the residents from agriculture or any other land-based occupations. This limitation is now removed and land can now be acquired even for a business establishment employing 1 person!!
Removing / altering clauses in LARR 2013
Section 24 (2) stipulated that in cases where land had been acquired under the provisions of LAQ 1894 but physical possession had not been taken or compensation had not been paid, then the proceedings were to be deemed to have lapsed and the matter would have to be started afresh under the provisions of this Act. The Ordinance amends this provision by adding a proviso which essentially means that any delay on account of litigation (court mandated stay or injunction), or where the compensation amount lies unclaimed in the court, then such period will not be factored into the computation of the period of limitation.
Section 87 stipulated when and under what conditions a government officer could be held guilty and proceeded against in a court of law. It removed the earlier constraint, viz. “the previous sanction of the appropriate Government” and would therefore act as a deterrent to bureaucrat- businessman nexus which was always detrimental to farmers’ interests. This section has been amended by the Ordinance and restores the previous limitation of government sanction for prosecution of a government employee.
Section 101 stipulated that any land acquired but remaining unutilised for a period of 5 years from the date of possession would revert back to the original owner/s or their heirs or to the Land Bank of the government. The amendment has substituted the words “a period of 5 years” by the words “a period specified for setting up of any project or for five years, whichever is later”. This is another major concession to the corporate lobby. The original stipulation was to remedy the situation where land was acquired without any work being carried out on it, and farmers rendered landless and jobless, and having to contend with the fact of their land having appreciated ten or twenty fold since acquisition and feeling cheated out of their due. The amendment again brings in arbitrariness in acquisition and holding. The project proponent may stipulate a longer duration (say 10 or 20 years) for setting up of a project and retain the land (most often for speculation). This is a draconian provision which will return India to a state of oligarchy and zamindari under a new socio-economic dispensation with a new set of zamindars.
Section 105 (3) stipulated that in cases of land acquisition (acquired under the provision of LAQ 1894) where compensation was pending or possession had not been taken, compensation and R&R provisions as per LARR 2013 had to be made applicable to all enactments listed in the Fourth Schedule4 of the Act within 1 year from the date of commencement of this
Act, i.e. by September 2014. The ordinance has extended this limit to 1st January 2015.
Section 105 (4) which mandated that any notification pertaining to compensation and R&R applicable to the enactments in the Fourth Schedule would have to be tabled (as a draft) in each House of Parliament, would have to be passed by them and only such notification as has been passed (with modifications) may be issued and if not passed, then would not be issued. This section has been omitted in its entirety by the Ordinance. This means that R&R and compensation matters, the source of much heartburn, had to be transparent and open. The deletion of this clause means that these would not be brought before the Houses of Parliament and may be legislated through GRs. How are people to know about these matters? RTI queries are routinely scuttled under one pretext or the other. The word ‘Transparency’ in the title of the Act is thus completely negated.
This last issue, legislation and governance through GRs, is important to understand for the implications for democracy and transparency. ‘Governance through GRs’ was an indispensable part of the ‘Gujarat Model of Development’, now going national. Important policy related issues were routinely dealt with through GRs instead of being tabled in the Assembly and being debated there. Elections, elected representatives, opposition party were all systematically sidelined and made redundant. ‘Governance through Ordinance’ is but an imitation of this tried and tested method. 6 months, by when the Ordinance will have to be put before the Houses of Parliament, is a long time for any and all kinds of political deals. Unless the people make their voices heard loud and clear. So far, it is one court that the politicians do fear.
Suppression of civil liberties
Whenever such draconian provisions to existing laws are made, it is imperative that they be challenged publicly by the people by voicing their dissent, in a non-violent manner and within the bounds of law. However, in recent times, the state, through its law and order machinery, has been coming down heavily on such public forms of protest, at least in Gujarat. Although no violence has been committed by the state the voice of dissent and protest has been successfully stymied. The routine methods of doing so are: a) denial of permission by the police for peaceful protests; b) holding activists and leaders into preventive detention of 24 – 72 hours; c) arrests of activists and leaders and court cases on them; and, d) routine visits and phone calls by LIB, IB officials to activists and leaders (as a means of intimidation). In such an atmosphere organising and leading protest programmes becomes difficult and dissent is successfully silenced. Suppression of civil liberties is thus another method for furthering the neoliberal agenda.
People’s protests against the Ordinance
The amendments in the Ordinance have been greeted with protests all over the country – ranging from the ‘padayatra’ (march on foot) from village Palwal (Haryana) to Parliament House by Ekta Parishad led by P. V Rajagopal who was joined by nearly 5,000 Adivasis, to the 2-day fast of Anna Hazare in New Delhi, to the massive protest by NAPM in___. In Gujarat too, the Jameen Adhikar Aandolan Gujarat (JAAG) and Gujarat Khedut Samaj together with several people’s organisations (Maldhari Vikas Sangathan, ...) organised a coordinated programme in 138 (out of total 248) blocks of districts of the state. The farmer organisations and farmers burnt a copy of the Ordinance as a symbol of their rejection of the amendments and submitted letters addressed to the Prime Minister, the Rural Development Minister and their local MP to the Mamlatdar (block revenue officer).
The political opposition has, in a rare display of unity, denounced the Ordinance unequivocally. Looking at the anger against it, especially after the drubbing in the Delhi Assembly elections, the BJP-led NDA showed a willingness to dilute certain clauses in the Ordinance, especially the consent clause. However, the opposition has so far stood its ground demanding the complete repeal of the Ordinance. Despite this it did go ahead and introduced it in the Lok Sabha (this means that it is no longer an Ordinance but a Bill, the LARR Amendment Bill, 2015). On 10th March 2015 the LARR Amendment Bill was passed by the Lok Sabha. However, it faces the test in the Rajya Sabha where the government does not have the requisite numbers to get it passed and made into a law.
The introduction of the Ordinance in parliament despite tremendous anger against it shows the arrogance of the government vis-a-vis the people. Country-wide protests against it debunks the myth (perpetuated by the Prime Minister himself in his ‘Mann ki Baat’ aired on radio channels) that the amendments are farmer-friendly or rather in the interest of the farmers. The other myth is related to the fact of it being done on popular demand (“people are demanding it and we are merely responding to the demands”). This latter claim reveals the biases and assumptions of the government. Who constitutes the category’ people’? do farmers, Adivasis, landless labourers, rural people constitute ‘people’? Or does that category only include corporate / business leaders, industrialists, financiers and bankers, MNC and TNC personnel, and the urban middle class only?
The amendments in the Ordinance have, at the stroke of a pen, decimated the achievements of decades of hard struggle by adivasis, farmers, people’s movements against injustice in land acquisition. All amendments, it is clear, are to the benefit of the corporate lobby and are farm-unfriendly. 18 industrial corridors all over the country, which will take away land from a majority of farmers of the country, being exempted from the provisions of this Act reveals the anti-farm, anti-people attitude of the government. All farmers in the DMIC route falling in Gujarat (covering 18 districts and 60% of its land) will be adversely affected by these amendments. Incidentally, the new amendments, by and large, remain true to the demands voiced by the Revenue Ministers of the states (Annexure 2).
However, it is not that farmers are the only large group coming for severe punishment. Labour laws are also slated for amendment. While it is not clear what they will be, given the anti-people or pro-management attitude so far displayed, they will certainly not benefit the labourers. Dismal as the scenario seems, these amendments could yet prove to be an opportunity to bring together two huge labouring classes of our society viz. farmers (rural) and industrial labourers (urban). It could be a moment of reckoning.
1. Sagar Rabari is an activist associated with the land rights struggles in Gujarat and India and is Secretary, Khedut Samaj – Gujarat, Ahmedabad.
2. The Conference of State Revenue Ministers was held on 27th June, 2014 at Vigyan Bhavan under the Chairpersonship of Hon’ble Minister of Rural Development Shri Nitin Gadkari. Altogether 32 States and Union Territories participated. 12 States/UT namely, Assam, Chhattisgarh, Delhi, Goa, Himachal Pradesh, Karnataka, Kerala, Madhya Pradesh, Maharashtra, Meghalaya, Tamil Nadu and Telangana were represented by their Lt. Governor / State Deputy Chief Minister in-charge Revenue / Revenue Ministers / Rural development Minister; the reset were represented by their Principal Secretaries / Secretaries. The States of Arunachal Pradesh, Mizoram, Nagaland and Sikkim did not attend the Conference.3. “...right of eminent domain of the State (is) ... merely an assertion that natural wealth belongs to the people, to the State” (K. T. Shah, in Constituent Assembly of India Debates (Proceedings), Vol. VII, 9th December, 1948)
4. Viz. the Ancient Monuments and Archeological Sites and Remains Act, 1958 (24 of 1958); the Atomic Energy Act, 1962 (33 of 1962); the Damodar Valley Corporation Act, 1948 (14 of 1948); the Indian Tramways Act, 1886 (11 of 1886); the Land Acquisition (Mines) Act, 1885 (18 of 1885); the Metro Railways (Construction of Works) Act, 1978 (33 of 1978); the National Highways Act, 1956 (48 of 1956); the Petroleum and Minerals Pipelines (Acquisition of Right of User in Land) Act, 1962 (50 of 1962); the Requisitioning and Acquisition of Immovable Property Act, 1952 (30 of 1952); the Resettlement of Displaced Persons (Land Acquisition) Act, 1948 (60 of 1948); the Coal Bearing Areas Acquisition and Development Act, 1957 (20 of 1957); the Electricity Act, 2003 (36 of 2003); and the Railways Act, 1989 (24 of 1989).
||Transport||Roads and bridges
Railway Track, tunnels, viaducts, bridges1
Urban Public Transport (except rolling stock in case of urban road transport)
Oil/Gas/Liquefied Natural Gas (LNG) storage facility2
Solid Waste Management
Water supply pipelines
Water treatment plants
Sewage collection, treatment and disposal system
Irrigation (dams, channels, embankments etc)
Storm Water Drainage System
Telecommunication (fixed network)4
||Social and Commercial Infrastructure||
Education Institutions (capital stock)
Hospitals (capital stock)5
Three-star or higher category classified hotels located outside cities with population of more than one million
Common infrastructure for industrial parks, SEZ, tourism facilities and agriculture markets
Fertilizer (Capital investment)
Post harvest storage infrastructure for agriculture and horticultural produce including cold storage
The Conference of State Revenue Ministers was held on 27th June, 2014 at Vigyan Bhavan under the Chairpersonship of Hon’ble Minister of Rural Development Shri Nitin Gadkari. Altogether 32 States and Union Territories participated. 12 States/UT namely, Assam, Chhattisgarh, Delhi, Goa, Himachal Pradesh, Karnataka, Kerala, Madhya Pradesh, Maharashtra, Meghalaya, Tamil Nadu and Telangana were represented by their Lt. Governor / State Deputy Chief Minister in-charge Revenue / Revenue Ministers / Rural development Minister; the reset were represented by their Principal Secretaries / Secretaries. The States of Arunachal Pradesh, Mizoram, Nagaland and Sikkim did not attend the Conference.
A summary of the suggestions on the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement (RFCTLARR) Act, 2013 made during the Conference of State Revenue Ministers is as follows:
* The Consent Clause [Section 2(2)] should be re-examined, as ownership of land vests with the Government in PPP projects. The Consent clause should be removed from PPP projects. Alternatively, consent requirement may be brought down to 50%.
* Definition of ‘affected family [Section 3(c)] needs to be re-examined as it is very elaborate and includes ‘livelihood losers’ working in the affected area for three years prior to acquisition of land and whose primary source of livelihood is affected. The Act provides for R&R benefits to the affected families. Hence, the provision is likely to be misused in the absence of clear criteria for determination of affected families.
* Posers of ‘Appropriate Government’ [Section 3(e)] which are with the Central Government should be delegated to the Union Territories.
* Mandatory Social Impact Assessment study (Sections 4 to 9) should be done away with, SIA should be confined to large projects/PPP Projects as it may delay the acquisition process.
* The provision to safeguard food security (Section 10) by development of ‘culturable wastelands’ in lieu of acquisition of ‘multi-cropped irrigated land’ needs to be amended as States like Delhi, Goa, Himachal Pradesh and Uttarakhand do not have any wasteland for the purpose.
* The Retrospective clause (Section 24) which stipulates that land acquisition proceedings would lapse in case compensation is not paid or physical possession is not taken should be modified. Payment of compensation as per New Act to the persons specified in Section 4 notification under old Act leads to increased burden on the State exchequer. The provisions of Section 24 need to be amended as it is leading to litigations.
* The litigation period or period of stay / injunction should be excluded while calculating the prescribed time limits for completing various proceedings under the Act a.g. Section 24(2), Section 25.
* Section 26 should be re-examined as determination of market price of land based on ‘agreements to sell’ will lead to speculation in land prices. As such, at present the compensation paid is higher than market value in Himachal Pradesh, Lakshadweep, Kerala etc.
* In Section 30(3), the date from which an amount of 12% of market value is to be given, should be calculated from date of preliminary notification under Section 11 and not from Section 4 notification which deals with SIA study as stipulated in the Act presently. It also contravenes the Section 69(2) of the New Act which deals with determination of Award by authority and stipulates calculation of 12% of market value from date of preliminary notification under Section 11.
* Under the Urgency Clause (Section 40), the powers to determine ‘any other emergency’ should also be exercised by the State Government. At present, urgency clause is restricted to ‘the Defence of India or National Security or for any other emergency arising out of natural calamity or any other emergency with the approval of Parliament’.
* Section 46 stipulating R&R obligation in case of private purchase beyond limits specified by the State Government should be deleted.
* The jurisdiction of Authority (Section 51) should be restricted to dispute resolution only and not be on determination of award.
* Penalty Provisions (Sections 84-90) including imprisonment of 6 months extendable to 3 years or with fine of with both for the Government Servants are too stringent and may lead to harassment of civil servants.
* Section 101 dealing with return of unutilised land to the original land owners or heirs should be deleted.
* The clause specifying sharing of 40% enhanced cost with original land owners (Section 102) when the land is transferred on higher consideration should be deleted as it leads to disputes.
* Under Section 104 of the Act, a formula for calculating ‘lease amount’ may be given, as a formula has been prescribed for calculating compensation value.
* There should be threshold for R&R entitlements in Second Schedule and infrastructural amenities in Third Schedule.
* Under Second Schedule, the provision of ‘land for land’ should be re-examined.
* State Specific Acts dealing with land acquisition should be included
in the Fourth Schedule exempting the enlisted Acts from provisions of
the New Act.
1.1 One-person company: The 2013 Act introduces a new type of entity to the existing list i.e. apart from forming a public or private limited company, the 2013 Act enables the formation of a new entity a ‘one-person company’ (OPC). An OPC means a company with only one person as its member [section 3(1) of 2013 Act].
1.2 Private company: The 2013 Act introduces a change in the definition for a private company, inter-alia, the new requirement increases the limit of the number of members from 50 to 200. [section 2(68) of 2013 Act].
1.3 Small company: A small company has been defined as a company, other than a public company.
(i) Paid-up share capital of which does not exceed 50 lakh INR or such higher amount as may be prescribed which shall not be more than five crore INR
(ii) Turnover of which as per its last profit-and-loss account does not exceed two crore INR or such higher amount as may be prescribed which shall not be more than 20 crore INR: As set out in the 2013 Act, this section will not be applicable to the following:
* A holding company or a subsidiary company
* A company registered under section 8
* A company or body corporate governed by any special Act [section 2(85) of 2013 Act]
1.4 Dormant company: The 2013 Act states that a company can be classified as dormant when it is formed and registered under this 2013 Act for a future project or to hold an asset or intellectual property and has no significant accounting transaction. Such a company or an inactive one may apply to the ROC in such manner as may be prescribed for obtaining the status of a dormant company.[Section 455 of 2013 Act]
(Excerpted from Companies Act, 2013: Key Highlights and Changes, Pricewaterhouse Coopers)Click here to return to the April 2015 index.