Introduction
The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (RFCTLARR Act) changed how compensation is awarded to landowners in India. Sections 26 to 30 of the Act focus on fair valuation of land, apportionment of compensation, and additional benefits for those displaced due to compulsory acquisition. The aim is to ensure that landowners do not suffer unfair loss and receive adequate relief when their land is taken for public projects. These provisions mark a shift from the older Land Acquisition Act of 1894, where compensation rules for landowners was often inadequate and led to prolonged disputes.
How To Determine Market Value
The law lays down a strict method to calculate the market value of land. Authorities must consider the highest value among three indicators: the minimum value fixed for stamp duty, the average sale price of similar land in the past three years, or the agreed value in cases involving private or public-private projects. This prevents undervaluation and ensures the owner receives the most beneficial price.
For rural areas, the law introduces a multiplication factor that increases the final value. Depending on the location, the factor may range from one to two times and in some regions even up to four times the market value. For urban areas, the factor is usually one to two times. This system recognizes the socio-economic gap between rural and urban landowners and tries to provide fairer compensation in rural areas where sale prices are often lower.
How To Calculate Compensation
After fixing the market value, authorities calculate the total compensation. This includes not just the land value but also the worth of attached assets. Houses, wells, trees, crops, and any permanent structures on the land are valued and added to the compensation amount. By including these elements, the law ensures that owners are not left uncompensated for the investments made on their land.
What Are The Components of Compensation
The Act also recognizes indirect losses. Compensation must include damage to standing crops and trees that are destroyed during acquisition. If the acquisition cuts off part of the land or reduces the value of the remaining portion, that reduction must also be compensated. The cost of relocating to a new place, shifting belongings, and loss of income between the notice of acquisition and the actual possession of land are all included in the calculation. Section 28 leaves room for authorities to consider any other genuine loss suffered by the landowner due to acquisition. This ensures a comprehensive relief package rather than a narrow valuation based only on the land price.
Apportionment of Compensation
Disputes often arise when multiple parties claim ownership of the same land. Section 29 deals with such cases. The compensation is apportioned among all persons with valid rights or interests in the land. If ownership is disputed, the amount may be deposited in court until the dispute is resolved. This rule prevents delays in payment and protects rightful owners from being deprived of their share.
What Is Solatium and Additional Benefits
Perhaps the most significant reform under the 2013 Act is the introduction of solatium. The law mandates that landowners receive an additional 100 percent of the compensation amount as solatium. This payment recognizes that compulsory acquisition causes involuntary hardship. For example, if the calculated compensation is ₹10 lakh, the solatium adds another ₹10 lakh, doubling the amount payable.
Along with solatium, the Act provides for rehabilitation and resettlement benefits. These include allowances for transportation, temporary housing, and resettlement support. In many cases, affected families also receive employment or annuity payments to restore livelihood opportunities. These benefits move the law beyond mere compensation and toward a holistic package for displaced communities.
Formula for Compensation
The law provides a clear formula for calculation. The total compensation equals the market value multiplied by the applicable factor, plus 100 percent solatium, along with rehabilitation and resettlement benefits. In rural areas, this may increase the payout up to four times the market value. In urban areas, it can go up to twice the market value. By adopting this formula, the Act attempts to standardize payments across states while allowing flexibility based on local conditions.
Importance of Sections 26–30
These sections form the backbone of the compensation system under the 2013 Act. They address past criticisms of unfair and arbitrary awards under the 1894 law. By ensuring transparent methods, higher payouts, and rehabilitation support, the Act reduces the chances of prolonged litigation and resistance to acquisition projects. It also reflects a constitutional commitment to protect the right to property under Article 300A and to provide a dignified standard of living for displaced families.
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Conclusion
Sections 26 to 30 of the 2013 Act transform compensation rules for landowners. The law values land at the highest possible rate, adds assets and indirect losses, ensures fair apportionment, provides double compensation through solatium, and extends rehabilitation benefits. These reforms make land acquisition more humane and transparent. For landowners, it means a stronger safety net against displacement. For the State, it ensures smoother execution of public projects with reduced conflict.
