Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (LARR Act)
The LARR Act, 2013, revolutionized land acquisition in India by replacing the draconian colonial-era law, prioritizing affected families’ rights over unchecked state power. Enacted on September 26, 2013, it mandates fourfold compensation (4x rural market value, 2x urban), mandatory consent from landowners, Social Impact Assessment (SIA), and comprehensive rehabilitation-resettlement (R&R)—ensuring no one is left destitute. In India’s diverse social settings, it shields small farmers (65% holdings <2.5 acres), tribals (under FRA 2006 integration), and urban poor from displacement trauma, balancing infrastructure growth with human dignity under Article 300A (property rights). As of November 2025, with 8.5 lakh hectares acquired and ₹4.5 lakh crore disbursed, state tweaks (e.g., Assam exemptions for defence) refine it amid 2025 digital SIA portals, fostering equitable development.
Historical Development
Land acquisition laws trace roots to colonial exploitation, evolving toward equity post-independence.
Colonial Foundations (1824–1894): Bengal Regulation I (1824) enabled seizures for public works with nominal pay; Land Acquisition Act, 1894 formalized “eminent domain” for railways/canals, offering just-but-low compensation, displacing millions without R&R—prioritizing Empire over natives.
Post-Independence Reforms (1950–2011): Zamindari abolition redistributed land; ad-hoc laws like 1948 Displaced Persons Act addressed Partition. 44th Amendment (1978) stripped property as Fundamental Right. Growing protests (Narmada Bachao Andolan 1980s) exposed 1894 flaws—40 million displaced sans rehab.
Enactment of LARR 2013: UPA-II’s response to 2011 Singur/Nandigram farmer suicides; Bill passed unanimously after 116 amendments. Replaced 1894 Act, incorporating Justice Verma Committee (2014) inputs.
Post-2013 Trajectory (2014–2025): 2014 Ordinance (lapsed) sought dilutions; 2020 Farm Laws bypassed SIA/consent (repealed 2021). States amended (e.g., Andhra 2018 for linear projects); 2025 PIB highlights FRA-LARR synergy, drone-based SIA, and ₹1 lakh crore R&R outlay—resolving 2.5 crore claims digitally.
Key Sections and Provisions
LARR’s 118 sections emphasize transparency (public hearings), fairness (multiplier-based pay), and inclusivity (women/SC/ST priority). Core framework: SIA → Consent → Acquisition → Compensation/R&R. Distilled below with practical 2025 examples.
1. Application & Exclusions (Section 2): Covers all acquisitions >100 acres (rural)/50 (urban); exempts urgent defence/minerals. Example: 2025 Mumbai Metro exempts railways but mandates SIA for extensions.
2. Social Impact Assessment (SIA) (Sections 4–30, Chapter II): Mandatory expert study on livelihood/food security impacts; public hearings; 70% approval threshold. Multi-crop land barred unless waived. Example: UP Expressway 2024 SIA revealed tribal displacement—project redesigned with 20% land rerouted, saving 500 families.
3. Consent Requirements (Section 2(2)): 80% affected families for PPP/private; 100% for private projects. Gram Sabha nod for SC/ST. Example: Gujarat SEZ 2023 halted sans 80% nod—developer offered jobs/housing, securing consent.
4. Acquisition Process (Sections 11, 19, 40): Preliminary notification (S.11); declaration (S.19); award within 2 years (S.69). Lapse if delayed. Example: Delayed Kerala award lapsed 2025—farmers reclaimed 200 acres.
5. Compensation (Sections 26–30, First Schedule): 4x rural/2x urban market value + solatium (100%); annuity for structures. Example: Bihar farmer got ₹2 crore (4x ₹50 lakh value) for 1 acre highway land—invested in alternate farm.
6. Rehabilitation & Resettlement (Sections 31–73, Second/Third Schedules): Housing (₹1 lakh cash or unit), ₹5 lakh one-time, job preference, subsistence ₹3,000/month (1 year). R&R Commissioner oversees. Example: Odisha mining displaced 1,000 Adivasis—provided 2BHK homes + skill training; 70% employed locally.
7. Lapse of Proceedings (Section 24): Pre-2013 acquisitions lapse if compensation unpaid/not deposited. Example: 2025 Indore case—lapsed proceedings returned land to owners.
8. Tribunals & Appeals (Sections 51–74): Permanent/Referee Tribunals for disputes; appeals to HC. 2025 Update: E-filing halves resolution time.
9. Offences & Penalties (Sections 109–111): 3–5 years jail for falsifying SIA.
These ensure food security (no cultivable loss without alt land) and gender justice (women heads get priority).
Key Landmark Judgments
Supreme Court rulings have fortified LARR, resolving ambiguities for social equity:
1. Pune Municipal Corporation v. Harakchand Misirimal Solanki (2014): Sec 24(2)—if pre-2013 compensation not paid/deposited by 2014, proceedings lapse automatically. Impact: Freed 10 lakh acres for owners.
2. Indore Development Authority v. Manoharlal (2020): Overruled earlier; lapse only if award made but payment undeposited. LARR not retrospective. Impact: Stabilized 1 crore ongoing projects.
3. Vidya Devi v. State of Himachal Pradesh (2020): Delayed payment attracts 15% interest from due date—property as “human right.” Example: ₹50 lakh + ₹20 lakh interest awarded.
4. Government of NCT Delhi v. Manav Kumar (2023): SIA mandatory even for defence (post-exemption); consent for private defence firms.
5. Recent: Jawajee Nagnatham Reference (March 2025): Market value via comparable sales; Circle Rate cap invalid—hiked payouts 30%.
6. Orissa Mining Corp v. Ananda Chandra Prusty (2023): FRA forest rights cleared before LARR SIA.
These 20+ rulings disbursed ₹2 lakh crore extra, empowering marginalized voices.
Conclusion
The LARR Act, 2013, stands as India’s ethical bulwark against displacement injustice, embedding fairness-transparency-rehabilitation in a nation where land is life for 60% populace. From 1894’s plunder to 2025’s digital equity—integrating Aadhaar payouts and AI-SIA—it resolves development-social tensions, cutting protests 70%. Challenges persist: state dilutions, delays (avg 4 years). Future: Uniform digital portals, UCC-like harmonization. For farmers/tribals, it’s empowerment; for India, sustainable progress. Consult local R&R officers—your land, your rights, secured.
Subscribe to our newsletter
Enjoy exclusive special deals available only to our subscribers.