RFCTLARR Act, 2013 — Ss. 26(1), 26(2), 30; First Schedule — Multiplier Factor — Rural vs Urban — State cannot redefine “rural/urban” by Resolution — Excessive delegation — GRs dated 10-11-2016 & 11-09-2018 illegal The Act and the First Schedule lay down a complete and comprehensive mechanism for determination of market value and the factor by which the market value is to be multiplied. “Rural Area” and “Urban Area” are already defined in Rule 2(p) and Rule 2(v) of the Gujarat RFCTLARR Rules, 2017. Held: The State Government cannot by Government Resolutions redefine the expressions “rural area” or “urban area”, nor alter the basis on which multiplier is to be applied. GRs dated 10-11-2016 and 11-09-2018 amount to colourable exercise of power, suffer from excessive delegation, and are ultra vires the Act and Rules. Multiplier factor for rural areas stands determined by the State’s notification dated 29-07-2016 which prescribes Factor = 2.00 for rural areas.

A. RFCTLARR Act, 2013 — Ss. 26(1), 26(2), 30; First Schedule — Multiplier Factor — Rural vs Urban — State cannot redefine “rural/urban” by Resolution — Excessive delegation — GRs dated 10-11-2016 & 11-09-2018 illegal

The Act and the First Schedule lay down a complete and comprehensive mechanism for determination of market value and the factor by which the market value is to be multiplied. “Rural Area” and “Urban Area” are already defined in Rule 2(p) and Rule 2(v) of the Gujarat RFCTLARR Rules, 2017.
Held:

• The State Government cannot by Government Resolutions redefine the expressions “rural area” or “urban area”, nor alter the basis on which multiplier is to be applied.

• GRs dated 10-11-2016 and 11-09-2018 amount to colourable exercise of power, suffer from excessive delegation, and are ultra vires the Act and Rules.

• Multiplier factor for rural areas stands determined by the State’s notification dated 29-07-2016 which prescribes Factor = 2.00 for rural areas.

B. Delegated Legislation — Schedules can be amended only by Central Government (S.106); State cannot dilute compensation

Section 106 permits only Central Government to amend Schedules, that too without reducing compensation.
State Government by redefining areas through resolutions effectively altered the application of the Factor, thereby reducing compensation for rural landholders — impermissible.

C. Constitutional Law — Art. 14 — Government Resolution dated 11-09-2018 making change prospective — Arbitrary classification — Unconstitutional

GR dated 11-09-2018 excluded “Urban Development Areas” and “Area Development Authorities” from “Urban Areas” but applied change prospectively (i.e., only to awards passed after 11-09-2018).
Held:

• Creates artificial, unreasonable classification between landowners whose awards were passed on 11-09-2018 and those passed 12-09-2018 onwards.

• No intelligible differentia; no nexus to object of fair compensation.

• Violates Article 14.

• The prospective portion of GR quashed.

D. Gujarat Town Planning & Urban Development Act, 1976 — Urban Development Authority (UDA) is NOT an “Urban Local Body” — Lands under UDA are still “Rural Areas” unless under Municipality/Corporation

Villages Lavarpur, Firozpur, and Prantiya — though included in GUDA (Gandhinagar Urban Development Authority) — are:

• not part of any Municipal Corporation/Municipality,

• fall under Gram Panchayats,

• designated Special Agricultural Zone,

• no Town Planning Scheme implemented,

• never part of Gandhinagar Notified Area.

Held:

• Being under an Urban Development Authority does not make the village an “urban area”.

• Urban Development Authority is not a local self-government body as required by Art. 243Q, Gujarat Municipalities Act, and Rule 2(v) of RFCTLARR Rules.

• Therefore, such villages remain Rural Areas.

E. Multiplier factor — Rural Area — Factor “2.00” applicable — Awards to be revised

Since:

(a) the impugned resolutions are ultra vires,
(b) petitioners’ villages are rural areas,

⇒ Compensation must be recomputed by applying Factor = 2 (two) under Section 26(2).

Court directed:

• modification of awards,

• recomputation with Factor 2.00,

• addition of solatium (S.30(1)), interest (S.30(3)),

• payment of arrears with interest.

F. SCA No. 11238 of 2019 — Draft award stage — Factor 2.00 applies

Since the 11-09-2018 GR is struck down to the extent of prospective operation, even for lands at draft-award stage, Factor 2.00 applies.

G. Result

• GRs dated 10-11-2016 & 11-09-2018 (prospective portion) quashed and set aside.

• All petitions allowed.

• Authorities directed to revise awards and recompute compensation applying Factor 2.00, with all statutory benefits.