Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 — Ss. 26(2), 30(2) and First Schedule — Multiplier Factor — Validity of State Notification — Requirement of Differential Multiplier Based on Distance from Urban Area — Compensation Principles —

Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 — Ss. 26(2), 30(2) and First Schedule — Multiplier Factor — Validity of State Notification — Requirement of Differential Multiplier Based on Distance from Urban Area — Compensation Principles — Notification dated 04-12-2014 issued by the State of Chhattisgarh fixing a flat multiplier of 1.00 for all rural lands across the State, held ultra vires, arbitrary and contrary to statutory mandate. The Act envisages a variable multiplier between 1.00 and 2.00, depending upon distance of rural land from the nearest urban area. The legislative object underlying differential multipliers is to ensure fair compensation to landholders in remote rural areas where market values are low and livelihood dependence is high. A flat multiplier ignores the statutory scheme, constitutes non-application of mind, and frustrates the compensatory framework. The State, as appropriate Government, is competent to notify the multiplier; however, manner of exercise of power must conform to statutory policy and cannot dilute compensation. Notification quashed. Fresh notification to be issued prescribing region-wise multipliers strictly in terms of Act and First Schedule. All awards passed using multiplier 1.00 liable to be revised and revisited accordingly.
Panjabrao v. State of Maharashtra, 2015 (6) Mh LJ 69, followed with approval.
(Paras 2–7, 9–12)

Delegated Legislation — Limits — Notification cannot override or dilute statute — When subordinate legislation has the effect of reducing compensation or nullifying statutory benefits, it is liable to be struck down. Delegated power must be exercised within legislative policy; cannot amend or supplant the First Schedule. (Paras 33–35)

Compensation — Rural Land — Requirement of Survey for Distance-based Classification — For proper exercise of power under First Schedule, State must undertake assessment of actual distances of rural areas from nearest urban centres and prescribe multiplier accordingly; radial or uniform approach arbitrary. (Paras 33–35)

Held — State notification dated 04-12-2014 (Annexure P/1) fixing uniform multiplier 1.00 for entire State is quashed. State directed to issue fresh notification conforming to statutory guidelines. All awards based on multiplier 1.00 to be revised. Writ petitions allowed.