Section 11 RFCTLARR Act Notification Alone Governs Compensation Date, No Judicial Discretion Allowed: Supreme Court on Land Acquisition Law

“The use of the word ‘shall’ in the proviso to Section 26(1) is reflective of the legislative mandate” — In a landmark judgment Supreme Court of India ruled that the date for determination of market value for compensation under the RFCTLARR Act, 2013 must be the date of issuance of Notification under Section 11, and not any other arbitrary or historical date. Setting aside the Gujarat High Court’s earlier judgment, the Court emphasized that the legislative language of Section 26(1) admits “no judicial discretion” and mandates a fair market valuation only as per the date of formal acquisition notification.

The appellant, Sumitraben Singabhai Gamit, owns agricultural land in Village Moje Sarkuva, Taluka Vyara, District Tapi, part of which had earlier been legally acquired by the State for the construction of the Ukai High Level Cantor Canal. However, an additional portion of her land measuring He-0-11-41 sq. meters was subsequently used by the State without acquisition or compensation.

Upon approaching the Gujarat High Court, she was met with a ruling that fixed 01st January 2014 — the date of the enactment of the RFCTLARR Act, 2013 — as the relevant date for determining compensation. This decision was passed despite the State’s own admission through an affidavit that the land had been used without any acquisition proceedings or compensation.

The appellant challenged the order on the ground that the compensation could only be calculated from the date of Notification under Section 11, which had not even been issued at that point.

The central legal question before the Supreme Court was whether, under the RFCTLARR Act, 2013, a court can arbitrarily determine a date for calculating market value compensation, or whether the Act mandates a fixed statutory date.

The Court stated in no uncertain terms:

“The use of the word ‘shall’ in Section 26(1) proviso is reflective of the legislative mandate that Section 11 Notification is the date for determination of the compensation.”

Further elaborating on the purpose of the Act, the Court emphasized:

“This Court has no doubt that the legislative intent is to ensure that the landowners receive fair compensation reflective of the market value prevailing at the time of acquisition.”

It further rejected the High Court's fixation of January 1, 2014, as the valuation date, holding that:

“By fixing the date of 01st January, 2014 as the date for determination of market value, the impugned order deprives the Appellant of compensation at the 2023 rates, which must be considerably higher.”

The Bench noted that no acquisition proceedings had yet begun for the disputed parcel and that a Section 11 Notification was still pending, with the State itself admitting a technical delay in uploading the proposal on the PM Gati Shakti portal.

In delivering its verdict, the Supreme Court clarified the statutory scheme of RFCTLARR, 2013:

“The legislative scheme does not give discretion to the Courts to select a date for valuation. On the contrary, the RFCTLARR Act, 2013 expressly mandates that compensation/valuation must be determined as of the date of Notification under Section 11.”

It also dismissed any attempt to invoke the date of the enactment of the 2013 Act, noting:

“The date of enactment of RFCTLARR Act, 2013 i.e. 01st January, 2014 has no relevance to fresh acquisition initiated under the statute.”

Finally, the Court ruled in favor of the appellant, setting aside the Gujarat High Court's judgment and directing:

“The date of determination of market value of He-0-11-41 sq. meters land of Survey No.119 shall be the date on which Notification under Section 11 of the RFCTLARR Act, 2013 is issued by the Respondents.”

Through this emphatic ruling, the Supreme Court has reaffirmed the statutory protection available to landowners under the RFCTLARR Act, 2013. It firmly rejected judicial discretion in compensation matters where the law clearly prescribes a method:

“Legislative intent is clear — compensation must reflect current market value as on the date of formal acquisition, not any prior date.”

The judgment stands as a strong precedent against arbitrary valuation and underscores the binding nature of Section 26(1)'s proviso, reinforcing the primacy of Section 11 Notification in compensation determination.

Date of Decision: April 21, 2025