Supreme Court Clarifies Compensation Date for Land Acquisition Under RFCTLARR Act

The Supreme Court of India recently delivered a significant judgment in the case of Sumitraben Singabhai Gamit vs State of Gujarat & Ors., clarifying the crucial question of determining the market value date for land acquisition compensation under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (RFCTLARR Act). The judgment, delivered by Justices Dipankar Datta and Manmohan, overturned a Gujarat High Court decision and provided important interpretation of Section 26(1) of the Act.

The case involved a landowner whose 0.1141 hectares of land in village Moje Sarkuva, Tapi district was utilized for constructing the Ukai High Level Cantor Canal without proper acquisition proceedings or compensation. While part of her land had been legally acquired earlier, this additional portion was used without following due process. The Gujarat High Court had ruled that the compensation should be calculated as per market rates on January 1, 2014 – the date when the RFCTLARR Act came into force.

The Supreme Court strongly disagreed with this approach. The bench observed: “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.” The Court further clarified: “The legislative scheme does not give discretion to the Courts to select a date for valuation. On the contrary, RFCTLARR Act, 2013 expressly mandates that compensation/valuation must be determined as of the date of Notification under Section 11 of the RFCTLARR Act, 2013.”

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The judgment makes a crucial distinction about the relevance of January 1, 2014 date: “The date of enactment of RFCTLARR Act, 2013 i.e. 01st January, 2014 has no relevance to fresh acquisition initiated under the statute. The date of 01st January, 2014 is relevant only if land acquisition proceedings had been initiated under the old Land Acquisition Act, 1894.”

The Court allowed the appeal, setting aside the High Court’s order and directing that compensation be calculated based on market rates prevailing when the Section 11 notification is eventually issued. This ensures the landowner receives fair compensation reflecting current land values rather than outdated 2014 rates.

This judgment provides much-needed clarity on the RFCTLARR Act’s compensation provisions and reinforces the legislative intent to ensure landowners receive just and equitable compensation when their property is acquired for public purposes.

Petitioner Name: Sumitraben Singabhai Gamit.
Respondent Name: State of Gujarat & Ors..
Judgment By: Justice DIPANKAR DATTA, Justice MANMOHAN.
Place Of Incident: Village Moje Sarkuva, Tapi District, Gujarat.
Judgment Date: 21-04-2025.
Result: allowed.

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