Harmonizing Land Acquisition Compensation across Special Acts: The 2015 Order and Tarsem Singh

For a landowner, the identity of the statute under which the land is taken ought to be a matter of indifference. The Constitution does not grade citizens by the acquiring department: whether the road is a National Highway, the line a railway, or the plot a general acquisition, the owner surrenders the same property and deserves the same measure of justice. Yet for years the law told a different story. Land taken under a handful of “special” enactments was compensated on a thinner scale than land taken under the general law, and the difference could run to crores. This article traces how that disparity arose, and how two developments — an executive order of 2015 and a Supreme Court judgment of 2019 — have very largely cured it. It explains how land acquisition compensation under the National Highways and Railways Acts has been brought into alignment with the LARR Act, 2013. The practical message is simple, and we state it at the outset: whatever the acquiring statute, a landowner today should insist on First-Schedule-level compensation, and identify which of the two remedies applies by looking at the notification date.

For the architecture of the 2013 Act and its Schedules, see Spoke 1 of this series; for the forums in which these claims are pressed, see Spoke 3.

The problem: a two-tier land Acquisition compensation regime

The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (“the 2013 Act” or “LARR Act”) was enacted precisely to end the parsimony of the colonial Land Acquisition Act, 1894. It built a generous package into three Schedules — the First Schedule (compensation: market value under s.26, multiplied by the factor in the First Schedule of up to 1x in urban and up to 2x in rural areas, plus 100% solatium under s.30, plus the additional amounts), the Second Schedule (rehabilitation and resettlement) and the Third Schedule (infrastructure amenities).

But the 2013 Act did not sweep away every acquisition statute in the country. Certain existing enactments — thirteen of them — were listed in its Fourth Schedule and, by force of s.105 read with s.105(3), were kept outside the direct operation of the 2013 Act’s compensation and R&R machinery. Two of the most consequential entries in that Fourth Schedule were the National Highways Act, 1956 and the Railways Act, 1989 — the very statutes under which a very large share of India’s compulsory acquisitions actually take place.

The result was a two-tier regime. An owner whose land was taken under the general 2013-Act procedure received First-Schedule market value with the multiplier, 100% solatium and the additional amounts, together with Second- and Third-Schedule benefits. An owner next door, whose land was taken for a National Highway under s.3G of the 1956 Act, or for a railway under Chapter IVA of the 1989 Act, received a compensation computed by a Competent Authority under the special statute — historically without the solatium, without the multiplier, and without the R&R package. Same land, same public purpose, materially different cheque.

Worse, in the case of the National Highways Act the exclusion had been made explicit and aggressive. Section 3J of the NH Act provided, in terms, that “nothing in the Land Acquisition Act, 1894” shall apply to an acquisition under the NH Act — the practical effect being to shut out the solatium (s.23(2)) and interest (s.28) that even the 1894 Act had guaranteed. Highway landowners were thus doubly disadvantaged: denied the new 2013-Act generosity, and denied even the old 1894-Act solatium and interest.

The first cure: the Removal of Difficulties Order, 2015

The first, and broadest, corrective came from the Central Government itself. Section 113 of the 2013 Act confers a power to remove difficulties in giving effect to the Act. Exercising s.113(1) read with s.105(3), the Government issued the RFCTLARR (Removal of Difficulties) Order, 2015, dated 28 August 2015.

The Order did the one thing the 2013 Act had left conspicuously undone: it extended the land acquisition compensation, rehabilitation and resettlement and infrastructure benefits of the First, Second and Third Schedules to the thirteen Fourth-Schedule enactments — expressly including the National Highways Act, 1956 and the Railways Act, 1989. Critically, the Order was deemed effective from 1 January 2015.

What this means on the ground is concrete and substantial. An acquisition under the National Highways Act or the Railways Act, once the Order applies, can no longer be compensated on the old thin scale. It must now carry:

• First-Schedule market value determined under s.26 (the higher of the jantri value under s.26(1)(a) and the average of the top 50% of sale deeds under s.26(1)(b)), taken with the applicable value of assets under s.29;
• the First-Schedule multiplier (a factor up to 1x for urban land and up to 2x for rural land);
• 100% solatium under s.30, and the additional amounts the Act provides; and
• the Second- and Third-Schedule rehabilitation, resettlement and infrastructure entitlements.

For National Highways specifically, the position was later put beyond serious argument by the Ministry of Road Transport & Highways guidelines dated 28 December 2017, which confirm that the First Schedule of the RFCTLARR Act applies to National Highways acquisitions. A Competent Authority determining compensation under s.3G of the NH Act, or an arbitrator appointed under s.3G(5), is therefore now to compute compensation on the 2013-Act First-Schedule footing, not the old NH-Act footing.

The one limitation of the 2015 Order is temporal, and it is important. The Order is prospective: it is deemed effective from 1 January 2015. It does nothing for the owner whose National Highway or railway land was notified and acquired before that date. For that earlier population, a different remedy was needed — and it came from the Supreme Court.

The second cure: Union of India v. Tarsem Singh (2019)

The gap left open by the prospective 2015 Order was filled, at least for National Highways, by Union of India v. Tarsem Singh, (2019) 9 SCC 304.

The Supreme Court in Tarsem Singh addressed s.3J of the NH Act — the provision that excluded the 1894 Act and thereby denied solatium and interest to highway landowners. The Court held that s.3J is unconstitutional, as violative of Article 14, insofar as it denies solatium and interest. There was no rational basis, the Court reasoned, for treating a person whose land is acquired for a National Highway less favourably than a person whose land is acquired under the general law; the classification failed the equality test. Accordingly, the solatium (s.23(2)) and interest (s.28) of the Land Acquisition Act, 1894 apply to National Highways Act acquisitions — the relevant window being the period 1997 to 2015.

The 1997-2015 window is not arbitrary; it is precisely the pre-Order period. From 1 January 2015 onwards the 2015 Order supplies the (larger) 2013-Act package. For the years before that — reaching back to when the NH-Act acquisition machinery took its modern shape in 1997 — Tarsem Singh restores, at a minimum, the 1894-Act solatium and interest that s.3J had purported to strip away.

The reach of Tarsem Singh was subsequently confirmed and strengthened. The principle was reaffirmed and applied retrospectively by the Supreme Court’s order dated 4 February 2025 — meaning that highway landowners in the pre-2015 window may claim the solatium and interest even where their acquisitions had long since concluded, subject of course to the ordinary discipline of the individual case.

Together, then, the 2015 Order and Tarsem Singh interlock neatly. Neither alone would have sufficed: the Order is generous but prospective; Tarsem Singh is retrospective but narrower in what it restores (solatium and interest, under the 1894 baseline, and expressly in the National Highways context). Read together they close the disparity across the whole timeline.

The timeline: which remedy applies

Because everything turns on when the acquisition was notified, the position is best set out chronologically.

A landowner (or an acquiring authority) need only locate the notification date on this timeline to know which limb governs. For National Highway acquisitions, the MoRTH guidelines of 28 December 2017 reinforce the third row; for the pre-2015 rows, Tarsem Singh supplies the equal-treatment floor.

Practical upshot for a landowner

Three points follow for anyone facing, or already caught by, an land acquisition under a special Act:

1. Do not accept a “special-Act discount.” The premise that a National Highways or railway acquisition necessarily pays less than a general land acquisition is, for post-2015 notifications, simply wrong. Insist on First-Schedule-level compensation — market value, multiplier, 100% solatium and the additional amounts — and on the Second- and Third-Schedule benefits.
2. Fix the notification date first. The date decides the remedy. On or after 1 January 2015, invoke the 2015 Order. For a National Highway acquisition notified in the 1997-2015 window, invoke Tarsem Singh to recover solatium and interest, relying additionally on the 4 February 2025 order for its retrospective application.
3. Combine the harmonisation argument with the valuation argument. Extending the First Schedule is only half the battle; the quantum of market value under s.26 still has to be fought on comparable sales and the correct multiplier (the subject of other articles in this series). Harmonisation gets you into the First-Schedule room; valuation determines what you take home from it.

Key takeaways

• Before 2015, land taken under thirteen Fourth-Schedule enactments — notably the National Highways Act, 1956 and the Railways Act, 1989 — was kept outside the 2013 Act’s land acquisition compensation and R&R package by 105 read with s.105(3), producing a two-tier regime.
• The RFCTLARR (Removal of Difficulties) Order, 2015, dated 28 August 2015 (issued under 113(1) read with s.105(3)) extended the First, Second and Third Schedule benefits to all thirteen enactments, deemed effective 1 January 2015.
• The MoRTH guidelines dated 28 December 2017 confirm that the First Schedule applies to National Highways acquisitions.
• Union of India v. Tarsem Singh, (2019) 9 SCC 304 struck down 3J of the NH Act as violative of Article 14 insofar as it denied solatium and interest, and applied the 1894-Act solatium and interest to NH acquisitions in the 1997-2015 window — a position reaffirmed and applied retrospectively by the SC order dated 4 February 2025.
• The two remedies are complementary: the 2015 Order is prospective from 1 January 2015; Tarsem Singh reaches back to fill the pre-2015 gap for National Highways.
• Practically: identify the notification date, then claim under the 2015 Order or under Tarsem Singh accordingly, and always press for First-Schedule-level compensation.

Frequently asked questions

1. My land was taken for a National Highway in 2019. Am I entitled to the full 2013-Act compensation? Yes, in substance. Because the notification post-dates 1 January 2015, the RFCTLARR (Removal of Difficulties) Order, 2015 applies, extending the First, Second and Third Schedule benefits to the National Highways Act acquisition. That means First-Schedule market value under s.26, the applicable multiplier, 100% solatium under s.30 and the additional amounts, plus R&R and infrastructure benefits. The MoRTH guidelines dated 28 December 2017 confirm the First Schedule applies to National Highways acquisitions. The remaining battle is over the quantum of market value, not the applicability of the First Schedule.
2. My highway land was acquired in 2010, before the 2015 Order. Is there anything I can claim? Yes. The 2015 Order is prospective from 1 January 2015 and does not reach a 2010 acquisition. But Union of India v. Tarsem Singh, (2019) 9 SCC 304 struck down s.3J of the NH Act insofar as it denied solatium and interest, and held that the 1894-Act solatium (s.23(2)) and interest (s.28) apply to National Highways acquisitions in the 1997-2015 window. Your 2010 acquisition falls squarely within that window, so you may claim solatium and interest, aided by the Supreme Court’s order dated 4 February 2025 applying Tarsem Singh retrospectively.
3. Does the 2015 Order apply to railway acquisitions as well as highways? Yes. The Removal of Difficulties Order, 2015 extends the First, Second and Third Schedule benefits to all thirteen Fourth-Schedule enactments, which expressly include the Railways Act, 1989 (Chapter IVA acquisitions) as well as the National Highways Act, 1956. The MoRTH guidelines of 28 December 2017 are specific to National Highways, but the Order itself is broader.
4. Where is compensation actually determined and challenged in these special-Act acquisitions? That depends on the statute. Under the National Highways Act, land acquisition compensation is fixed by a Competent Authority under s.3G, with arbitration under s.3G(5)-(6); under the Railways Act, by a Competent Authority under Chapter IVA. The forums, and the routes for challenging the resulting awards, are discussed in Spoke 3 of this series.

Sources & authorities

• Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 — ss.26 (market value), 29 (value of assets), 30 (solatium), 105 & 105(3) (Fourth-Schedule enactments), 113 & 113(1) (power to remove difficulties); First, Second, Third and Fourth Schedules
• RFCTLARR (Removal of Difficulties) Order, 2015, dated 28 August 2015 (issued under s.113(1) read with s.105(3)) — extending the First, Second and Third Schedule benefits to the thirteen Fourth-Schedule enactments, deemed effective 1 January 2015
• MoRTH guidelines dated 28 December 2017 — First Schedule of RFCTLARR to apply to National Highways acquisitions
• National Highways Act, 1956 — ss.3G, 3G(5), 3G(6), 3J
• Railways Act, 1989 — Chapter IVA (ss.20A–20W)
• Land Acquisition Act, 1894 — ss.23(1), 23(2) (solatium), 28 (interest)
• Union of India v. Tarsem Singh, (2019) 9 SCC 304 (reaffirmed and applied retrospectively by SC order dated 4 February 2025)