Section 26 Land Acquisition Act 2013: Determination of Market Value by Collector

Section 26 of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 lays down the statutory method the Collector must use to assess and determine the market value of land proposed to be acquired.

What Section 26 provides

Section 26 establishes the starting point for valuation of land under the 2013 Act. The Collector must compare the statutory valuation benchmarks specified in sub-section (1) and adopt the applicable higher amount. The relevant valuation date is linked to the preliminary notification issued under Section 11.

Date for determination of market value

The proviso to Section 26(1) fixes the relevant date for determining market value as the date on which the preliminary notification under Section 11 is issued. Section 11 deals with publication of the preliminary notification when it appears to the appropriate Government that land is required or likely to be required for a public purpose.

How average sale price is calculated

The explanations to Section 26 prescribe how the sale-price benchmark is to be worked out.

Section 26(2): Multiplier under the First Schedule

After the market value is calculated under Section 26(1), it is multiplied by the factor specified in the First Schedule to the Act. The First Schedule forms part of the statutory compensation framework and must be read with the applicable rules and notifications governing the relevant acquisition.

Section 26(3): When ordinary market value cannot be determined

Section 26(3) addresses situations in which market value cannot be determined under the normal method, including where land transactions are legally restricted, comparable registered transactions are unavailable for the immediately preceding three years, or market value has not been specified under the Indian Stamp Act, 1899 by the appropriate authority.

In such circumstances, the concerned State Government must specify a floor price or minimum price per unit area based on the price calculated in the prescribed manner for similar land in immediately adjoining areas.

Shares offered by the Requiring Body

Where the Requiring Body offers shares to landowners as part compensation, the value of such shares cannot exceed twenty-five per cent of the value calculated under Section 26. A landowner cannot be compelled to accept such shares.

Updating market value before acquisition

Section 26 further requires the Collector, before initiation of land acquisition proceedings in an area, to take necessary steps to revise and update the market value of land on the basis of the prevailing market rate in that area.

Minority educational institutions

The appropriate Government must ensure that market value determined for acquisition of land or property of an educational institution established and administered by a religious or linguistic minority is such that it does not restrict or abrogate the right to establish and administer educational institutions of their choice.

This page explains the central statutory framework. State-specific rules, notifications, multiplier factors and legally applicable amendments should also be checked for the acquisition concerned.