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On Repealing the Urban Land Ceiling Act

The argument that the Urban Land (Ceiling and Regulation) Act should be repealed because it has not been able to achieve its objectives is a dangerous one. Should we not aim for the proper implementation of the act instead and amend those clauses which act as loopholes for its subversion? Sections 20 and 21 of the act that grant exemptions to landholders for developing their surplus lands for the weaker sections have become fountainheads of corruption.

On Repealing the Urban Land Ceiling Act

The argument that the Urban Land (Ceiling and Regulation) Act should be repealed because it has not been able to achieve its objectives is a dangerous one. Should we not aim for the proper implementation of the act instead and amend those clauses which act as loopholes for its subversion? Sections 20 and 21 of the act that grant exemptions to landholders for developing their surplus lands for the weaker sections have become fountainheads of corruption.

SIMPREET SINGH

T
he repeal of the Urban Land (Ceiling and Regulation) Act (ULCRA) is once again an issue for debate, thanks to the recently launched Jawaharlal Nehru National Urban Renewal Mission (JNNURM). The JNNURM envisions improving and modernising urban infrastructure throughout the country forcibly through a mission, which seems to harbour disaster for urban India under the guise of “development”. For this, an amount of Rs 55,000 million has been assigned in the 2005-06 union budget. The sanctioning of the release of funds by the JNNURM would be contingent upon the states and their urban local bodies (ULB) signing a tripartite memorandum of understanding with the union government and accepting to undertake mandatory and optional reforms. The list of mandatory reforms to be implemented in order to be eligible for receiving grants under the mission includes repealing of the ULCRA. This can only benefit urban landlords.

Maharashtra is one of the few states that has still not repealed the act despite the passing of the Urban Land Ceiling and Regulation Repeal Act, 1999 by the union government that has been accepted by 17 states. The union government pushed through the 1999 repeal act on the basis that the law had never achieved the objective for which it was enacted.1 An additional thread to the argument runs like this: because of the act, vast tracks of land have been locked out of development resulting in an artificial scarcity of land, which has led to an exorbitant rise in real estate prices, thus keeping it out of the reach of the poor.2 Thus by repealing the act, it is argued the release of land for the development of the urban agglomerate will also benefit the poor. But how? No answers are available as of now.

The argument that since its enactment the act has not been able to achieve its objectives, and thus should be repealed is also a dangerous one and defies logic. To date, the objectives of no law or act have been achieved to the fullest. Does this mean that all those laws and acts should be repealed? Or must we aim for proper implementation and compliance with the rules/clauses, which facilitate achieving of the objectives and amending/repealing those sections or clauses which act as loopholes for subversion? The question needs to be raised, and answered, by those in power.

Of particular mention are Sections 20 and 21 of the said act. Section 21 of the act entitles landholders to prepare schemes and develop their surplus land for the housing of weaker sections and thereby obtain exemption from the provisions of the act. It has been rightly observed that these exemption clauses have become the fountainhead of corruption as they depend on the whims and fancies of the local authorities who decide such exemption. These exemption clauses have helped not the poor but the rich and the influential who, through the complicity of officials, are able to subvert the law and hold land much beyond the ceiling limits. In Mumbai alone, since the date of the enactment of the act, 1,000 acres of land have been exempted and allowed to be held by their holders whereas the government of Maharashtra has acquired only 182.5 acres of land3 by taking over surplus land from landlords. This indicates that rather than employing the act for the purpose for which

Economic and Political Weekly February 25, 2006

it is meant, it is being used to defeat that very purpose. This clearly shows that with the complicity of the concerned authorities landholders have been bypassing the provisions of the act. As recently as September 2005, the government of Maharashtra scrapped 757 housing projects promoted by private builders as they violated the ULCRA.4 As a result, 522.78 hectares of land in the state has been made available for redevelopment. The action against the defaulters, however small compared to the enormous scope that persists, vindicates the position that what is required is the political will to implement the law, not to repeal it.

Another exemption clause, which exempts the central, state or local governments, public charitable trusts and cooperative societies from the ceiling limit of 500 sqm, also demands serious review in the present context. The exemptions to public sector agencies should also be critically reviewed, as they should also face the test of the stated objectives of the act, which are:

  • (i) To prevent the concentration of urban land in the hands of a few persons.
  • (ii) To prevent speculation and profiteering in land, and
  • (iii) To bring about an equitable distribution of urban land to subserve the common good.

    In open violation of the act and its justifiable objectives, private interests are being fulfilled, under the doctrine of “public interest”. As an example, the Bandra Kurla Complex (BKC) developed by MMRDA would be a good case. BKC was conceived as the new commercial centre for the growth of the government, corporate offices and commercial activities. Presently, BKC stands on 730 acres of land, including the area that earlier constituted the basin of the Mithi river. Today the complex hosts huge premises spread over lakhs of square feet, which house leading financial institutions like ICICI, IDBI, UTI, Citibank and shopping malls. Though a governmental authority has developed the land and the complex, and is thus being granted exemptions from sections of the act, it has by no means helped in achieving any of the abovementioned objectives. The real beneficiaries of this “development” have been real estate agents, builders, developers or the occupants of the constructed buildings – the corporate brigade. The entire state machinery has been geared towards the welfare and benefit of the rich and the elite, ignoring the toiling masses that constitute the majority of the city. This demands that in the present context of the state taking a neoliberal turn, the activities of governmental bodies be critically monitored and challenged so that the benefits of development do not become the privilege of the few.

    Mumbai, in the last one year, has been witness to an unprecedented and largestever demolition drive whereby more than 70,000 houses were demolished and around 3,50,000 people were rendered shelter-less. The demolitions were carried out by arguing that the status of these slum dwellers was illegal; through the demolitions 300 acres of land were “released” from the illegal inhabitants, the government claimed and boasted. Ironically, at the same time, more than 15,000 acres of land are held by few landlords in violation of the law. The implementation of the provisions of the act provides us with an opportunity that could solve the problem of slums in Mumbai by making available land at affordable prices to the poor.

    EPW

    Email: simpreet_s@rediffmail.com

    Notes

    1 Mahalingam Sudha, ‘The False Ceiling’, Frontline, August 1-14, 1998.

    2 Inaugural address by Kumari Selja, Minister for Urban Employment and Poverty Alleviation, ‘National Conference on Housing’, November 2004.

    3 Public interest litigation filed in Mumbai High Court by P B Sawant, 2005.

    4 ‘Maharashtra to Scrap 757 Projects Flouting ULCRA Norms’, Business Line, September 28, 2005.

    Economic and Political Weekly February 25, 2006

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