Panel to determine market rate of land for laying inter-State transmission lines

The Power Ministry has said that a committee will be formed to fix the market rate of land for laying of inter-state transmission lines in States where a mechanism for determination of the market value has not been created.

The Ministry pointed out that many States are yet to come out with a mechanism for determination of market rate. This has led to landowners’ raising concerns over the compensation stating that it is being proposed at unacceptable circle rates which are significantly lower than market rates.

“This issue is more pronounced in urban and semi-urban areas, where District Collectors face difficulties in arriving at a fair market rate,” the Ministry added.

To deal with the issue, the Ministry has released the supplementary guidelines for payment of compensation in Right of Way (RoW) for transmission lines.

These guidelines will apply to Inter-State Transmission System (ISTS) lines only in cases where landowners have objected to the compensation because the circle rates were below market rates.

States can adopt these guidelines in their entirety or issue their own modified guidelines. These will apply in cases where states are yet to specify the manner of determination of market value of land.

Guidelines

“The market rate of land shall be determined by the following Market Rate Committee (MRC) based on the valuation by independent land valuers. The panel will be chaired by the District Magistrate or District Collector or Deputy Commissioner or his nominee not below the rank of a Sub-Divisional Magistrate.

The committee will include representatives of land owners and the member nominee of ISTS Transmission Service Provider (TSP). Besides, two additional members can be co-opted.

Valuers to be appointed

The MRC will appoint two valuers— one nominated by the TSP and the other by the representative of landowners. The panel will engage the land valuers empanelled by the Insolvency and Bankruptcy Board of India (IBBI). The valuers should preferably be from the same state or, if an adequate pool of valuers is not available, from adjoining states, the Ministry said.

“If the difference in market rates worked out by valuers is less than 20 per cent over the lowest value, then average value of the two valuations shall be taken as the reference market rate. If the difference exceeds 20 per cent, MRC may negotiate the reference market rate,”it added.

If negotiations fail, the MRC can engage a third valuer, and the reference market value shall be determined as the average of the two closest valuations.

The compensation amount for the Right-of-Way (RoW) corridor for ISTS lines is 30 per cent of the land value in rural areas or 60 per cent of the value in municipal corporations and metropolitan areas. It will be 45 per cent of the land’s value for municipalities, nagar panchayats and all other urban planning areas.

The District Collector may allow the construction of ISTS lines to proceed without obstruction on the condition that compensation would be paid based on the market rate determined by the MRC. The market rate determination should ideally be completed within one month from the date of application by TSP.

If the actual RoW compensation paid by the TSP due to implementation of these guidelines or the extant guidelines /policy of the appropriate government differs from the base RoW compensation determined for the ISTS scheme as per Tariff-Based Competitive Bidding (TBCB) Guidelines, the same shall be eligible for pass through under Change in Law (CIL) by the Central Electricity Regulatory Commission (CERC).