Supreme Court Rules Land Acquired for the Same Public Purpose Must Receive Uniform Compensation
The Supreme Court of India has reiterated that contiguous parcels of land acquired under the same scheme for a unified public purpose must receive uniform and non-discriminatory compensation. In a judgment delivered on September 29, 2026, in Surinder Ahuja and Another v. State of Punjab and Another, the court restored a uniform market value for the acquired land, holding that arbitrary differences in compensation cannot be justified when the properties form part of an integrated public project.
A bench comprising Justice Dipankar Datta and Justice Sheel Nagu examined disputes involving land acquired across six villages in Punjab’s Fazilka district for the construction of the Aspal Extension Drain, an approximately 18.42-kilometre drainage project. The acquisition proceedings had originated in 2000 under the Land Acquisition Act, 1894, and the dispute concerned the valuation of agricultural and orchard land.
The landowners challenged differences in the compensation awarded for properties acquired as part of the same development scheme. The case raised questions about whether authorities could apply different valuation rates to contiguous land parcels despite their common purpose and connection to a single infrastructure project.
The Supreme Court emphasised that compensation must be determined fairly and consistently, based on the relevant evidence and circumstances of the acquisition. It rejected an arbitrary step-down approach to valuation that reduced compensation according to distance without adequately considering comparable local land transactions and the circumstances of the properties concerned.
The court restored a uniform market value of Rs. 5 lakh per acre, relying on the applicable benchmark and the unified nature of the acquisition. The ruling reinforces the principle that landowners whose properties are similarly situated within a common project should not face unjustified disparities in compensation.
The judgment also clarified the treatment of severance damages, which arise when acquiring part of a property divides or diminishes the usefulness of the remaining land. The court held that such damages must be calculated with reference to the market value of the unacquired portion affected by the acquisition, rather than the value of the land actually acquired.
Addressing additional compensation components, the bench explained that statutory solatium and the additional amount payable under the 1894 Act must be calculated in accordance with the relevant statutory provisions. These benefits cannot automatically be extended to every separate head of compensation without examining the legal basis for the claim.
The court also considered the limits of evidence in land acquisition proceedings, reiterating that parties cannot ordinarily introduce evidence beyond the claims set out in their pleadings. Accordingly, compensation claims for trees and other assets must be assessed within the scope of the case properly presented before the court.
The ruling has important implications for landowners affected by large public infrastructure projects, including drainage systems, roads and other developments involving acquisitions across multiple villages. It underscores that a common public purpose and comparable land characteristics must be carefully considered when determining compensation, while preserving the requirement for evidence-based valuation.
By restoring uniform valuation in the cases before it, the Supreme Court has reinforced the need for fairness and consistency in compulsory land acquisition. The judgment makes clear that public development must be accompanied by a lawful compensation process that avoids arbitrary differences between similarly situated landowners.
