The Allahabad High Court quashed a 2004 state government order to acquire land for a mega power project by the Anil Ambani group near Dadri in Uttar Pradesh, 50 km east of Delhi.
The court on Friday asked the state authorities to start the land acquisition process afresh, as the earlier one didn't have the consent of the very farmers whose lands were being taken up for the project.
The ruling came as a setback for Reliance Power, which plans to build a 7,500-MW gas-powered plant, a project that could help reduce electricity shortage in the national capital region.
The land, about 2,500 acres, was acquired in 2004 by the Mulayam Singh Yadav-led government. They had used a provision in the law that gives governments emergency powers to bypass objections and acquire land, if the acquisition is meant for public purpose.
Authorities in the state then justified the action, citing potential development benefits from the project that promised to supply at least 1,500 megawatt power exclusively to UP and create tens of thousands of jobs.
Passing the order, a division bench comprising Justice Ashok Bhusan and Justice Sudhir Aggrawala said that all “subsequent proceedings consequent to the notification of February 11, 2004, including the notification under Section 6 of June 25, 2004 are quashed”.
The state government will now have to invite objections from farmers, who have the option of either returning the money to reclaim the land or forfeiting any claim.
The agitating farmers interpreted this as a victory for their five-year-old campaign against the project. “I am glad a Singur-like situation has been avoided,” said KTS Tulsi, a counsel for the farmers.
But the Ambani’s group interpretation of the judgement was different. “While we are still reviewing the judgment, land acquisition for the Dadri project has not been set aside,” said a statement from the Anil Dhirubhai Ambani Group.
“Notification under Section 4 in relation to acquisition of land has in fact been upheld. The State government has been directed by the court to follow certain procedures in the land acquisition process.”
The Dadri project, involving an investment of Rs 25,000 crore, has also been marred by another controversy rooted in a bitter legal battle between Anil Ambani and his brother, Mukesh over supply of natural gas.
The former has charged the elder brother and his Reliance Industries Ltd. of reneging on its commitment to supply gas, which it claimed had rendered the project non-bankable. The case is pending before the Supreme Court.