Centre tells Bengal and others to cut land fee

Pranesh Sarkar, TT, Calcutta: The Centre has asked Bengal to slash by three-fourths the fee it charges for acquiring land for central infrastructure projects, or face an embargo on such projects.

A similar letter has been sent to all the dozen-odd states and Union territories that charge this fee as "administrative costs", asking that the amount be reduced to 2.5 per cent of the total acquisition cost.

Bengal and Bihar charge the highest fee of 10 per cent. Bengal is said to earn around Rs 500 crore a year from the fees. Sources said the response would be decided by chief minister Mamata Banerjee.

In the letter to the state land and land reforms department, the Union road transport and highways ministry has cited the example of the widening of NH34 between Barasat and Krishnagar.

Here, against an "acquisition cost" of Rs 700 crore - the compensation paid to the land-losers - the Centre must pay Bengal Rs 70 crore for surveying the plots, issuing notifications, holding objection hearings and distributing the compensation.

A source in Nabanna agreed that a 10 per cent fee was on the higher side, considering that most states don't charge anything or keep it below 5 per cent, treating the infrastructure project itself as reward enough. "But land acquisition in Bengal comes with its own problems. The landholdings are small, which necessitates several meetings," the official added.

Another official said: "Land acquisition does not involve any major cost as officials don't have to be paid extra for doing the job. Claiming 10 per cent administrative costs is nothing but a way to earn something extra."