West Bengal Govt failed to protect tribal interests in mining land acquisition, says CAG report
A Comptroller and Auditor General (CAG) audit found that land acquisition for coal mining in West Bengal did not adequately protect the statutory entitlements of tribal landowners.
The audit examined 66 land acquisition cases between 2017-18 and 2021-22, covering Eastern Coalfields Limited's (ECL) Salanpur, Sripur, Kunustoria, and Parbelia areas, and Bharat Coking Coal Limited's (BCCL) Barakar area.
Against an assessed market value of about ₹17.79 crore for the acquired land, the coal companies paid tribal landowners only about ₹2.55 crore through negotiated purchase — a shortfall of roughly ₹15.25 crore, or nearly 86% of assessed value.
The audit also found the mandatory 100% solatium over market value, prescribed under national land acquisition law, was not paid in any of the test-checked cases, depriving affected tribal families of a further amount.
No socio-economic or social impact assessment surveys were conducted before acquisition in some of the audited areas, despite these being required to identify project-affected persons and prepare rehabilitation plans.
CAG's Constitutional Mandate — Articles 148 to 151
The Comptroller and Auditor General is an independent constitutional authority established under Article 148, tasked with auditing the accounts of the Union and state governments, and of public sector undertakings such as Eastern Coalfields Limited (a Coal India subsidiary). Its findings, once compiled, are placed before the relevant legislature for scrutiny — this is how audit findings like the West Bengal land acquisition report become public and actionable.
Key Details
- Article 148 provides for appointment of the CAG by the President; Article 149 empowers Parliament to prescribe CAG's duties and powers, codified in the CAG's (Duties, Powers and Conditions of Service) Act, 1971.
- Article 151(2) requires that reports relating to the accounts of a state be submitted to the Governor, who causes them to be laid before the state legislature.
- The Public Accounts Committee (PAC) of the legislature subsequently examines CAG reports for follow-up action — the CAG itself has no power to enforce recovery or penalize, only to report.
- CAG audits of public sector undertakings (like Coal India subsidiaries ECL and BCCL) fall under its mandate to audit government companies where the government holds a majority equity stake.
This audit — of ECL and BCCL, both Coal India subsidiaries — is a routine exercise of CAG's constitutional mandate to scrutinize whether public sector land acquisition complied with statutory compensation requirements, with the findings now due to be tabled before the West Bengal state legislature.
LARR Act, 2013 — Compensation and Solatium Standards
The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (LARR Act) is the principal national law governing compensation, rehabilitation, and resettlement for land acquired for public purposes, replacing the colonial-era Land Acquisition Act, 1894. It significantly enhanced compensation standards, including a mandatory 100% solatium over the assessed market value.
Key Details
- Section 30 of the LARR Act mandates a solatium equal to 100% of the market value of the acquired land, in addition to the compensation amount, along with an additional 12% per annum on market value from the date of the Social Impact Assessment notification until the award or possession date.
- Section 4 requires a Social Impact Assessment (SIA) study to be conducted before acquisition to identify affected families and design rehabilitation measures — a step the audit found was skipped in some of the coal mining acquisitions.
- Coal-bearing land acquisition, however, has historically been carried out under the separate Coal Bearing Areas (Acquisition and Development) Act, 1957 (CBA Act), which does not mandate consent, a Social Impact Assessment, or the LARR-style 100% solatium — creating a dual regime under which coal-sector acquisitions can bypass LARR's stronger tribal safeguards depending on which law is invoked.
- The audit's finding that solatium was not paid in any test-checked case reflects this gap — even where the LARR compensation benchmark was cited by auditors, actual payments to tribal landowners fell far short of what LARR would require.
The core audit finding — an 86% shortfall against assessed market value and zero solatium payment — reflects a failure to apply the fuller compensation and rehabilitation protections that either LARR mandates directly, or that the CBA Act's weaker framework fails to guarantee for coal-bearing land.
Section 41, LARR Act — Special Protections for Scheduled Tribes in Land Acquisition
Section 41 of the LARR Act, 2013 provides that land acquisition in Scheduled Areas should be avoided "as far as possible" and undertaken only as a "demonstrable last resort," requiring the prior consent of the Gram Sabha before any notification is issued. It also mandates that at least one-third of compensation be paid as a first installment before possession is taken, and that displaced Scheduled Tribe families be resettled, where possible, in the same Scheduled Area in a compact block to preserve their ethnic and cultural identity.
Key Details
- Section 41 protections are explicitly tied to "Scheduled Areas" under the Fifth Schedule to the Constitution — West Bengal, notably, has no districts formally notified as Fifth Schedule Scheduled Areas, even though it has a substantial tribal population (around 40 notified Scheduled Tribe communities) and constitutes Tribal Advisory Councils.
- This means the strongest Gram Sabha consent safeguards under Section 41 may not technically apply to the audited mining areas, even though the affected landowners are tribal — a structural gap between tribal protection law (keyed to notified Scheduled Areas) and the lived presence of tribal populations outside such areas.
- The Panchayats (Extension to Scheduled Areas) Act, 1996 (PESA), which mandates Gram Sabha consent before land acquisition and for granting mining leases for minor minerals, similarly applies only within notified Fifth Schedule areas — reinforcing why tribal landowners in non-Scheduled-Area West Bengal rely mainly on the general LARR compensation and SIA safeguards rather than PESA's consent architecture.
The audit's tribal-interest findings highlight a broader policy gap — tribal communities affected by mining outside notified Fifth Schedule areas (like those in the audited West Bengal coalfields) fall outside PESA's and LARR Section 41's strongest consent protections and depend instead on baseline compensation provisions, which this audit found were themselves not properly implemented.
- Audit period: 66 land acquisition cases, 2017-18 to 2021-22.
- Areas covered: ECL's Salanpur, Sripur, Kunustoria, and Parbelia; BCCL's Barakar.
- Assessed market value of acquired land: approximately ₹17.79 crore.
- Amount actually paid to tribal landowners: approximately ₹2.55 crore.
- Shortfall: approximately ₹15.25 crore (about 86% of assessed market value).
- Mandatory solatium under LARR Act, 2013 (Section 30): 100% of market value — not paid in any test-checked case.
- LARR Act, 2013 also provides 12% per annum additional compensation from SIA notification to award/possession date.
- West Bengal has no notified Fifth Schedule Scheduled Areas despite around 40 recognized Scheduled Tribe communities in the state.