Central
Section 21 of The Atomic Energy Act, 1962
Principles relating to payment of compensation.
- (1)Save as otherwise provided in this Act, where by reason of exercise of any powers under this Act, any compensation is payable, the amount of such compensation shall be determined in the manner and in accordance with the principles hereinafter set out, that is to say--
- (a)where the amount of compensation is fixed by agreement, it shall be paid in accordance with such agreement;
- (b)where no such agreement is reached, the Central Government shall appoint as arbitrator a person having expert knowledge as to the nature of the right affected who shall determine the amount of compensation payable.
- (2)In making his award, the arbitrator appointed under sub-section (1) shall have regard--
- (a)in the case of any compensation payable under section 9--
- (i)to the nature of the work done;
- (ii)the manner, extent and duration of the exercise of any powers under that section;
- (iii)the diminution in the rent of the land and of the property situated thereon, which might reasonably be expected over any period or diminution in the market value of the land and property on the date when the exercise of powers comes to an end; and
- (iv)the provisions of sub-section (1) of section 23 of the Land Acquisition Act, 1894 (1 of 1894), in so far as such provisions can be made applicable to the exercise of powers under section 9; and
- (b)in the case of any compensation payable under section 11 or under section 12, to the price which the owner might reasonably have been expected to obtain on a sale of the property effected by him immediately before the date of the acquisition.
- (a)in the case of any compensation payable under section 9--
- (3)An appeal shall lie to the High Court against an award of the arbitrator except in cases where the amount claimed thereof does not exceed an amount prescribed in this behalf by the Central Government.
- (4)The Central Government may make rules prescribing the procedure to be followed in arbitrations under this Act and the principles to be followed in the apportionment of the cost of proceedings before the arbitrator and on appeal.
- (5)Save as provided in this Act, nothing in any law for the time being in force relating to arbitration shall apply to arbitrations under this Act.
Summary
- If the compensation amount is fixed by an agreement, it will be paid according to that agreement.
- If no agreement is reached, the Central Government must appoint an arbitrator who has expert knowledge of the affected right to determine the compensation.
- When awarding compensation for activities under Section 9 (doing work to discover minerals), the arbitrator must consider the nature of the work done, the manner, extent, and duration of the work, any diminution in the rent or market value of the land or property, and the provisions of Section 23(1) of the Land Acquisition Act, 1894, where applicable.
- When awarding compensation for compulsory acquisitions under Section 11 (acquisition of substances, minerals, and plants) or Section 12 (acquisition of a mine), the arbitrator must consider the price the owner might reasonably have expected to obtain on a sale immediately before the acquisition date.
- An appeal can be made to the High Court against the arbitrator's award, unless the claimed amount does not exceed an amount prescribed by the Central Government.
- The Central Government can make rules for arbitration procedures and the apportionment of costs.
- Standard laws relating to arbitration do not apply to arbitrations under this Act, except as explicitly provided.
Practical examples
1On March 1, 2026, the government enters Ajay's farmland to dig test bores for discovering uranium under Section 9. Ajay and the government fail to agree on a compensation amount. The Central Government appoints Justice Mehra, a retired judge with land valuation expertise, as arbitrator under Section 21 to assess the land's rent diminution and determine the award.
2On April 15, 2026, the government compulsorily acquires a processing plant owned by Neha under Section 11. Neha claims 5,000,000 rupees based on future earnings, but the arbitrator under Section 21 rules that the award must be based strictly on the price Neha could have reasonably obtained if she had sold the plant on April 14, 2026 (the day before acquisition).
3Gopal is unhappy with an arbitrator's compensation award of 500,000 rupees for his acquired minerals. The government's rules state that claims under 100,000 rupees cannot be appealed. Since Gopal's claim exceeds this limit, he files an appeal in the High Court on June 20, 2026, as permitted under Section 21.
FAQ
1. How is compensation determined if the owner and the government cannot agree on a price?
The Central Government will appoint an arbitrator who has expert knowledge of the affected right to determine the compensation.
2. What principles does the arbitrator use to calculate compensation for an acquired plant or mine under Sections 11 or 12?
The arbitrator must look at the market value, specifically the price the owner might reasonably have expected to get if they had sold the property immediately before the acquisition date.
3. Can I appeal the arbitrator's decision in a court?
Yes, you can appeal to the High Court, unless the compensation amount you claimed is less than or equal to the limit prescribed by the Central Government.
Test yourself
1.Under Section 21 of The Atomic Energy Act, 1962, who must the Central Government appoint to determine compensation when no agreement is reached?
2.Under Section 21 of The Atomic Energy Act, 1962, which of the following is a factor the arbitrator must consider when awarding compensation specifically for acquisition under Section 11 or Section 12?
3.Under Section 21 of The Atomic Energy Act, 1962, how does a compensation claim under Section 9 (doing work to discover minerals) differ in its valuation principles from an acquisition under Section 11?
4.Under Section 21 of The Atomic Energy Act, 1962, where does an appeal lie against the compensation award of an arbitrator?