Officials said the proposed section has been vetted by the Attorney General (AG), and could be included as the Centre's recommendation to the Joint Committee of Parliament.
The states can tweak contentious clauses of the 2013 Act, while framing their respective rules and regulations.
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The committee got a two-week extension on Wednesday. The extension was sought as members wanted to seek certain clarifications from the government on the amendments brought to the 2013 law. Several states have opposed the "dilution" of provisions of the original Land Acquisition Act of 2013 regarding the consent of farmers and exemption from social impact assessment (SIA).
The Centre through an ordinance promulgated in December last year had exempted defence, rural infrastructure, affordable housing, industrial corridors and infrastructure projects, including public-private partnership (PPP) projects, where the government owns the land from the clause, which required consent of 80 per cent of land owners be obtained for private projects and of 70 per cent for PPP projects.
Later, it made some more dilutions, but none was enough to get the Ordinance ratified in Rajya Sabha, where NDA is not in majority.
In the latest suggested changes, some officials said would keep the relief and rehabilitation and compensation untouched as has been the practice so far in all the amendments done.
This also means that states could have the power to impose consent clause and SIA in their respective laws in the five exempted sectors, but won't be able to do anything with the compensation as mandated by the 2013 Act.
Officials said rural development secretary Vandana Jena in her witness before the committee defended the inclusion of the term 'private entity' in the ordinance saying it will enhance the scope of investments for public purposes.
The joint panel would continue with its interaction with Union secretaries on Thursday as well.
Sources said the some panel members objected to the term 'private entity' saying a public entity may be an individual who would acquire land from farmers.