The Land Acquisition Act 1960 allows the government to acquire private land for public purposes, such as infrastructure and development projects. Compensation is required to be provided to the land owner. Compensation amounts are determined based on the market value of the land and may also include amounts for issues like severance of remaining land, loss of business, relocation costs, and any increase or decrease in land values due to the purpose of acquisition. The Act aims to ensure land owners are financially compensated to the same level as if their land had not been acquired, following principles of fairness and adequate compensation under the Malaysian Constitution.

1. TOPIC 1.
LAND ACQUISITION ACT 1960
Prepared by
WAN MOHAMAD AZIM BIN WAN MUSA
Ba. Estate Management (Hons) (Uitm)

2. Introduction
to the Land Acquisition Act 1960
 Land Acquisition was originally adapted from United
Kingdom rules under a Commonwealth Country.
Purpose of the provision is to vest power for the
Government to acquire an alienated land for a
particular purpose.
 According to the Article 13 Federal
Constitutions:
 No person shall deprived of property saved in
accordance with the law
 No law shall provide for the compulsory acquisition
of use of property without adequate compensation.
 Since the land was a State matters, Land office or
Registry office under authority of the Act to gazette
any land within the jurisdiction area.

3.  Section 3(1) Land Acquisition Act 1960 states
that:
 The state Authority may acquire any land,
which is needed.
 For any public purpose
 By any person any corporation for any purpose
which in the opinion of the State Authority is
beneficial to the economic development of
Malaysia or any part thereof or to the public
generally or any class of the public.
 For the purpose of mining or for residential,
agricultural, commercial, industrial or
recreational purposes or any combination of
such purpose.

4.  For the Acquisition under Section 3 (1) (b) or
(c), the application of acquisition must be
approved by SEPU and must fulfill:
 Public Interest
 Capacity or capability to carry out purpose
of acquisition
 The feasibility of the project
 The development approval granted to the
registered proprietor.
 Article 13 Federal Constitution:
 No person shall be deprived of property save
in accordance with law.
 No law shall apply provide for the compulsory
acquisition or use of property without
adequate compensation.

5. Basic principle:
 The sum awarded should enable the claimant to
be in the same financial position as he would
have been if his interest had not been
compulsorily required.
 The principle of equivalence- no worst and no
better

6.  As provided in the 1st Schedule to the Land
Acquisition 1960 the amount of
compensation to be awarded shall take into
consideration the following matters:
a) Market Value
b) Betterment
c) Severance
d) Injurious affection
e) Disturbance claims
f) Accommodation works

7.  A) MARKET VALUE
 i) Factor to be considered in the Market Value of
gazetted land.
 Scheduled land
 If part of land is acquired, it is as part of the whole
land with regards to specific features on the
acquired portion.
 ii) Date of valuation
 Date publication in the Gazette, under section 4,
provided that within 12 months it is followed by a
declaration under section 8.
 In other cases, the date of gazette notification
under section 8.
 i.e Gazette notification Section 4 is 1.10.04
followed by Section 8 is 1.02.05 . Date of valuation
is _______________

8. iii) Method of Valuation:
(Comparison Method)
- Based on the economic principle or substitution:
no prudent purchase or economic goods will pay
more than what it will cost him to purchase a
comparable substitute Evidence of Sales:
 Similar characteristics
 Recent Sales ( not more than 2 years from gazette
 Bona fide test
 Auction sales (forced)
 Asking price not relevant.
 Previous awards on the same property –not suitable
 Not arm’s length transaction.
 Evidence after gazette date not considered

9.  Investment method –
- United Temiang (FMS) Rubber Estate v. CLR Muar
 Cost method
– Lun Chung Yang and others v. --Superintendent of
Land and Surveys first Division Sarawak
 Residual Method –
- Estate and Trust Agencies Ltd v. CLR Johor Bahru
 Leasehold property:
- Regards may be had to the expiry of lease
 Malay Reservation
 All land to be valued on the same basis i.e. ignored the
Malay Reservation restriction, unless acquisition for the
purposes of Malays only
 Zoning
- Compensation to have due regards to the use
indicated by the Director of TCP. If gazetted as for
public purpose, to value as such. If it is not gazetted, to
value all its potentialities.
 Improvement within 2 years of declaration To be ignored

10.  Reinstatement
- If the property no market- cost for
reinstatement
 Use contrary to Law
- Zoning, implied and express condition
 Encumbered land
- Squatters and controlled tenants – to be
taken into account
 Mining Land
- Section 40 NLC Mineral found within parcel of
land does not belong to the owner, therefore
cannot compensated

11. B) BETTERMENT
- Section 2(b) 1st Schedule of Land Acquisition
Act 1960 .
 The principle:
- The interested party should not stand to gain
from the acquisition.
- The compensation payable to the owner
whose land is acquired is reduced by the
amount of any increase in the value of any
land belonging to him likely to accrue due to
the use which the land acquired will be put.
- Enhanced by the declared purposes.
- Enhanced by actual construction
- Any enhancement involved shall be set off by
the government.

12. C) SEVERANCE
- Section 2(c) 1st Schedule of Land Acquisition Act
1960.
- For partial taking of land, the raining portion
/other land being reduced in value.
- Depreciation in value of remaining land caused
by the loss of the acquired land.
 Guidelines:
- There must be partial taking. The land taken and
the remaining land held under same title or
ownership or physical location and each giving
enhanced value to the whole.
- There must be damage to the remaining the land
- Caused by the loss of portion taken
- Caused by separating one part from the other.
- Where the damages is extensive ,acquiring body
may acquire the remaining portion

13.  Guidelines:
- There must be partial taking. The land taken
and the remaining land held under same title
or ownership or physical location and each
giving enhanced value to the whole.
- There must be damage to the remaining the
land
- Caused by the loss of portion taken
- Caused by separating one part from the
other.
- Where the damages is extensive ,acquiring
body may acquire the remaining portion.

14. D) INJURIOUS AFFECTION
- Section 2(d) of 1st schedule of Land
Acquisition 1960,
- Depreciation in value of remaining land
caused by intended use of the portion
acquired.
- Closely linked with concept but include:
 His other property, movable and immovable
 use which cause a diminution of value of other
land
 if it reduces the chances of continued
profitable utilization of other land
 include all conceivable damage that could
arise –not allowed to claim at later date
 e.g. loss of privacy ,construction of road
sewerage, depreciating the value of land due
to noise.

15. E) DISTURBANCE CLAIMS.
- Sec 2(e) First Schedule of Land
Acquisition Act 1960.
- Loss of earning
- Depreciation of Fixtures
- Depreciation of Stock
- Loss of Goodwill
- Cost of removal and other incidental
cost
- Professional fees

16.  Basis of calculation for disturbances:
 i) Total extinguishment of business-
- A claimant seeking compensation for the
extinguishment of his business conducted on
the acquired land must establish that the
extinguishment is due to the acquisition.
 ii) Alternative premises –
- A claimant is obliged to mitigate his loss
where reasonably possible and one of the
best ways doing this is to remove his business
suitable alternative premises to enable him to
carry on his business in substantially the same
as before. Generally, cost of removal and
damage incurred in the move

17.  F) ACCOMODATION WORKS
- Sec 2(f) First Schedule of Land Acquisition 1960
- Damages put right at the acquiring authority’s
expense (thus reducing compensation payable)
- Instances of accommodation works:
- Where buildings are severed
- Where small parcels of land are left with the
owner
- Intersection of land leaving small parcels on either
side with owner.
- Accommodation works include construction and
maintaining of bridges, arches, culverts, passages
or roads.
- The undertaking for accommodation works should
be clear and enforceable.

18.  The degree of urgency of the acquisition
 Any disinclination of the person to part with
the land
 any damage sustained by the person
interested which, if caused by private person,
would not be good cause of action.
 Any depreciation in the value of the land
acquired likely to result from the use which it
will be put when acquired
 Any increase in the value of the land
acquired likely to result from the use which it
will be put when acquired
 any improvement to land acquired after the
date of publication of declaration under Sec
8, unless for normal maintenances.