National Advisory Council member N C Saxena on Thursday termed as "unconstitutional" a key clause in the proposed land acquisition Act which binds private firms buying 100 acre or more to follow the rehabilitation package, as suggested in the draft bill.

According to the draft National Land Acquisition and Rehabilitation & Resettlement Bill, 2011, the rehabilitation provision would be mandatory if private companies buy 100 acre or more on their own.

"This is unconstitutional. The government of India cannot decide how much land can be bought. The Centre cannot control this, (whereas) state can control this through various laws including Land Ceiling Act," Saxena said at an Assocham conference here.

This provision should be removed from the draft bill, he added.

NAC, headed by Congress president Sonia Gandhi, is a high-level body advising the government on UPA's (United Progressive Alliance) flagship programmes like MGNREGA (Mahatma Gandhi National Rural Employment Guarantee Act) and Food Security Bill.

Under the draft land acquisition bill, the farmers will be given a compensation of not less than twice the market value in urban areas. In rural areas, the same should be at least six times the market price.

The clause has also been opposed by real estate industry.

"No private land acquisition should be covered under the proposed Act. If this is done, housing prices will go up multi-fold," CREDAI President Lalit Kumar Jain had recently said.

However, Saxena, who helped the government in drafting the bill, said that the other provisions of the proposed law are reasonable for all the stakeholders.

He said if farmers are given adequate compensation, they are "keen to go out of agriculture". The real issue, according to him, was compensation.

Citing the Posco example, NAC member said if farmers were paid good compensation, the company would not have faced agitation.