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Informist, Tuesday, Nov. 5, 2024

 

--SC: Not every resource owned by individuals material resource of community 

--SC: All private properties not material resources, can't be taken by state 

 

NEW DELHI – The Supreme Court Tuesday ruled that all private properties cannot be considered as "material resource of the community" under Article 39(b) of the Indian Constitution and consequently, these cannot be taken over by the State to subserve the common good. Article 39(b) imposes a positive obligation on the State to ensure that the "ownership and control of the material resources of the community are so distributed as best to subserve the common good". 

 

The nine-judge Bench led by Chief Justice of India D.Y. Chandrachud, in a majority judgment, said some private properties may come under Article 39(b) provided they are material and belong to the community. The top court rejected the view taken by it in a minority judgement in 1977 and thereafter, in 1983 and 1997, that all private properties can be acquired by the State for the common good.

 

The top court said the phrase "material resources of the community" may theoretically include privately owned resources, but the expansive view expressed by the minority judgement in 1977 and subsequent cases can't be accepted. "Not every resource owned by an individual can be considered a material resource of the community merely because it meets the qualifier of material needs," said the court.

 

The apex court said that the enquiry on whether a resource falls in the ambit of "material resource of community" must be based on the nature of the resource, its characteristics, its impact on the well-being of the community, its scarcity, and the consequence of such a resource being concentrated in the hands of private players. The public trust doctrine can also be applied here, said the court. 

 

The court said the term "distribution" has a broad connotation. The various forms of distribution which can be adopted by the State can include vesting of the concerned resource in the State or nationalisation, said the court. 

 

Chief Justice Chandrachud wrote the judgement combining the views of himself and Justices Hrishikesh Roy, J.B. Pardiwala, Manoj Misra, Rajesh Bindal, Satish Chandra Sharma, and Augustine George Masih. Meanwhile, Justice B.V. Nagarathna partially dissented with the majority opinion, and Justice Sudhanshu Dhulia completely disagreed with the majority view. 

 

The top court held that Article 31C of the Constitution, to the extent that it was upheld in the Kesavananda Bharati versus State of Kerala in 1973, remains in force. Article 31C, introduced in 1971, protected laws enacted to ensure the "material resources of the community" are distributed to serve the common good (Article 39(b)) and that wealth and the means of production are not "concentrated" to the "common detriment" (Article 39C). These directive principles under Articles 39(b) and 39C cannot be challenged by invoking Article 14 or under Article 19 of the Constitution. In 1973, the apex court struck down the last portion of Article 31C which states "...and no law containing a declaration that it is for giving effect to such policy shall be called in question in any court on the ground that it does not give effect to such policy".

 

In 1976, Parliament expanded the scope of Article 31C and included all directive principles. This was done to give precedence to the directive principles over those fundamental rights which hinders socio-economic reforms for implementing these principles. In 1980, the top court struck down these amendments. However, a question arose whether the top court struck down Article 31C as a whole, or did it restore the post-Kesavananda Bharati position wherein Articles 39(b) and (c) remained protected.

 

The case has its genesis in 1986 when the Maharashtra government amended the Maharashtra Housing and Area Development Act, 1976 to insert Chapter VIII-A. Under this chapter, Mumbai Building Repair and Reconstruction Board was allowed to acquire certain "cessed properties" for restoration purposes with the consent of 70% of the residents. The Act aimed to implement the principles enshrined under Article 39(b) of the Constitution.

 

Thereafter, the Property Owners Association moved the Bombay High Court challenging the amendments made to the 1976 Act. The Association, which was a body of more than 20,000 landowners in Mumbai, said the amendments gave untethered power to Mumbai Building Repair and Reconstruction Board to forcibly take possession of residential complexes. In 1991, the high court rejected the association's plea and said that the government was duty bound to provide shelter to the common people. The high court ruled that Article 31(c) of the Constitution bars any challenge to a law made to give effect to Directive Principles of State Policy, if that law takes away any of the rights conferred by Article 14 or Article 19 of the Constitution. 

 

Consequently, the Association along with other parties moved the apex court against the high court's order. The top court is also dealing with contrasting views taken by it previously by different benches. In 1977, a seven-judge Constitution Bench in a 4:3 majority judgement had held that privately owned resources did not fall within the ambit of "material resources of the community". However, In 1983, a five-judge Constitution Bench favoured the minority judgment of 1977 and said the expression "material resources of the community" could not be confined to natural resources or publicly-owned material resources, and included private resources as well. Another nine-judge Constitution bench in 1997 held that "material resources of the community" included privately-owned resources and were not confined to public resources only.

 

The petitioners have argued that Article 39(b) states about public resources or natural resources and not private resources. The government has said that the principle of 'common good' and the ideals of the Constitution to ensure distributive justice and achieve socialist egalitarian goals of distribution of resources would stand defeated if private properties were kept outside the ambit of Article 39(b). "All things in the material world which are available and made available by human interaction or engagement constitute the material resources of the community," Attorney General for India R. Venkataramani had argued.  End

 

Reported by Surya Tripathi

Edited by Tanima Banerjee

 

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