NEW DELHI, Nov 5: In a significant ruling, the Supreme Court declared on Tuesday that states do not possess the constitutional authority to confiscate all privately-owned resources for redistribution aimed at serving the “common good.” The majority verdict, delivered by a nine-judge bench led by Chief Justice DY Chandrachud, was passed with a 7:2 majority.
While the court maintained that states can claim ownership over private properties in certain specific instances, it overruled the previous interpretation by Justice Krishna Iyer, which allowed for the acquisition of all private resources under Article 39(b) of the Constitution.
Chief Justice Chandrachud, along with six other judges, addressed the contentious legal question regarding whether private properties qualify as “material resources of the community” under Article 39(b), thus justifying state appropriation for public distribution. The ruling overturned several earlier judgments that had endorsed a more socialist perspective, enabling the state to seize private properties for the common good.
Justice BV Nagarathna partially dissented from the majority opinion, while Justice Sudhanshu Dhulia disagreed with the entire ruling. The court’s decision follows the precedent set in the 1980 Minerva Mills case, where it struck down provisions of the 42nd Amendment that restricted judicial review of constitutional amendments and prioritized the Directive Principles of State Policy over individual fundamental rights.
Article 31C of the Constitution allows for laws made under Articles 39(b) and (c) to enable the state to take control of community resources, including private properties, for redistribution to promote the common good.
The Supreme Court considered 16 petitions in total, including a significant one from the Mumbai-based Property Owners’ Association (POA), which has contested Chapter VIII-A of the Maharashtra Housing and Area Development Authority (MHADA) Act. This chapter, added in 1986, empowers state authorities to acquire cessed buildings and the land beneath them if 70% of occupants request restoration. The MHADA Act was enacted in line with Article 39(b), which mandates the state to distribute ownership and control of material resources to best serve the community’s interests.
