The Supreme Court has upheld the first part of Article 31C of the Constitution, as it was established in the Keshavanada Bharati case. The seven-judge Constitution Bench, after reviewing several past judgments, concluded that the first part of the unamended Article 31C was constitutional and continues to be in force.
The bench, which included Justices Hrishikesh Roy, BV Nagarathna, Sudhanshu Dhulia, JB Pardiwala, Manoj Misra, Rajesh Bindal, SC Sharma, and AG Masih, was tasked with determining whether the term material resources of the community in Article 39(b) includes privately owned property. They also had to decide whether laws intended to achieve this provision's objective of redistributing material resources for the common good could be exempted from legal challenges based on violations of fundamental rights.
The majority of the bench held that not every resource owned by an individual can be considered a "material resource of the community". The inquiry about the resource in question must be contest specific. Justice Nagarathna authored a separate but partially concurring opinion, while Justice Dhulia penned a dissenting judgment.
Article 39(b) of the Indian Constitution, which falls under the Directive Principles of State Policy (DPSP), mandates that the administration will direct its policy towards ensuring that the material resources of the community are distributed equitably. The key question before the Supreme Court was whether private property can be considered part of the material resources of the community in the context of this provision.
The principle behind the insertion of Article 39(b) was to ensure that the resources necessary for economic growth and social justice serve the collective welfare or "common good", rather than being concentrated in the hands of a few. However, the court ruled that not every private property resource owned by an individual can be considered as a "material resource of the community" under Article 39 (B) of the Constitution.
The nine-judge bench, led by Chief Justice DY Chandrachud, stated that states can stake claim over private properties in certain cases. It overturned several verdicts that had adopted the socialist theme and ruled that states can take over all private properties for the common good. Justice BV Nagarathna partially disagreed with the majority judgment penned by the CJI, while Justice Sudhanshu Dhulia dissented on all aspects.
The bench also noted that such a judicial declaration would lead to a situation where no private investor would come forward to invest. This was in response to a challenge to Chapter VIIIA of the Maharashtra Housing and Area Development Act, 1976(MHADA). This provision allowed the Mumbai Building Repair and Reconstruction Board (MBRRB) to acquire certain "cessed properties" for restoration purposes with the consent of 70 percent of the residents.
The court's ruling has far-reaching implications for the interpretation of the term material resources of the community and the extent to which private property can be considered part of these resources. It also underscores the delicate balance that must be struck between individual property rights and the broader societal goal of equitable resource distribution.
