New Delhi: In a majority 7:2 ruling, the Supreme Court on Tuesday held that states are not empowered under the Constitution to take over all privately owned resources for distribution to serve the “common good”.
A nine-judge bench headed by Chief Justice DY Chandrachud, however, said states can stake claim over private properties in certain cases.
The majority verdict pronounced by the CJI overruled Justice Krishna Iyer’s previous ruling that all privately owned resources can be acquired by the State for distribution under Article 39(b) of the Constitution.
“Private property may form ‘material resource of community’, but not every resource owned by an individual can be said to be material resource of community,” the Constitution bench said in a three-part judgment.
The nine-judge bench led by Chief Justice D.Y. Chandrachud concluded that “the first part of the unamended Article 31C of the constitution continues to be in force”. In a majority verdict, the bench observed that not all private properties can be taken over by the state.
The CJI wrote for himself and six other judges on the bench which decided the vexed legal question of whether private properties can be considered “material resources of the community” under Article 39(b) and taken over by State authorities for distribution to subserve the “common good”.
It overturned several verdicts that had adopted the socialist theme and ruled that states can take over all private properties for common good. Justice BV Nagarathna partially disagreed with the majority judgement penned by the CJI, while Justice Sudhanshu Dhulia dissented on all aspects.
The petition challenged Article 31C, which protects a law made under Articles 39(b) and (c) empowering the State to take over material resources of the community, including private properties, for distribution to subserve the common good.
The Tuesday hearing comes after the bench reserved its verdict on May 1. In the previous hearing, the top court had remarked that holding every private resource of an individual as part of the material resource of the community would be “far-fetched”. It will also scare away investors who may be wary of the level of protection they would get, the SC added.
