Article 39(b) Verdict Live Updates: SC overrules 1978 ruling that held all privately owned resources can be acquired by state

In a landmark decision, the Supreme Court ruled on Tuesday that government cannot take control of all private properties for distribution to the public. This 7-2 majority ruling clarifies that while states can acquire private land in specific situations, they lack the constitutional authority to seize all resources for the 'common good.'

The nine-judge bench, led by Chief Justice DY Chandrachud, overturned previous rulings, including one by justice Krishna Iyer, which suggested that Article 39(b) of the Constitution granted states sweeping powers to acquire private resources.

The Supreme Court's decision stems from a case filed in 1992 by the Mumbai-based Property Owners' Association (POA).

The POA challenged a section of the Maharashtra Housing and Area Development Authority (MHADA) Act, which allowed state authorities to acquire buildings and land if 70% of the occupants requested it for restoration.

Article 31C 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.

SC ruled that Article 31C as it stood after Minerva Mills judgment in 1980, which struck down amendments to it during emergency, continues to hold good. A portion earlier added to Art 31C and struck down by a 13-Judge bench in 1973 Keshavananda Bharti case would not revive. Article 31C: No legislation giving efect to Directive Principles (Chapt IV of Constitution) would be invalid for mere violation of equality (Art 14) or free speech (Art 19). Emergency era amendment had barred SC/HC from testing policy decisions effectuating directive principles.

Judgement by CJI-led bench

The 9-J bench's majority judgment was authored by CJI Chandrachud, for self and Justices Hrishikesh Roy, J B Pardiwala, Manoj Misra, Rajesh Bindal, S C Sharma and A G Masih. Justice B V Nagarathna partially dissented with CJI while Justice S Dhulia differed with the CJI.

Cannot subscribe to Justice Iyer's philosophy: Supreme Court

SC said adoption of dynamic economic policy through the last 30-odd years has made India the fastest growing economy in the world. SC said it cannot subscribe to Justice Iyer's philosophy that every asset, including that of pvt individuals, can be termed community resource.

SC said the economy has shifted since the 1960s

SC said there was a shift towards socialist economy in 1960s and 70s, but the focus shifted to market oriented economy since 1990s. "India's tragectory of economy eschews any particular type of economy but meant to meet emerging challenges of a developing country," the SC said.

SC ruled that Justice Krishna Iyer's 1978 ruling unsustainable

CJI D Y Chandrachud led bench ruled that Justice Krishna Iyer's 1978 ruling - all properties of private individuals can be termed community property -advanced socialist economic ideology, hence unsustainable. However, it said some pvt property could be termed community property.

Why does the HC decision appears to be on shaky ground?

Even the UP govt defended the validity of the Act before SC even though it had not appealed to the top court against the verdict. The state had said it would defend its legislation before SC and that the law may require reforms to mainstream madrassas, as educational certificates issued by them were recognised only till Class 12. HC had agreed with the UP govt, and while reserving its verdict on Oct 22, had said, "The state has a vital interest in mainstreaming madrassas, otherwise, how do these institutions produce worthy citizens if they are not acquainted with mathematics, science and other such mainstream subjects? We will interpret the Act that way. But to strike down the Act entirely is akin to throwing the baby out with the bath water."

Allahabad HC judgement challenged by madrassas

Allahabad HC on March 22 had quashed the UP Board of Madrassa Education Act, 2004, terming it to be violative of principles of secularism, and directed the state to admit over 12 lakh students studying in 13,364 madrassas in regular schools recognised by the state education board. This was challenged by various madrassas and madrassa teachers' associations.

SC will decide the correctness of Justice Krishna Iyer's singular socialist view in 1978 that public as well as private resources fall within the ambit of Article 39(b), which was upheld by a series of SC judgments between 1982 and 1996.

In 2002, a seven-judge bench reopened the issue while adjudicating the validity of an amendment to Maharashtra Housing and Area Development Act that had incorporated the stated objective of Article 39(b) and referred it to a nine-judge bench, which reserved its verdict on May 1.

Both verdicts will be delivered by benches of different strengths led by CJI D Y Chandrachud

A nine-judge bench will decide on the meaning of Article 39(b), which is part of the Directive Principles of State Policy that mandate states to direct its policies towards securing "that the ownership and control of the material resources of the community are so distributed as best to subserve the common good". A three-judge bench will rule on the validity of HC's madrassa verdict.

Supreme Court will pronounce its verdict on Tuesday on two important issues - correctness of its 1978 view that the state can distribute public and private resources for the greater common good, and the validity of Allahabad HC's decision ordering closure of madrassas terming them 'non-secular'.