Supreme Court: The majority of 7:2 comprising of CJI Dr. DY Chandrachud, Hrishikesh Roy, J.B. Pardiwala, Manoj Misra, Rajesh Bindal, Satish Chandra Sharma and Augustine George Masih, JJ., held that all the ‘private properties’ cannot form part of the ‘material resources of the community‘ under Article 39(b) of the Constitution. Justice BV Nagarathna partially concurred with the majority, however, on the aspect of Article 39(b) she opined that a private owned resource can be transformed and can indeed acquire the status of ‘material resource of the community’.
The view taken in Sanjeev Coke Mfg. Co. v. Bharat Coking Coal Ltd. (1983) 1 SCC 147 was held to be correct by Justice Nagarathna. She opined that on merits it cannot be held that Sanjeev Coke violated judicial discipline. One cannot lose sight of the fact that in Sanjeev Coke this Court did not decide the case only on the basis of the opinion of Krishna Iyer, J. in State of Karnataka v. Ranganatha Reddy (1977) 4 SCC 471 but on merits on the validity of the Nationalisation Act. Therefore, Sanjeev Coke is good law insofar as on the merits of the matter is concerned.
She opined that Articles 37, 38 and 39 have to be interpreted by bearing in mind the changing economic policies of the State and not in a rigid watertight compartment. Articles 37 and 38 of the Constitution have to be borne in mind by the Courts while considering the validity of any policy or statute which intend to further any of the Directive Principles of State Policy. The expression “common good” would, inter alia, mean that the distribution of the “ownership and control of material resources of the community” would not lead to concentration of the wealth and means of production in the hands of few which is a Directive Principle in clause (c) of Article 39.
The Constitution of India: A Living Tree
Justice Nagarathna said that the interpretation of the Constitution to contain rights in their broadest realm matters to the living tree theorists. She highlighted that for the living tree theorists, it matters little what the intentions were at the time of Constitution making. The living tree doctrine suggests that the past plays a critical but non-exclusive role in determining the contents of the Constitution. Although the rights and freedoms under a Constitution may be rooted in the past and historically determined, they cannot be considered to be frozen by particular historical anomalies.
In the Indian context, the living tree doctrine is largely inspired by Canadian jurisprudence. Justice Nagarathna relied on the trajectory of authorities wherein this doctrine has been applied in the adjudication of a wide spectrum of controversies. While toying with different variants of the living Constitution metaphor, the Court has consistently emphasised two of the principal elements of the living tree doctrine- (1) the original understanding in the roots of the constitutional tree; and (2) the possibility of growth and development, within its natural limits.
Further, she pointed out that, the framers of our Constitution did not limit either themselves or succeeding generations to any one economic school of thought. To substantiate she referred to Dr. Ambedkar’s speech in the Constituent Assembly evincing that while the economic philosophy adopted by the Government may swiftly pass from one generation to another, the ideal of economic democracy finds firm place within our Constitution. There is no strict economic diktat in the Constitution for the Parliament to follow; however, the Directive Principles act as the principles or goals that the Parliament must regard on its path to progress.
Justice Nagarathna highlighted that Krishna Iyer, J. in State of Karnataka v. Ranganatha Reddy (1977) 4 SCC 471 adjudicated on the construction of “material resources of the community” in the backdrop of a constitutional, economic and social culture that gave primacy to the State over the individual in a broad-sweeping manner. Further, she pointed out that during this time, the word ‘socialist’ was added through the 42nd Amendment into the Preamble to the Constitution. She observed that “Socialist” is starkly distinguished from “Socialism”, which is an economic policy of organising society and the political economy of the country.
She noted that the CJI in the majority opinion (proposed judgment) considered the meaning of the expression “material”, “resources” and “community” independently to conclude that none of the definitions excludes “private property” from the provision. She noted that the CJI had observed that opinion of Krishna Iyer, J. in Ranganatha Reddy and the consequent observations in Sanjeev Coke by Chinnappa Reddy, J. fell into error as the said judgments cast the net wide by holding that all resources which meet “material needs” are covered by the phrase. It was laid down in the majority opinion that the judgments doubted in the reference order were incorrect to the extent that they hold that “all resources” of an individual are part of the community and thus, all private property is covered by the phrase “material resources of the community”.
She noted that it was opined – “thus, the role of this Court is not to lay down economic policy, but to facilitate this intent of the framers to lay down the foundation for an “economic democracy”. The Krishna Iyer doctrine does a disservice to the broad and flexible spirit of the Constitution.” Justice Nagarathna viewed that such observations were unwarranted and unjustified.
“It is a matter of concern as to how the judicial brethren of posterity view the judgments of the brethren of the past, possibly by losing sight of the times in which the latter discharged their duties and the socio-economic policies that were pursued by the State and formed part of the constitutional culture during those times. Merely because of the paradigm shift in the economic policies of the State to globalisation and liberalisation and privatisation, compendiously called the “Reforms of 1991”, which continue to do so till date, cannot result in branding the judges of this Court of the yesteryears “as doing a disservice to the Constitution”.
Further, she observed that-
“Such observations emanating from this Court in subsequent times creates a concavity in the manner of voicing opinions on judgments of the past and their authors by holding them doing a disservice to the Constitution of India and thereby implying that they may not have been true to their oath of office as a Judge of the Supreme Court of India. Of course, no particular line of thinking is static and changes are brought about by the State by bearing in mind the exigencies of the times and global impact, particularly on the Indian economy. Such attempts to create an environment suitable to the changing times have to be also appreciated by the judiciary, of course, by suitably interpreting the Constitution and the laws. But by there being a paradigm shift in the economy of this Country, akin to Perestroika in the erstwhile USSR, in my view, neither the judgments of the previous decades nor the judges who decided those cases can be said to have done a “disservice to the Constitution”. This Court, in particular, and the Indian judiciary, in general, has in meeting the newer challenges of the times by choosing only that part of the past wisdom which is apposite for the present without decrying the past judges. Lest the judges of posterity ought not to follow the same practice. The institution of the Supreme Court of India is greater than individual judges, who are only a part of it at different stages of history of this great Country!”
Issues
1. Whether Article 31C (as upheld in Kesavananda Bharati v. State of Kerala, (1973) 4 SCC 225) survives in the Constitution after the amendment to the provision by the forty-second amendment was struck down in Minerva Mills Ltd. v. Union of India, AIR 1980 SC 1789 (“Minerva Mills”).
Justice Nagarathna concurred with the majority opinion penned by CJI Dr. DY Chandrachud. She stated that without any indication that Parliament intended a “repeal without substitution,” the original text of Article 31C as it existed before the Constitution (Forty-Second) Amendment Act, 1976 must be reinstated following the amendment’s invalidation. She added that in Minerva Mills Ltd. when the 42nd amendment was struck down for deviating from constitutional principles, the logical consequence that must follow the declaration of invalidity of the amendment is to revert to those original principles which the amendment deviated from. This is by giving effect to Article 31C, to the extent it was upheld in Kesavananda Bharati v. State of Kerala, (1973) 4 SCC 225.
Consequently, invalidating Section 4 of the 42nd should automatically resulted in the restoration of the unamended Article 31C.
2. Whether the interpretation of Article 39(b) adopted by Justice Krishna Iyer in State of Karnataka v. Ranganatha Reddy (1977) 4 SCC 471 and followed in Sanjeev Coke (supra) must be reconsidered. Whether the phrase ‘material resources of the community’ in Article 39(b) can be interpreted to include resources that are owned privately and not by the state.
Justice Nagarathna partially concurred with the majority opinion on the aspect that, not all privately-owned resources fall within the ambit of the phrase “material resources of the community.
Disagreeing with the majority opinion on the legal distinction between how a private resource qualifies as one “of the community” and how such a resource is subsequently distributed to subserve the common good, Justice Nagarathna dissented by saying that, a privately owned material resource can be transformed and can indeed acquire a status of “material resource of the community”. Discussing that what are the material resources owned by private persons which can be material resources of the community, she said that these would not include what can be termed as “personal effects” of an individual such as movables in the form of an individual’s apparel, household articles of daily use such as furniture, personal jewellery, kitchenware and such other articles. They are resources but not “material” resources within the meaning of Article 39(b). She opined that expression “of the community” would include all those privately owned “material resources” which have the potential to be transformed as “material resources of the community” excluding personal effects.
She opined that a fundamental prerequisite for the distribution of a resource in a manner that serves the common good is to first bring that resource within the collective domain of the community, thereby rendering it a “material resource of the community”. She stated that any privately owned “material resources” could be transformed as “material resource of the community” by four different modes, namely: (i) by nationalisation; (ii) by acquisition; (iii) by vesting of the said resource in the state, by operation of law under specific statutes and (iv) by the owner of a material resource converting such a resource into a “material resource of the community” by way of donation or a gift, a creation of a charitable endowment, a grant or a dedication so that the said material resource is useful for the community and used or distributed as to subserve the common good.
Districting from the majority, she highlighted that,
“the act of distributing a private material resource, cannot proceed in isolation from such preliminary steps to first incorporate such private material resource into the community’s pool. Thus, acquisition, nationalization, and vesting by operation of law are instances of actions that bring a private material resource into the community’s collective domain, rather than being termed as methods of distributing such resources.”
Agreeing with majority opinion that the Public Trust doctrine applies to such resources, Justice Nagarathna said that- Public/State owned resources are per se “material resources of the community” and such “material resources of the community” can be distributed as best to subserve the common good.
Elaborating on Article 39, Justice Nagarathna elucidated that this Directive Principle under Article 39(b) has to be read in the context of Article 39(c) which states that the State shall, in particular, direct its policy towards securing that the operation of the economic system does not result in the concentration of wealth and means of the production to the common detriment. Therefore, the Indian State must ensure that the ownership and control of the material resources of the community are so distributed to subserve the common good with the object of eliminating the concentration of wealth and means of production in the hands of a few.
Material Resource ‘of the Community’ to subserve the ‘common good’
Justice Nagarathna established that firstly, what is to be distributed is “material resources of the community” and not material resources of the private persons, and secondly, pointed out that the distribution must subserve the common good, which means that it is for the benefit of the public at large. It was elucidated that such distribution could be in two ways: Firstly, by the State itself retaining the material resource for a public purpose and/or for public use; and Secondly, privately owned material resources when converted as “material resources of the community” can be distributed to eligible and deserving persons either by way of auction, grant, assignment, allocation, lease, sale or any other mode of transfer known to law either temporarily or permanently depending upon the mode adopted and unconditionally or with conditions depending upon:
(a) nature of the resource and its inherent characteristics;
(b) the impact of the resource on the well-being of the community;
(c) the scarcity of the resource;
(d) the consequences of such a resource being concentrated in the hands of the private owners; and
(e) any such factors. Thus, “distribution of material resources of the community” cannot violate the Directive Principle in Article 39(c) of the Constitution.
[Property Owners Association v. State of Maharashtra, 2024 SCC OnLine SC 3122, decided on: 05-11-2024]
*Dissent Authored by: Justice BV Nagarathna
मेरे को सुप्रीमकोर्ट व हाईकोर्ट के द्वारा आरटीआई के सम्बंध में दिये गये जजमेंट की बुक जो हिन्दी व इंग्लिश दोनों में छपी हो चाहिये वह कहाँ मिलेगी।