Balancing Rights and Welfare: How India’s Laws Treat Private Property and Public Needs

This essay, based on Alok Prasanna Kumar’s article “Not So Eminent Domain” from The Indian Express (November 8, 2024), discusses a recent Supreme Court judgment. The case, Property Owners Association v. State of Maharashtra, changes how private property rights and the government’s power to take private land are viewed. The journey of property rights in India—from the socialist amendments of the 1970s to the recent Supreme Court decision—reflects a balance between private ownership and public welfare, showing how laws can protect both people’s rights and the community’s well-being.

Balancing Rights and Welfare.

In India, the Rights and Welfare to own property and the government’s power to take it for public good have often conflicted. This ongoing debate was highlighted in a recent case, Property Owners Association v. State of Maharashtra, decided by the Supreme Court of India. The case focused on an important question: Should private property always be considered something that can serve the entire community? This question is not new; India’s leaders have faced it since the 1970s when socialist ideas inspired changes to the Constitution. Today, the Supreme Court’s decision seeks to balance property rights with public welfare, considering both personal freedoms and the country’s changing needs.

The 25th and 26th Constitutional Amendments for Rights and Welfare

In 1971, the Indian government introduced two important amendments—the 25th and 26th—to support socialist ideals. These amendments aimed to give the government greater control over property to promote fairer distribution of resources. Under the 25th Amendment, the term “compensation” in Article 31 was replaced with “amount,” meaning that the government could pay less than market value when acquiring private land. It also added Article 31C, giving priority to Articles 39(b) and (c) of the Directive Principles of State Policy (DPSP), which support the distribution of resources for the common good and prevent wealth from gathering in only a few hands.

The 26th Amendment went further, abolishing special payments to former princes, known as “privy purses.” This helped establish an equal society where everyone could benefit, not just a privileged few. Together, these amendments encouraged a system where the government could control resources to help everyone, especially the less fortunate.

Strengthening Public Welfare Through Articles 39(b) and 39(c)

The changes to the Constitution allowed the government to enforce Articles 39(b) and (c) more strongly. Article 39(b) calls for resource distribution to benefit everyone, while Article 39(c) works to prevent wealth concentration. With the 25th Amendment, the government could acquire land more easily to build schools, hospitals, and other public resources. This amendment prioritised public welfare over individual property rights, which meant the government could take land if it would help a larger number of people.

The Supreme Court Case: Property Owners Association v. State of Maharashtra

Recently, the Supreme Court revisited the question of property rights in the case Property Owners Association v. State of Maharashtra. The case arose from a law passed by the Maharashtra state government in 1986, which allowed the government to take over poorly maintained buildings from landlords and give them to tenants. This was meant to protect tenants from unsafe living conditions. However, landlords argued that this law violated their property rights.

Chief Justice D.Y. Chandrachud, representing the majority of the judges, decided that not all private property could automatically be taken by the government for community purposes. Instead, the Court ruled that only certain types of property could be considered “material resources of the community,” depending on factors like scarcity, necessity, and the benefit to the community. This new approach means that the government can only acquire private property when it clearly serves the community’s interests.

Balancing Rights with Judicial Review on Rights and Welfare.

The Court’s ruling placed limits on the government’s power to acquire private property by strengthening the role of judicial review. Judicial review allows courts to examine government actions and decide whether they are fair and just. Previously, the government could simply claim that a law followed Article 39(b) and avoid judicial review. Now, however, the Court requires a case-by-case examination to ensure the law truly benefits the public and respects property owners’ rights.

Justice Sudhanshu Dhulia, in his dissenting opinion, argued that Parliament should have the final say on what counts as community resources, since elected representatives are responsible for making decisions on public welfare. Meanwhile, Justice B.V. Nagarathna added that personal items, like someone’s clothes or furniture, should never be considered community resources, emphasising the importance of respecting individual privacy.

Socialist Roots and the Shift to a Balanced Approach

The new ruling is a shift from India’s earlier socialist view, inspired by judges like Justice V.R. Krishna Iyer and Justice O. Chinnappa Reddy, who believed that all property could be controlled by the government to benefit society. This older view supported nationalisation and wealth redistribution, but India’s economic direction has since changed. The Court’s ruling acknowledges this shift and supports a welfare model that balances private ownership with public needs rather than focusing solely on socialist ideals.

The judgment also brings in the concept of “intergenerational equity.” This means that today’s property owners have a responsibility to future generations, ensuring that resources are used wisely and are available for the next generation. This idea encourages sustainable development and responsible ownership, aligning with a vision of long-term community welfare.

The Influence of Past Interpretations

The recent judgment also revisits and adapts earlier interpretations of property rights. In the past, Justice Krishna Iyer argued that all essential resources should serve the community and that the government should be able to control them. However, today’s Court chose a more balanced approach, recognising that while public welfare is essential, private property rights are also valuable in a modern, market-driven economy. This change reflects India’s growth from a strictly state-controlled economy to a mixed one that respects both private and public interests.

The Case’s Broader Socio-Economic Impact

This ruling comes at a time when India balances socialism with capitalist growth. After independence, the government often took over private industries to build a state-led economy. Over time, however, private investment has become essential to the nation’s economic growth. This Supreme Court ruling supports this new approach, respecting both community needs and private investment.

For property owners, the ruling offers protection, assuring them that their land cannot be taken without reason. It encourages a stable environment for people and businesses to invest without fearing that the government will take away their property unfairly. For the government, it means any property acquisition must be justified as genuinely benefiting the public.

The Continuing Story of Property Rights

This case reminds us of Saeed Akhtar Mirza’s film Mohan Joshi Hazir Ho, where the character Mohan Joshi fights for his right to live in a safe home despite his landlord’s neglect. Like in the film, this legal battle has gone on for decades, with both landlords and tenants waiting years for a decision. Although the nine-judge bench’s decision offers clarity, it leaves some questions open, as another bench will decide if the 1986 law is constitutional.

The judgment illustrates how the law can help people while also respecting personal property rights. It shows that both sides—property owners and the government—can be protected through fair laws.

Future Implications of the Judgment

The Supreme Court’s judgment has several long-term implications for both property owners and the government. First, it reinforces the right to private property, establishing that private ownership is not only constitutionally protected but also respected within the legal framework. For property owners, this judgment is a form of protection, as the government must now follow clear guidelines and provide fair compensation if it wishes to acquire private property​.

For India’s investment climate, this judgment is also significant. By protecting property rights, the Court has created a stable environment for investors. This move encourages individuals and companies to invest in private property without the fear of sudden, unjust acquisition by the state. As a result, this judgment can have a positive impact on India’s economy, supporting both domestic and foreign investments.

Conclusion

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The Source’s Authority and Ownership of the Article is Claimed By THE STUDY IAS BY MANIKANT SINGH