'Govt can't take over all pvt properties for common good': What SC said on Article 39(b)

NEW DELHI: The Supreme Court on Tuesday ruled that not all privately owned resources can be acquired by the State for distribution to serve the " common good ".

Overturning the verdicts post 1978 that adopted socialist theme, the 9-judge bench led by Chief Justice DY Chandrachud delivered the judgment with an 8-1 majority and said that private resource may fall under the ambit of Article 39(b) depending on the nature of the resource being 'material' and the impact of the resource on the community.

Article 39(b) of the Constitution provides that the state shall direct policy to ensure "ownership and control of the material resources of the community are so distributed as best to sub-serve the common good."

The majority judgment was authored by CJI Chandrachud, for self and Justices Hrishikesh Roy, J B Pardiwala, Manoj Misra, Rajesh Bindal, SC Sharma and AG Masih, while Justice BV Nagarathna partially concurred and Justice Dhulia dissented.

Earlier, The top court had, in the Minerva Mills case of 1980, declared two provisions of the 42nd Amendment, which prevented any constitutional amendment from being "called in question in any court on any ground" and accorded precedence to the Directive Principles of State Policy over the fundamental rights of individuals, as unconstitutional.

What the SC said

• The majority judgment authored by CJI DY Chandrachud held that the phrase "material resources of the community" may theoretically include privately owned resources, however, the expansive view expressed by Justice Krishna Iyer's minority judgment in Ranganath Reddy and relied on by Justice Chinnappa Reddy in Sanjeev Coke can't be accepted.
• The apex court 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 private individuals, can be termed community resource.
• The apex court said there was a shift towards socialist economy in the 1960s and 70s, but the focus has shifted to a market oriented economy since the 1990s. "India's trajectory of economy eschews any particular type of economy but meant to meet emerging challenges of a developing country," the SC said.
• The term 'distribution' has a wide connotation. The various forms of distribution which can be adopted by the State can include vesting of the concerned resource in the State or nationalisation, the SC said.
• The court, however, said that the State can stake claim over resources that are material and are held by the community, for public good.
• Earlier, on May 1, the top court observed that nothing will be left for future benches if it is held that all private properties can be considered as "material resources of the community" under Article 39(b) of the Constitution and consequently, the State can take those over to subserve the "common good"
• It had observed that such a judicial declaration would lead to a situation where no private investor would come forward to invest.