Document Fragment View

Matching Fragments

This Court in State of West Bengal v. Mrs. Bela Banerjee & Ors. [1954] SCR 558, State of West Bengal v. Subodh Gopal Bose & Ors., [1954] SCR 587, interpreted the word 'compensation' in clause (2) of Article 31 as just equivalent or indemnification for the property expropriated which led to the Constitution 4th Amendment Act, 1955 suitably amending Article 31(2) that no law providing for compulsory acquisition or requisition "shall be called in question in any court on the ground of compensation provided by that law is not adequate." Its effect was considered in P. Vajravelu Mudaliar v. Spl. Deputy Collector, Madras & Ors., [1965] 1 SCR 614 and the Court reiterated the interpretation put up in Bela Banerjee's case. This court also, on that score, struck down the Metal Corporation (Acquisition of Under-taking) Act, 1965 in Union of India v. The Metal Corporation of India Ltd. & Anr., [1967] 1 SCR 255, for violating Article 31(2) read with Article 19(1) (f). These two decisions were reconsidered by a Constitution bench in State of Gujarat v, Shanti Lai Mongal Das, [1969] 3 SCR 341 and overruled the metal corporation's case and upheld and accepted the principles laid down in the 4th Amendment Act. Thereafter, in R.C. Cooper v. Union of India, known as Bank Nationalisation case [1970] 3 SCR 530, per majority this Court overruled Mangaldas and held that even after the 4th Amendment, compensation meant "the equivalent in terms of money of the property compulsorily acquired" according to "relevant principles which principles must be appropriate to the determination of compensation under par-ticular class of property sought to be acquired." The Parliament again amended by Constitution's 25th Amendment Act, 1971, wherein the word "compensation" was substituted with the word "amount". This had become the subject of consideration in Kesavanand Bharti v. State of Kerala, [1973] SuppL SCR 1, known as Fundamental Rights case Full Court of 13 Judges per majority of 7 Judges, held, after considering the validity of 25th Amendment Act, that substituting the word 'amount' for 'compensation' in Article 31(2) of the Constitution, the quantum of amount, if directly fixed by law, or the principles for its quantification are matters for legislative judgment. The principles made or laid down are general guiding rules applicable to all persons or transactions covered thereby. In fixing the amount the court will not sit over the general nature of the legislative purpose, The principle may be specified in fixing the amount which may include consideration of social justice as against the equivalent in value of the property acquired. Consideration of social justice will include the relevant directive principles particularly in Articles 39 (b) and {c). These principles are to subserve the common good and to prevent common detriment. The question of adequacy had been excluded by Constitution 4th Amendment Act obviating the necessity to provide a standard or rule to measure adequacy with reference to fixing the amount. The ground of adequacy of the amount as to how the amount has to be given otherwise in cash is not amenable to judicial review. The quantum cannot be a matter for judicial review but the principles to determine the compensation must be relevant to the consideration and must not be illusory. The fundamental rights are subject to reasonable restrictions and rational discrimination and that, therefore, are amendable under Article 368 and they are not basic features or basic structure of the Constitution. The agrarian reforms covered under Art. 3LA brought by Constitution First Amendment Act and saved by Art. 31B as well as Art. 31C brought by Constitution 25th Amendment Act were upheld. Khanna, J. who constituted the majority held that right to property did not pertain to the basic structure of Constitution and it was subordinate to the common good as explained in Indira Gandhi's case. According to Hidayatullah, J. in his concurrent judgment in Golak Nath v. State of Punjab, [1967] SCR 177 and reiterated in his "Right to Property and the Indian Constitution", the right to property is an acquired right and it is the weakest right fit to be placed along with commerce clauses. The Constitution 42nd Amendment Act, 1976 had given primacy to law made to implement any or all directive principles and provided protective umbrella under Article 31C and placed in Ninth Schedule enlarging its width that "a law made to give effect to directive principles does not become void violating fundamental rights and shall not be questioned in a court of law. In Minerva Mills Ltd. v. Union of India, [1981] 1 SCR 36 per majority it was held that any law made by the Parliament or the Legislature, the latter received the assent of the Presi- dent, other than the one to give effect to the principles of Article 39(b) and (c) violates Art. 14 of the Constitution. Accordingly clause 4 of Art. 368 was declared ultra vires.

The question, therefore, is whether right to property is a basic structure, after Constitution 44th Amendment Act, 1978. Indian society is predominantly agrarian and about 3/4th of its population is living in rural areas on agriculture and other ancillary occupations. In pre-independent period, the land tenures were in vogue on Zamindari, Jagirdari, Taluqadari, inamdari or settlement systems in diverse forms. The tenure and holding by the tiller of the soil was insecure and was exploited by intermediaries. On January 26, 1950, the Independence Day, the Congress Party affirmed in its pledge that the inalienable right of the people is "to have freedom and to enjoy the fruits of their toil and have the necessities of life so that they may have full opportunity of growth". In 1931 in Karachi Congress, Resolution on Fundamental Rights envisaged that "the organiza-tion of economic life must conform to the principles of justice" emphasising to reform "the system of land tenure and revenue and rent"............relief from agricultural indebtedness.......ownership or control of land...........

The First Amendment has thus made the constitutional ideal of equal justice a living truth. It is like a mirror that reflects the ideals of the Constitution: it is not the destroyer of its basic structure. The provisions introjnceded by it "and the 4th" Amrndment for the extinguishment or modification of rights in lands held or let for purposes of agriculture or for purposes ancillary thereto, strengthen rather than weaken the basic struc-ture of the Constitution............. It seems to us ironical indeed that the laws providing for agricultural ceilings should be stigmatized as destroying the guarantee of equality when their true object and intendment was to remove inequalities in the matter of agricultural holdings. The Constitution (First Amendment) Act and the (4th Amendment) Act do not destroy or damage the basic structure of the Constitution. This Court in Kesavananda Bharti's case held that Article 31-C brought by Constitution 25th Amendment Act, 1971 has to be given full play as it fulfills the basic purpose of restructuring the economic order. Each word in Article 39 has a strategic role and the whole Article has a social mission. It embraces the entire material resour-ces of the community. Its task is to distribute such resources. Its goal is' so to undertake distribution as best to subserve the common good. It reor-ganizes, by such distribution, the ownership and control of material resour-ces of the Community. Resources is a sweeping expression and covers not only cash sources but even ability to borrow credit resources........In State of Tamil Nadu v. L. Abu Kavi Bai, [1984] 1 SCC 515, another Constitution Bench interpreting Article 39(b) and (c) (material resources) held that the concept is wide enough to cover not only natural or physical resources but also movable or immovable properties such as the vehicles, tools, imple- ments and the workshops, etc. The mere fact that the resources are material will make no differences in the concept of the word 'resources'. The word 'distribution' used hi Article 39(b) must be broadly construed so that a court may give full and comprehensive effect to the statutory intent contained in Article 39(b). It should not be construed in a purely literal sense so as to mean only division of a particular kind or to particular persons. The word 'distribution' will include various facets, aspects, methods and terminology of a broad-based concept of distribution. It does not merely mean that property of one should be taken over and distributed to others like land reforms. It is only one of the modes of distribution but not the only mode. Nationalisation of the transport as also the units, the vehicles would be able to go to the farthest.........."as possible and provide better and quicker and more efficacious facilities". Nationalisation of con-tract carriages were thus upheld.

Thus it is clear that right to property under Art, 300A is not a basic feature or structure of the Constitution. It is only a constitutional right. The Amendment Act having had the protective umbrella of Ninth Schedule habitat under Art. 31B, its invalidity is immuned from attack by operation of Art. 31A. Even otherwise it would fall under Arts. 39(b) and

(c) as contended by the appellants. It is saved by Art. 31C. Though in the first Minerva Mill's case, per majority, Article 14 was held to be a basic struc-ture, the afore-referred and other preceding and subsequent to the first Minerva Mill's case consistently held that Art. 14 is not a basic structure. Article-14 of the Constitution in the context of right to property is not a basic feature or basic structure. The Constitution 66th Amendment Act, 1990 bringing the Amendment Act 8/1982 under 9th Schedule to the Constitution does not destroy the basic structure of the Constitution, Even agreeing with the contention that after the Constitution Forty-fourth Amendment Act, 1978, which had come into force from June 19, 1979, the right to property engrafted in Chapter IV, Part 17, namely Art. 300A that the appellants are entitled to its protection, whether Section 69A is unconstitutional? The heading "Right to Property" with marginal note reads thus :