The Supreme Court cleared that all privately owned properties cannot be treated as community resources for use by the state, putting to rest a major constitutional question over property rights. The nine-judge Constitution bench led by Chief Justice of India DY Chandrachud, ruled 8-1 on whether private assets could be taken over by the state for the common good. Chief Justice Chandrachud delivered the leading judgment on behalf of himself and six other justices. Justice BV Nagarathna offered a concurrent but separate opinion. Justice Sudhanshu Dhulia dissented, creating a mix of perspectives within the bench.

The core issue: What qualifies as a community resource?

This case orbits around Article 31C of the Indian Constitution, which protects state laws attempting to fulfill the directive principles of the Constitution - broad social guidelines for law and policy. Protected under Article 31C is Article 39B, which directs the state to ensure that material resources are allocated to benefit the common good. 

Chief Justice Chandrachud noted the intricacy of this question: “Does material resource of a community used in 39B include privately owned resources? Theoretically, the answer is yes, the phrase may include privately owned resources. However, this court is unable to subscribe itself to the minority view of Justice Iyer in Ranganath Reddy. We hold that not every resource owned by an individual can be considered a material resource of a community only because it meets the qualifier of material needs.”

To determine what constitutes a community resource, Chief Justice Chandrachud established criteria to be followed for evaluating that: “The enquiry about the resource in question falls under 39B must be contest-specific and subject to a non-exhaustive list of factors such as nature of resource, the characteristics, the impact of the resource on well-being of the community, the scarcity of resource and consequences of such a resource being concentrated in the hands of private players.” He added that the “public trust doctrine” may also be used to evaluate whether a resource qualifies as a community asset.

The judgment returns to the 1977 Supreme Court ruling of a seven-judge bench, in a close 4-3 majority, that privately owned properties do not automatically qualify as community resources under Article 39B. In that case, Justice Krishna Iyer dissented, arguing that both public and private resources should fall within the scope of “material resources of the community.”

A differing viewpoint from Justice Nagarathna

Justice BV Nagarathna expressed a separate opinion, a disagreement with the understanding of Chief Justice Chandrachud regarding the 1977 dissent by Justice Iyer.  She questioned his comments about past judicial interpretations, observing, “Justice Krishna Iyer adjudicated on the material resources of a community in the backdrop of a constitutional and economic structure which gave primacy to the State in a broad sweeping manner. As a matter of fact, the 42nd amendment had included socialist in the Constitution. Can we castigate former judges and allege them with disservice only because of reaching a different interpretative outcome?”

 Justice Nagarathna urged caution in criticizing past judgments, noting that judicial views should reflect the socio-economic conditions and policies of their time. “It is a matter of concern as to judicial brethren of posterity view the judges of the brethren of past… possibly by losing sight of time when the latter discharged duty and socio-economic policies pursued by the state… merely after liberalisation, paradigm shift after 1991 reforms, it cannot lead to branding the judges of this court of yesteryears as to doing disservice to the Constitution.”

The verdict of the Supreme Court led to setting up a new precedent in an ongoing debate over the rights of properties, social welfare, and the authority of the state: in other words, how the interests of individual property can be balanced and rationed with the superior interest of the community at large.