DR.

RAM MANOHAR LOHIA

NATIONAL LAW UNIVERISTY

RIGHT TO PROPERTY

Submitted to Submitted by

Dr. Manish Singh Param Chaudhary

Professor Enrolment No. – 210101099

Property Law B.A. L.L.B (Hons.)

Dr. Ram Manohar Lohia National Law University 5th Semester, Section ‘B’

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 DECLARATION

I hereby declare that my project work titled “Right to Property” submitted to the Law

department, Dr. Ram Manohar Lohia National Law University, Lucknow is a record of an

original work done by me under the guidance of Dr. Manish Singh and this project work is

submitted in the partial fulfilment of the requirements for the award of the degree of B.A.

LLB.(hons). This project work has not been submitted to any other University or Institute for

the award of any degree or diploma.

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 ACKNOWLEDGEMENT

I would like to express profound gratitude to Dr. Manish Singh, Prof. (Law), who gave me

the opportunity to work on this project and allowed me to develop the skills and acquire the

necessary knowledge to complete this project. I would also like to express humble gratitude

for the exemplary guidance, monitoring and constant encouragement throughout the course of

this project.

I would also like to thank the faculty of Dr. Madhu Limaye Library who extended their

assistance to me by helping me consult relevant legal research material which was essential to

the completion of this project.

Lastly, I would like to thank my family for their constant encouragement without which this

project would not have been possible to complete.

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 INDEX

S. No. HEADING PAGE No.

1 INTRODUCTION 5

2 ARTICLE 19(1)(F) 6

3 DOCTRINE OF EMINENT DOMAIN 7-8

4 SUPREME COURT’S APPROACH TO RIGHT TO PROPERTY 9 - 10

5 RIGHT TO PROPERTY AS FUNDAMENTAL RIGHT 11

6 RIGHT TO PROPERTY AS CONSTITUTIONAL RIGHT 12- 13

7 FUNDAMENTAL RIGHTS AND RIGHT TO PROPERTY 14 - 15

8 CHALLENGES ARISING FROM ELIMINATION OF RIGHT 16 - 18

TO PROPERTY FROM FUNDAMENTAL RIGHTS

9 DEFECTS OF 44TH AMENDMENT ACT 19

10 CONCLUSION 20

11 BIBLIOGRAPHY 21

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 INTRODUCTION

The Indian Constitution does not recognize property right as a fundamental right. In the year

1977, the 44th amendment eliminated the right to acquire, hold and dispose of property as a

fundamental right. However, in another part of the Constitution, Article 300 (A) was inserted

to affirm that no person shall be deprived of his property save by authority of law. The result

is that the right to property as a fundamental right is now substituted as a statutory right. The

amendment expanded the power of the state to appropriate property for social welfare

purposes.

Indian experiences and conception of property and wealth have a very different historical

basis than that of western countries. The present system of property as we know arises out of

the peculiar developments in Europe in the 17th to 18thcentury and therefore its experiences

were universally not applicable. A still more economic area in which the answer is both

difficult and important is the definition of property rights. The notion of property as it has

developed over centuries and it has embodies in our legal codes, has become so much a part

of us that we tend to take it for granted, and fail to recognize the extent to which just what

constitutes property and what rights the ownership of property confers are complex social

creations rather than self evident propositions. This also seems to be the hidden reason why

the right to property is suddenly much contested throughout India today and why the state is

coming up unexpectedly against huge resistance from unexpected quarters in attempting to

acquire land in India.

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 ARTICLE 19(1)(F)

The right to property under the Indian constitution tried to approach the question of how to

handle property and pressures relating to it by trying to balance the right to property with the

right to compensation for its acquisition through an absolute fundamental right to property

and then balancing the same with reasonable restrictions and adding a further fundamental

right of compensation in case the properties are acquired by the state. This was exemplified

by Article 19(1) (f) balanced by Article 19(5) and the compensation article in Article 31.

When the state realized that an absolute right over property and the aspirations of the people

were not the same, the legislature was subsequently forced to make the said right to property

subject to social welfare amid amendments to the constitution. Articles 31-A, 31-B and 31-C

are the indicators of the change and the counter pressure of the state when it realized the

inherent problems in granting a clear western style absolute fundamental right to property

(even though it was balanced by reasonable restrictions in the interest of the public), specially

Article 31-C, which for the first time brought out the social nature of property. It is another

matter that the said provisions were misused, and what we are discussing today, but the abuse

of the socialist state in India is not the scope of the present article and the articles are

considered on their face value only.

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 DOCTRINE OF EMINENT DOMAIN

This doctrine entitles sovereign to acquire private land for a public use, provided the public

utility can be demonstrated beyond doubt. In the present context this doctrine raises the

classic debate of powers of State v. Individual Rights. Here comes the DID (Development

Induced Displacement) which means, the forcing of communities even out of their homes,

often from their home lands for the purpose of economic development, which is viewed as a

violation of human rights at the international level.

ESSENTIAL INGREDIENTS

1. Property is taken for public use

2. Compensation is paid for the property taken.

The above said are the two limitations imposed on the power of Eminent Domain by the

repealed Article 31.

RELEVANT MAXIMS

The doctrine is based on the following two Latin maxims:

i. Salus Populi est Suprema Lex – The welfare of the people of the public is the

paramount law;

ii. Necessita Public Major est Quam - Public necessity is greater than private

necessity.

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Every government has an inherent right to take and appropriate the private property

belonging to individual citizen for public use. This power is known as Eminent Domain. It is

the offspring of political necessity. This right rests upon the above-said two maxims. Thus

property may be needed and acquired under this power for government offices, libraries, slum

clearance projects, public schools, parks, hospitals, highways, telephone lines, colleges,

universities, dams, drainages etc. The exercise of such power has been recognized in the

jurisprudence of all civilized countries as conditioned by public necessity and payment of

compensation. But this power is subject to restrictions provided in the constitution. In the

United States of America, there are limitations on the power of Eminent Domain -

1. There must be a law authorizing the taking of property

2. Property is taken for public use

3. Compensation should be paid for the property taken.

MEANING OF PROPERTY

The word property as used in Article 31 the Supreme Court has said should be given liberal

meaning and should be extended to all those well recognized types of interest which have the

insignia or characteristic of property right. It includes both corporeal and incorporeal right. It

includes money, Contract, interest in property e.g., interest of an allottee, licensees,

mortgages or lessees of property. The Mahantship of a Hindu Temple, and shareholders of

Interests in the company are recognizable interest in property. The right to receive pension is

property.

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 SUPREME COURT’S APPROACH TO RIGHT TO PROPERTY

The Supreme Courts approach to the right to property can be divided into two phases:-

The time till the right to property was a fundamental right (pre 1978)

The time after the conversion of right to property as a constitutional right (post 1978)

Pre 1978 The Fundamental Right to Property

The Ninth Schedule was inserted in the constitution by the Constitution (First Amendment)

Act, 1951 along with two new Articles 31 A & 31 B so as to make laws acquiring zamindaris

unchallengeable in the courts. Thirteen State Acts named in this schedule were put beyond

any challenge in courts for contravention of fundamental rights. These steps were felt

necessary to carry out land reforms in accordance with the economic philosophy of the state

to distribute the land among the land workers, after taking away such land from the land

lords.

By the Fourth Amendment Act, 1955, Art 31 relating to right to property was amended in

several respects. The purpose of these amendments related to the power of the state o

compulsory acquisition and requisitioning of private property. The amount of compensation

payable for this purpose was made unjustifiable to overcome the effect of the Supreme Court

judgement in the decision of State of West Bengal v. Bella Banerjee[12]. By the constitution

(Seventeenth Amendment) Act, 1964, article 31 A was amended with respect to meaning of

expression estate and the Ninth Schedule was amended by including therein certain state

enactments.

During this period the Supreme Court was generally of the view that land reforms need to be

upheld even if they did strictly clash against the right to property[13], though the Supreme

Court was itself skeptical about the way the government went about exercising its

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administrative power in this regard[14]. The Supreme Court was insistent that the

administrative discretion to appropriate or infringe property rights should be in accordance

with law and cannot be by mere fact[15]. The court however really clashed with the socialist

executive during the period of nationalization, when the court admirably stood up for the

right to property in however a limited manner against the over reaches of the socialist

state[16].

In this juncture the court in this Bank Nationalisation case has clearly pointed out the

following two points:

A. The constitution guarantees the right to compensation which is equivalent in money to

the value of the property has been compulsorily acquired. This is the basic guarantee.

The law must therefore provide compensation and for determining compensation

relevant principles must be specified: if the principles are not relevant the ultimate

value determined is not compensation

B. The constitution guarantees that the expropriate owner must be given the value of his

property (the reasonable compensation for the loss of the property). That reasonable

compensation must not be illusionary and not reached by the application of an

undertaking as a unit after awarding compensation for some items which go to make

up the undertaking and omitting important items amounts to adopting an irrelevant

principle in the determination of the value of the undertaking and does not furnish

compensation to the expropriated owner.

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 RIGHT TO PROPERTY AS FUNDAMENTAL RIGHT

It was at this period the Supreme Court had gone out of its way to hold against the right to

property and the right to accumulate wealth and also held that with regard to Article 39, the

distribution of material resources to better serve the common good and the restriction on the

concentration of wealth.The court however is also responsible in toning down the excesses on

the right to property and wealth by the socialist state. During the period of Liberalisation, the

Supreme Court has attempted to get back to reinterpret the provisions which give protection

to the right to property so as to make the protection real and not illusory and dilute the claim

of distribution of wealth.However, this has been an incremental approach and much more

needs to be done to shift the balance back to the original in the constitution. This means that

the acquisition of property is not merely temporal but to be accepted as valid it must conform

to spiritual guidelines as well as the Indian conceptions recognize quite clearly that though

property can be enjoyed which has not been acquired strictly in terms of the law, it cannot be

called real property of the person concerned. Property therefore is not merely an individual

right but a construction and part of social and spiritual order. The basis of conception of

property in the societies of India is not a rigid and clear demarcation of claims belonging to

an individual but is a sum total of societal and individual claims all of which need not be

based on clear individual legal demarcation.

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 RIGHT TO PROPERTY AS CONSTITUTIONAL RIGHT

The outburst against the Right to Property as a Fundamental Right in Articles 19 (1) (f) and

31 started immediately after the enforcement of the Constitution in 1950. Land reforms,

zamindari abolition laws, disputes relating to compensation, several rounds of constitutional

amendments, litigations and adjudications ultimately culminated first in the insertion of the

word socialist in the Preamble by the 42nd Amendment in 1977 and later in the omission of

the Right to Property as a FR and its reincarnation as a bare constitutional right in Article

300-A by the 44th Amendment in 1978. Today, the times have changed radically. India is no

more seen through the eyes of only political leaders with a socialist bias. It is India Shining

seen through the corporate lenses of financial giants like the Tatas, Ambanis and Mahindras,

with an unfathomable zeal for capitalism, money and markets. There is another angle. There

is a scramble by industrialists and developers for land all over the country for establishment

of Special Economic Zones. Violent protests by poor agriculturists have taken place to defend

their meager land-holdings against compulsory acquisition by the State. In particular, the riots

and killings in Singur, Nandigram etc. in a State (of West Bengal) ruled by communists has

turned the wheel full circle. Socialism has become a bad word and the Right to Property has

become a necessity to assure and assuage the feelings of the poor more than those of the rich.

Soon after the abolition of the Fundamental Right to property, in Bhim Singh v. UOI, the

Supreme Court realised the worth of the Right to Property as a Fundamental Right. In the

absence of this Fundamental Right to property, it took recourse to the other Fundamental

Right of Equality which is absolutely the concept of Reasonableness under Article 14 for

invalidating certain aspects of the urban land ceiling legislation. Today, the need is felt to

restore the right to property as a Fundamental Right for protecting at least the elementary and

basic proprietary rights of the poor Indian citizens against compulsory land acquisition. Very

recently, the Supreme Court, while disapproving the age-old Doctrine of Adverse Possession,

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as against the rights of the real owner, observed that The right to property is now considered

to be not only a constitutional right or statutory right but also a human right.Thus, the trend is

unmistakable. By 2050, if the Constitution of India is to be credited with a sense of sensibility

and flexibility in keeping with the times, the bad word socialist inserted in the Preamble in

1977 shall stand omitted and the Right to Property shall stand resurrected to its original

position as a Fundamental Right. Earlier, the apex court in its famous Keshavanandan Bharti

case of 1973 had first termed some basic and unalterable parameters and features of the

Indian state and its constitution like the country's democratic form of government, as its basic

structure, which could not be changed at all even by constitutional amendment. But, in the

judgement of the case, Justice H.R. Khanna had made a passing observation to the effect that

fundamental rights accorded to the citizens' might not be a basic structure of the Constitution.

This had left the scope open for changing or diluting the fundamental right of the citizens.

Though later in 1975, while adjudicating another famous lawsuit between erstwhile Prime

Minister Indira Gandhi and prominent political leader of his times Raj Narain, Justice Khanna

had tried to clarify that his observation had been misconstrued. Despite that clarification, the

Janata Party government, under the advice of then law minister Shanti Bhushan, had changed

the Constitution, removing the right to property from the list of fundamental rights.

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 THE FUNDAMENTAL RIGHTS AND RIGHT TO PROPERTY

This decision which changed the entire scenario of the Indian Constitution did the three

following important changes-

1. Through Article 31 C took away the right to acquire, hold and dispose off the property

under Article 19(1) (f)

2. Right to property under Article 19(1) (f) did not pertain to the basic structure of the

constitution (Honble Justice. H.R.Khanna)

3. Article 19(1) (f) conferred citizens the right to acquire, hold and dispose off the

property under Article 19(1) (f) which formed a part of group of articles under the

heading Right to Freedom

4. There is no necessity for an elaborate argument to demonstrate that property is

intimately connected with the Right to Freedom.

The 44th amendment act which deleted article 19(1) (f) and introduced this article brought

out the following important changes:

1. In view of the special position sought to be given to fundamental rights, the right to

property, which has been the occasion for more than one Amendment of the

Constitution, would cease to be a fundamental right and become only a legal right.

Necessary amendments for this purpose are being made to Article 19 and Article 31 is

being deleted. It would however be ensured that the removal of property from the list

of fundamental rights would not affect the rights of the minorities to establish and

administer educational institutions of their choice.

2. Similarly, the right of persons holding land for personal cultivation and within ceiling

limit to receive market compensation at the market value will not be affected.

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3. Property, while ceasing to be a fundamental right, would, however, be given express

recognition as a legal right, provision being made that no person shall be deprived of

his property save in accordance with law.

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 CHALLENGES ARISING FROM ELIMINATION OF RIGHT TO

PROPERTY FROM FUNDAMENTAL RIGHTS

The rights conferred by Article 19(1)(f) and Article 31 read with the undernoted entries were

so closely interwoven with the whole fabric of our Constitution that those rights cannot be

torn out without leaving a jagged hole and broken threads. The hole must be mended and the

broken threads must be replaced so as to harmonise with the other parts of the Constitution.

The task is not easy, and courts will be called upon to answer problems more formidable than

those raised by the Article 31 after it was amended a number of times. However some of the

problems which will arise and the probable lines of solution are considered below:

(i) That Articles 19(1) (f) and 31(2) dealt with a different, but connected, aspects of

the right to property is clear from several Supreme Court decisions which dealt

with the co relation of those two Articles.

(ii) The correct view was that the two Articles were mutually exclusive. But one

judgement which was soon corrected and another judgement which was a

judgement per incur am, to the view that Articles 19(1)(f) and 31(2) were not

mutually exclusive. This judicial conflict was resolved by 25th Amendment,

which introduced in Article 31 a new clause (2-B) which provided that Nothing in

Article 19(1)(f) shall effect any such law as is referred in clause (2). The validity

of this Amendment as unanimously upheld in the Kesavananda case. The reason

for this mutual exclusiveness was that when property is acquired for a public

purpose on payment of compensation, the right of a citizen to hold property is

gone and the question of his right to hold property subject to reasonable

restrictions does not arise.

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(iii) Further, Article 19(1)(f) that conferred citizens the right to acquire, hold and

dispose of property formed part of a group of articles under the heading Right to

Freedom. It requires no elaborate argument to demonstrate that property is

intimately connected with the right to freedom. Article 31 appeared under the

heading Right to Property; for the right to freedom conferred by Article 19(1)(f)

would be worth little if the property when acquired could be taken away by law.

Hence Article. 31 provided that private property could be acquired only for a

public purpose and on payment of compensation. There is nothing in the

Statement of Objects and Reasons to show that Parliament no longer looks upon

the right to acquire, hold and dispose of property as a part of the Right to

Freedom.

(iv) The retention of Article. 19(1) (a) to (e) and (g) is a clear indication to the

contrary. Sub-clauses (d), (e) and (f) of Article. 19(1)(f)(1) were interlinked is

clear from their provisions as well as from sub-Article (5) which governed each of

those sub-clauses. The meaning of Article 19(1) (f) has been considered and it is

being submitted that the Supreme Court correctly held that the right conferred by

Article 19(1)(d) was not a right of free movement simpliciter, but a special right to

move freely throughout the territory of India with a view to secure, among other

things, the unity of India which a narrow provincialism would deny.

(v) This right of free movement was not limited to travelling throughout India,

because it was accompanied by the further right conferred by Article 19(1) (e) to

reside and settle in any part of India, as also the right conferred by Article 19(1)(f)

to acquire, hold and dispose of property, in any part of India. But a right to settle

in any part of India means not only a right to have a place to live in, but also a

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 place to work in, for Article 19(1)(g) confers on every citizen the right to practise

any profession, or to carry on any occupation, trade or business.

(vi) Further, Article 19(1)(a) confers on every citizen the right to the freedom of

speech and expression, which right includes the freedom of the press a right which

is basic to democracy. But a press needs a building or buildings to house it, and

movable property to work it, so that without the right to acquire, hold and dispose

of property, there can be no freedom of the press. And the same is broadly true of

the fundamental right conferred by Article 19(1) (c)-the right to form associations

or unions-for normally the working of associations and unions involves the right

to acquire, hold and dispose of property. What then is the effect of deleting Article

19(1) (f), which conferred the right to acquire, hold and dispose of property, and

of deleting Article 31 which provided for the acquisition of property for public

purpose on payment of compensation.

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 DEFECTS OF THE 44TH AMENDMENT ACT

The amendment was brought out without realizing the following draw backs:

1. The close relation of property with other fundamental rights, which the Janata Party

was pledged to restore;

2. The effect of this change on the legislative power to acquire and requisition property;

and

3. The correlation of fundamental rights to Directive principles of state policy.

IMPLICATIONS

(i) The Right to Property would now be a Constitutional Right and not a

Fundamental Right. A legislation violating the constitutional right to property

could now be challenged only in High Courts and not directly in the Supreme

Court.

(ii) Due to the deletion of Article 31 the Government was no longer under an

obligation to compensate persons whose land had been acquired as per a law

passed by Parliament.

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 CONCLUSION

In the past, it was thought that the personal rights like the right to vote, right to freedom of

speech or personal liberty occupied a higher status in the hierarchy of values than the right to

property. As a result the courts were more astute to strike down legislations, which impinged

upon these rights, than upon property rights. But the courts of law that the distinction

between the two was unreal and held that nobody seems to have bestowed any thought on the

question why property rights are not personal rights.

The Supreme Court of America which once gave hospitable quarter to the distinction between

personal rights and property rights and accorded a preferred position to the former, has given

a decent burial both to the distinction and the preferred status of the so called personal rights

or liberties in 1972 by saying the dichotomy between personal liberties and property rights is

a false one. The right to enjoy property without unlawful deprivation, not less than the right

to speak or the right to travel is in truth a personal right, whether the property in question be a

welfare cheque, a home or a savings account. In fact, a fundamental interdependence exists

between the personal right to liberty and the personal right in property. Neither could have

meaning without the other.

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 BIBLIOGRAPHY

BOOKS

M.P. JAIN’S CONSTITUTIONAL LAW

V.N. SHUKLA’S CONSTITUTION OF INDIA

WEBSITES

 www.judic.nic.in

 www.supremecourtcases.com

 www.manupatra.com

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