Property Owners Association & Ors. v. State of Maharashtra & Ors.

Judgment

) (Concurring): The unamended Article 31-C to the extent held valid in Kesavananda Bharati survives. [Para 2] B 1. Constitution of India – Art.39(b) – Whether the phrase ‘material resources of the community’ used in Art.39(b) includes privately owned resources – Held [per Dr Dhananjaya Y Chandrachud, CJI (for himself and for Hrishikesh Roy, J. B. Pardiwala, Manoj Misra, Rajesh Bindal, Satish Chandra Sharma, and Augustine George Masih, JJ.)] (Majority opinion) – Theoretically, the answer is yes, the phrase may include privately owned resources  – However, one cannot subscribe to the expansive view adopted in the minority judgement authored by Justice Krishna Iyer in Ranganatha Reddy case and subsequently relied upon in Sanjeev Coke case – Not every resource owned by an individual can be considered a ‘material resource of the community’ merely because it meets the qualifier of ‘material needs’ – The inquiry about whether the resource in question falls within the ambit of Art. 39(b) must be context-specific and subject to a non-exhaustive list of factors such as the nature of the resource and its characteristics; the impact of the resource on the well-being of the community; Property Owners Association & Ors. v. State of Maharashtra & Ors. 6 [2024] 11 S.C.R. the scarcity of the resource; and the consequences of such a resource being concentrated in the hands of private players – Public Trust Doctrine evolved by Supreme Court may also help identify resources which fall within the ambit of the phrase “material resource of the community” – Held (per B.V. Nagarathna, J.) – Yes, privately owned resources except “personal effects” can come within the scope and ambit of the phrase “material resources of the community” provided such resources get transformed as “resources of the community” – Held (per Sudhanshu Dhulia, J.) (Dissenting) – The view of the learned Chief Justice in this case (i.e. the majority opinon) ultimately holds that not all privately owned resources are “material resources of the community” – Not only this it further limits the hands of the legislature to a non- exhaustive list of factors to determine which resources can be considered as “material resources” – There is no need for this pre-emptive determination – The definition of “material resources of the community” was purposely kept in generalized and broad-based terms – Privately owned resources are part of “material resources of the community” – Provisions in Article 39(b) & (c) have to be read in light of Art.38 of the Constitution – Once one does that, one cannot but give an expansive meaning to the phrase “material resources of the community”. B 2. Constitution of India – Art.39(b) – Interpretation of – Whether interpretation of Article 39(b) adopted by Justice Krishna Iyer in Ranganatha Reddy case and followed in Sanjeev Coke case must be reconsidered – Held [per Dr Dhananjaya Y Chandrachud, CJI (for himself and for Hrishikesh Roy, J. B. Pardiwala, Manoj Misra, Rajesh Bindal, Satish Chandra Sharma, and Augustine George Masih, JJ.)] (Majority opinion) – The majority judgment in Ranganatha Reddy expressly distanced itself from the observations made by Justice Krishna Iyer (speaking on behalf of the minority of judges) on the interpretation of Art.39(b) – Thus, a coequal bench of this Court in Sanjeev Coke erred by relying on the minority opinion – Held (per B.V. Nagarathna, J.) (Dissenting) – On merits it cannot be held that Sanjeev Coke violated judicial discipline – One cannot lose sight of the fact that in Sanjeev Coke Digital Supreme Court Reports [2024] 11 S.C.R. 7 this Court did not decide the case only on the basis of the opinion of Krishna Iyer, J. in Ranganatha Reddy – Therefore, Sanjeev Coke is good law insofar as on the merits of the matter is concerned – Held (per Sudhanshu Dhulia, J.) (Dissenting) – In Sanjeev Coke, when the Five Judge Constitution Bench unanimously followed the minority judgement in Ranganatha Reddy, it did not violate judicial discipline of not following the majority, since in Sanjeev Coke, the Five Judges did not go against the law laid down by the majority Judges in Ranganatha Reddy but only adopted the logic of the Three Judges on which the majority of Four Judges were silent – The five learned judges in Sanjeev Coke relied upon the decision of the minority judges in Ranganath Reddy as they were persuaded by the logic and the interpretation given by Justice Krishna Iyer to the phrase “material resources of the community” – The broad and inclusive meaning given to the expression “material resources of the community” by Justice Krishna Iyer and Justice O. Chinnappa Reddy in Ranganatha Reddy and Sanjeev Coke respectively has lost none of its relevance, or jurisprudential value, nor has it lost the audience which appreciates these values. B 3. Constitution of India – Art.39(b) – Phrase ‘material resources of the community’ in Article 39(b) – Meaning of – Single-sentence observation in Mafatlal case to the effect that ‘material resources of the community’ include privately owned resources  – Effect of – Held [per Dr Dhananjaya Y Chandrachud, CJI (for himself and for Hrishikesh Roy, J. B. Pardiwala, Manoj Misra, Rajesh Bindal, Satish Chandra Sharma, and Augustine George Masih, JJ.)] (Majority opinion) – The single-sentence observation in Mafatlal case to the effect that ‘material resources of the community’ include privately owned resources is not part of the ratio decidendi of the judgement – Thus, it is not binding on the Court – Held (per Sudhanshu Dhulia, J.) (Concurring) – The majority opinion in Mafatlal constitutes obiter dicta and is not binding on this Court – Held (per B.V. Nagarathna,  J.) – The single-sentence observation in Mafatlal to the effect that “material resources of the community” include privately owned resources may be obiter but has great persuasive value. Property Owners Association & Ors. v. State of Maharashtra & Ors. 8 [2024] 11 S.C.R. B 4. Words and Phrases – Term ‘distribution’ – Meaning and connotation of – Distribution by the State – Whether acquisition of private resources falls within the ambit of the term ‘distribution – Held [per Dr Dhananjaya Y  Chandrachud, CJI (for himself and for Hrishikesh Roy, J. B. Pardiwala, Manoj Misra, Rajesh Bindal, Satish Chandra Sharma, and Augustine George Masih, JJ.)] – The term ‘distribution’ has a wide connotation  – The various forms of distribution which can be adopted by the State cannot be exhaustively detailed – However, it may include the vesting of the concerned resources in the State or nationalisation – In the specific case, the Court must determine whether the distribution ‘subserves the common good’ – Held (per B.V. Nagarathna, J.): The term “distribution” has no doubt a wide connotation but vesting in the State of a particular privately owned “material resource” or nationalisation of the same are only conditions precedent to distribution which have to comply with Article 300A of the Constitution – Further, a resource which has vested in the State or a resource retained by a State on nationalisation could be utilised by the State to subserve the common good as a material resource of the community – The public trust doctrine would apply to such material resources – Alternatively, the State could decide to actually distribute the “material resources of the community” to eligible and deserving persons by way of assignment, lease, allotment, grant, etc. – The same would also come within the scope and ambit of the expression “distribution” – Held (per Sudhanshu Dhulia, J.): It is for the legislature to decide how the ownership and control of material resources is to be distributed in order to subserve common good – How to control and distribute a material resource is also the task of the Legislature, but while doing so what has to be seen is that the control and ownership of the material resource be so distributed that it subserves common good of the community – If it does not, then such a legislation can be struck down as the Judiciary is not deprived of its powers of judicial review. Digital Supreme Court Reports [2024] 11 S.C.R. 9 Held [per Dr Dhananjaya Y Chandrachud, CJI (for himself and for Hrishikesh Roy, J. B. Pardiwala, Manoj Misra, Rajesh Bindal, Satish Chandra Sharma, and Augustine George Masih, JJ.)] (Majority Opinion):

1. Article 39(b) is not a source of legislative power. The inclusion or exclusion of ‘privately-owned resources’ from the ambit of the provision does not impact the power of the legislature to enact laws to acquire such resources. The power to acquire private resources, in certain situations, continues to be traceable to other provisions in the Constitution, including the sovereign power of eminent domain. [Para 203]

3. The interpretation of Article 39(b), i.e. that all private property is covered within the ambit of Article 39(b) is inconsistent with the text of Article 39(b). [Para 204] There is a distinction between holding that private property may form part of the phrase ‘material resources of the community’ and holding that all private property falls within the net of the phrase. It is here that the judgment by Justice Krishna Iyer in Ranganatha Reddy, and the consequent observations in Sanjeev Coke fall into error. Justice Krishna Iyer cast the net wide, holding that all resources which meet “material needs” are covered by the phrase and any attempts by the government to nationalise these resources would be within the scope of Article 39(b). He clarified that not only the “means of production” but also the goods so produced fall within the net of the provision. The illustration which he provides in Ranganatha Reddy indicates the unworkable nature of such an interpretation. Justice Krishna Iyer observed, by way of an illustration, that not only do factories which produce cars fall within the net of Article 39(b), but even privately owned cars are covered by the provision. Similarly, even in Sanjeev Coke, the net is cast wide and this Court observed that “all things capable of producing wealth of the community” fall within the ambit of the phrase. In both decisions, it was observed that all resources of the individual are consequentially the resources of the community. [Para 209]

4. An interpretation of Article 39(b) which places all private property within the net of the phrase “material resources of the community” only satisfies one of the three requirements of the phrase, i.e. that the goods in question must be a Property Owners Association & Ors. v. State of Maharashtra & Ors. 10 [2024] 11 S.C.R. ‘resource’. However, it ignores the qualifiers that they must be “material” and “of the community”. The use of the words “material” and “community” are not meaningless superfluities. One cannot adopt a construction of the provision which renders these terms otiose. The words “of the community” must be understood as distinct from the “individual”. If Article 39(b) was meant to include all resources owned by an individual, it would state the “ownership and control of resources is so distributed as best to subserve the common good”. Similarly, if the provision were to exclude privately owned resources, it would state “ownership and control of resources of the state …” instead of its current phrasing. The use of the word “of the community” rather than “of the state” indicates a specific intention to include some privately owned resources. [Para 211] In essence, the text of the provision indicates that not all privately owned resources fall within the ambit of the phrase. However, privately owned resources are not excluded as a class and some private resources may be covered. The resource in question must meet the two qualifiers, i.e. it must be a “material” resource and it must be “of the community”. [Para 212] To declare that Article 39(b) includes the distribution of all private resources amounts to endorsing a particular economic ideology and structure for our economy. Justice Krishna Iyer’s judgment in Ranganatha Reddy, which was followed inter alia in Sanjeev Coke and Bhim Singhji, was influenced by a particular school of economic thought. In essence, the interpretation of Article 39(b) adopted in these judgements is rooted in a particular economic ideology and the belief that an economic structure which prioritises the acquisition of private property by the state is beneficial for the nation. [Para 213] The Constitution was framed in broad terms to allow succeeding governments to experiment with and adopt a structure for economic governance which would subserve the policies for which it owes accountability to the electorate. The role of this Court is not to lay down economic policy, but to facilitate this intent of the framers to lay down the foundation for an ‘economic democracy’. The doctrinal error in the Krishna Iyer approach was, postulating a rigid economic theory, which

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8. advocates for greater state control over private resources, as the exclusive basis for constitutional governance. The foresighted vision of our framers to establish an ‘economic democracy’ and trust the wisdom of the elected government, has been the backbone of the highgrowth rate of India’s economy, making it one of the fastest-growing economies in the world. To scuttle this constitutional vision by imposing a single economic theory, which views the acquisition of private property by the state as the ultimate goal, would undermine the very fabric and principles of our constitutional framework. [Paras 214, 215 and 216] The right to property was included in the Constitution as a fundamental right under Articles 19(1)(f) and Article 31. Subsequently, the right to property was deleted from Part III of the Constitution by the Constitution (Forty-fourth Amendment) Act, 1978. However, a modified version was inserted and the right to property continues to be constitutionally protected under Article 300A. Although no longer in the nature of a fundamental right, the provision has been characterised as a constitutional and human right. The interpretation of Article 39(b), both as a pre-cursor to the protection of Article 31C and as an aspirational Directive Principle, cannot run counter to the constitutional recognition of private property. To hold that all private property is covered by the phrase “material resources of the community” and that the ultimate aim is state control of private resources would be incompatible with the constitutional protection. [Paras 217, 220]

9. A construction of Article 39(b) which provides that all private property is included within the ambit of Article 39(b) is incorrect. However, there is no bar on the inclusion of private property as a class and if a privately owned resource meets the qualifiers of being a ‘material resource’ and ‘of the community’, it may fall within the net of the provision. “Material resources of the community” refers to either natural resources (which are those of the nation) or those resources which in a large sense can be said to be of community, even though they may be in private hands. [Para 221]

10. There are various forms of resources, which may be privately owned, and inherently have a bearing on ecology and/or the well-being of the community. Such resources fall within Property Owners Association & Ors. v. State of Maharashtra & Ors. 12 [2024] 11 S.C.R. the net of Article 39(b). To illustrate, non-exhaustively, there may exist private ownership of forests, ponds, fragile areas, wetlands and resource-bearing lands. Similarly, resources like spectrum, airwaves, natural gas, mines and minerals, which are scarce and finite, may sometimes be within private control. However, as the community has a vital interest in the retention of the character of these resources, they fall within the ambit of the expression “material resources of the community”. [Para 223]

11. The majority judgment in Ranganatha Reddy expressly distanced itself from the observations made by Justice Krishna Iyer (speaking on behalf of the minority of judges) on the interpretation of Article 39(b). Thus, a coequal bench of this Court in Sanjeev Coke erred by relying on the minority opinion. [Para 229(b)]

12. The single-sentence observation in Mafatlal to the effect that ‘material resources of the community’ include privately owned resources is not part of the ratio decidendi of the judgement. Thus, it is not binding on this Court. [Para 229(c)]

13. On the limited question of whether the acquisition of private resources falls within the ambit of the term ‘distribution’, to hold that the term “distribution” cannot encompass the vesting of a private resource would amount to falling into the same error as the Justice Krishna Iyer doctrine, i.e. to lay down a preference of economic and social policy. The term ‘distribution’ has a wide connotation. The various forms of distribution which can be adopted by the state cannot be exhaustively detailed. However, it may include the vesting of the concerned resources in the state or nationalisation. In the specific case, the Court must determine whether the distribution ‘subserves the common good’. [Paras 227, 228 and 229(f)]

14. The direct question referred to this bench is whether the phrase ‘material resources of the community’ used in Article 39(b) includes privately owned resources. Theoretically, the answer is yes, the phrase may include privately owned resources. However, this Court is unable to subscribe to the expansive view adopted in the minority judgement authored by Justice Krishna Iyer in Ranganatha Reddy and subsequently relied on by this Court in Sanjeev Coke. Not every resource Digital Supreme Court Reports [2024] 11 S.C.R. 13 owned by an individual can be considered a ‘material resource of the community’ merely because it meets the qualifier of ‘material needs’. [Para 229(d)]

15. The inquiry about whether the resource in question falls within the ambit of Article 39(b) must be context-specific and subject to a non-exhaustive list of factors such as the nature of the resource and its characteristics; the impact of the resource on the well-being of the community; the scarcity of the resource; and the consequences of such a resource being concentrated in the hands of private players. The Public Trust Doctrine evolved by this Court may also help identify resources which fall within the ambit of the phrase “material resource of the community”. [Para 229(e)] Held (per B.V. Nagarathna, J.):

1. Articles 37, 38 and 39 of the Constitution of India which are part of the Directive Principles of State Policy have to be interpreted by bearing in mind the changing economic policies of the State and not in a rigid watertight compartment. The flexibility of interpretation is having regard to the dynamic changes in the Indian socio-economic policies meant for the welfare and progress of the people of India. An interpretation of the aforesaid Articles or for that matter any other provision of the Constitution must be viewed in the historical backdrop of the period in which the interpretation was made by this Court during the course of adjudication. Any interpretation which was found to be sound and in consonance with the socio-economic policy of the State during a particular period of time, cannot be critiqued at a later point of time in any quarter including by a court of law merely because the socio- economic policies of the State have changed over a period of time or there is a paradigm shift in the thinking and policies of the State. [Para 22(I)]

2. Articles 37 and 38 of the Constitution have to be borne in mind by the Courts while considering the validity of any policy or statute which intend to further any of the Directive Principles of State Policy. [Para 22(II)]

3. Article 39(b) has to be read in the context of Article 39(c). Articles 39(b) and (c) supplement and complement each other and cannot be construed in silos. Article 39(b) comprises of Property Owners Association & Ors. v. State of Maharashtra & Ors. 14 [2024] 11 S.C.R. following five components, namely, (i) ownership and control; (ii) material resources; (iii) of the community; (iv) so distributed; and (v) as best to subserve the common good. (i) (ii) (iii) The expression “ownership and control” must be given its widest connotation in the context of “distribution of” “material resources of the community” “as best to subserve the common good”. “Material resources” can in the first instance be divided into two basic categories, namely, (i) State owned resources which belong to the State which are essentially material resources of the community, held in public trust by the State; and (ii) privately owned resources. However, the expression “material resources” does not include “personal effects” or “personal belonging” of individuals, such as, clothing or apparel, household articles, personal jewellery and other articles of daily use belonging to the individuals of a household and which are intimate and personal in nature and use. Excluding “personal effects”, all other privately owned resources can be construed as “material resources”. Thus, all resources whether they are public resources or privately owned resources which come within the scope and ambit of the expression “material resources” as stated above are included within that expression. “Material resources” which are privately owned could be transformed as “material resources of the community”, inter alia, in the following five ways: a. by nationalisation, which could be either by way of an enactment made by the Parliament or a State legislature or in any other manner in accordance with law; b. by acquisition, which could be by way of a special enactment made by the Parliament or a State legislature having regard to Entry 42 – List III of the Seventh Schedule of the Constitution. Alternatively, the acquisition could be made under the extant Parliamentary or State laws dealing with acquisition; c. by operation of law, such as vesting of private resources in the State, which could be by virtue of statutes dealing with land reforms, land tenures, abolition of inams, village offices or any other law where by operation of law there would be vesting Digital Supreme Court Reports [2024] 11 S.C.R. 15 of private material resources in the State or in any other manner in accordance with law; d. by purchase of the material resource from private persons by the State, its agencies and instrumentalities in the manner known to law; and e. by the private owner of the material resource converting his “material resources” as a “material resource of the community” by donation, gift, creation of an endowment or a public trust or in any other manner known to law. (iv) In (a) to (d) above, the provision of Article 300A which is a constitutional right to property has to be complied with. (v) The “material resources of the community” have to be “distributed as best to subserve the common good”. Distribution could be in two ways: Firstly, by the State itself retaining the material resource for a public purpose and/or for public use; and Secondly, privately owned material resources when converted as “material resources of the community” can be distributed to eligible and deserving persons either by way of auction, grant, assignment, allocation, lease, sale or any other mode of transfer known to law either temporarily or permanently depending upon the mode adopted and unconditionally or with conditions depending upon:(a) nature of the resource and its inherent characteristics; (b) the impact of the resource on the well-being of the community; (c) the scarcity of the resource; (d) the consequences of such a resource being concentrated in the hands of the private owners; and (e) any such factors. (vi) The expression “common good” would, inter alia, mean that the distribution of the “ownership and control of material resources of the community” would not lead to concentration of the wealth and means of production in the hands of few which is a Directive Principle in clause (c) of Article 39. Thus, “distribution of material resources of the community” cannot violate the Directive Principle in clause (c) of Article 39 of the Constitution. [Para 22(III)]

4. The majority judgment of this Court in Ranganatha Reddy and the judgment in Abu Kavur Bai relate to nationalisation of contract carriages/State carriages which were upheld by this Property Owners Association & Ors. v. State of Maharashtra & Ors. 16 [2024] 11 S.C.R.

5. Court. Nationalisation of coking coal mines was upheld by this Court in Sanjeev Coke. In Bhim Singhji and Basantibai, certain provisions of the Urban Land Ceiling Act and the provisions of MHADA respectively were upheld on the touchstone of Article 39(b) of the Constitution. The nine-Judge Bench in Mafatlal referred to the judgments of this Court in Ranganatha Reddy, Abu Kavur Bai etc. in the context of the submission made before, i.e., the Indian Constitution envisages Justice – social, economic and political, to all citizens of India as enshrined in the preamble. This was by way of an obiter but having persuasive value. [Para 22(IV)] The majority judgment in Ranganatha Reddy, no doubt, did not concur with the views of Krishna Iyer, J. expressed in his separate opinion. However, in Sanjeev Coke the Constitution Bench of five-Judges independently upheld what was challenged in the said case, namely, the Coking Coal Mines (Nationalisation) Act, 1972 and while doing so in paragraphs 19 and 20 referred to the observations of Krishna Iyer, J. in Ranganatha Reddy and made certain observations on the majority judgment in Minerva Mills. However, A.N. Sen, J. did not express any opinion on the judgment of this Court in Minerva Mills. What is significant is that the judgments in Ranganatha Reddy as well as in Sanjeev Coke upheld the respective Nationalisation Acts. Therefore, on merits it cannot be held that Sanjeev Coke violated judicial discipline. One cannot lose sight of the fact that in Sanjeev Coke this Court did not decide the case only on the basis of the opinion of Krishna Iyer, J. in Ranganatha Reddy but on merits on the validity of the Nationalisation Act. Therefore, Sanjeev Coke is good law insofar as on the merits of the matter is concerned. [Para 23(b)]

6. The single-sentence observation in Mafatlal to the effect that “material resources of the community” include privately owned resources may be obiter but has great persuasive value. [Para 23(c)]

7. Yes, privately owned resources except “personal effects” as explained above can come within the scope and ambit of the phrase “material resources of the community” provided such resources get transformed as “resources of the community” as discussed by me above. [Para 23(d)] Digital Supreme Court Reports [2024] 11 S.C.R. 17

9. I agree that the inquiry about whether the resource in question falls within the ambit of Article 39(b) must be context-specific and subject to a non-exhaustive list of factors such as the nature of the resource and its characteristics; the impact of the resource on the well-being of the community; the scarcity of the resource; and the consequences of such a resource being concentrated in the hands of private players. The Public Trust Doctrine evolved by this Court may also help identify resources which fall within the ambit of the phrase “material resource of the community”. In addition, I also reiterate my discussion and conclusion on how privately owned material resource can be transformed as “material resource of the community”. [Para 23(e)] The term “distribution” has no doubt a wide connotation but vesting in the State of a particular privately owned “material resource” or nationalisation of the same are only conditions precedent to distribution which have to comply with Article 300A of the Constitution. Further, a resource which has vested in the State or a resource retained by a State on nationalisation could be utilised by the State to subserve the common good as a material resource of the community. The public trust doctrine would apply to such material resources. Alternatively, the State could decide to actually distribute the “material resources of the community” to eligible and deserving persons by way of assignment, lease, allotment, grant, etc. The same would also come within the scope and ambit of the expression “distribution”. [Para 23(f)]

10. The judgments of this Court in Ranganatha Reddy, Sanjeev Coke, Abu Kavur Bai and Basantibai correctly decided the issues that fell for consideration and do not call for any interference on the merits of the matters. The observations of the Judges in those decisions would not call for any critique in the present times. Neither is it justified nor warranted. [Para 24] Held (per Sudhanshu Dhulia, J.):

1. The question as to whether privately owned resources are part of “material resources of the community” as used in Article 39(b), has been answered by the learned Chief Justice as “yes”, “the phrase may include privately owned resources”, but not in the expansive manner as held by the three learned Property Owners Association & Ors. v. State of Maharashtra & Ors. 18 [2024] 11 S.C.R. judges in State of Karnataka v. Ranganatha Reddy and later in Sanjeev Coke Mfg. Co. v. Bharat Coking Coal Ltd. The judgment further sets limits on what could be “material resources of the community”. I am unable to accept the above proposition as this view ultimately holds that not all privately owned resources are “material resources of the community”. Not only this it further limits the hands of the legislature to a non-exhaustive list of factors to determine which resources can be considered as “material resources”. In my opinion there is no need for this pre-emptive determination. The definition of “material resources of the community” was purposely kept in generalized and broad-based terms. I entirely endorse the view taken by the Three learned Judges in Ranganatha Reddy and by the Five learned Judges in Sanjeev Coke, as to the scope and ambit of “material resources of the community”. Privately owned resources are a part of the “material resources of the community”. [Para 3] “We may have democracy, or we may have wealth concentrated in the hands of a few, but we cannot have both.” This expression is attributed to Justice Louis D. Brandeis, an eminent Jurist and a former Judge of US Supreme Court. Without doubt, when Articles 38 and 39 of the Constitution of India were being incorporated in Part IV of our Constitution, a similar thought dominated the minds of the framers of our Constitution. It is for this reason that Granville Austin calls the Indian Constitution, “first and foremost a social document”. Our Constitution is not merely a roadmap for governance, it is also a vision for a just and equitable society. [Para 5] In Mafatlal, the question before this Court primarily was of unjust enrichment. The observations of Justice Jeevan Reddy are only incidental and were not related to the core issue. I agree with the learned Chief Justice on this point and I adopt the detailed reasoning given by him in holding that the majority opinion in Mafatlal constitutes obiter dicta and is not binding on this Court. [Para 24] The question is that when in Sanjeev Coke, the Five Judge Constitution Bench unanimously followed the minority judgement in Ranganatha Reddy did it violate judicial discipline of not following the majority but the minority decision. In my opinion, it did not break any judicial discipline, since in

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6. Sanjeev Coke, the Five Judges did not go against the law laid down by the majority Judges in Ranganatha Reddy but only adopted the logic of the Three Judges on which the majority of Four Judges were silent. [Para 30] It is difficult to even come to the conclusion that the Four Judges in Ranganatha Reddy entirely disagreed with the minority opinion of Justice Krishna Iyer. It merely says “we must not be understood to agree with all that he has said in his judgment in this regard.” This is not exactly a disagreement. The majority of the Four Judges chose to remain silent on the subject. It cannot be said that the Four Judges, in any way, said anything contrary or in opposition to what was laid down by the Three Judges in Ranganatha Reddy, and therefore, no judicial discipline was broken by Justice O. Chinnappa Reddy when he authored the unanimous judgment in Sanjeev Coke by adopting the logic of the Three Judges in Ranganatha Reddy. The logic is very clear, in cases where a Judge or Judges of the Supreme Court in minority have given a decision on a point on which the majority has remained silent, that it would be binding on the High Courts and all other Courts, and for this Court the least it will have is persuasive value. The five learned judges in Sanjeev Coke relied upon the decision of the minority judges in Ranganath Reddy as they were persuaded by the logic and the interpretation given by Justice Krishna Iyer to the phrase “material resources of the community”. [Para 31] The provisions in Article 39(b) & (c) have to be read in the light of Article 38 of the Constitution of India. Once one does that, one cannot but give an expansive meaning to the phrase “material resources of the community”. The meaning which must be given to “material resources of the community” is what has been given to it in Ranganatha Reddy by the Three Judges and what has been followed in the Constitution Bench decision in Sanjeev Coke. To my mind, this has been the interpretation of the phrase “material resources of the community”. [Para 48]

7. It is for the legislature to decide how the ownership and control of material resources is to be distributed in order to subserve common good. Once the expansive meaning of “material resources of the community” is determined, there is Property Owners Association & Ors. v. State of Maharashtra & Ors. 20 [2024] 11 S.C.R. no necessity of drawing further guidelines for the legislatures to determine as to what will constitute material resources. How to control and distribute a material resource is also the task of the Legislature, but while doing so what has to be seen is that the control and ownership of the material resource be so distributed that it subserves common good of the community. If it does not, then such a legislation can be struck down as the Judiciary is not deprived of its powers of judicial review. The legislation in question has to establish a nexus with the principles specified in Article 39(b) and (c) to be a valid legislation. This is the law in terms of Kesavananda Bharati and Minerva Mills. To put it differently what and when do the “privately owned resources” come within the definition of “material resources” is not for this Court to declare. This is not required. The key factor is whether such resources would subserve common good. Clearly the acquisition, ownership or even control of every privately owned resource will not subserve common good. Yet at this stage we cannot come out with a catalogue of do’s and don’ts. We must leave this exercise to the wisdom of the legislatures. [Para 49] The incorporation of Article 38 as well as Article 39(b) and (c) in Part IV of our Constitution was based on the prevalent philosophy of the time and the path of development India chose to follow. The interpretation given to the above provisions by this Court, particularly in Ranganatha Reddy and Sanjeev Coke also has its contextual relevance. Perhaps in some ways situations have changed. What has not changed, however, is the inequality. There is today a political equality and there is also an equality in law, yet the social and economic inequalities continue as cautioned by Dr. Ambedkar in his speech in the constituent Assembly on November 25, 1949. The inequality in income and wealth and the growing gap between the rich and the poor is still enormous. It will therefore not be prudent to abandon the principles on which Articles 38 and 39 are based and on which stands the Three Judge opinion in Ranganatha Reddy and the unanimous verdict in Sanjeev Coke. [Para 50]

9. The broad and inclusive meaning given to the expression “material resources of the community” by Justice Krishna Iyer and Justice O. Chinnappa Reddy in Ranganatha Reddy and Sanjeev Coke respectively has stood us in good Digital Supreme Court Reports [2024] 11 S.C.R. 21 stead and has lost none of its relevance, or jurisprudential value, nor has it lost the audience which appreciates these values. I must also record here my strong disapproval on the remarks made on the Krishna Iyer Doctrine as it is called. This criticism is harsh, and could have been avoided. The Krishna Iyer Doctrine, or for that matter the O. Chinnappa Reddy Doctrine, is familiar to all who have anything to do with law or life. It is based on strong humanist principles of fairness and equity. It is a doctrine which has illuminated our path in dark times. The long body of their judgment is not just a reflection of their perspicacious intellect but more importantly of their empathy for the people, as human being was at the centre of their judicial philosophy. [Para 50] Case Law Cited In the judgment of Dr. Dhananjaya Y. Chandrachud, CJI: Sanjeev Coke Manufacturing Co v. Bharat Coking Coal Ltd. [1983] 1 SCR 1000 : (1983) 1 SCC 147 : 1982 INSC 93 and State of Karnataka v. Ranganatha Reddy [1978] 1 SCR 641 : (1977) 4 SCC 471 : 1977 INSC 196 [Minority opinion of Justice Krishna Iyer] – held, erroneous. State of Maharashtra v. Central Provinces Manganese Ore. [1977] 1 SCR 1002 : (1977) 1 SCC 643; DK Trivedi & Sons v. State of Gujarat [1986] 1 SCR 479 : (1986) Supp. SCC 20; Shamarao Parulekar v. District Magistrate, Thana [1952] 1 SCR 683 : (1952) 2 SCC 1 : 1952 INSC 63; Natural Resources Allocation, In Re : Special Reference No.1 of 2012 [2012] 9 SCR 311 : (2012) 10 SCC 1 : 2012 INSC 428; Shaukat Khan v. State of Andhra Pradesh [1975] 1 SCR 429 : (1974) 2 SCC 376; Indian Express Newspapers (Bombay) v. Union of India [1985] 2 SCR 287 : (1985) 1 SCC 641 : 1984 INSC 231 – relied on. State of Maharashtra v. Basantibai Khetan [1986] 1 SCR 707  : (1986) 2 SCC 516 : 1986 INSC 40; Minerva Mills v. Union of India [1981] 1 SCR 206 : (1980) 3 SCC 625 : 1980 INSC 142; Kesavananda Bharati v. State of Kerala [1973] Supp. 1 SCR 1 : (1973) 4 SCC 225 : 1973 INSC 91; Waman Rao v. Union of India [1981] 2 SCR 1 : (1980) 3 SCC 587 : 1980 INSC 216; Mafatlal Industries Ltd v. Union of India [1996] Supp. 10 SCR 585 : (1997) 5 SCC 536 : 1996 INSC 1514; IR Coelho v. State of Tamil Nadu [1999] Supp. 2 SCR 394 : (1999) 7 SCC 580 : 1999 INSC 394; Malpe Property Owners Association & Ors. v. State of Maharashtra & Ors. 22 [2024] 11 S.C.R. Vishwanath Acharya v. State of Maharashtra [1997] Supp. 6 SCR 717 : (1998) 2 SCC 1 : 1997 INSC 831; Supreme Court Advocates- On-Record Association v. Union of India [2015] 13 SCR 1 : (2016) 5 SCC 1 : 2015 INSC 285; Maharao Sahib Shri Bhim Singhji v. Union of India [1985] Supp. 1 SCR 862 : (1981) 1 SCC 166 : 1980 INSC 219; ATB Mehtab Majid v. State of Madras [1963] Supp. 2 SCR 435 : (1963) 14 STC 355 : 1962 INSC 342; Koteswar Vittal Kamath v. Rangappa Baliga [1969]  3  SCR  40  : (1969) 1 SCC 255 : 1968 INSC 335; The Property Owners’ Association and Ors. v. The State of Maharashtra and Ors. [1996] Supp. 2 SCR 230 : (1996) 4 SCC 49 : 1996 INSC 598; Property Owners’ Assn. v. State of Maharashtra (2001) 4 SCC 455; Property Owners’ Assn. v. State of Maharashtra (2013) 7 SCC 522; Mulchand Odhavji v. Rajkot Borough Municipality (1971) 3 SCC 53; BN Tewari v. Union of India [1965] 2 SCR 421; T Devadasan v. Union of India [1964] 4 SCR 680 : 1963 INSC 183; B Banerjee v. Anita Pan [1975] 2 SCR 774 : (1975) 1 SCC 166 : 1974 INSC 246; State of Tamil Nadu & Ors. v. L. Abu Kavur Bai & Ors. [1984] 1 SCR 725 : (1984) 1 SCC 515; Jijubhai Nanbhai Kachar v. State of Gujarat [1994] 1 SCR 807 : (1995) Supp 1 SCC 596; National Textile Corp Ltd. v. Sitaram Mills Ltd. [1986] 2 SCR 187 : AIR 1986 SC 1234 : 1986 INSC 61; Union of India v. Cynamide India Ltd. [1987] 2 SCR 841 : (1987) 2 SCC 720 : 1987 INSC 100; Tinsukhia Electric Supply Co. Ltd. v. State of Assam & Ors. [1989] 2 SCR 544 : (1989) 3 SCC 709  : 1989 INSC 128; N. Parthasarathy v. Controller of Capital Issues [1991] 2 SCR 329 : (1991) 3 SCC 153 : 1991 INSC 104; Orient Paper and Industries Ltd. v. State of Orissa [1990] Supp. 2 SCR 480  : (1991) Supp 1 SCC 81; Assam Sillimanite Ltd. & Anr v. Union of India & Ors. [1990] 1 SCR 983 : (1992) Suppl 1 SCC 692 : 1990 INSC 89; Mahinder Kumar Gupta v. Union of India, Ministry of Petroleum and Natural Gas (1995) 1 SCC 85; Tata Iron & Steel Co v. UOI [1996] Supp. 3 SCR 808  : (1996) 9 SCC 709 : 1996 INSC 770; Victorian Granites Pvt. Ltd. v. P. Rama Rao & Ors. [1996] Supp. 5 SCR 692 : (1996) 10 SCC 665 : 1996 INSC 1018; Mafatlal Industries Ltd. & Ors. v. Union of India & Ors. [1996] Supp. 10 SCR 585 : (1997) 5 SCC 536; Reliance Natural Resources Ltd. v. Reliance Industries Ltd. [2010] 5 SCR 704 : (2010) 7 SCC 1 : 2010 INSC 290; Central Board of Dawoodi Bohra v. State of Maharashtra [2004] Supp. 6 SCR 1054 : (2005) 2 SCC 673; Trimurthi Fragrances (P) Ltd. v. State (NCT of Delhi) [2022] 15 SCR 516 : 2022 SCC OnLine SC 1247 : 2022 INSC 975; Jaishri Laxmanrao Patil v. State of Maharashtra [2021] 15 Digital Supreme Court Reports [2024] 11 S.C.R. 23 SCR 715 : (2021) 8 SCC 1 : 2021 INSC 284; Rajnarain Singh v. Patna Administration Committee [1955] 1 SCR 290 : (1954) 2 SCC 82 : 1954 INSC 69; Kaikhosrou (Chick) Kavasji Framji v. Union of India [2019] 4 SCR 222 : (2019) 20 SCC 705 : 2019 INSC 378; Navtej Singh Johar v. Union of India [2018] 7 SCR 379 : (2018) 10 SCC 1 : 2018 INSC 790; Lt. Col. Nitisha & Ors. v. Union of India & Ors. [2021] 4 SCR 633 : (2021) 15 SCC 125 : 2021 INSC 210; Sita Soren v. Union of India [2024] 3 SCR 462 : (2024) 5 SCC 629 : 2024 INSC 161; Islamic Academy of Education v. State of Karnataka [2003] Supp. 2 SCR 474 : (2003) 6 SCC 697 : 2003 INSC 391; Secunderabad Club v. CIT [2023] 12 SCR 979 : 2023 SCC OnLine SC 1004 : 2023 INSC 736; State of Gujarat v. Utility Users’ Welfare Assn. [2018] 9 SCR 106 : (2018) 6 SCC 21 : 2018 INSC 329; State of Madras v. Champakan Dorairjan [1951] 1 SCR 525 : AIR 1951 SC 226 : 1951 INSC 26; Mohd Hanif Qureshi v. State of Bihar [1959] 1 SCR 629 : 1957 SCC OnLine SC 17; Golak Nath v. State of Punjab [1967] 2 SCR 762 : [1967] SCC OnLine SC 14 : 1967 INSC 45; Indian Handicrafts Emporium v. Union of India [2003] Supp. 3 SCR 43 : (2003) 7 SCC 589 : 2003 INSC 427; M.R.F. Ltd. v. Inspector, Kerala Govt [1998] Supp. 2 SCR 632 : (1998) 8 SCC 227 : 1998 INSC 423; Workmen v. Meenakshi Mills Ltd. [1992] 3 SCR 409 : (1992) 3 SCC 336 : 1992 INSC 164; Pathumma v. State of Kerala [1978] 2 SCR 537 : (1978) 2 SCC 1 : 1978 INSC 7; State of Gujarat v. Mirzapur Moti Kureshi Kassab Jamat [2005] Supp. 4 SCR 582 : (2005) 8 SCC 534 : 2005 INSC 525; State of Kerala v. N.M. Thomas [1976] 1 SCR 906 : (1976) 2 SCC 310 : 1975 INSC 224; Bandhua Mukti Morcha v. Union of India [1984] 2 SCR 67 : (1984) 3 SCC 161 : 1983 INSC 203; Ashok Kumar Thakur v. Union of India [2008] 4 SCR 1 : (2008) 6 SCC 1 : 2008 INSC 473; Olga Tellis v. Bombay Municipal Corpn. [1985] Supp. 2 SCR 51 : (1985) 3 SCC 545 : 1985 INSC 151; S.R. Chaudhuri v. State of Punjab [2001] Supp. 1 SCR 621 : (2001) 7 SCC 126 : 2001 INSC 373; K.S. Puttaswamy v. Union of India [2017] 10 SCR 569 : (2017) 10 SCC 1 : 2017 INSC 1235; Maharashtra State Electricity Board v. Thana Electric Supply Co. [1989] 2 SCR 518 : (1989) 3 SCC 616 : 1989 INSC 127; Tinsukhia Electric Supply Co. Ltd. v. State of Assam [1989] 2 SCR 544 : (1989) 3 SCC 709 : 1989 INSC 128; Assam Sillimanite Ltd. v. Union of India [1990] 1 SCR 983  : (1992) Supp. 1 SCC 692 : 1990 INSC 89; Hardeep Singh v. State of Punjab [2014] 2 SCR 1 : (2014) 3 SCC 92 : 2014 INSC 21; Rohitash Kumar v. Om Prakash Sharma [2012] 13 SCR 47 : (2013) 11 SCC 451 : Property Owners Association & Ors. v. State of Maharashtra & Ors. 24 [2024] 11 S.C.R. 2012 INSC 509; Chandigarh Housing Board v. Major General Devinder Singh [2007] 3 SCR 1049 : (2007) 9 SCC 6 : 2007 INSC 291; Lachhman Dass v. Jagat Ram [2007] 2 SCR 980 : (2007) 10 SCC 448; Vidya Devi v. State of Himachal Pradesh [2020] 1 SCR 749 : (2020) 2 SCC 569 : 2020 INSC 23; Kolkata Municipal Corporation & Anr v. Bimal Kumar Shah & Ors. [2024] 5 SCR 831 : 2024 INSC 435; M.C. Mehta v. Kamal Nath [1996] Supp. 10 SCR 12 : (1997) 1 SCC 388 : 1996 INSC 1482; M.I. Builders (P) Ltd. v. Radhey Shyam Sahu [1999] 3 SCR 1066  : (1999) 6 SCC 464 : 1996 INSC 1482; Fomento Resorts and Hotels Ltd. v. Minguel Martins [2009] 3 SCR 1 : (2009) 3 SCC 571 : 2009 INSC 39; Intellectuals Forum v. State of A.P. [2006] 2 SCR 419 : (2006) 3 SCC 549 : 2006 INSC 101; Vedanta Limited v. State of Tamil Nadu [2024] 2 SCR 1121 : 2024 INSC 175; Centre for Public Interest Litigation v. Union of India [2012] 3 SCR 147 : (2012) 3 SCC 1 – referred to. Property Owners’ Association v. State of Maharashtra, 1991 SCC OnLine Bom 521; Laxmibai v. State of Madhya Pradesh, AIR 1951 Nag 94; Shriram Gulabdas v. Board of Revenue, Madhya Pradesh (1952) 3 STC 343 – referred to. Frost v. Corporation Commissioner, 278 U.S. 505; Texas Company v. Cohn Wash, 2d 360 (17 April 1941, Supreme Court of Washington); Mazurek v. FM Ins Company, Jamestown 320 Pa 33 (Pa. 1935) (25 November 1935, Supreme Court of Pennsylvania) – referred to. In the judgment of B. V. Nagarathna, J. Sanjeev Coke Manufacturing Co. v. Bharat Coking Coal Ltd. [1983] 1 SCR 1000 : (1983) 1 SCC 147 : AIR 1983 SC 239; State of Tamil Nadu v. L. Abu Kavur Bai [1984] 1 SCR 725 : (1984) 1 SCC 515 : 1984 INSC 17 and State of Maharashtra v. Basantibai Mohanlal Khetan [1986] 1 SCR 707 : (1986) 2 SCC 516 – affirmed. Property Owners’ Association v. State of Maharashtra [1996] Supp. 2 SCR 230 : (1996) 4 SCC 49; H.H. Kesavananda Bharati Sripadagalvaru v. State of Kerala [1973] Supp. 1 SCR 1 : (1973) 4 SCC 225 : AIR 1973 SC 1461; State of Karnataka v. Ranganatha Reddy [1978] 1 SCR 641 : AIR 1978 SC 215; Mafatlal Industries v. Union of India [1996] Supp. 10 SCR 585 : (1997) 5 SCC 536; IR Coelho v. State of Tamil Nadu [1999] Supp. 2 SCR 394 : (1999) 7 SCC 580 : 1999 INSC 394; Minerva Mills Ltd. v. Union of India Digital Supreme Court Reports [2024] 11 S.C.R. 25 [1981] 1 SCR 206 : (1980) 3 SCC 625 : AIR 1980 SC 1789; State of West Bengal v. Anwar Ali Sarkar [1952] 1 SCR 284 : AIR 1952 SC 75; Supreme Court Advocates-On-Record Association v. Union of India [1993] Supp. 2 SCR 659 : (1993) 4 SCC 441; Zee Telefilms Ltd. v. Union of India [2005] 1 SCR 913  : AIR 2005 SC 2677; Justice K.S. Puttaswamy (Retd.) v. Union of India [2017] 10 SCR 569 : (2017) 10 SCC 1; National Legal Services Authority v. Union of India [2014] 5 SCR 119 : (2014) 5 SCC 438; Joseph Shine v. Union of India [2018] 11 SCR 765 : (2019) 3 SCC 39; Navtej Johar v. Union of India [2018] 7 SCR 379 : (2018) 10 SCC 1; Anuj Garg v. Hotel Association of India [2007] 12 SCR 991 : AIR 2008 SC 63; Secretary, Ministry of Defence v. Babita Punia [2020] 3 SCR 833 : (2020) 7 SCC 469; Lt. Colonol Nitisha & Others v. Union of India [2021] 4 SCR 633 : AIR 2021 SC 1797; Bhim Singhji v. Union of India, AIR 1981 SC 234; Waman Rao v. Union of India [1981] 2 SCR 1 : (1980) 3 SCC 587 : 1980 INSC 216; AIR 1981 SC 271; Centre for Public Interest Litigation v. Union of India [2012] 3 SCR 147 : (2012) 3 SCC 1; In Re : Natural Resources Allocation, Special Reference No.1 of 2012 [2012] 9 SCR 311  : (2012) 10 SCC 1; H.H. Maharaja Rana Hemant Singhji v. CIT [1976] 3 SCR 423 : (1976) 1 SCC 996; State of West Bengal v. Subodh Gopal Bose [1954] 1 SCR 587 : AIR 1954 SC 92; Jilubhai v. State of Gujarat [1994] 1 SCR 807 : AIR 1995 SC 142; Rustom Cavasjee Cooper v. Union of India [1970] 3 SCR 530 : AIR 1970 SC 564; State of Bihar v. Kameshwar Singh [1952] 1 SCR 889 : AIR 1952 SC 252; Coal India Ltd. v. CCI [2023] 7 SCR 827 : (2023) 10 SCC 345; Madhusudan Singh v. Union of India [1984] 1 SCR 849 : (1984) 2 SCC 381; Tinsukhia Electric Supply Co. Ltd. v. State of Assam [1989] 2 SCR 544  : (1989) 3 SCC 709; Assam Sillimanite Ltd. v. Union of India [1990] 1 SCR 983 : (1992) Supp. 1 SCC 692; Kolkata Municipal Corporation v. Bimal Kumar Shah [2024] 5 SCR 831 : 2024 INSC 435 – referred to. In the judgment of Sudhanshu Dhulia, J. State of Karnataka v. Ranganatha Reddy [1978] 1 SCR 641 : (1977) 4 SCC 471 [Minority opinion of Justice Krishna Iyer]; and Sanjeev Coke Mfg. Co. v. Bharat Coking Coal Ltd. [1983] 1 SCR 1000 : (1983) 1 SCC 147 : AIR 1983 SC 239 – impliedly affirmed. Minerva Mills v. Union of India [1981] 1 SCR 206 : (1980) 3 SCC 625; Kesavananda Bharati v. State of Kerala [1973] Supp. Property Owners Association & Ors. v. State of Maharashtra & Ors. 26 [2024] 11 S.C.R. 1 SCR  1  : (1973) 4 SCC 225; State of Madras v. Champakam Dorairajan [1951] 1 SCR 525 : 1951 SCC OnLine SC 30; In Re : Kerala Education Bill, 1957 [1959] 1 SCR 995 : 1958 SCC OnLine SC 8; Mohd. Hanif Quareshi and others v. State of Bihar and others [1959] 1 SCR 629 : 1957 SCC OnLine 17; State of Kerala v. N.M. Thomas [1976] 1 SCR 906 : (1976) 2 SCC 310; State of Gujarat v. Mirzapur Moti Kureshi Kassab Jamat and others [2005] Supp. 4 SCR 582  : (2005) 8 SCC 534; Mafatlal Industries v. Union of India [1996] Supp. 10 SCR 585 : (1997) 5 SCC 536; Waman Rao & Others v. Union of India [1981] 2 SCR 1 : (1981) 2 SCC 362; State of T.N. v. L. Abu Kavur Bai [1984] 1 SCR 725  : (1984) 1 SCC 515; Tinsukhia Electric Supply Co. Ltd. v. State of Assam [1989] 2 SCR 544 : (1989) 3 SCC 709; Madhusudan Singh v. Union of India [1984] 1 SCR 849 : (1984) 2 SCC 381; State of Maharashtra v. Basantibai Mohanlal Khetan [1986] 1 SCR 707 : (1986) 2 SCC 516; Assam Sillimanite Ltd. v. Union of India [1990] 1 SCR 983 : (1992) Supp 1 SCC 692; Jilubhai Nanbhai Khachar v. State of Gujarat [1994] 1 SCR 807 : (1995) Supp 1 SCC 596; KT Moopli Nair v. State of Kerala [1961] 3 SCR 77 : 1960 SCC OnLine SC 7; Shankari Prasad Singh v. Union of India, AIR 1951 SC 458; State of Bihar v. Kameshwar Singh [1952] 1 SCR 889 : (1952) 1 SCC 528; State of West Bengal v. Bela Banerjee [1954] 1 SCR 558 : (1953) 2 SCC 648; Vajravelu v. Special Deputy Collector [1965] 1 SCR 614 : 1964 SCC OnLine SC 22; State of Madras v. D. Namasivaya Mudaliar [1964] 6 SCR 936 : 1964 SCC OnLine SC 169; Union of India v. Metal Corporation of India [1967] 1 SCR 255 : 1966 SCC OnLine SC 15; State of Gujarat v. Shri Shantilal Mangaldas & Ors. [1969] 3 SCR 341 : AIR 1969 SC 634; RC Cooper v. Union of India [1970] 3 SCR 530 : (1970) 1 SCC 248; Video Electronics Pvt. Ltd. v. State of Punjab [1989] Supp. 2 SCR 731 : (1990) 3 SCC 87; Bangalore Water Supply & Sewerage Board. v. A. Rajappa & Others [1978] 3 SCR 207 : (1978) 2 SCC 213; Maneka Gandhi v. Union of India [1978] 2 SCR 621 : (1978) 1 SCC 248; MH Hosket v. State of Maharashtra [1979] 1 SCR 192 : (1978) 3 SCC 544; Hussainara Khatoon v. Home Secretary, State of Bihar (I) [1979] 3 SCR 169 : (1980) 1 SCC 81; Sunil Batra v. Delhi Administration [1980] 2 SCR 557 : (1980) 3 SCC 488; Bijoe Emmanuel v. State of Kerala [1986] 3 SCR 518  : (1986) 3 SCC 615; Vishaka v. State of Rajasthan [1997] 3 Supp. SCR 404 : (1997) 6 SCC 241; K.S. Puttaswamy Digital Supreme Court Reports [2024] 11 S.C.R. 27 v. Union of India [2017] 10 SCR 569 : (2017) 10 SCC 1; Navtej Singh Johar v. Union of India [2018] 7 SCR 379  : (2018) 10 SCC 1 – referred to. V. Padmanabha Ravi Varma Raja v. Deputy Tahsildar, 1962 SCC OnLine Ker 98; Mahinder Bahawanji Thakur v. S.P. Pande, 1963 SCC OnLine Bom 28; Sudha Tiwari v. Union of India, 2011 SCC OnLine All 253; Raja Suryapal Singh v. U.P of Govt., 1951 SCC OnLine All 183 – referred to. Hunter v. Southam Inc (1984) 2 SCR 145 (Canada Supreme Court); Fay v. New York 332 U.S. (1947) (Jackson, J.) – referred to. Books and Periodicals Cited In the judgment of Dr. Dhananjaya Y. Chandrachud, CJI: DD Basu, ‘Constitution of India’, Vol 9, p. 9917; Advanced Law Lexicon by Ramanathaier, 3rd Edn., Vol. III, p. 2509; Halsbury, 2nd Edn, Vol 19, para 556; Eugene Wambaugh, The Study of Cases (Boston: Little, Brown & Co., 1892); HM Seervai, Constitutional Law of India, Vol 2 (4th ed, Universal Law Publishing 2002) 1934–40; Constituent Assembly Debates, Vol VII (15th November 1948); Black’s Law Dictionary, 8th Edition, South Asian Edition, 2015; Hughes, The Supreme Court of The United States, (1930) American Bar Asson. Journal.; Rahul De, A History of Economic Policy in India: Crisis, Coalitions, and Contingency, 2023 (Oxford University Press); Ministry of Finance (Department of Economic Affairs), Government of India, The Indian Economy: A Review, January 2024; Ministry of Finance (Department of Economic Affairs), Government of India, Economic Survey 2023-24, July 2024 – referred to. In the judgment of Sudhanshu Dhulia, J. Mr. Justice Brandeis, Great American: Press Opinion & Public Appraisal (The Modern View Press, Saint Louis, 1941), Pg.42; Granville Austin, The Indian Constitution: Cornerstone of a Nation (Oxford University Press, New Delhi, Second Impression 2000), Pgs. 50, 51; Aharon Barak, The Judge in a Democracy (Princeton University Press, 2006), Pgs. 4-5, 308; Aharon Barak, Purposive Property Owners Association & Ors. v. State of Maharashtra & Ors. 28 [2024] 11 S.C.R. Interpretation in Law (Universal Law Publishing Co., 2007), Pgs. 370, 372, 377; Aharon Barak, Hermeneutics and Constitution Interpretation, 14 Cardozo L. Rev. 767, (1992-93), Pg. 772; A. M Zaidi et al., The Encyclopaedia of The Indian National Congress (VOL.-10: 1930-1935): The Battle For Swaraj (S. Chand & Co. Ltd., 1980), Pg. 183; Rakesh Batabyal (ed.), The Penguin Book of Modern India Speeches (Penguin Books, 2007), Pg. 365; O. Chinnappa Reddy, The Court and The Constitution of India: Summits and Shallows (Oxford University Press, 2008), Pg. 137, 139; Bipan Chandra, Nationalism & Colonialism in Modern India (Orient Longman, 1979), Pgs. 145, 158; Sir P. Thakurdas, Jrd Tata et al., A Plan of Economic Development for India (Part II) (1944); Sanjay Baru (ed.), The Bombay Plan (Rupa Publications India Pvt Ltd., 2018), Pg. 292; Aditya Mukherjee, Political Economy of Colonial and Post-Colonial India (Primus Books, 2022), Pg.192; Justice O. Chinnappa Reddy, The Court and The Constitution of India: Summits and Shallows (Oxford University Press, 2008), Pgs. 74-75, 76; Constituent Assembly Debates, Vol. I, Pg. 62; Vol. II, Pg. 316; Vol. V, Pg.341; Vol. VII, Pgs. 41, 225, 473, 518-19 and 539; Vol. IX, Pg. 1195; Vol. XI, Pg.979; P.K. Tripathy, Spotlights on Constitutional Interpretation (N.M Tripathi Pvt. Ltd., 1972), Pg. 295; Shylashri Shankar, Scaling Justice: The Supreme Court, Social Rights and Civil Liberties in India (Oxford University Press, 2009), Pg. 124; H.M. Seervai, Constitutional Law of India (4th Ed., Vol. II, 1993), Pgs. 1923-1924, 1932; Lael K. Weis, Constitutional Directive Principles, 37 (4) Oxford Journal of Legal Studies 916 (2017), Pg. 923; Parliamentary Debates (Part II-Proceedings Other Than Questions and Answers), Pgs. 8830, 8831-8832; Aditya Mukherjee, Political Economy of Colonial and Post-Colonial India (Primus Books, 2022), Pg. 511; C.H Hanumantha Rao, Rural Society and Agricultural Development in Course of Industrilisation: Case of India, 26 Economic and Political Weekly (1991), Pg. 691; Report of the Monopolies Inquiry Commission 1965; Lok Sabha Debates (Part II- Proceedings Other Than Questions and Answers), Vol-III, Pgs. 4833-4834; A. Moin Zaidi, The Great Upheaval 1969-1972 (Orientalia, 1972), Pgs. 103-105; Anatole France et. al., Crainquebille (Dodd, Mead & Co., Inc., 1922), Pg. 171; Global Hunger Index 2024; National Multidimensional Poverty Index: A Progress Review 2023, Niti Aayog, Government Of India – referred to. Digital Supreme Court Reports [2024] 11 S.C.R. 29 List of Keywords Article 31C of the Constitution; Amendment struck down by Supreme Court; Interpretation of Article 39(b) of the Constitution; Article 300A; Phrase ‘material resources of the community’; Kesavananda Bharati case; Minerva Mills case; Sanjeev Coke case; Ranganatha Reddy case; Privately owned resources; Qualifier of ‘material needs’; Public Trust Doctrine; Minority opinion; Term ‘distribution’; Distribution by the State; Vesting of resources in the State; Nationalisation; Common good. Case Arising From CIVIL APPELLATE/ ORIGINAL JURISDICTION: Civil Appeal No. 1012 of 2002 From the Judgment and Order dated 13.12.1991 of the High Court of Judicature at Bombay, Maharashtra in WP No. 2673 of 1986 With Special Leave Petition (Civil) Nos. 4367, 5204, 5777, 6191-6192, 7950, 8797 of 1992, Special Leave Petition (Civil) No. 6744 of 1993, Special Leave Petition (Civil) Nos. 2303 And 13467 of 1995, Writ Petition (Civil) No. 934 of 1992, Writ Petition (Civil) No. 660 of 1998, Writ Petition (Civil) No. 342 of 1999, Writ Petition (Civil) Nos. 469 And 672 of 2000 and Writ Petition (Civil) No.66 of 2024 Appearances for Parties R Venkataramani, Attorney General for India, Tushar Mehta, Solicitor General, Zal Andhyarujina, Balbir Singh, Rakesh Dwivedi, Gopal Sankaranarayanan, Shyam Divan, Ms. Uttara Babbar, Dr. Harshvir Pratap Sharma, Santosh Paul, Rajiv Dutta, Sr. Advs., H. Devarajan, Sameer Parekh, Ms. Sonali Basu Parekh, E.R. Kumar, Sumit Goel, Ishan Nagar, Jayom Mahesh Shah, Ashok Rajagopalan, Abhishek Thakral, Ms. Aditi, Ms. Apurba Pattanayak, Abhay Jadeja, Ms. Dhanyashree Jadeja, Varun Satiya, Arun Unnikrishnan, Ms. Revati Desai, Ms. Akanksha Agrawal, Ms. Serena Jetmalani, Shayan Bisney, M/s. Parekh & Co., D. Ashok Rajagopalan, Ms. Madhu Tyagi, Kunal Jain, S. C. Birla, Subrat Birla, Ujjwal A. Rana, Himanshu Mehta (for M/s. Gagrat And Co.), S. R. Setia, Amarjit Singh Bedi, Gaganpreet Sandhu, Varun Chandiok, Ms. Riya Seth, Dinesh Kumar, Jay Kishan Dev, P. N. Gupta, Mrs. Bharti Gupta, Pushp Raj Gupta, Ms. Aashima Gupta, T. Srinivasa Murthy, Hemant Property Owners Association & Ors. v. State of Maharashtra & Ors. 30 [2024] 11 S.C.R. Pathak, Mrs. Manisha Chanwani, Samit Shukla, Ashish Wad, Manoj Wad, Mrs. Tamali Wad, Ajeyo Sharma, Ms. Akriti Arya, M/s. J S Wad And Co, P. Narasimhan, Sushant Dogra, Dhananjay Kataria, Kartikay Aggarwal, Raman Yadav, Ms. Ameyavikrama Thanvi, Ms. Oorjasvi Goswami, Chitvan Singhal, Abhishek Kr. Pandey, Chirag M. Shroff, Siddharth Dharmadhikari, Aaditya Aniruddha Pande, Bharat Bagla, Sourav Singh, Aditya Krishna, Kanu Agrawal, Naman Tandon, Madhav Sinhal, Gaurang Bhushan, Ms. Monica Benjamin, Ms. Anu Sura, Ranjeev Khatana, Shyam Gopal, Ms. Preet S. Phanse, Adarsh Dubey, Prahlad Singh, Shashank Bajpai, Ms. Sansriti Pathak, Nipun Saxena, Ms. Astha Sharma, Srisatya Mohanty, Ms. Anju Thomas, Sanjeev Kaushik, Ms. Mantika Haryani, Shreyas Awasthi, Eklavya Dwivedi, Himanshu Chakravarty, Ms. Aditi Gupta, Ms. Jahnvi Dubey, Ms. Trisha Chandran, Ms. Shivani Vij, Ms. Tanya Srivastava, Vishal Sinha, Madhav Gupta, Ms. Ripul Swati Kumari, Bhanu Mishra, Ms. Muskan Surana, Ms. Lihzu Shiney Konyak, Archit Adlakha, Ms. Saumya Saxena, Aditya Raj Pandey, Shrutanjaya Bharadwaj, Mahesh Agarwal, Rishi Agrawala, Manu Krishnan, Ms. Anwesha Padhi, Yash Momaya, Ms. Shivani Agarwal, Udayaditya Banerjee, Aditi Deshmukh, Shaurya Rai Ranjan, Aryan Rachh, E. C. Agrawala, Ms. Daisy Hannah, Ms. Oindrila Sen, Ms. Rayana Mukherjee, Samarth Mohanty, Tejas Patel, Mrs. Meera Kaura, Mrs. Stuti Jain, Paras Joshi, Akshu Jain, Akul Krishnan, Amit Seth, Dibyanshu Pandey, Radhe Shyam Sharma, Varun K Chopra, Mehul Sharma, M/s. Vkc Law Offices, Ms. Sujata Kurdukar, Gopal Balwant Sathe, Nishant Ramakantrao Katneshwarkar, M/s. Manoj Swarup And Co., Mrs. Manik Karanjawala, Ms. Nandini Gore, Ms. Sonia Nigam, Mohammad Shahyan Khan, Akarsh Sharma, Rabin Majumder, Pramod B. Agarwala, Sriharsh Nahush Bundela, Vedant Mishra, Virendra Mohan, M/s. Lawyer S Knit & Co, Sunil Kumar Verma, Manu Krishnan G, Ms. B. Vijayalakshmi Menon, Vivek Sharma, R. Nedumaran, Haresh G. Ganatra, Ms. Anuradha H. Ganatra, Siddharth Dutta, Ms. Neha Singh, Ms. Subhashree Jaganathan, C. Aravind, Shivaji M. Jadhav, Brij Kishor Sah, Adarsh Kumar Pandey, Ms. Apurva, Vignesh Singh, Aditya S. Jadhav, Alok Kumar, Diwakar Sharma, Arun Kanwa, Ms. Aliya Singh, Kanishk Chaudhary, Prabal Chaudhary, Mrs. Chitra Chaudhary, Prashant Chaudhary, M. C. Dhingra, Gaurav Dhingra, Piyush Kant Roy, Surendra Gautam, Abhishek Lakra, Rishab Kumar Singh, Arvind Kumar Singh, Shashank Singh, Advs. for the appearing parties. Digital Supreme Court Reports [2024] 11 S.C.R. 31 Judgment / Order of the Supreme Court Judgment Dr Dhananjaya Y Chandrachud, CJI Table of Contents* A. Background ...................................................................... 6 i. Genesis of the Reference ......................................... 6 ii. The three reference orders ....................................... 12 iii. Scope of the present reference ................................ 18 B. Issues ................................................................................ 21 C. Article 31C ........................................................................ 23 i. Brief History of Article 31-C ...................................... 23 ii. The present dispute concerning Article 31-C and rival contentions ...................................................... 35 iii. Precedents concerning invalidation of amendments ........................................................... 46 iv. Analysis and Conclusions concerning Article 31-C 75 D. Article 39(b) ...................................................................... 84 i. Submissions ............................................................. 84 a. Submissions of the appellants and intervenors ..... 84 b. Submissions of the Respondents and Intervenors.... 89 ii. Judicial Discipline: Observations in Sanjeev Coke and Mafatlal ............................................................... 95 a. The resurrection of the minority view in Ranganatha Reddy by Sanjeev Coke ............................... 95 b. Sanjeev Coke erred in relying on the observations of the minority in Ranganatha Reddy ...................... 103 c. The error has been carried forward in subsequent decisions ............................................................... 110 d. The single-line observation in Mafatlal is obiter dicta ...................................................................... 112 iii. Interpreting Article 39(b) ........................................... 123 * Ed. Note: Pagination as per the original Judgment. Property Owners Association & Ors. v. State of Maharashtra & Ors. 32 [2024] 11 S.C.R. a. Article 39(b) as a pre-requisite to protection under Article 31C ............................................................ 123 b. Article 39(b) as a Directive Principle ......................... 128 iv. Historical Context: Constituent Assembly Debates 135 a. Debates about the purpose of Directive Principles... 135 b. Debates about the text of Article 39(b) ..................... 142 c. Inferences from the discussions in the Constituent Assembly .............................................................. 150 v. Interpretation of Article 39(b) that has been doubted ...................................................................... 156 vi. Correctness of the above interpretation of Article 39(b) ........................................................................... 175 a. The interpretation is inconsistent with the text of Article 39(b) ........................................................... 176 b. The interpretation amounts to endorsing a particular economic ideology ................................. 180 c. The interpretation is incompatible with the right to property ................................................................. 184 d. Determining the ‘materiality’ and ‘community element’ of the resource ........................................ 186 e. The provision may include the ‘vesting’ of private resources in the state ............................................ 189 E. Conclusion ....................................................................... 191

1. The reference to this Constitution Bench raises significant questions about Articles 39(b) and 31-C of the Constitution. Answering the reference has been an adventure through the intricacies of constitutional interpretation and the annals of constitutional history. However, an interpretation of these provisions must involve an understanding of not only their historical context but also the social and economic values which guide the present and are likely to guide the future. Directive Principles of State Policy1 such as Article 39(b) and safe harbour provisions such as Article 31-C are unique creations of our Constitution. Understanding them is a delicate task 1 “Directive Principles” Digital Supreme Court Reports [2024] 11 S.C.R. 33 that involves balancing competing yet coexistent values embedded in our Constitution – the recognition of the individual rights of all citizens and an aspiration towards a welfare state which secures socio-economic justice.

2. Before proceeding, it would be appropriate to briefly refer to the provisions of the Constitution which form the heart of the reference and controversy before this Court. Article 39(b), a part of the Directive Principles contained in Chapter IV of the Constitution, reads as follows: “39. Certain principles of policy to be followed by the State.—The State shall, in particular, direct its policy towards securing— … “(b) that the ownership and control of the material resources of the community are so distributed as best to subserve the common good;”

3. Article 31C of the Constitution provides certain legislations a safe harbour and protects them from being challenged under Articles 14 and 19. The only requirement is that the legislation must give effect to “the principles specified in clause (b) or clause (c) of Article 39”. In a sense, Article 31C is the ying to the yang of Article 39(b), which gives it a unique colour and texture and provides it with far-reaching consequences. Once it is established that a particular legislation has a nexus with the principles specified in Article 39(b), Article 31C provides the legislation with a lifeboat – protecting it from a challenge to its constitutionality under Articles 14 and 19 of the Constitution.

4. With this broad context in mind, we first delve into the journey of the reference to this Constitution Bench and define the scope of this judgement. A. Background i. Genesis of the Reference

5. Mumbai is the most populous city in India and one of the most densely populated cities in the world. A persistent problem faced by its residents has been the large number of old, dilapidated buildings which continue to be inhabited despite becoming unsafe due to lack of repairs and reconstruction. It is estimated that over sixteen Property Owners Association & Ors. v. State of Maharashtra & Ors. 34 [2024] 11 S.C.R. thousand buildings in the city were constructed before 1940.2 The antiquity of the buildings in the island city is compounded by the geographical location of the city. Situated on the western coastline, the saline air of the city contributes to the reduction in the lifespan of its structures. The monsoon rains create pressing challenges for the safety of human settlements and residential buildings. Every year before the monsoon, the Mumbai Building Repair and Reconstruction Board issues a list of dangerous buildings deemed unfit for human habitation. It issues eviction notices to the people living in such buildings and asks occupants to vacate the buildings to avert untoward incidents. Yet, despite these efforts, the city still grapples with the recurring tragedy of building collapses, resulting in loss of life and property, a reminder of the ongoing struggle to ensure safe and secure housing for its residents.3

6. The erstwhile Bombay was originally a group of seven islands. These islands were merged by a series of land reclamation projects to create the present-day ‘Island City of Bombay’. By the beginning of the twentieth century, the island city emerged as a major textile centre. With the growth of the textile industry, there was a significant inflow of workmen from outside of the city. This necessitated the construction of additional residential buildings to house the workmen and their families. The colonial government leased properties for this purpose and a large number of buildings were constructed. During World War II, the scarcity of housing accommodation became even more acute and there was an unprecedented increase in the rents. To mitigate this, Rent Control legislations were introduced.

7. The use of the buildings by more people than they could accommodate resulted in a steady deterioration of the structures and the dilapidation of the buildings over a period of time. Therefore, the Bombay Housing 2 3 Maharashtra Housing and Area Development Authority, Number of Cessed Buildings, https://www. mhada.gov.in/en/content/m-b-r-r-board-history. See Hindustan Times, 1 dead, four hurt as portion of nearly 100-year-old building collapses in Grant Road, 21 July 2024, https://www.hindustantimes.com/cities/mumbai-news/1-dead-four-hurt-as-portion- of-nearly-100-year-old-building-collapses-in-grant-road-101721503683871.html; Express, Dongri building collapse: In 37 years, 894 people died in accidents involving MHADA, 17 July 2019, https://indianexpress.com/article/cities/mumbai/dongri-building-collapse-in-37-years-894-people-died- in-accidents-involving-mhada-buildings-5832965/; Indian Express, Mumbai building collapse: Bhendi Bazaar accident leaves 24 dead, CM Devendra Fadnavis assures strict action, 31 August 2017, https:// indianexpress.com/article/cities/mumbai/mumbai-building-collapse-bhendi-bazaar-accident-death-toll- rises-to-22-4822665/ Indian Digital Supreme Court Reports [2024] 11 S.C.R. 35 Board Act 1948 was enacted which provided for the setting up of a Housing Board of Bombay to execute housing schemes and construct new residential buildings in the island city. Although the enactment helped increase the housing stock, it could not address the issue of existing buildings, which were collapsing from time to time, resulting in loss of life and property. To address the alarming rate of collapses, which were resulting in the loss of life and property, and exacerbating the existing housing shortage, urgent measures were needed, particularly in light of the rapid population growth of the city due to influx from various parts of the country. The Bombay Repairs and Reconstruction Board Act 1969 was introduced. Under this enactment, the Bombay Building Repairs and Reconstruction Board was set up and a cess was introduced to generate funds for the repair and reconstruction of dangerous buildings. A part of the cess was borne by the owners, while the remaining part was borne by the tenants. However, despite these efforts, due to the unprecedented scale of the problem and lack of financial resources, the problem persisted.

8. Accordingly, the state legislature of Maharashtra enacted the Maharashtra Housing and Area Development Act 1976,4 which received the assent of the President on 25 April 1977. The long title stipulates that it is an Act to “unify, consolidate and amend the laws relating to housing, repairing and reconstructing dangerous buildings and carrying out improvement works in slum areas.” Pre- existing laws such as the Bombay Housing Board Act 1948, the Madhya Pradesh Housing Board Act 1950, the Bombay Building Repairs and Reconstruction Board Act 1969 and the Maharashtra Slum Improvement Board Act 1973 were repealed on the enactment of the MHADA Act.5

9. Chapter VIII of the MHADA Act provides for the repairs and reconstruction of dilapidated buildings in ‘Brihan Mumbai’ or the erstwhile ‘Greater Bombay’.6 A cess is levied on the owners which is utilised by the Mumbai Building Repair and Reconstruction Board to carry out repairs and reconstruction of such buildings. 4 5 6 “MHADA Act” Section 188, MHADA Act. Section 1(2), MHADA Act. Property Owners Association & Ors. v. State of Maharashtra & Ors. 36 [2024] 11 S.C.R. For this purpose, the buildings in Brihan Mumbai are divided into three categories. Category A consists of buildings erected before 1 September 1940, Category B consists of buildings erected between 1 September 1940 and 31 December 1950 and Category C consists of buildings erected between 1 January 1951 and 30 September 1969.7

10. On 26 February 1986, the Governor of Maharashtra introduced an Ordinance to amend the MHADA Act.8 Subsequently, an amending Act came into force, which inserted Chapter VIII-A of the MHADA Act.9 The chapter deals with the ‘acquisition of cessed properties for co-operative societies of occupiers’, and its provisions apply to the buildings in Category A, i.e. cessed buildings erected before 1 September 1940 in Brihan Mumbai.10 The provisions of the Chapter envisage the acquisition of such properties by the state and their transfer to a cooperative society on payment of a hundred times the monthly rent of the premises if seventy per cent of the occupiers of the building make an application to this effect.11 Such acquisition may be for the better preservation of the buildings; for carrying out structural repairs or for the reconstruction of a new building. After the land is transferred to the cooperative society, it must be used solely for its original purpose, and there is a restriction on transferring the land or building.12

11. The intention behind inserting Chapter VIII-A has been stated by the legislature in the Preamble and the Statement of Objects and Reasons of the Amending Act. It is stated that the provisions were introduced to address the urgent need for repairs and reconstruction of old, dilapidated buildings in urban areas, particularly in ‘Greater Bombay’. These buildings pose a significant danger due to their poor condition and risk of collapse. Previous efforts, including levying a cess and establishing an authority for structural repairs, failed to achieve the desired results due to the scale of the problem and insufficient financial resources. Thus, a new approach was adopted 7 8 9 10 11 12 Section 84, MHADA Act. Maharashtra Housing and Area Development (Amendment) Ordinance, 1986 Maharashtra Housing and Area Development (Second Amendment) Act, 1986 [Mah. XXI of 1986] (“Amending Act”) Section 103A, MHADA Act. Section 103B, MHADA Act. Section 103C, MHADA Act. Digital Supreme Court Reports [2024] 11 S.C.R. 37 by introducing Chapter VIII-A, involving occupiers in structural repairs or reconstruction by acquiring the old buildings and transferring ownership and control to the occupiers. The aim, according to the legislature, is to protect the occupiers’ shelter, prevent building collapses, and promote equitable distribution of ownership and control of tenements to subserve the ‘common good’.

12. Significantly, by the same Amending Act, Section 1A was also inserted in the MHADA Act containing the following declaration: “1-A. Declaration.—It is hereby declared that this Act is for giving effect to the policy of the State towards securing the principle specified in Clause (b) of Article 39 of the Constitution of India and the execution of the proposals, plans or projects therefor and the acquisition therefor of the lands and buildings and transferring the lands, buildings or tenements therein to the needy persons and the co- operative societies of occupiers of such lands or buildings.”

13. The appellants instituted proceedings under Article 226 of the Constitution before the High Court of Judicature at Bombay13 challenging the constitutionality of the provisions of Chapter VIII-A of the MHADA Act. The case of the appellants before the High Court was that the provisions of Chapter VIII-A are violative of Articles 14 and 19 of the Constitution. It was urged that the provisions are arbitrary, deprive property owners of their rights for illusory amounts and the classification of the buildings had no rational nexus to their object. On the other hand, the respondents submitted that the provisions were not discriminatory or unreasonable. Further, the respondents argued that the MHADA Act gives effect to the principles laid down in Article 39(b) and in view of the immunity granted by Article 31C, the constitutionality of the Act cannot be challenged under Articles 14 and 19.14

14. On 13 December 1991, a Division Bench of the High Court dismissed the writ petitions and upheld the constitutionality of the provisions of Chapter VIII-A of the MHADA Act.15 Relying on the decision of this 13 “High Court” 14 Property Owners’ Association v. State of Maharashtra, 1991 SCC OnLine Bom 521, para 10. 15 Ibid. Property Owners Association & Ors. v. State of Maharashtra & Ors. 38 [2024] 11 S.C.R. Court in State of Maharashtra v Basantibai Khetan,16 the High Court held that the provisions of Chapter VIII-A are saved by Article 31C as they were enacted to give effect to the principles laid down in Article 39(b). In Basantibai Khetan, this Court held certain other provisions of the MHADA Act to be protected by Article 31C. The High Court held that the same principle applies to Chapter VIII-A as well. Further, the High Court also rejected the challenge to the constitutionality of the provisions on their merits and held that they do not violate Article 14.

15. Aggrieved by the judgement of the High Court, the appellants instituted Special Leave Petitions before this Court. These petitions have culminated in the underlying civil appeals. ii. The three reference orders

16. The appeals have travelled through three separate reference orders before being placed before this bench of nine judges. The batch of appeals was first placed before a bench of three judges of this Court. By an order dated 1 May 1996,17 the three-Judge Bench recorded the submission of Mr Fali S Nariman, the learned counsel appearing for the appellants that Article 31C no longer survives in the Constitution after an amendment to the provision was invalidated by this Court in Minerva Mills v. Union of India.18 It was argued that since Article 31C no longer survived, it could not exclude an attack on the constitutional validity of the Act on the grounds of Articles 14 and 19.

17. A brief history of Article 31C and the layers of this contention are discussed in Part C of this judgement. However, at this stage, to understand the scope of the reference, it is sufficient to note that in Kesavananda Bharati v. State of Kerala,19 this Court upheld the validity of Article 31C in part. Subsequently, Article 31C was amended by the Constitution (Forty-second Amendment) Act, 197620 to expand the protection of Article 31-C to laws framed in furtherance of any Directive Principle and not only Articles 39(b) and (c). This 16 17 18 19 20 [1986] 1 SCR 707 : (1986) 2 SCC 516 : 1986 INSC 40 [1996] Supp 2 SCR 230 : (1996) 4 SCC 49 : 1996 INSC 598 (“three-judge bench order”) [1981] 1 SCR 206 : (1980) 3 SCC 625 : 1980 INSC 142 [1973] Supp. 1 SCR 1 : (1973) 4 SCC 225 : 1973 INSC 91 “Forty-Second Amendment” Digital Supreme Court Reports [2024] 11 S.C.R. 39 amendment to Article 31C by the forty-second amendment was invalidated by this Court in Minerva Mills for being violative of the basic structure of the Constitution.

18. Before the bench of three judges, Mr Nariman inter alia urged that the doctrine of revival, as it applies to ordinary statutes does not apply to a constitutional amendment. Hence, he urged that when the part of the forty-second amendment which amended Article 31C was invalidated, it did not result in the automatic revival of the unamended Article 31C. He argued that the decision in Minerva Mills proceeded on a concession that Article 31C remained in force and an unexplained assumption that the unamended Article 31-C (to the extent that it was upheld in Kesavananda Bharati)stood revived. He argued that the question never arose nor was it decided in the case or subsequently in Waman Rao v Union of India21 or Sanjeev Coke Manufacturing Co vs. Bharat Coking Coal Ltd.22

19. On the other hand, Mr Ashok Desai appearing for the respondents contended that the matter stood concluded by the decisions in Minerva Mills, Waman Rao and Sanjeev Coke, wherein revival of the unamended Article 31C was undisputed because it was an ‘obvious position of law’ and had held the field for a long period of time.

20. The three-judge bench of this Court observed since the decisions in Minerva Mills, Waman Rao and Sanjeev Coke were all rendered by a bench of five judges and the assumption that Article 31C remains in force was disputed, it would be appropriate to refer the matter to a larger bench. The reference was made in the following terms: “8. Having heard learned counsel for some time, we have formed the opinion that it would be more appropriate for a Bench of not less than five Judges to consider and decide these questions for an authoritative pronouncement on the same. The decisions in Minerva Mills [(1980) 3 SCC 625], Waman Rao [(1980) 3 SCC 587] and Sanjeev Coke [(1983) 1 SCC 147] are all by a Bench of five Judges. The question in the form it is raised by Shri F.S. Nariman did 21 22 [1981] 2 SCR 1 : (1980) 3 SCC 587 : 1980 INSC 216 [1983] 1 SCR 1000 : (1983) 1 SCC 147 : 1982 INSC 93 Property Owners Association & Ors. v. State of Maharashtra & Ors. 40 [2024] 11 S.C.R. not arise for consideration in any of those decisions which were rendered on a certain premise as indicated therein, which assumption is now seriously challenged by Shri F.S. Nariman. Even if it is assumed that Article 145(3) of the Constitution is not attracted, it does appear to us that in order to settle the controversy on this point which is of some significance and to avoid the question being reagitated before another Bench of less than five Judges, the more appropriate course is to refer these matters for being heard and decided by a Bench of not less than five Judges.” (emphasis supplied)

21. The underlying appeals were then placed before a bench of five judges of this Court. By an Order dated 21 March 2001,23 the five- judge bench noted the contentions which had been raised before the three-judge bench about the revival of Article 31-C. Further, it was observed that the counsel were heard by the Bench at length on the “various issues” that arose in the case, including the interpretation of Article 39(b). The bench went on to express the need to reconsider the view taken by this Court in Sanjeev Coke on the interpretation of Article 39(b), where this Court relied on a concurring opinion authored by Justice Krishna Iyer in State of Karnataka v. Ranganatha Reddy,24 on behalf of a minority of judges.

22. Part D of this judgement will explore these decisions and their interpretation of Article 39(b) in further detail. At this stage, to understand the scope of the reference, it is sufficient to note that in Ranganatha Reddy, the validity of the Karnataka Contract Carriages (Acquisition) Act 1976 was under challenge. The majority opinion authored by Justice Untwalia (for himself and three other judges) upheld the constitutionality of the legislation on its merits. However, Justice Krishna Iyer (for himself and two other judges) authored a concurring opinion, where the enactment was upheld on the ground that it had a nexus with Article 39(b), which protected the legislation under Article 31C. The majority opinion expressly noted that it did not consider it necessary to deal with Article 31C or Article 39(b) and must 23 24 (2001) 4 SCC 455 (“five-judge bench order”) [1978] 1 SCR 641 : (1977) 4 SCC 471 : 1977 INSC 196 Digital Supreme Court Reports [2024] 11 S.C.R. 41 not be construed to agree with the observations of Justice Krishna Iyer. Subsequently, in Sanjeev Coke, while upholding the validity of the Coking Coal Mines (Nationalisation) Act 1972, a five-judge Bench of this Court adopted the view taken in the judgement authored by Justice Krishna Iyer, on behalf of the minority in Ranganatha Reddy.

23. In this backdrop, the Bench of five judges expressed the view that the interpretation of Article 39(b) in Sanjeev Coke, requires reconsideration and referred the cases to a larger bench, in the following terms: “6. The interpretation put on Article 39(b) by Krishna Iyer, J.in Ranganatha Reddy case [(1977) 4 SCC 471 : (1978) 1 SCR 641] was not specifically assented to in the majority decision but in Sanjeev Coke case[(1983) 1 SCC 147 : (1983) 1 SCR 1000] it is the observations in the judgment of Krishna Iyer, J. which have been followed.

7. Having heard the counsel at length, we are of the opinion that the views expressed in Sanjeev Coke case [(1983) 1 SCC 147 : (1983) 1 SCR 1000] require reconsideration. Keeping in view the importance of the point in issue, namely, the interpretation of Article 39(b) it will be appropriate if these cases are heard by a larger Bench of not less than seven Judges.” (emphasis supplied)

24. Finally, the batch of cases was placed before a Bench of seven judges of this Court. The learned Solicitor General (at the time) brought the attention of the bench to an observation in the majority opinion in Mafatlal Industries Ltd vs. Union of India,25a decision by a bench of nine judges of this Court. In the majority opinion in Mafatlal, Justice Jeevan Reddy (speaking for himself and four other judges) observed: “[t]that ‘the material resources of the community are not confined to public resources but include all resources, natural and man-made, public, and private owned’ is repeatedly affirmed by this Court” and referred inter alia to the decisions of this Court in Ranganath Reddy and Sanjeev Coke to advance this proposition. 25 [1996] Supp. 10 SCR 585 : (1997) 5 SCC 536 : 1996 INSC 1514 Property Owners Association & Ors. v. State of Maharashtra & Ors. 42

25. [2024] 11 S.C.R. In its order dated 19 February 2002,26 the Bench of seven judges took the view that the interpretation of Article 39(b) requires reconsideration by a larger bench of nine judges. The bench expressed “some difficulty in sharing the broad view” that material resources owned by the community, the phrase employed by Article 39(b), includes privately owned resources. It was directed that the case be listed before a bench of nine judges after the hearing in IR Coelho vs. State of Tamil Nadu27 is concluded, as there appeared to be similar issues raised. The reference was made in the following terms: “5. Having given due consideration, we are of the opinion that this interpretation of Article 39(b) requires to be reconsidered by a Bench of nine learned Judges: we have some difficulty in sharing the broad view that material resources of the community under Article 39(b) covers what is privately owned.

6. Given that there is some similarity in the issues here involved and in I.R. Coelho v. State of T.N. [(1999) 7 SCC 580. Ed. : The nine-judge Bench decision therein is reported as I.R. Coelho v. State of T.N., (2007) 2 SCC 1.] which already stands referred to a larger Bench, preferably of nine learned Judges, we are of the view that these matters should be heard by a Bench of nine learned Judges immediately following the hearing in I.R. Coelho” (emphasis supplied)

26. The above seven-Judge Bench order has resulted in the present reference before this bench of nine judges. iii. Scope of the present reference

27. During the course of the hearing, the learned Solicitor General appearing on behalf of the respondents,submitted that the reference made in the seven-judge bench order only pertains to the interpretation of Article 39(b) and not the survival of Article 31-C. It was urged that, unlike the three-judge bench order, the five-judge bench order and the seven-judge bench order dropped the issue concerning Article 26 27 (2013) 7 SCC 522 (“seven-judge bench order”) [1999] Supp. 2 SCR 394 : (1999) 7 SCC 580 : 1999 INSC 394 Digital Supreme Court Reports [2024] 11 S.C.R. 43 31C and only referred the Article 39(b) question to a larger bench. Therefore, it was urged that this Court restrict the scope of this judgement to the interpretation of Article 39(b) and more specifically, only to the question of whether “material resources of the community” include privately owned resources.

28. On the other hand, the learned counsel for the appellants urged this Court to understand the scope of the reference more expansively. They broadly submitted that this Court may consider five issues and filed detailed submissions on each of these questions. The issues which they raised are: firstly, whether the unamended Article 31C survives after the amendment to the provision by the forty-second amendment was struck down in Minerva Mills. Second, the meaning of Article 39(b) and whether the phrase ‘material resources of the community’ includes privately owned resources. Third, whether the MHADA Act gives effect to the principles laid down in Article 39(b) and is protected by Article 31C. Fourth, in view of the decision in IR Coehlo, whether a challenge under Articles 14, 19 and 21 can continue to be mounted even if the Act is protected by Article 31C. Finally, the appellants have also filed their submissions challenging the constitutionality of specific provisions of Chapter VIII-Aof the MHADA Act on other grounds.

29. Eventually, during the course of the hearing, the counsel for the appellants fairly conceded that the last three issues may be argued before a regular bench after the present reference is answered. They urged that this Court, however, must determine the question about whether Article 31C survives in the Constitution as it was a central theme in the reference orders and also has a bearing on the interpretation of Article 39(b). We agree with this understanding.

30. In our considered view, although the seven-judge bench order does not directly refer the question regarding the survival of Article 31C to this bench of nine judges, it must form a part of our analysis for the following reasons: i. The issue about the survival or revival of Article 31C is intrinsically connected to the question of interpreting Article 39(b). If this Court concludes that Article 31C does not survive as part of the Constitution after the decision in Minerva Mills, no protection will be provided to the MHADA Act even if it has a nexus with the principles laid down in Article 39(b). Therefore, Property Owners Association & Ors. v. State of Maharashtra & Ors. 44 [2024] 11 S.C.R. ii. logically, in the context of this reference, this Court must first decide the question about the survival of Article 31C before adjudicating on the interpretation of Article 39(b). The question about the survival of 31-C has never been conclusively answered by this Court. The question was specifically referred to the bench of five judges in the three-judge bench order. However, the five-judge bench did not decide the question about the survival of Article 31-C and instead referred the case to a larger bench on the question of the interpretation of Article 39(b). Similarly, even the seven-judge bench did not answer the Article 31-C question and only referred the Article 39(b) question to this bench. Therefore, the 31-C question has remained unanswered. iii. Several judgements of this Court post-Minerva Mills have proceeded on the assumption that Article 31C (as upheld in Kesavananda Bharati) remains part of the Constitution. However, none of these decisions directly deals with the legal question of its survival. These decisions are addressed in further detail in Part C below. This Court must provide certainty on questions of law that have remained unanswered over prolonged periods of time, particularly, when the question has a direct bearing on the reference before it. In the event that this Court concludes that Article 31C is not revived, it will impact numerous legislations that have been protected by this provision. Therefore, it is incumbent on this Court to decide this significant constitutional question at the earliest occasion. A bench of nine judges is best suited to carry out this exercise and bring finality to this question of law. B. Issues

31. In view of the above, the scope of this judgment can be tied down to determining two issues: a. Article 31C: Whether Article 31C (as upheld in Kesavananda Bharati) survives in the Constitution after the amendment to the provision by the forty-second amendment was struck down by this Court in Minerva Mills; and b. Article 39(b): Whether the interpretation of Article 39(b) adopted by Justice Krishna Iyer in Ranganatha Reddy and followed in Sanjeev Coke must be reconsidered. Whether the phrase Digital Supreme Court Reports [2024] 11 S.C.R. 45 ‘material resources of the community’ in Article 39(b)can be interpreted to include resources that are owned privately and not by the state.

32. All other issues, including the constitutionality of the MHADA Act, are not being determined in the present judgment. Parties are at liberty to raise submissions on these issues before the regular bench that will decide the underlying appeal.

33. A Writ Petition challenging inter alia the standard rent provisions of the Bombay Rent Hotel and Lodging House Rates Control Act 1947 and the Maharashtra Rent Control Act 1999 has also been tagged with the underlying appeals.28 The petitioners contend that the provisions of these legislations contravene the decision of this Court in Malpe Vishwanath Acharya vs. State of Maharashtra.29 A determination of the constitutionality of these individual enactments does not form part of our analysis in this judgement and may be determined by a regular bench after this Court answers the present reference.

34. Further, several intervenors before this Court, including the State of West Bengal are parties to a pending batch of appeals before this Court relating to the constitutionality of the West Bengal Land Reforms Act 1955 and the amendments made to the Act in 1981 and 1986.30Akin to the declaration in the MHADA Act, the West Bengal Land Reforms Act 1955 also contains a declaration that it has been enacted to give effect to the “policy of the State towards securing the principle specified in Clauses (b) and (c) of Article 39 of the Constitution”. By an Order dated 17 July 2014, a three-judge Bench of this Court has referred several questions arising from these appeals to a Bench of five judges.31 On 26 February 2016, 28 Writ Petition No 660 of 1998. 29 [1997] Supp. 6 SCR 717 : (1998) 2 SCC 1 : 1997 INSC 831 30 Civil Appeal No. 16879 of 1996. 31 Questions referred: “a. Whether Article 300 A, which does not contain a provision like Article 31(2), would mandate payment of any amount as compensation for depriving of a person of his property under the authority of law? If yes, then what are the parameters of adjudging the principles for payment of amount or the amount fixed by the Acquiring Act as illusory? b. Whether the Constitutional Amendments inserting the amending Acts in the 9th Schedule would be violative of the Basic Structure of the Constitution and would therefore be open to challenge in the light of the judgment of this Hon’ble Court in I.R. Coelho (Dead by LRS) Vs. State of Tamil Nadu [(2007) 2 SCC 1] and therefore be liable to be struck down? c. Whether the Section 4-D inserted by the 1981 Amendment Act of the West Bengal Land Reforms Act, 1955 which prescribes the offences and penalties with retrospective effect from 07.08.1969 in the face of the prohibition contained in Article 20(1) of the Constitution of India is valid?” Property Owners Association & Ors. v. State of Maharashtra & Ors. 46 [2024] 11 S.C.R. the five-Judge Bench of this Court so constituted directed that these appeals be listed after the disposal of the underlying civil appeals in the present case. It is clarified that the intervenors have only been heard on the issues that arise from the reference before us. This judgement does not deal with the West Bengal Land Reforms Act 1955 or any other related enactment. A determination on the questions of law referred to the five-judge bench and adjudication of the constitutionality of the West Bengal Land Reforms Act 1955 will be carried out by appropriate benches of this Court. C. Article 31C i. Brief History of Article 31-C

35. Article 31-C provides statutes with immunity against constitutional challenges for alleged breaches of Articles 14 and 19 provided that the statutes give effect to the principles set out in clauses (b) or (c) of Article 39. Article 31-C represents a constitutionally sanctioned limitation on the operation of certain Part III rights insofar as they give effect to the Directive Principles contained in clauses (b) and (c) of Article 39.

36. When inserted into the Constitution in 1971, Article 31-C provided that no law giving effect to a State policy securing the principles set out in clauses (b) or (c) of Article 39 was void on the ground that it impermissibly abridged the rights conferred by Articles 14, 19, or 31. However, Article 31-C has been amended by Parliament and interpreted by this Court on several occasions. It is therefore necessary to clearly lay out the history of this constitutional provision before adverting to the current controversy concerning the provision. Article 31-C was inserted into the Constitution by Section 3 of the Constitution (Twenty-Fifth Amendment) Act, 1971. At the time of its inclusion in the Constitution, it read as follows: “31C. Saving of laws giving effect to certain directive principles. – Notwithstanding anything contained in article 13, no law giving effect to the policy of the State towards securing the principles specified in clause (b) or clause (c) of article 39 shall be deemed to be void on the ground that it is inconsistent with, or takes away or abridges any of the rights conferred by article 14, article 19 or article 31; and no law containing a declaration that it is for giving Digital Supreme Court Reports [2024] 11 S.C.R. 47 effect to such policy shall be called in question in any court on the ground that it does not give effect to such policy: Provided that when such law is made by the Legislature of a State, the provisions of this article shall not apply thereto unless such law, having been reserved for the consideration of the President, has received his assent.”

37. Article 31-C, along with Article 31-A, was challenged in Kesavananda Bharati v State of Kerala.32 In the decision in that case, a majority comprising of seven of the thirteen judges consisting of Justices KK Mathew, AN Ray, DG Palekar, HR Khanna, YV Chandrachud, MH Beg, and SN Dwivedi upheld the constitutional validity of the first part of Article 31-C which provided immunity from challenges under Article 14, Article 19, and Article 31 to laws giving effect to the Directive Principles set out in clauses (b) or (c) of Article 39.33 In the case of six of the Judges (Mathew, Ray, Palekar, Chandrachud, Beg, and Dwivedi JJ), this flowed from their reasoning that Parliament’s power to amend the Constitution was unbounded and courts could not judicially review the validity of a constitutional amendment even if it modified the application of fundamental rights. Justice Khanna, however, did not subscribe to the view that Parliament’s power to amend the Constitution was unlimited.34 Nonetheless, on an independent analysis of Article 31-C, Justice Khanna found that the first part of Article 31-C which immunised laws from Article 14, Article 19, and Article 31 challenges did not violate the basic structure of the Constitution.35

38. In Kesavananda Bharati, there also arose substantial disagreement concerning the second half of Article 31-C which stated that no law containing a declaration that the statute gave effect to a policy furthering the principles in clause (b) or (c) of Article 39 could be questioned by a court on the ground that it did not in fact give effect to such policy. A majority of seven judges consisting of Chief Justice SM Sikri, and Justices JM Shelat, AN Grover, KS Hegde, AK 32 33 34 35 [1973] Supp. 1 SCR 1 : (1973) 4 SCC 225 : 1973 INSC 91 Ibid [1035]-[1040], [1065] (Ray J); [1323], [1331], [1333] (Palekar J); [1518] (Khanna J); [1770]-[1771], [1787]-[1788] (Mathew J); [1855] (Beg J); [1995] (Dwivedi J); [2118] (Chandrachud J). Ibid [1537] (Khanna J). Ibid [1518] (Khanna J). Property Owners Association & Ors. v. State of Maharashtra & Ors. 48 [2024] 11 S.C.R. Mukherjea, P Jaganmohan Reddy, and HR Khanna found that the latter half of Article 31-C violated the basic structure and was therefore invalid.36 Thus, the final outcome of the decision in Kesavananda Bharati as concerns Article 31-C was that (i) the first half of Article 31-C granting immunity to laws enacted in furtherance of clauses (b) or (c) of Article 39 against challenges based on Articles 14,19 and 31 was valid; and (ii) the second half of Article 31-C excluding judicial review over whether a law in truth furthers the principles set out in clauses (b) or (c) of Article 39 was struck down. As Justice HR Khanna succinctly recorded in his conclusions: “1537. … (xiii) The first part of Article 31-C introduced by the Constitution (Twenty-fifth) Amendment Act is valid. The said part is as under: “31-C. Notwithstanding anything contained in Article 13, no law giving effect to the policy of the State towards securing the principles specified in clause (a) or clause (c) of Article 39 shall be deemed to be void on the ground that it is inconsistent with, or takes away or abridges any of the rights conferred by Article 14, Article 19 or Article 31: Provided that where such law is made by the legislature of a State, the provisions of this article shall not apply there to unless such law, having been reserved for the consideration of the President, has received this assent.” (xiv) The second part of Article 31-C contains the seed of national disintegration and is invalid on the following two grounds: (1) It gives a carte blanche to the legislature to make any law violative of Articles 14, 19 and 31 and make it immune from attack by inserting the requisite declaration. Article 31-C taken along with its second part gives in effect the power to the legislature including a State Legislature, to amend the Constitution in important respects. 36 Ibid [417]-[429] (Sikri CJ); [599]-[605] (Shelat and Grover JJ); [726]-[735] (Hedge and Mukhrejea); [1203]-1210] (Reddy J); [1530]-[1535-A] (Khanna J). Digital Supreme Court Reports [2024] 11 S.C.R. 49 (2) The legislature has been made the final authority to decide as to whether the law made by it is for the objects mentioned in Article 31-C. The vice of the second part of Article 31-C lies in the fact that even if the law enacted is not for the object mentioned in Article 31-C, the declaration made by the legislature precludes a party from showing that the law is not for the object and prevents a court from going into the question as to whether the law enacted is really for that object. The exclusion by the legislature, including a State Legislature, of even that limited judicial review strikes at the basic structure of the Constitution. The second part of Article 31-C goes beyond the permissible limit of what constitutes amendment under Article 368. The second part of Article 31-C can be severed from the remaining part of Article 31-C and its invalidity would not affect the validity of the remaining part. I would, therefore, strike down the following words in Article 31-C – “and no law containing a declaration that it is for giving effect to such policy shall be called in question in any court on the ground that it does not give effect to such policy.”

39. In essence, the second half of Article 31-C was severed from the first half and struck down. The second half of Article 31-C was thus no longer legally enforceable. What follows from the above conclusions is that after the decision in Kesavananda Bharati, Article 31-C ought to be read as follows: “31C. Saving of laws giving effect to certain directive principles. – Notwithstanding anything contained in article 13, no law giving effect to the policy of the State towards securing the principles specified in clause (b) or clause (c) of article 39 shall be deemed to be void on the ground that it is inconsistent with, or takes away or abridges any of the rights conferred by article 14, article Property Owners Association & Ors. v. State of Maharashtra & Ors. 50 [2024] 11 S.C.R. 19 or article 31; *[and no law containing a declaration that it is for giving effect to such policy shall be called in question in any court on the ground that it does not give effect to such policy:] Provided that when such law is made by the Legislature of a State, the provisions of this article shall not apply thereto unless such law, having been reserved for the consideration of the President, has received his assent.” *No longer enforceable after Kesavananda Bharati

40. Subsequently, Article 31-C was further amended by the Constitution (Forty-second Amendment) Act, 1976 (“Forty-Second Amendment”). By Section 4 of this Act, the words “the principles specified in clause (b) or clause (c) of article 39” were replaced with the words “all or any of the principles laid down in Part IV.” The effect of the Forty- Second Amendment was that Article 31-C was amended as follows: “31C. Saving of laws giving effect to certain directive principles. – Notwithstanding anything contained in article 13, no law giving effect to the policy of the State towards securing *[all or any of the principles laid down in Part IV the principles specified in clause (b) or clause (c) of article 39] shall be deemed to be void on the ground that it is inconsistent with, or takes away or abridges any of the rights conferred by article 14, article 19 or article 31; **[and no law containing a declaration that it is for giving effect to such policy shall be called in question in any court on the ground that it does not give effect to such policy:] Provided that when such law is made by the Legislature of a State, the provisions of this article shall not apply thereto unless such law, having been reserved for the consideration of the President, has received his assent.” *Substitution effected by the Forty-Second Amendment ** No longer enforceable after Kesavananda Bharati Shortly thereafter, Article 31-C was once again amended by Section 8 of the Constitution (Forty-fourth Amendment) Act, 1978. This amendment removed reference to Article 31 of the Constitution contained in Article 31-C. This was a logical corollary to the omission of Digital Supreme Court Reports [2024] 11 S.C.R. 51 Article 31 itself from the Constitution. As Article 31 had been removed from the Constitution, it was no longer necessary that Article 31-C provide legislation with immunity from Article 31 challenges. Thus, after the Constitution (Forty-fourth Amendment) Act, 1978, Article 31-C read as follows: “31C. Saving of laws giving effect to certain directive principles. – Notwithstanding anything contained in article 13, no law giving effect to the policy of the State towards securing *[all or any of the principles laid down in Part IV the principles specified in clause (b) or clause (c) of article 39] shall be deemed to be void on the ground that it is inconsistent with, or takes away or abridges any of the rights conferred by article 14, [or] article 19 **[or article 31]; ***[and no law containing a declaration that it is for giving effect to such policy shall be called in question in any court on the ground that it does not give effect to such policy:] Provided that when such law is made by the Legislature of a State, the provisions of this article shall not apply thereto unless such law, having been reserved for the consideration of the President, has received his assent.” *Substitution effected by the Forty Second Amendment **Omission by Forty Forth Amendment *** No longer enforceable after Kesavananda Bharati The amendment to Article 31-C by Section 8 of the Constitution (Forty- fourth Amendment) Act, 1978 and its legal effect are not in dispute.

41. The amendment to Article 31-C by Section 4 of the Forty-Second Amendment was challenged in Minerva Mills v Union of India.37 The petitioners had challenged the Sick Textile Undertakings (Nationalisation) Act, 1974, and the order dated 19 October 1971 nationalising their business. However, at the time of the challenge, the impugned legislation had already been inserted into the Ninth Schedule of the Constitution. Thus, to secure the ultimate relief of 37 [1981] 1 SCR 206 : (1980) 3 SCC 625 : 1980 INSC 142 Property Owners Association & Ors. v. State of Maharashtra & Ors. 52 [2024] 11 S.C.R. reversing the nationalisation, the petitioners in Minerva Mills also challenged the thirty-ninth amendment to the Constitution which had inserted the impugned legislation into the Ninth Schedule of the Constitution and Section 55 of the Forty-Second Amendment which modified Article 368 to exclude constitutional amendments from judicial review. As part of this broader challenge, the petitioners in Minerva Mills also separately challenged Section 4 of the Forty- Second Amendment on the ground that the amendment to Article 31-C violated the basic structure of the Constitution. Parallel to the Constitution Bench proceedings in Minerva Mills, a separate Constitution Bench heard the challenge to the Maharashtra Agricultural Lands (Ceiling on Holdings) Act, 1961 in Waman Rao v Union of India.38 Although Chief Justice YV Chandrachud and Justice PN Bhagwati sat on both Constitution Benches (and indeed Justice Bhagwati authored a common opinion for both cases), the remaining three judges on both Constitution Benches were different and the two cases dealt with separate issues. In Waman Rao, the petitioners sought to assail the unamended portion of Article 31-C. We shall advert to the decision in Waman Rao shortly, but at present, it is sufficient to note that in Minerva Mills, the Constitution Bench decided the validity of the changes wrought to Article 31-C by the Forty-Second Amendment while in Waman Rao, the Constitution Bench dealt with arguments concerning the validity of Article 31-C as it stood prior to the Forty-Second Amendment. This is clarified by the observation of Chief Justice YV Chandrachud, speaking for the majority in Minerva Mills, where he noted: “24. … Mr. Palkhivala did not challenge the validity of the unamended Article 31-C, and indeed that could not be done. The unamended Article 31-C forms the subject- matter of a separate proceeding and we have indicated therein that it is constitutionally valid – to the extent to which it is upheld in Kesavananda Bharati.” The separate proceedings that the learned Chief Justice was adverting to were those in Waman Rao. It is also worth referring to the opinion of Justice PN Bhagwati (as he then was) in the decision 38 [1981] 2 SCR 1 : (1981) 2 SCC 362 Digital Supreme Court Reports [2024] 11 S.C.R. 53 of Minerva Mills. Justice Bhagwati authored a common judgment for both the decisions in Minerva Mills and Waman Rao. In his common judgment he stated: “84. Now, in Wamanrao case the broad argument of Mr Phadke on behalf of the petitioners […] that the fundamental rights enshrined in Articles 14 and 19 form the basic structure of the Constitution and therefore Article 31-A, Article 31-B read with Ninth Schedule and the unamended Article 31-C insofar as they exclude the applicability of Articles 14 and 19 to certain kinds of legislation emasculate those fundamental rights and thereby damage the basic structure of the Constitution… […] The argument of Mr. Palkhivala on behalf of the petitioners in the Minerva Mills case was a little different. He too attacked the vires of clause (4) and 5) of Article 368 since they barred at the threshold any challenge against the constitutional validity of the amendment made in Article 31-C but so far as Article 31-A, Article 31-B and the unamended Article 31-C were concerned, he did not dispute their validity and, as pointed out by us earlier, he conceded and in fact gave cogent reasons showing that they were constitutionally valid. His only attack was against the validity of the amendment made in Article 31-C by Section 4 of the Constitution (Forty-second Amendment) Act, 1976 and he contended that this amendment, by making the directive principles supreme over the fundamental rights, damaged or destroyed the basic structure of the Constitution….” (emphasis supplied) The opinion of Justice PN Bhagwati clearly delineates the scope of the contentions, and consequently the decisions in Minerva Mills and Waman Rao. In the former case, the amendment to Article 31-C, which expanded the scope of immunity provided to legislation, was challenged. In the latter case, the petitioners sought to challenge the unamended Article 31-C that had already been partly upheld and partly invalidated in Kesavananda Bharati. Property Owners Association & Ors. v. State of Maharashtra & Ors. 54 [2024] 11 S.C.R.

42. The Constitution Bench of five judges of this Court in Minerva Mills invalidated Section 4 of the Forty-Second Amendment.39 Chief Justice YV Chandrachud, speaking for the majority held: “58. … On any reasonable interpretation, there can be no doubt that by the amendment introduced by Section 4 of the 42nd Amendment, Articles 14 and 19 stand abrogated at least in regard to the category of laws described in Article 31-C. The startling consequence which the amendment has produced is that even if a law is in total defiance of the mandate of Article 13 read with Articles 14 and 19, its validity will not be open to question so long as its object is to secure a directive principle of State policy. […] A large majority of laws, the bulk of them, can at any rate be easily justified as having been passed for the purpose of giving effect to the policy of that State towards securing some principle or the other laid down in Part IV. In respect of such laws, which will cover an extensive gamut of the relevant legislative activity, the protection of Articles 14 and 19 will stand wholly withdrawn…” Chief Justice YV Chandrachud noted that the amendment to Article 31-C provided immunity to a sweeping range of legislation and the threshold for availing of such immunity was remarkably low. This severely undermined the protections granted to citizens by Articles 14 and 19. This reasoning led the majority in Minerva Mills to conclude that: “75.…Section 4 of the Constitution (Forty-second Amendment) Act is beyond the amending power of the Parliament and is void since it damages the basic or essential features of the Constitution and destroys its basic structure to the total exclusion of challenge to any law on the ground that it is inconsistent with, or takes away or abridges any of the rights conferred by Article 14 or Article 19 of the Constitution, if the law is for giving effect to the policy of the State towards securing all or any of the principles laid down in Part IV of the Constitution.” 39 Minerva Mills [75] (Chandrachud CJ). Digital Supreme Court Reports [2024] 11 S.C.R. 55 Before examining the legal effect of the Minerva Mills decision on Article 31-C, we may briefly advert to the decision in Waman Rao which was delivered four months after the decision in Minerva Mills. As noted above, the Constitution Bench in Waman Rao was faced with arguments that the unamended Article 31-C was also unconstitutional.

43. The petitioners in Waman Rao challenged the Maharashtra Lands (Ceiling on Holdings) Act, 1961 which had been placed in the Ninth Schedule of the Constitution. The respondents relied on Articles 31A, 31B, and 31C to contend that the impugned legislation was immunised from constitutional challenges grounded in Articles 14 and 19. In response to this defence, the petitioners contended that the aforementioned constitutional provisions were themselves unconstitutional and assailed the constitutional amendments which inserted them into the Constitution. In doing so, the petitioners challenged Article 31-C (as it stood prior to the Forty-Second Amendment). To obviate the precedent in Kesavananda Bharati, where the vires of Article 31-C had already been disputed and arguably settled, the petitioners in Waman Rao contended that no clear holding concerning Article 31-C was discernible from the numerous opinions in Kesavananda Bharati. The Constitution Bench in Waman Rao rejected this contention. Chief Justice YV Chandrachud, speaking for the majority, held: “53. Shri M.N. Phadke, who led the argument on behalf of the petitioners, built a formidable attack against the vires of Article 31-C. But, with respect to the learned counsel, the effort is fruitless because the question as regards the validity of Article 31-C is no longer res integra. The opening clause of Article 31-C was upheld by the majority in Kesavananda Bharati and we do not quite see how the petitioners can be permitted to go behind this decision. […] It is well known that six learned Judges who were in minority in Kesavananda Bharati upheld the first part of Article 31-C, which was a logical and inevitable consequence of Parliament’s power to amend the Constitution. Khanna, J. did not subscribe to that view but, all the same, he upheld the first part of Article 31-C for different reasons. The question of the validity of the Twenty-fifth Amendment by which the unamended Article 31-C was introduced Property Owners Association & Ors. v. State of Maharashtra & Ors. 56 [2024] 11 S.C.R. into the Constitution was specifically raised before the court and the arguments in that behalf were specifically considered by all the six minority Judges and by Khanna, J. It seems to us difficult, in these circumstances, to hold that no common ratio can be culled from the decision of the majority of the seven judges who upheld the validity of Article 31-C. Putting it simply, there is no reason why simple matters should be made complicated, the ratio of the majority judgements in Kesavananda Bharati is that the first part of Article 31-C is valid.” The majority of the Constitution Bench in Waman Rao ultimately held that: “68. … (3) Article 31-C of the Constitution, as it stood prior to its amendment by Section 4 of the Constitution (42nd Amendment) Act, 1976, is valid to the extent to which its constitutionality was upheld in Kesavananda Bharati. Article 31-C, as it stood prior to the Constitution (42nd Amendment) Act does not damage any of the basic or essential features of the Constitution or its basic structure….” The decision in Waman Rao upheld the validity of Article 31-C (as it stood prior to the Forty-Second Amendment) insofar as it had already been upheld in Kesavananda Bharati.

44. To sum up, the decision in Kesavananda Bharati upheld the first half of Article 31-C to the extent that it provided immunity to statutes from Article 14 and Article 19 challenges if they gave effect to the principles in clause (b) or clause (c) of Article 39. The decision in Kesavananda Bharati also struck down the second half of Article 31-C which prevented judicial review of whether a law in fact gave effect to these principles. The decision in Minerva Mills invalidated Section 4 of the Forty-Second Amendment which expanded the scope of the immunity provided by Article 31-C from laws giving effect to the principles in clause (b) or clause (c) of Article 39 to laws giving effect to any Directive Principle. The decision in Waman Rao, which concerned Article 31-C prior to the Forty-Second Amendment, reiterated the position set out in Kesavananda Bharati, that the first half of the unamended Article 31-C was constitutionally valid and the second half was not. Digital Supreme Court Reports [2024] 11 S.C.R. 57

45. ii. The present dispute concerning Article 31-C and rival contentions It is here that the present controversy concerning Article 31-C arises. Both the appellants and the respondents before us accept that after the decision in Minerva Mills, the words “all or any of the principles laid down in Part IV” in Article 31-C are legally unenforceable. But this is where the agreement ends. In the respondents’ view, the consequence of Minerva Mills invalidating these words is that the words that existed in Article 31-C prior to the Forty-Second Amendment stand revived. In other words, as the Forty-Second Amendment has been struck down by the Court, Article 31-C will now read as it did after the decision in Kesavananda Bharati but prior to the Forty-Second Amendment. The Respondents submit that after Minerva Mills, Article 31-C should be read as follows: “31C. Saving of laws giving effect to certain directive principles. – Notwithstanding anything contained in article 13, no law giving effect to the policy of the State towards securing [all or any of the principles laid down in Part IV] the principles specified in clause (b) or clause (c) of article 39 shall be deemed to be void on the ground that it is inconsistent with, or takes away or abridges any of the rights conferred by article 14, article 19 or article 31; and no law containing a declaration that it is for giving effect to such policy shall be called in question in any court on the ground that it does not give effect to such policy:” In contrast to this, the appellants submit that since the words “the principles specified in clause (b) or clause (c) of Article 39” were omitted by the Forty-Second Amendment and substituted with different words, the invalidation of the substituted words by the Minerva Mills decision cannot revive words specifically omitted by Parliament. Thus, in the view of the appellants, Article 31-C reads as follows: “31C. Saving of laws giving effect to certain directive principles. – Notwithstanding anything contained in article 13, no law giving effect to the policy of the State towards securing [all or any of the principles laid down in Part IV] the principles specified in clause (b) or clause (c) of article 39 shall be deemed to be void on the ground that it is Property Owners Association & Ors. v. State of Maharashtra & Ors. 58 [2024] 11 S.C.R. inconsistent with, or takes away or abridges any of the rights conferred by article 14, article 19 or article 31; and no law containing a declaration that it is for giving effect to such policy shall be called in question in any court on the ground that it does not give effect to such policy:” The appellants acknowledge that such an interpretation would effectively render the protection granted to legislation by Article 31-C nugatory. However, this is not an inadvertent consequence of the appellants’ argument but rather a central plank. It is their case that after the decision in Minerva Mills, Article 31-C may no longer be relied on to immunise legislation, even if such legislation can be justified as giving effect to the principles specified in clause (b) or clause (c) of Article 39. Thus, the tests of Articles 14 and 19 would be unequivocally applicable even to such legislations. The contentions and interpretation advanced by the appellants have significant ramifications not only for the legislations impugned in the underlying appeals before us but also for countless others whose constitutional validity is dependent on the immunity provided by Article 31-C.

46. At its core, the present dispute concerns whether the text of Article 31-C as it stood prior to the Forty-Second Amendment can continue to be given legal effect after the Court in Minerva Mills invalidated Section 4 of the Forty-Second Amendment. The appellants contended that the unamended Article 31-C (as it stood prior to the Forty-Second Amendment) does not automatically revive after the decision in Minerva Mills. Mr Zal Andhyarujina, learned senior counsel and Mr Sameer Parekh, learned counsel represented the appellants. Their position was supported by Ms Uttara Babbar, learned senior counsel for one of the intervenors. The argument may be briefly summarised as follows: (i) The act of substitution by the Forty-Second Amendment consists of two steps, first the old provision is erased and next, the new provision is inserted. After the new provision is inserted, the old text ceases to exist and cannot be given legal effect. This was described as the “pen and ink” theory. Thus, even if Minerva Mills invalidated the amended text, the judgement’s effect was only to stop the inserted text from being enforced and a judicial order cannot reverse the first step of erasure. Only a legislature can modify words in a statute. As a result, Digital Supreme Court Reports [2024] 11 S.C.R. 59 after Minerva Mills, the words erased by the Forty-Second Amendment do not revive and the unamended Article 31-C cannot be given effect to. (ii) Further, when a court declares a law to be unconstitutional, this declaration does not repeal the law from the statute books, it merely renders it legally unenforceable. Only the legislature can add or repeal the text from the statute books. Thus, the decision in Minerva Mills only renders the amended text of Article 31-C unenforceable and cannot repeal the Forty-Second Amendment in totality or reinstate the unamended Article 31-C.

47. Mr R Venkatramani, learned Attorney General for India and Mr Tushar Mehta, learned Solicitor General of India, representing the respondents, countered the above understanding. Their position was supported by Mr Rakesh Dwivedi and Mr Gopal Sankarnarayan, learned senior counsel appearing for the intervenors. Their arguments may be briefly summarised as follows: (i) When an amendment is set aside, the entire legal effect of the amendment is invalidated and thus the text preceding the amendment will be restored. There are no distinct steps of erasure and insertion. All the stages of the Forty-Second Amendment stand cumulatively negated by the decision in Minerva Mills; (ii) When exercising basic structure scrutiny, this Court grounds its reasoning in the relationship between the unamended provision and the amended provision and the impact the amendment has on the Constitution. If the Court finds an amendment impermissible and invalidates it, the position as it stood prior to the amendment must stand revived for the basic structure theory to have effect. If the invalidation of an amendment by the Court led to some third result, where the insertion was invalidated but the erased text did not revive, this would not result in a return to the unamended Constitution but some third uncontemplated result which may itself violate the basic structure. Thus, the revival of the unamended constitutional provision is the approach consistent with the theoretical foundation of basic structure review; Property Owners Association & Ors. v. State of Maharashtra & Ors. 60 [2024] 11 S.C.R. (iii) The decision of a Constitution Bench of this Court in Supreme Court Advocates-On-Record Association v Union of India40 squarely covers the present scenario and holds that when a constitutional amendment is struck down, the position that existed prior to the amendment stands revived; (iv) This Court in the decisions in Maharao Sahib Shri Bhim Singhji v Union of India,41 Sanjeev Coke and Basantibal Khetan has repeatedly held that Article 31-C as it stood prior to the Forty-Second Amendment is operative; and (v) If the words struck down by Minerva Mills relating to clauses (b) and (c) of Article 39 were omitted by judicial fiat from Article 31-C, the entire provision would be unworkable despite this precise text of Article 31-C having been upheld by thirteen judges in Kesavananda Bharati and the constitutional validity of the provision having been reaffirmed in Waman Rao. Before delving further into our analysis, we may briefly advert to the decisions relied on by the Respondents where this Court has applied Article 31-C after the decision in Minerva Mills. If these decisions provide a cogent answer as to the status of Article 31-C after Minerva Mills, our inquiry need not go any further.

48. In Bhim Singh, a Constitution Bench of this Court upheld the Urban Land (Ceiling and Regulation) Act, 1976 on the ground that the Act gave effect to the Directive Principles in clauses (b) and (c) of Article 39 of the Constitution. The impugned legislation in Bhim Singh sought to inhibit the concentration in ownership of urban land and was inter alia challenged on the ground that it was not in furtherance of clause (b) or (c) of Article 39 and thus not protected under Article 31-C. Rejecting this submission, Chief Justice YV Chandrachud, speaking for himself and Justice PN Bhagwati held: “1. We have perused the judgement prepared by Brother Tulzapurkar with care but, with respect, we are unable to agree with him that the Urban Land (Ceiling and Regulation) Act, 33 of 1976, does not further the Directive Principles of State Policy in clauses (b) and (c) of Article 39 of the 40 41 [2015] 13 SCR 1 : (2016) 5 SCC 1 : 2015 INSC 285 [1985] Supp. 1 SCR 862 : (1981) 1 SCC 166 : 1980 INSC 219 Digital Supreme Court Reports [2024] 11 S.C.R. 61 Constitution. The vice from which a provision here or a provision there of the impugned Act may be shown to suffer will not justify the conclusion that the Act is not intended to or does not, by its scheme, in fact implement or achieve the purpose of clause (b) and (c) of Article 39.”42 Justice Krishna Iyer, concurring with Chief Justice Chandrachud and Justice Bhagwati and thus forming a majority in Bhim Singh, held: “16-A. … The purpose of the enactment, garnered from the preamble, is to set a ceiling on vacant urban land, to take over the excess and to distribute it on a certain basis of priority. The whole story of the legislation, the long gestation of pre-legislative consideration, the brooding presence of Article 39(b) and (c) and the emphasis in Section 23(4) on common good as the guiding factor for distribution point to public purpose, national development and social justice as the cornerstone of the policy of distribution…”43 The decision in Bhim Singh was delivered after that in Minerva Mills. The majority opinions in Bhim Singh proceeded on the basis that the text of Article 31-C stood as it had prior to the Forty-Second Amendment to the Constitution. In other words, the judges began their analysis with the presumption that the Union could rely on Article 31-C and that the appropriate test under Article 31-C was whether the legislation in question furthered the principles set out in clauses (b) or (c) of Article 39. If the Court had adopted the present appellants’ interpretation of Article 31-C, they could not have proceeded on this basis because according to the appellants, references to clauses (b) or (c) of Article 39 are deemed to be omitted from Article 31-C after the Forty-Second Amendment and Minerva Mills. While the decision in Bhim Singh would fortify the position of the present respondents, the judgment does not provide any rationale as to how and why the text of the unamended Article 31-C stood revived.

49. In Sanjeev Coke, a challenge was brought to various legislations including the Coking Coal Mines (Emergency Provisions) Act, 1971 which vested the management of coking coal mines and coke oven 42 Maharao Sahib Shri Bhim Singhji v Union of India 1981 (1) SCC 166 [1] (Chandrachud CJ). 43 Maharao Sahib Shri Bhim Singhji v Union of India 1981 (1) SCC 166 [16-A] (Krishna Iyer J). Property Owners Association & Ors. v. State of Maharashtra & Ors. 62 [2024] 11 S.C.R. plants with the State, the Coking Coal Mines (Nationalisation) Act, 1972 which resulted in the nationalisation of certain coking coal mines, the Coal Mines (Taking Over of Management) Act, 1973 and finally the Coal Mines (Nationalisation) Act, 1973 which together resulted in nationalisation of all coal mines irrespective of whether they were a coking coal mine or not. The petitioners in Sanjeev Coke argued that the State had discriminated between certain coke oven plants and their coke oven plants. In response, the Union Government contended that the legislations were immunised against an Article 14 challenge as they were protected by Article 31-C. The majority opinion in Sanjeev Coke raised certain concerns regarding the reasoning in Minerva Mills but observed that as a review petition against Minerva Mills was pending before the Court, it was not appropriate to examine this issue further.44 Nonetheless, in the ultimate analysis of the petitioners’ arguments, Justice Chinnappa Reddy speaking for the Constitution Bench in Sanjeev Coke, held: “17. We are firmly of the opinion that once Article 31-C comes in Article 14 goes out. There is no scope for bringing in Article 14 by a side wind as it were, that is, by equating the rule of equality before the law of Article 14 with the broad egalitarianism of Article 39(b) or by treating the principle of Article 14 as included in the principle of Article 39(b).To insist on nexus between the law for which protection is claimed and the principle of Article 39(b) is not to insist on fulfilment of the requirement of Article 14. They are different concepts and in certain circumstances, may even run counter to each other. That is why the need for the immunity afforded by Article 31-C. Indeed there are bound to be innumerable cases where the narrower concept of equality before the law may frustrate the broader egalitarianism contemplated by Article 39(b)….” “18. The next question for consideration is whether the Coking Coal Mines (Nationalisation) Act is a law directing the policy of the State towards securing “that the ownership and control of the material resources of the community are so distributed as best to subserve the common good”…” 44 Sanjeev Coke [10]-[13] (Chinnappa Reddy J). Digital Supreme Court Reports [2024] 11 S.C.R. 63 As in the decision in Bhim Singh, the above paragraphs evince that the Constitution Bench in Sanjeev Coke proceeded on the basis that Article 31-C was operative and that it ought to be interpreted as it stood prior to the Forty-Second Amendment. The Court noted that once an Article 31-C defence is claimed, Article 14 cannot be resorted to if there is a nexus between the law and the aims set out in clause (b) and clause (c) of Article 39. The explicit references to Articles 31-C and 39(b) demonstrate that the Court proceeded on the basis that the protection afforded to legislations by Article 31-C continued to operate after Minerva Mills. However, as with Bhim Singh, the decision in Sanjeev Coke offers no explanation as to the exact legal mechanics which lead to the continued legal operation of the unamended Article 31-C. Thus, these decisions leave unaddressed the contentions raised by the present appellants. It is also pertinent to refer to the approach of the two-judge Bench of this Court in Basantibal Khetan. In that case, Special Leave Petitions were filed against the judgement of the High Court of Judicature at Bombay invalidating certain provisions of the MHADA Act which permitted the acquisition of private property. It was contended that the provisions of the legislation which set out the basis for determining compensation were violative of Articles 14 and 19 of the Constitution. In invalidating these provisions, the High Court held that the impugned provisions were not protected by Article 31-C of the Constitution and were violative of Article 14. However, when the matter was heard by a Division Bench of this Court, Justice ES Venkataramiah (as the learned Chief justice then was) held that the law would be entitled to immunity under Article 31-C. The learned judge observed:

50. “13. Even granting for purpose of argument that sub- sections (33) and (4) of Section 44 are violative of Article 14 of the Constitution, we are of the view that the said provisions receive the protection of Article 31-C of the Constitution. […] Let us proceed on the basis that after Kesavananda Bharati v. State of Kerala and Minerva Mills Ltd. v. Union of India, Article 31-C reads as: “Notwithstanding anything contained in Article 13, no law giving effect to the policy of the State towards securing the principles specified in clause (b) or clause (c) of Article 39 shall be deemed to be void on the Property Owners Association & Ors. v. State of Maharashtra & Ors. 64 [2024] 11 S.C.R. ground that it is inconsistent with or takes away or abridges any of the rights conferred by Article 14 or Article 19.” Clause (b) or Article 39 of the Constitution which is relevant for our purpose states that the State shall, in particular, direct its policy towards securing that the ownership and control of material resources of the community are so distributed as best to subserve common good. […]

14. … The High Court erred in taking a very narrow view of the objects of the Act and the functions of the Authority under it. We are satisfied that the Act is brought into force to implement the Directive Principle contained in Article 39(b) and hence even if there is any infraction of Article 14 it is cured by Article 31-C which is clearly attracted to the case.” The extracted paragraphs demonstrate that the Division Bench explicitly proceeded on the basis that the unamended Article 31-C had revived and was in legal effect. The two-Judge Bench cited both the decisions in Kesavananda Bharati and Minerva Mills. It concluded that after Kesavananda Bharati, the second half of Article 31-C was no longer in effect. It also concluded that after Minerva Mills struck down the Forty-Second Amendment, the text of Article 31-C as it stood prior to the Forty-Second Amendment stood revived. This approach would support the arguments of the respondents concerning the interpretation of Article 31-C. However, like the decisions in Bhim Singh and Sanjeev Coke, no argument was raised that the unamended Article 31-C did not automatically revive absent legislative intervention and the two-judge Bench has proceeded on an assumption that the unamended Article 31-C is enforceable.

51. In the above decisions interpreting Article 31-C, this Court has consistently taken the position that Article 31-C, as it stood prior to the Forty-Second Amendment, has legal effect and can be invoked to defend legislations against Article 14 and Article 19 challenges. However, as the appellants correctly point out, no jurisprudential explanation has been provided for why this is the case and, in most Digital Supreme Court Reports [2024] 11 S.C.R. 65 decisions, this Court has assumed that Article 31-C continues to have legal effect. In light of the specific contentions raised by the appellants in the present case, and the significant consequences flowing from the appellants’ arguments, this Court must examine the constitutional question of whether, after Minerva Mills invalidated the Forty-Second Amendment, the text of the unamended Article 31-C can be enforced. iii. Precedents concerning invalidation of amendments

52. The first decision which the appellants relied on was Shamarao Parulekar v District Magistrate, Thana.45 The case concerned the Preventive Detention Act, 1950 which at the time was scheduled to expire on 1 April 1952. A few months prior to this, on 15 November 1951, the petitioner (Shamarao) was detained. However, the statute was subsequently amended to extend its lifespan by six months till 1 October 1952. Shamarao contended that the extension of the Act could not extend his detention past 1 April 1952, when the Act was originally scheduled to expire. Justice Vivian Bose, speaking for a Constitution bench of this Court observed that the amendment to the Preventive Detention Act, 1950 expressly stated that detention orders shall remain in force “so long as the principal Act is in force” and “principal Act” had been defined as the 1950 Act. The learned Judge went on to explain: “7. … The rule is that when a subsequent Act amends an earlier one in such a way as to incorporate itself, or a part of itself, into the earlier, then the earlier Act must thereafter be read and construed (except where that would lead to a repugnancy, inconsistency or absurdity) as if the altered words had been written into the earlier Act with pen and ink and the old words scored out so that thereafter there is no need to refer to the amending Act at all. This is the rule in England [citation omitted]; it is the rule in America [citation omitted] and it is the law which the Privy Council applied in India in Keshoram Poddar v. Nundo Lal Mallick. Bearing this in mind it will be seen that the 1950 Act remains the 1950 Act all the way through even with its subsequent amendments. Therefore, the moment the 1952 Act was 45 [1952] 1 SCR 683 : 1952 (2) SCC 1 : 1952 INSC 63 Property Owners Association & Ors. v. State of Maharashtra & Ors. 66 [2024] 11 S.C.R. passed and Section 2 came into operation, the Act of 1950 meant the 1950 Act as amended by Section 2, that is to say, the 1950 Act now due to expire on 1-10-1952.” The decision in Shamarao Parulekar outlines the “Pen and Ink” theory advocated by the appellants. When an amending statute effectuates a substitution, it modifies the original statutory text by omitting certain words and inserting certain other words. After the amending Act, the statute must be read to exclude the omitted words and to include the inserted words. The appellants rely on Shamarao Parulekar to highlight that a court cannot give effect to the omitted words after they have been removed by the amending Act. This rule is subject to certain well-recognised exceptions (such as in respect of rights which have been created under the original statutory text and limitations on the retrospective operation of laws). The exceptions are not of concern to us presently. However, the appellants argue that Shamarao Parulekar represents an authority for the proposition that after the Forty-Second Amendment, the words “the principles specified in clause (b) or clause (c) of article 39” can no longer be enforced as they were omitted by a constitutional amendment. However, the decision in Shamarao Parulekar is not strictly applicable to the present situation as it did not deal with the legal effect of the amending act itself being declared void. While the decision undoubtedly lays down the correct position of law where a valid amendment is enacted, it offers no insight into whether a court can give effect to the words omitted by an amendment if the amendment is declared unconstitutional. In such cases, do the omitted words revive? This question is not answered by Justice Bose in Shamarao Parulekar for the amendment to the Preventive Detention Act was not invalidated.

53. The Appellants next placed significant emphasis on the decision in ATB Mehtab Majid v State of Madras.46 The case concerned a challenge to Rule 16 of the Madras General Sales Tax (Turnover and Assessment) Rules, 1939. Rule 16 had been amended to include a proviso which resulted in the differential taxation of tanned hides based on whether they had been tanned within the state of Madras or outside the state. When the issue reached this Court, it 46 [1963] Supp. 2 SCR 435 : (1963) 14 STC 355 : 1962 INSC 342 Digital Supreme Court Reports [2024] 11 S.C.R. 67 was observed that under the amended Rule 16, a dealer who both purchased the untanned hides and tanned them within the State, was only required to pay the duty on the purchase price but a dealer who purchased the untanned hides from outside the state and tanned them within the state, would be liable to pay sales tax on the sale price of the tanned hides, which was substantially higher.47 Speaking for a Constitution Bench of this Court, Justice Raghubar Dayal, struck down the amended Rule 16 as violative of Article 304(a) of the Constitution on the following terms: “We are therefore of the opinion that the provisions of rule 16(2) discriminate against imported hides or skins which had been purchased or tanned outside the State and that therefore they contravene the provisions of Article 304(a) of the Constitution. It has been urged for the respondent that if the impugned rule be held invalid, old rule 16 gets revived and that the tax assessed on the petitioner will be good. We do not agree. Once the old rule has been substituted by the new rule, it ceases to exist and it does not automatically get revived when the new rule is held to be invalid.”48 The Court in ATB Mehtab Majid found that when an amendment to a rule is invalidated by a court, the old rule does not revive. It draws on the underlying rationale of the Shamarao Parulekar decision in that once a rule is substituted, it ceases to have any legal force and cannot be given legal effect. Hence, the Court held that if the amendment is found to be unconstitutional, the unamended text does not revive and cannot be enforced. While the decision does support the argument of the appellants, that the unamended text of Article 31-C does not revive, the judgement does not elaborate on why the pre-existing rule does not revive. Thus, the decision is of no more assistance to us than the decisions in Bhim Singh and Sanjeev Coke which, without providing detailed reasons, found that Article 31-C stood revived. 47 ATB Mehtab Majid v State of Madras 1963 14 STC 355. 48 ATB Mehtab Majid v State of Madras 1963 14 STC 355. Property Owners Association & Ors. v. State of Maharashtra & Ors. 68 [2024] 11 S.C.R.

54. However, further elucidation on the view in ATB Mehtab Majid is found in Koteswar Vittal Kamath v Rangappa Baliga.49 The decisions has its roots in a contractual dispute where the appellants contended that the contracts in question were forward contracts and void considering the prohibition on forward contracts in the Travancore-Cochin Vegetable Oils and Oil cakes (Forward Contracts Prohibition) Order, 1950. The respondents in the case alleged that the 1950 Prohibition Order was unenforceable as it was passed under a law that had since been repealed. After tracing the history of the relevant legislation, a three-judge bench of this Court observed that the 1950 Prohibition Order was potentially still in force due to the Section 73(2) of the Travancore-Cochin Public Safety Measures Act, 1950, which stipulated that orders passed under certain repealed legislations continued in force.50 However, the respondents in the case raised a secondary contention that the state legislature of Travancore was not competent to enact the Public Safety Measures Act, 1950 because Parliament had the exclusive power to legislate on the issue of stock exchanges and forward contracts under Entry 48 of List I of the Seventh Schedule of the Constitution. Justice Bhargava, speaking for a three-Judge Bench of this Court opined that this contention was not relevant for the following reasons: “7. … if it be held that the State Government could not competently pass the Prohibition Order, 1950, because it was a piece of legislation on Forward Contracts, that Order would be treated as void and non-est. Thereupon, the earlier Prohibition Order 1119, would continue in force right up to 30th March, 1950. […] When the Prohibition Order of 1950, was purported to be issued on 8th March, 1950, it was not laid down that it was being issued so as to supersede the earlier Prohibition Order of 1119. If it had been a valid Order, it would have covered the same field as the Prohibition Order of 1119, and, consequently, would have been the effective Order under which the rights and obligations of parties have to be governed. On the other hand, if it be held to be void, this Order will not have the effect of superseding the earlier Order of 1119.” 49 50 [1969] 3 SCR 40 : (1969) 1 SCC 255 : 1968 INSC 335 Ibid [4] (Bhargava J). Digital Supreme Court Reports [2024] 11 S.C.R. 69 Justice Bhargava observed that even if the 1950 Prohibition Order was held to be void, the consequence would merely be that the parties would have been governed by the earlier Prohibition Order 1119. Justice Bhargava held that if the later Order was found to be void, it would “not have the effect of superseding the earlier Order.”51 The learned Judge went on to distinguish the decision in ATB Mehtab Majid in the following manner: “7. … Learned counsel for the respondent, however, urged that the Prohibition Order of 1119, cannot, in any case, be held to have continued after 8th March, 1950, if the principle laid down by this Court in Firm A.T.B. Mehtab Majid & Co. v. State of Madras is applied…. […]

8. On that analogy, it was argued that, if we hold that the Prohibition Order of 1950, was invalid, the previous Prohibition Order of 1119, cannot be held to be revived. This argument ignores the distinction between supersession of a rule, and substitution of a rule. In the case of Firm A.T.B. Mehtab Majid & Co., the new Rule 16 was substituted for the old Rule 16. The process of substitution consists of two steps. First, the old rule is made to cease to exist and, next, the new rule is brought into existence in its place. Even if the new rule is invalid, the first step of the old rule ceasing to exist comes into effect, and it was for this reason that the court held that, on declaration of the new rule as invalid, the old rule could not be held to be revived. In the case before us, there was no substitution of the Prohibition Order of 1950, for the Prohibition order of 1119. The Prohibition Order of 1950, was promulgated independently of the Prohibition Order of 1119 and because of the provisions of law it would have had the effect of making the Prohibition Order of 1119 inoperative if it had been a valid Order. If the Prohibition Order of 1950 is found to be void ab initio, it could never make the Prohibition Order of 1119 inoperative.” (emphasis supplied) 51 Ibid [7] (Bhargava J). Property Owners Association & Ors. v. State of Maharashtra & Ors. 70 [2024] 11 S.C.R. Justice Bhargava observed that unlike in ATB Mehtab Majid, in Koteswar Vittal Kamath, the later order did not substitute the earlier order but it merely superseded the earlier order. Thus, the earlier order was never expressly repealed and hence if the later order was struck down, the earlier order continued to be in force. However, beyond this distinction, Justice Bhargava went on to explain what in his view was the reason for the holding in ATB Mehtab Majid, namely that the process of substitution had two distinct steps, first,an omission and second,an insertion. According to Justice Bhargava, the reason for the outcome in ATB Mehtab Majid was that where an amending rule is struck down, only the second step of inserting new words is invalidated but the first step of omitting old words continues to have legal effect. The appellants rely on this reasoning to contend that when Minerva Mills stuck down the Forty-Second Amendment, only the newly inserted language expanding Article 31-C’s exemption to cover all Directive Principles was struck down. However, the Amendment’s function of omitting the words “the principles specified in clause (b) or clause (c) of article 39” still stands. Hence, it was urged that even after the decision in Minerva Mills, these words stand omitted from Article 31-C. This is in essence the heart of the argument of the appellants. As a matter of interpreting precedent, it is important to note that the two-step process of substitution relied on by the appellants is only found in the three-judge bench decision in Koteswar Vittal Kamath, and not in the Constitution Bench decision in ATB Mehtab Majid. Further, Justice Bhargava’s explanation of the process of substitution as having two steps after he had already distinguished ATB Mehtab Majid on facts is at best an obiter dictum. However, ultimately neither of these judgments is binding on us, sitting in a composition of nine, and we must independently evaluate the correctness and completeness of the view taken regarding the legal effect of invalidating an amendment.

55. The Respondents resist the reasoning of a two-step substitution process set out in Koteswar Vittal Kamath by relying on a second line of decisions, beginning with the 1951 decision of the High Court of Nagpur in Laxmibai v State of Madhya Pradesh.52 The case concerned the Central Provinces & Berar Regulation of Letting 52 AIR 1951 Nag 94. Digital Supreme Court Reports [2024] 11 S.C.R. 71 Accommodation Act, 1946 which, when originally enacted, stipulated that the statute would expire at the end of one year. However, by an Ordinance, and later a validating legislation, the lifespan of the statute was extended till such date as the provincial government may specify. The Ordinance and validating legislation were challenged on the grounds of excessively delegating legislative functions (concerning the lifetime of a statute) to the executive. A Full Bench of the Nagpur High Court upheld the Ordinance and the validating legislation extending the operation of the 1946 Act.53 Justice Hidayatullah, as the learned Chief Justice then was, speaking for the majority of the Full Bench went on to discuss the question of whether, if the amending Ordinance had been void, the original text would have been revived or not. The learned Judge observed: “144. The original section read: “It shall come into force on 1-10-1947 & shall remain in operation for a period of one year.’

145. The underlined (here italicised) words alone were amended. If the amendment is unconstitutional we must leave it completely out. We cannot use the intention underlying that amendment to take the place of enactment. We cannot read the legislative act of the Governor as involving a repeal & a reenactment & give effect to the repeal though not the enactment. To do so would leave the original section truncated, & besides, there is no authority to give effect to a mere legislative intent or purpose… […]

146. … When the amendment comes later & is unconstitutional it has no effect whatever.” (emphasis supplied) The judgement in Laxmibai outlines a different approach to analysing the legal effect of a judicial decision invalidating an amendment. Justice Hidayatullah found that where an amendment is invalid, the legal effect of the amendment is nullified in its entirety. The learned 53 Ibid [142] (Hidayatullah J); [157] (Mangalmurti J). Property Owners Association & Ors. v. State of Maharashtra & Ors. 72 [2024] 11 S.C.R. Judge relied on several decisions of the US Supreme Court, most notably, Frost v Corporation Commissioner54 where Justice Sutherland held: “Here it was conceded that the statute, before the amendment, was entirely valid. When passed, it expressed the will of the Legislature which enacted it. Without an express repeal, a different Legislature undertook to create an exception, but, since that body sought to express its will by an amendment which, being unconstitutional, is a nullity and therefore, powerless to work any change in the existing statute, that statute must stand as the only valid expression of the legislative intent.” According to Frost and Laxmibai, where an amendment is invalidated both the amendment’s omission of old words and its insertion of new words have no legal effect. Justice Hidayatullah noted that giving effect to the legislative intent of repeal while simultaneously striking down the new enactment could lead to a truncated statutory provision rendering the law unworkable. The effect of the judgement may be to inadvertently invalidate two provisions, both the new and the old, despite there being no constitutional fault with the old. This observation is directly applicable to the case before us because if the unamended Article 31-C does not revive after the decision in Minerva Mills, Article 31-C would be truncated and unworkable despite the validity of the Article being upheld by thirteen Judges in Kesavananda Bharati. In terms of precedential value, Justice Hidayatullah’s observations are admittedly also obiter dictum given that the High Court had upheld the Ordinance. However, these observations were subsequently relied on by the High Court of Nagpur in Shriram Gulabdas v Board of Revenue, Madhya Pradesh55 and in the decisions of this Court that we shall now advert to.

56. In Mulchand Odhavji v Rajkot Borough Municipality56 a Constitution Bench of this Court invalidated the Municipality of Rajkot’s levy of octroi duty. The case originated from the United States of Saurashtra where the Saurashtra Terminal Tax and Octroi Ordinance of 1949 54 55 56 278 U.S. 505. 1952 (3) STC 343. 1971 (3) SCC 53. Digital Supreme Court Reports [2024] 11 S.C.R. 73 allowed the state government to levy octroi duty from the towns and cities specified in Schedule I until these municipalities enacted their own rules for the levy of octroi duty. Rajkot was one such town and in 1953 the municipality enacted its own rules for the levy of octroi duty. In 1956, the state government removed Rajkot from Schedule I of the 1949 Ordinance. However, in Mulchand Odhavji, the 1953 rules for levying octroi duty were invalidated by the trial court for violating the rule-making procedure in the parent legislation.57 Following this invalidation and in appeal to this Court, a secondary question arose as to whether the municipality could still collect octroi duty for the period that the 1953 rules were in force. In other words, did the levy of octroi duty by the state government under the 1949 Ordinance revive after the 1953 rules were invalidated? Justice JM Shelat, speaking for a Constitution Bench of this Court held: “8. … As already stated, Ordinance 47 of 1949, was promulgated to meet the transitional situation when municipalities in towns and cities of Saurashtra were yet to be constituted. […] The rules framed by the Government were thus put in the field until the time when the municipalities could frame rules of their own and levy and collect the octroi duty. […] While issuing the said notification, the intention obviously was that once the municipal rules came into operation the Government rules, insofar as they pertained to the respondent-Municipality, would cease to operate. The Government rules, however, were to cease to operate as the notification provided “from the date the said Municipality put into force their independent bye-laws.” It is clear beyond doubt that the Government rules would cease to apply from the time the respondent Municipality brought into force its own bye- laws and rules under which it could validly impose, levy and recover the octroi duty. The said notification did not intend any hiatus when neither the Government rules nor the municipal rules would be in the field. Therefore, it is clear that if the bye-laws made by the respondent Municipality could not be legally in force for some reason or the other, for instance, for not having been 57 Ibid [10]. Property Owners Association & Ors. v. State of Maharashtra & Ors. 74 [2024] 11 S.C.R. validly made, the Government rules would continue to operate as it cannot be said that the Municipality had “put into force their independent bye-laws.” (emphasis supplied) The decision in Mulchand Odhavji admittedly did not concern an amendment simpliciter and relied on the text of the state government rules which stipulated when they would operate. However, two important observations may be made. First, this Court observed that it would be an anomalous situation whereby a court invalidated a freshly enacted rule, but because of such invalidation and the courts’ simultaneous enforcement of the repeal of the earlier rule, no rule of taxation held the field despite the state government having such power and there being no fault with the earlier rule. Second, the court gave effect to the state government’s rules despite Rajkot being removed from Schedule I of the 1949 Ordinance. This was a recognition that the omission of Rajkot was only done because of the corresponding enactment of the municipality’s separate rules. This was even though the omission was done by an entirely separate authority (the state government) from the enacting authority (the municipality). Thus, the Constitution Bench in Mulchand Odhavji adopted a broader approach of examining the entirety of the legislative circumstances and reversed both the omission and insertion steps of the legislative process after invalidating the unconstitutional rule.

57. The respondents next relied on State of Maharashtra v Central Provinces Manganese Ore.58 In a taxation dispute, the assessee challenged an amendment to the Explanation to clause (g) of Section 2 of the Central Provinces and Berar Sales Tax Act, 1947. The amendment to the Explanation modified the regime of taxation from one concerning goods that were in the Central Provinces and Berar when the contract was made, to one covering even future goods that were in the provinces after the contract was made. The High Court invalidated the amendment on the ground that it had not secured the assent of the Governor General under Section 107 of the Government of India Act, 1935.59 After the High Court declared the amendment as void, a question arose before this Court as to 58 59 [1977] 1 SCR 1002 : (1977) 1 SCC 643 : 1976 INSC 269 Ibid [8] (Beg J). Digital Supreme Court Reports [2024] 11 S.C.R. 75 whether the unamended Explanation to clause (g) stood revived. The assessee adopted the two-step argument concerning substitution found in Koteswar Vittal Kamath and contended that as the assent of the Governor General was not required to repeal the earlier Explanation to clause (g), the repealing step of the substitution was valid while only the insertion step of the substitution was hit by the failure to secure the Governor General’s assent under Section 107 of the Government of India Act. Therefore, the assessee contended that the unamended Explanation to clause (g) did not stand revived. Justice Beg, speaking for a Three-Judge Bench of this Court rejected this contention and held: “17. In the case before us although the word “substitution” is used in the amending Act, yet, the whole legislative process termed substitution was itself abortive. The whole of that process did not take effect as the assent of the Governor-General, required by Section 107, Government of India Act, was lacking. […]

18. We do not think that the word substitution necessarily or always connotes two severable steps, that is to say, one of repeal and another of a fresh enactment even if it implies two steps. Indeed, the natural meaning of the word “substitution” is to indicate that the process cannot be split up into two pieces like this. If the process describes as substitution fails, it is totally ineffective as to leave intact what was sought to be displaced. That seems to be the ordinary and natural meaning of the words “shall be substituted”. This part could not become effective without the assent of the Governor-General. The State Governor’s assent was insufficient. It could not be inferred that, what was intended was that, in case the substitution failed or proved ineffective, some repeal, not mentioned at all, was brought about and remained effective so as to create what may be described as a vacuum in the statutory law on the subject matter. Primarily, the question is one of gathering the intent from the use of words in the enacting provisions seen in the light of the procedure gone through. Here, no intention to repeal, without a substitution, is deducible. In other words, Property Owners Association & Ors. v. State of Maharashtra & Ors. 76 [2024] 11 S.C.R. there could be no repeal if substitution failed. The two were a part and parcel of a single indivisible process and not bits of a disjointed operation.” (emphasis supplied) This extracted paragraph has several strands of important reasoning that build on the decisions of Laxmibai and Mulchand Odhavji. First, the Court cast doubt on whether substitution always entails two distinct steps of repeal and enactment as outlined in Koteswar Vittal Kamath. Second, the Court reiterated that this two-step approach, where repeal is given effect to but insertion is not given effect to, can result in an unintended legislative vacuum. Third, the Court highlighted that it was necessary to examine whether there was any intention to repeal without insertion. This is relevant because there may exist cases where a legislature independently seeks to repeal a provision and also enacts another provision. In such cases, it may be appropriate to differentiate the two steps if there is cogent evidence to demonstrate that independent of the enactment step, the legislature would have nonetheless repealed the provision in question. In the words of Justice Beg, is there an “intention to repeal, without a substitution”? However, absent clear legislative intent to independently repeal without substitution, where the legislature engages in substitution, it is in fact a single indivisible process and the effect of a court invalidating the amended text is to bring back the unamended text. This is because, in the case of substitution, an inference can be made that the legislature would never have repealed the unamended text without simultaneously inserting the new amended text. Thus, to invalidate the amended text but also refuse to give effect to the unamended text would be to give effect to a third outcome that could lead to absurd consequences and was never intended by the legislature. Thus, where the intent is substitution and the inserted or amended text is declared invalid, the result is to invalidate the combined exercise of repeal and enactment and the pre-amendment provision continues in force.

58. The above approach was also adopted by a two-Judge Bench of this Court in DK Trivedi & Sons v State of Gujarat.60 The case concerned three notifications issued by the state government of 60 [1986] 1 SCR 479 : (1986) Supp SCC 20 Digital Supreme Court Reports [2024] 11 S.C.R. 77 Gujarat under Section 15 of the Mines and Minerals (Regulation and Development) Act, 1957 (MMRD Act) specifying rates of royalty and dead rent to be paid by mining companies. Section 15(3) of the MMRD Act prohibited the state government from increasing the rates of royalty (and as a result dead rent)61 more than once in a period of four years. For the four-year period between 1974 and 1978, this Court found that the State of Gujarat had increased the rates of royalty and dead rent in 1974 and then again impermissibly increased royalty rates in 1975 and dead rents in 1976. The Court struck down these subsequent enhancements as violative of Section 15(3) of the MMRD Act.62 A question then arose, as to whether after invalidating these subsequent notifications, the rate of royalty and dead rent under the last valid notification of 1974 stood revived or not. Justice DP Madon, writing for the Bench, cited the decision in Central Provinces Manganese Ore with approval and held: “72. The position before us is the same. It was not the intention of the Government of Gujarat that even if the new schedule of royalty substituted by the 1975 Notification was void and inoperative Schedule I as substituted by the 1974 Notification nonetheless stand repealed. It was equally not the intention of the Government of Gujarat that even if the rates of dead rent substituted in Schedule II by the 1976 Notification were void and inoperative, the rates of dead rent as substituted by the 1974 Notification would nonetheless stand repealed. If the contention in this behalf were correct, it would lead to the startling result that on and from the date of the coming into force of the 1975 Notification no royalty was payable in respect of minor minerals and that on and from the date of the coming into force of the 1976 Notification no dead rent was payable in respect of any leased area. The rates in Schedule I and Schedule II were intended to be substituted by new rates. The intention was not to repeal them in any event. If the substitutions effected by the 1975 and 1976 Notifications were invalid, such substitutions were equally invalid to repeal the 1974 61 See Ibid [55] (Madon J). 62 Ibid [65], [67] (Madon J). Property Owners Association & Ors. v. State of Maharashtra & Ors. 78 [2024] 11 S.C.R. Notification. The result is that the 1974 Notification continued to be operative both as regards the rates of royalty and the rates of dead rent until they were validly substituted with effect from April 1, 1979, by the 1979 Notification.” (emphasis supplied) The above extract comports with the reasoning in Central Provinces Manganese Ore. The two-Judge bench observed that it could never have been the intention of the Government of Gujarat to independently repeal the existing 1974 rates of royalty and dead rent when it substituted them by subsequent notifications enhancing the rates. This is doubly evident from the fact that the government had enhanced the rates of royalty and dead rent. Therefore, it cannot be presumed that the Government ever independently intended to repeal the 1974 notification which would have led to a cessation in the collection of revenue. This being the position, the result of invalidating the subsequent notifications while simultaneously giving effect to repeal of the 1974 Notification would lead to an absurd result which was never intended by the government. Thus, rather than breaking down the process of substitution into two distinct steps of repeal and enactment and analysing the effect of the invalidation disjunctively, in Central Provinces Manganese Ore and DK Trivedi & Sons, the Court asks whether it is plausible that the legislature intended to independently repeal the substituted provision. In the absence of clear evidence of such legislative intent, the process of substitution is invalidated in its entirety and the original, unamended provision continues to have legal force.

59. The position adopted in Central Provinces Manganese Ore and DK Trivedi & Sons also finds support from decisions in the US. We have already noted Justice Hidayatullah’s reliance on the US Supreme Court’s decision in Frost v Corporation Commissioner.63 However, decisions in state Courts of the United States following Frost are even more explicit in their reasoning. For example, in Texas Company v Cohn64 the Supreme Court of Washington was tasked with determining whether a 1937 taxation statute continued 63 64 278 U.S. 505. 8 Wash 2d 360 (17 April 1941, Supreme Court of Washington). Digital Supreme Court Reports [2024] 11 S.C.R. 79 in force after a 1939 statute had replaced it, but the subsequent statute had been invalidated by the Court. Justice Drive, speaking for the Supreme Court of Washington sitting en banc held: “The 1939 petroleum products tax law specifically repealed the 1937 statute, but it is the position of the appellants that, when the repealing act was wholly vitiated as unconstitutional by the Inland case, its repealing clause also fell. Therefore, they assert, the 1937 statute has never been legally repealed and has remained in full force and effect in contemplation of law, assuming, of course, that it is constitutional. This position, we think, is sound. It is too apparent to require much comment that the legislature, when it enacted the 1939 act, attempted to set up a new and complete fuel oil tax law in place of the 1937 statute. The earlier law was repealed only to clear the decks and give the new act unobstructed operation and effect. It does not appear that the legislature intended in any event, to repeal the prior law. Under such circumstances, the repeal clause falls within the unconstitutional statute of which it is part.” (emphasis supplied) The approach adopted by the Supreme Court of Washington was to examine the totality of the legislative circumstances and proceedings, and absent any express intention of the legislature to independently repeal the 1937 law, hold that the repeal of the 1937 law was reversed by the 1939 law being invalidated. Thus, the 1937 law continued in force. This reasoning was also adopted by the Supreme Court of Pennsylvania in Mazurek v FM Ins Company, Jamestown.65 In that case, an 1857 statute allowed individuals to sue insurers in the county where the insured property was located. The 1857 statute was repealed by a 1921 law, but Section 344 of the 1921 law preserved the jurisdiction of individuals to sue insurers in the jurisdiction where the insured property was located. The 1921 law was later invalidated, and a question arose as to whether the 1857 law and the preservation of jurisdiction by Section 344 could still be given effect. Justice Maxey held that it could be: 65 320 Pa 33 (Pa. 1935) (25 November 1935, Supreme Court of Pennsylvania) Property Owners Association & Ors. v. State of Maharashtra & Ors. 80 [2024] 11 S.C.R. “The only question is whether where, as here, an act expressly repeals another act and provides a substitute for the act repealed and the substitute is found unconstitutional, is the other act so expressly repealed, to be judicially accepted as repealed. Such a construction is not warranted unless it clearly appears that the legislature would have passed the repealing clauses even if it had not provided a substitute for the acts repealed. Not only was there no such intention on the part of the legislature in the present case, but it is apparent that exactly the opposite was intended. The precise question now being discussed has not heretofore been passed upon by this court. However, other courts have enunciated the principle that a repealing clause expressly repealing a prior statute is itself ineffective where the substitute for the prior statute provided in the repealing statute is unconstitutional, and where it does not appear that the legislature would have enacted the repealing clause without providing a substitute for the act repealed [citations omitted]. There is no doubt that the legislature in enacting section 344 of the Act of 1921 intended to preserve to courts of countries in which insured properties were located the jurisdiction in insurance cases created by the Act of 1857. It is a legitimate inference that the Act of 1857 would not have been repealed by the Act of 1921 if the legislature had known that section 344 of that act would be declared invalid for defect in the title of the act.” (emphasis supplied) The above extracts make it evident that the appropriate test in cases of substitution is whether the legislature intended to repeal the law if they knew that the law they were enacting would not have legal effect. Looked at from another perspective, the question is, would the legislature have given effect to the repeal if they did not also simultaneously intend to enact an alternative provision or statute. These decisions from the United States of America are of particular relevance, as like in India, courts in the United States have long followed the doctrine of judicial review and invalidation of both primary and secondary legislation. Therefore, the experience of American Digital Supreme Court Reports [2024] 11 S.C.R. 81 courts on the consequences of a legislation being struck down is undoubtedly of assistance in the Indian context where courts are similarly empowered.

60. Although the decisions of Central Provinces Manganese Ore and DK Trivedi & Sons were rendered by a three-Judge Bench and a two-Judge Bench of this Court respectively, they were also endorsed by a Constitution Bench of five judges of this Court in Supreme Court Advocates-On-Record Association v Union of India.66 The NJAC Decision is particularly relevant to the case before us because it expressly concerns the legal consequences arising out of the invalidation of a constitutional amendment. In the NJAC Decision, a Constitution Bench of this Court was seized of a challenge to the Ninety-Ninth Constitutional (Amendment) Act, 2014.67 The amendment replaced the collegium-led system of appointing judges with a National Judicial Appointments Committee. The Constitution Bench invalidated the ninety-ninth amendment as violating the basic structure. However, the Union of India contended that upon the invalidation of the ninety-ninth amendment, the earlier collegium-led system of judicial appointments would not revive because Article 124(2) in its original form (upon which the collegium-led system is based) had been repealed by the ninety-ninth amendment. A majority of four judges in the NJAC Decision all rejected this argument and held that the earlier system of judicial appointments would stand revived upon the invalidation of the ninety-ninth amendment.68The opinion of Justice JS Khehar(as the learned Chief Justice then was) expressly relied on the decision in Central Provinces Manganese Ore. The learned Judge held: “412.10 What needs to be kept in mind as we have repeatedly expressed above is that the issue canvassed in the judgements relied upon [by the Solicitor General of India] was the effect of a voluntary decision of a legislature in amending or repealing an existing provision. That position would arise, if Parliament had validly amended or repealed an existing constitutional provision. Herein, the impugned constitutional amendment has definitely 66 67 [2015] 13 SCR 1 : (2016) 5 SCC 1 : 2015 INSC 285 (“NJAC Decision”). “Ninety-ninth amendment” 68 NJAC Decision [413] (Khehar J); [963] (Lokur J); [989] (Joseph J); [1110] (Goel J). Property Owners Association & Ors. v. State of Maharashtra & Ors. 82 [2024] 11 S.C.R. the effect of substituting some of the existing provisions of the Constitution, and also, adding to it some new provisions. Naturally substitution connotes that the earlier provision ceases to exist and the impugned constitutional amendment by a process of judicial review has been set aside. Such being the position, whatever be the cause and effect of the impugned constitutional amendment, the same will be deemed to be set aside and the position preceding the Amendment will be restored. It does not matter what are the stages or steps of the cause and effect of the Amendment, all the stages and steps will stand negated, in the same fashion as they were introduced by the Amendment, when the amended provisions are set aside.” (emphasis supplied) Justice Khehar endorsed the approach whereby the invalidation of an amendment would also reverse any repeals brought about by the amendment. The learned Judge rejected the approach of disaggregating the process of substitution into the two steps of repeal and enactment. When Parliament acted to substitute one provision with the other, it cannot be said to have intended to independently repeal the original provision absent clear evidence to the contrary. Where no intention to independently repeal the existing provision of law is to be found, the effect of invalidating a substitution is that the entirety of the substitution stands at nullity. In the NJAC Decision, Justice Khehar also opined on the dire consequences of the pre- existing appointment process for judges not reviving. He wrote: “413. … it would have to be kept in mind that if the construction suggested by the learned Solicitor General was to be adopted, it would result in the creation of a void. We say so, because if neither the impugned constitutional provision nor the amended provisions of the Constitution would survive, it would lead to a breakdown of the constitutional machinery inasmuch as there would be a lacuna or a hiatus insofar as the manner of selection and appointment of Judges to the higher judiciary is concerned. Such a position, in our view, cannot be the result of any sound process of interpretation..,” Digital Supreme Court Reports [2024] 11 S.C.R. 83 The above extract highlights a key issue originally expounded by Justice Hidayatullah in Laxmibai and reiterated by Central Provinces Manganese Ore and DK Trivedi & Sons; namely, that giving effect to the repeal while simultaneously invalidating the enactment could lead to a lacuna in the law, rendering a provision unworkable, or as in the case of the NJAC Decision, lead to a “constitutional crisis”.

61. The opinion of Justice MB Lokur in the NJAC Decision also highlights another aspect of this issue that must be kept in mind. Justice Lokur assessed the outcome of non-revival of the unamended text vis-à-vis the principles expressed in the judgement. The learned Judge wrote: “961. … If the contention of the learned Solicitor General is accepted, then on the facts of the case, the result would be calamitous. The simple reason is that if the 99th Constitutional Amendment Act is struck down as altering the basic structure of the Constitution and if Article 124(2) in its original form is not revived then Article 124(2) of the Constitution minus the words deleted (by the 99th Constitution Amendment Act) and minus the words struck down (those inserted by the 99th Constitution Amendment Act) would read as follows: “(2) Every Judge of the Supreme Court shall be appointed by the President by warrant under his hand and seal and shall hold office until he attains the age of sixty-five years:”

962. This would give absolute power to the President to appoint a Judge to the Supreme Court without consulting the Chief Justice of India (and also to appoint a Judge to a High Court). The result of accepting his submission would be to create a tyrant […]

963. This was put to the learned Solicitor General and it was also put to him that if his submissions are correct, then it would be better for the Union of India to have the 99th Constitution Amendment Act struck down so that absolute power resides in the President making him/her an imperium in imperio so far as the appointment of Judges is concerned. The learned Solicitor General smiled but obviously had no answer to give. It must, therefore, be Property Owners Association & Ors. v. State of Maharashtra & Ors. 84 [2024] 11 S.C.R. held that the constitutional provisions amended by the 99th Constitution Amendment Act spring back to life on the declaration that the 99th Constitution Amendment Act is unconstitutional.” The above extract highlights how following a two-step approach advanced by the appellants may result in a situation where the ultimate consequence of invalidating an amendment is a graver perpetuation of the harms sought to be prevented by the striking down of the amendment. The Constitution Bench in the NJAC Decision invalidated the Ninety-Ninth Amendment on the ground that it interfered with judicial independence which is part of the basic structure of the Constitution. But as Justice Lokur’s opinion points out, disaggregating the substitution and giving effect to the repealing portion of the amendment while also invalidating the new enactment would lead to a situation where judicial independence was further compromised. Such an approach would be neither legally tenable nor normatively desirable.

62. We may briefly advert to three more decisions on the relationship between the principles of the judgement in question and the outcome of invalidating an amendment to demonstrate the significance of this issue. In the NJAC Decision, it was evident that absent the pre-existing regime reviving, the principles set out in the judgement would be significantly undermined. However, the opposite may also be true. This may be seen from the decision in BN Tewari v Union of India,69 which was a writ petition under Article 32 filed on the heels of the decision of this Court in T Devadasan v Union of India.70 The case concerned a Union Public Service Commission (UPSC) notification reserving 12.5 per cent of seats for candidates from the Scheduled Castes and 5 per cent of seats for candidates from the Scheduled Tribes. In 1952, the UPSC instituted a carry-forward rule whereby unfilled reserved seats each year were added to the subsequent year’s reserved seats for up to two years. This rule was subsequently amended in 1955, challenged in T Devadasan, where the carry forward rule “as modified in 1955” was struck down 69 70 [1965] 2 SCR 421 [1964] 4 SCR 680 : 1963 INSC 183 Digital Supreme Court Reports [2024] 11 S.C.R. 85 as unconstitutional.71 In BN Tewari, the petitioners contended that it was only the 1955 substitution that was invalidated, and as a result the 1952 carry-forward rule was revived and continued to be in effect. Justice KN Wanchoo, speaking for a Constitution Bench of this Court, negatived this contention by noting: “6. … It is true that in Devadasan case, the final order of this Court was in these terms: “In the result the petition succeeds partially and the carry forward rule as modified in 1955 is declared invalid.” That however does not mean that this Court held that the 1952-rule must be deemed to exist because this Court said that the carry forward rule as modified in 1955 was declared invalid. The carry forward rule of 1952 was substituted by the carry forward rule of 1955. On this substitution the carry forward rule of 1952 clearly ceased to exist because its place was taken by the carry forward rule of 1955. Thus by promulgating the new carry forward rule in 1955, the Government of India itself cancelled the carry forward rule of 1952. When therefore this Court struck down the carry forward rule as modified in 1955 that did not mean that the carry forward rule of 1952 which had already ceased to exist, because the Government of India itself cancelled it and had substituted a modified rule in 1955 in its place, could revive it. We are therefore of the opinion that after the judgment of this Court in Devadasan case there is no carry forward rule at all, for the carry forward rule of 1955 was struck down by this Court while the carry forward rule of 1952 had ceased to exist when the Government of India substituted the carry forward rule of 1955 in its place.” The Court in BN Tewari found that after the rule was amended in 1955, the 1952 rule ceased to exist and even after the 1955 rule was struck down, the 1952 rule did not revive as it had been repealed by the Government itself. At first glance, the decision in BN Tewari also supports the “Pen and Ink” theory propounded by the appellants and results in an identical outcome to that in ATB Mehtab Majid. 71 T Devadasan [22] (Mudholkar J). Property Owners Association & Ors. v. State of Maharashtra & Ors. 86 [2024] 11 S.C.R. We have already adverted to the limitations and inconsistencies with this approach as highlighted in the cases of Laxmibai, Central Provinces Manganese Ore, and DK Trivedi & Sons. However, this case also demonstrates the practical difficulties that may arise if an unconstitutional provision revives. In T Devadasan, the Court had held the underlying basis for the carry forward rule to be unconstitutional. If the Court in BN Tewari had found the carry forward rule stood revived, it would have resulted in the revival of a rule that was (at the time) ex-facie unconstitutional and repugnant to the holding in the T Devadasan. Thus, in addition to the narrower issue of whether a pre-existing rule is revived, the Court in BN Tewari was also mindful of the relationship between the unamended provision and the decision to invalidate the amendment. BN Tewari is an example of where allowing the unamended rule to revive would have revived a (at the time) unconstitutional rule.

63. The need to assess not only the entirety of the legislative circumstances but also the judicial decision invalidating the amending statute is also apparent from the decision in Shaukat Khan v State of Andhra Pradesh.72 The case concerned the Hyderabad Inams Abolition Act, 1955 which was eventually repealed as amended by the Andhra Pradesh (Telangana Area) Abolition of Inams Act, 1967. During proceedings concerning the validity of the 1955 Act before this Court, the High Court of Andhra Pradesh Act invalidated the entirety of the 1967 legislation. Before this Court, a question arose that as the 1967 statute had repealed the 1955 law, and the 1967 statute itself had been struck down, whether the 1955 was now in force. Justice P Jaganmohan Reddy, speaking for a two-Judge Bench of this Court observed: “10. On the main question whether the impugned Acts were revived by reason of the High Court of Andhra Pradesh striking down Act 9 of 1967, a perusal of that judgment would show that the Division Bench considered the question and held that as the inam lands had already vested in the Government on July 20, 1955, there was no need to abolish inams which already stood abolished long before the date when the impugned Act, namely, Act 9 of 1967, was enacted.” 72 [1975] 1 SCR 429 : (1974) 2 SCC 376 : 1974 INSC 118 Digital Supreme Court Reports [2024] 11 S.C.R. 87 The learned Judge quoted the judgment of the High Court of Andhra Pradesh where the High Court had held: “The effect of the impugned Act in pith and substance is really not agrarian reform but to destroy the rights of the inamdars and others who were assured compensation under the repealed Act.” Based on this finding of the High Court, Justice Jaganmohan Reddy concluded: “10. … The striking down of Act 9 of 1967 must be construed in the light of the reasoning given by the learned Judges of the Division Bench of the Andhra Pradesh High Court that the Abolition Act 8 of 1955 and the Amendment Act 10 of 1956 had already achieved the result which Act 9 of 1967 was intended to achieve, and once the inams had already vested in the Government, compensation had to be paid in accordance with the terms of those laws and cannot again be re-opened by vesting the inams which had already vested as if they had not already vested in the Government. This postulates the existence of the Acts impugned before us as a ground for striking down Act 9 of 1967, so that when the High Court says that the latter Act 9 of 1967is void it could not have intended to say that even the Acts now impugned before us did not revive.” This Court in Shaukat Khan observed that the High Court of Andhra Pradesh had invalidated the 1967 statute precisely on the ground that the inams had already vested in the state government under the 1955 law and the regime of compensation could not subsequently be altered by the 1967 statute. This reasoning presupposes the existence of the 1955 laws being in force. The High Court could not invalidate the 1967 law but also simultaneously enforced the repeal of the 1955 statute which it had expressly stated would govern compensation. Thus, where a court assesses whether a law revives or not after an amendment or subsequent enactment is invalidated, the court must assess both the totality of the legislative circumstances but also the logical consequences that flow from the decision to invalidate the statute or provision in question. Property Owners Association & Ors. v. State of Maharashtra & Ors. 88 [2024] 11 S.C.R.

64. An even more explicit demonstration of this rationale can be found in Indian Express Newspapers (Bombay) v Union of India.73 The case concerned a 1977 notification under Section 25 of the Customs Act, 1962 granting a wholesale exemption from customs duty on newsprint. However, by a fresh notification in 1981, the Union Government amended its policy and stated that for the printing of newspapers, books and periodicals, the exemption from customs duty would only apply beyond 10 per cent. In effect, the 1981 notification imposed a 10 per cent ad valorem customs duty on imported newsprint from newspapers and periodicals. The 1981 notification was struck down by a three-judge bench of this Court on the ground that it impermissibly restricted the freedom of speech guaranteed by Article 19 of the Constitution.74 On the secondary question of whether the earlier 1977 notification stood revived, the Court held that it did. Justice ES Venkataramiah, as the learned Chief Justice then was, speaking for the Court held: “107. … We may also state that the legal effect on an earlier law when the later law enacted in its place is declared invalid does not depend merely upon the use of words like, ‘substitution’, or ‘supersession’. It depends upon the totality of the circumstances and the context in which they are used. […]

109. Hence, if the notification dated July 15, 1977 cannot revive on the quashing of the impugned notifications, the result would be disastrous to the petitioners as they would have to pay customs duty of 40% ad valorem from March 1, 1981 to February 28, 1982 and 40% ad valorem plus Rs 1000 per MT from March 1, 1982 onwards. […] Such a result cannot be allowed to ensue.” The Court in Indian Express Newspapers (Bombay) observed that the consequence of the pre-existing law not reviving would in fact result in greater prejudice to the petitioners than if there had been no judgment of the court at all. If after the 1981 notification 73 74 [1985] 2 SCR 287 : (1985) 1 SCC 641 : 1984 INSC 231 Ibid [102] (Venkataramiah J). Digital Supreme Court Reports [2024] 11 S.C.R. 89 was invalidated, the 1977 notification granting a general exemption from customs duty on newsprint did not continue in force, the net outcome would be a higher customs duty on news publishers. This was because the original notification itself was framed in the manner of an exemption from customs duty. The above extract makes it clear that in addition to the question of whether the legislative intent was indivisible, the issue of the legal effect of invalidation in cases of substitution must take into account the facts of a given case, the rationale for invalidation, and the practical effect of the unamended text being revived or not. iv. Analysis and Conclusions concerning Article 31-C

65. Based on the above precedents, certain principles governing the consequence of an amendment resulting in a substitution being invalidated come to the fore. It is not appropriate to separate an amendment which substitutes certain words with certain other words into multiple steps and examine the legal effect of invalidation on each of these steps independently. This is because when a legislature enacts a substitution, it is only removing certain text to make space for the new text it wishes to enact. Simply put, the legislature would not remove the text in question without at the same time inserting alternate text. Given that the legislative intent is composite and indivisible, to remove and insert simultaneously, a judicial approach which disaggregates these two steps and treats them differently would amount to the courtre-writing the law contrary to the legislative intent. As the decisions from the United States note, in such cases, there are two expressions of legislative intent, the original text and the amended text. If the amended text is invalidated, the only valid expression of legislative intent is the original text. If a court were to find that even the original text could not be given legal effect because it had been repealed, this would result in a third outcome, a legal vacuum which was neither intended by the legislature that enacted the original text nor by the legislature which adopted the amended the text. Crucially, this third outcome would fail to give effect to either legislative intent despite there being no constitutional fault in the original provision. As the decisions in Laxmibai, Central Provinces Manganese Ore, and DK Trivedi & Sons note, if a court were to not only invalidate the newly inserted text but also hold that the old text stands repealed it could lead to absurd outcomes or render the text wholly unworkable. The practical effect of such an outcome would be Property Owners Association & Ors. v. State of Maharashtra & Ors. 90

66. [2024] 11 S.C.R. that a judicial decision invalidating an unconstitutional amendment would also inadvertently nullify a valid and constitutional provision which the legislature would never have repealed without providing a replacement. Insofar as the argument that the original rule had been repealed by the legislature itself and thus ought not to be given effect, as noted above, this reasoning is negated by the inference that the legislature would never have repealed the original text without simultaneously adopting the amended text. While a court cannot give effect to text that the legislature has repealed, as noted in Shamarao Parulekar, a case where a legislature has engaged in substitution, and the newly enacted text has been invalidated, is materially different. There may exist a narrow sub-set of cases where it is evident from the legislative circumstances or external aids to statutory interpretation, that the legislature would have in fact repealed the provision or words in question independent of its enactment of an alternative provision. Therefore, it is incumbent on courts to ask the question posed by Justice Beg in Central Provinces Manganese Ore, is there “intention to repeal, without a substitution”? Although some of the precedents discussed frame the question as ‘would the legislature have repealed the original text if it knew a court would invalidate the amended text?’, a more appropriate framing of the question would be, “Would the legislature have repealed the original text without giving effect to the amended text?” for this is the result of a court invalidating the amended text. If in cases where a legislature has repealed text and inserted other text, there is clear evidence that the legislature would have repealed the text in question independent of its decision to give effect to new or alternate language, then a court can continue to give effect to the repeal despite invalidating the new text. This is because, in such cases, the legislative intent is not composite or indivisible, and it is evident that the legislature contemplated that the original text would be repealed independent of whether the new text was given effect or not. However, absent such clear legislative intent, where a legislature substitutes a text by amendment and the amendment is invalidated, it is presumed that the unamended text stands revived.

67. This analysis of whether legislative intent is composite or not is relevant to the case of substitutions. However, there is another reason why the argument of the appellants that repealed text can Digital Supreme Court Reports [2024] 11 S.C.R. 91 never be enforced after a court invalidates an amendment may be flawed, and that is the case of a repeal simpliciter. Let us imagine a situation where Parliament were to by constitutional amendment, repeal protections concerning tenure or salary granted to constitutional functionaries such as Judges or Election Commissioners. This would be a case of an amendment that only repealed constitutional text. Such an amendment would likely violate the basic structure of the Constitution. If this Court were to invalidate such an amendment, could it be contended that the protections do not revive? The only logical relief in such a case is the revival of those protections. These protections would be enforceable despite the fact that they have been omitted from the statute book or constitutional text by the legislature. This would not be a case of the court re-writing the law but merely nullifying the effect of the repeal. Thus, it cannot be said that a court cannot nullify the effect of a repeal. The case of substitutions is admittedly more complicated, as the Court must investigate whether the legislative intent to repeal and enact is composite and indivisible. However, once it is demonstrated that the legislature would not have repealed without simultaneously enacting, there can be no doubt that a court can reverse both the effects of the enactment and the repeal.

68. Finally, in addition to looking at the totality of the legislative circumstances, the court must also examine the consequence of the original text reviving or not reviving vis-à-vis the principles espoused in the judgement. Ordinarily, where an unconstitutional provision is struck down, it is presumed that the original text is constitutional and thus there are no adverse consequences flowing from its reviving. However, there may exist cases where the underlying or original rule itself is unconstitutional or that to revive the situation that existed prior to the amendment would either severely undermine the legal principles set out in the judgement invalidating the amendment or result in some other adverse consequences. In such cases, courts have the flexibility to appropriately shape reliefs. Having clarified the position of law, we now apply the tests outlined above to the question concerning Article 31-C before us.

69. By Section 4 of the Forty-Second Amendment the words “the principles specified in clause (b) or clause (c) of article 39” in Article 31-C were replaced with the words “all or any of the principles laid down in Part IV.” This is a case of substitution. Section 4 of the Forty-Second Amendment was subsequently struck down in Minerva  Mills. As Property Owners Association & Ors. v. State of Maharashtra & Ors. 92 [2024] 11 S.C.R. noted above, where an amendment substituting certain text with certain alternate text is invalidated, the effect is that the unamended text continues in force. This is because the legislative intent of repeal and enactment in such cases is composite and cannot be separated. To give effect to the repeal and not the enactment would result in an outcome which does not correlate with legislative intent, and, as Justice Hidayatullah noted in Laxmibai “leave the original section truncated” resulting in absurd outcomes. This would in effect invalidate the original, valid and constitutional provision despite there being no constitutional fault with it nor the legislature intending to repeal it. Thus, the presumption would be that after Minerva Mills, the unamended Article 31-C would continue in force. Indeed, it is evident that cases such as Bhim Singh and Sanjeev Coke proceeded on this presumption.

70. The only plausible exception to this presumption would be if it could be demonstrated that Parliament, when enacting the Forty-Second Amendment would have repealed the words “the principles specified in clause (b) or clause (c) of article 39” independent of their enactment of the words “all or any of the principles laid down in Part IV.” In this case, no reference to the broader legislative proceedings or external aids is necessary to arrive at the inference that Parliament would not have independently repealed these words. The text of the amendment adopted by Parliament itself makes it abundantly clear that there was no independent intention to repeal. The effect of Section 4 of the Forty-Second Amendment was to expand the scope of the immunity provided by Article 31-C to legislation. Under the unamended Article 31-C, immunity was only provided to legislation if it gave effect to the Directive Principles found in clause (b) or clause (c) of Article 39. However, by Section 4 of the Forty-Second Amendment, the scope of this immunity was significantly expanded to immunise legislations that gave effect to any or all of the Directive Principles in Part IV of the Constitution. Thus, the intention of Parliament in enacting Section 4 of the constitutional amendment was undoubtedly to expand the scope of the immunity granted by Article 31-C. This being the situation, it cannot be suggested that Parliament would have repealed the words “the principles specified in clause (b) or clause (c) of article 39” if it did not simultaneously enact the broader language expanding the scope of Article 31-C. If Parliament had independently repealed these words, it would have Digital Supreme Court Reports [2024] 11 S.C.R. 93 not just reduced the scope of Article 31-C but altogether eliminated the effect of the Article. Without the words “the principles specified in clause (b) or clause (c) of article 39” in Article 31-C, the provision would have been rendered nugatory. Given Parliament’s manifest intention to expand the scope of Article 31-C by Section 4 of the Forty-Second Amendment, it is not plausible to hold that Parliament independently sought to repeal the words “the principles specified in clause (b) or clause (c) of article 39” from Article 31-C. Therefore, it is evident that the legislative intent of Parliament when adopting Section 4 of the Forty-Second Amendment was composite, to repeal and enact (i.e., to substitute) through one single action. This Court cannot therefore disaggregate the steps of repeal and enactment and give effect to the repeal even after invalidating the enactment. After Minerva Mills invalidated Section 4 of the Forty-Second Amendment, the composite legal effect of Section 4 is nullified and the unamended text of Article 31-C stands revived.

71. The final question is whether the revival of the unamended text of Article 31-C would in some way manifestly contravene the principles laid down in the judgment of Minerva Mills or result in some other adverse consequence. The text of the unamended Article 31-C was challenged, and the first part of the Article was upheld by thirteen- judge decision in Kesavananda Bharati while the latter half of the Article was invalidated. Therefore, the first half of unamended Article 31-C, which is the subject matter of the present controversy, was undoubtedly constitutional as held by the thirteen-judge decision in Kesavananda Bharati and further by the Constitution Bench in Waman Rao. Therefore, if as a consequence of the decision in Minerva Mills, the unamended Article 31-C continues in force, there can be no question of any unconstitutionality or adverse consequences associated with the unamended Article 31-C. Indeed, both the Constitution Benches in Minerva Mills and Waman Rao expressly noted that the first half of Article 31-C had been held to be constitutional in Kesavananda Bharati. Further, given that the unamended Article 31-C has been given effect for over four decades as demonstrated by the decisions in Bhim Singh and Sanjeev Coke, no argument can be raised concerning any legal or practical difficulties with the operation of the unamended Article 31-C. Given these findings, we conclude that the unamended Article 31-C continues in force. Property Owners Association & Ors. v. State of Maharashtra & Ors. 94 [2024] 11 S.C.R.

72. One final observation may be made. The principles discussed in this section of the judgement concerning the consequences of a substitution being invalidated emanate from cases concerning the invalidation of statutory provisions or delegated legislation. While constitutional amendments undoubtedly stand on a different footing legally, there is no reason that these principles concerning statutory interpretation would not apply equally to constitutional amendments. Indeed, the respondents before us highlighted a reason for them to apply with even greater force to constitutional amendments. The underlying rationale of the basic structure doctrine concerning constitutional amendments is that the amendment must not impermissibly deviate from the core principles that structure and govern our constitutional democracy. An amendment can be invalidated when it modifies, obliterates, or adds some feature to the Constitution that is anathema to the principles that emerge upon a structural reading of the constitutional text. While Parliament undoubtedly has a constitutional prerogative to amend the Constitution and continually give constitutional character to the citizens’ democratic aspirations, the question in basic structure review is a question of the degree of deviation from the principles that undergird the Constitution. If an amendment is invalidated because it causes a drastic deviation from the principles that govern our constitutional democracy, the consequences must be a return to those principles. Article 31-C represented a delicate balance between the goals of Part IV and the rights of Part III of the Constitution. This balance was held to not impermissibly deviate from the core principles that govern our Constitution by the thirteen judges’ decision of this Court in Kesavananda Bharati. However, in Minerva Mills, Section 4 of the Forty-Second Amendment was held to violate these core principles that form the basic structure. The logical result of such a ruling is that the constitutional text must return to within the fold of the basic structure. To give effect to the repealing portions of Section 4 of the Forty-Second Amendment while also invalidating the enactment would not result in a return to a constitutional text that is in conformity with the basic structure. Rather, it would result in a novel third outcome, the constitutionality of which would be uncertain, untested, and may itself violate the basic structure. Therefore, the consequence of invalidating Section 4 of the Forty-Second Amendment must be that the unamended Article 31-C is revived. Digital Supreme Court Reports [2024] 11 S.C.R. 95 D. Article 39(b)

73. The second question framed for our determination is: “Whether the interpretation of Article 39(b) adopted by Justice Krishna Iyer in Ranganatha Reddy and followed in Sanjeev Coke must be reconsidered. Whether the phrase ‘material resources of the community’ in Article 39(b) can be interpreted to include resources that are owned privately and not by the state.”

74. To answer this question, we will first briefly summarise the submissions of the counsel on this issue. Next, we will address the arguments that relate to the judicial discipline followed in the judgments of this Court which have given rise to the reference. Finally, we analyse the interpretation of Article 39(b) adopted in the judgements that have been doubted and determine the correctness of such an interpretation. i. Submissions a. Submissions of the appellants and intervenors

75. Mr Zal Andhyarujina,learned senior counsel, and Mr Sameer Parekh, learned counsel for the appellants broadly made the following submissions: a. Article 31C gives primacy to the Directive Principles contained in Articles 39(b) and overrides the fundamental rights guaranteed in Articles 14 and 19. As this is a significant immunity, the requirements of Article 39(b) must be strictly complied with and read narrowly; b. Article 39(b) requires that there must not only be a ‘material resource’, but such resource must also be ‘of the community’. If the material cannot be traced to the ‘the community’, it cannot be the subject of the policy; c. The object that must be “distributed” under Article 39(b) is the “ownership and control” of the resources. The mere distribution of the resources, without disturbing the element of its ownership and control cannot be the subject of the policy; d. From various dictionary definitions of the terms ‘material’, ‘resource’, and ‘resources’, it emerges that ‘material resources of the community’ mean either natural resources (which are Property Owners Association & Ors. v. State of Maharashtra & Ors. 96 [2024] 11 S.C.R. those of the country or the nation) or the means of production which in a large sense can be said to be of community, even though they may be in private hands; e. The formulation of ‘material resources’ advanced by Justice Krishna Iyer in Ranganatha Reddy and subsequently followed in several judgements of this Court is too wide. Merely because a privately owned resource meets the qualifier of “material needs” does not make it a ‘material resource of the community’. The Constitution does not embody the social theory that because the individual is a member of the community, his resources however small are a necessary part of the community; f. As evidenced from the debates in the Constituent Assembly, Article 39(b) has been deliberately drafted in language which provides flexibility to adapt to changing constitutional and social values. It cannot be restricted to a ‘Marxist reading’ of the Constitution; g. Despite the purported socialist aims of the Constituent Assembly in incorporating the Directive Principles, private property was included as a fundamental right at the inception of the Constitution and continues to be given importance in inter alia Article 300A. This must be considered while interpreting the “community” element of Article 39(b); and h. The observations of this Court in Mafatlal on whether Article 39(b) encompasses private property are obiter dicta. The decision merely proceeds on the basis that the same has been “repeatedly affirmed by this Court” and the question was not before the Court.

76. Mr H Devarajan, counsel appearing on behalf of the appellants supplemented the arguments of Mr Andhyarujina and Mr Parekh. In the context of the MHADA Act, he made the following submissions: a. If Article 39(b) is to be read to include privately owned resources, the provision would have to be worded differently. It would either expressly contain the words “private material resources” or in any event, not contain the rider after material resources that they must be “of the community”; b. ‘Material resources of the community’ refers to resources which must produce goods or services for the community or be ‘capable Digital Supreme Court Reports [2024] 11 S.C.R. 97 of producing wealth for the community’. While dilapidated buildings in the island city of Mumbai may fall within the ambit of ‘resources’, they cannot constitute ‘material resources of the community’; and c. The minority opinion authored by Justice Krishna Iyer in Ranganatha Reddy and subsequently followed in Sanjeev Coke was rendered in the context of ‘nationalisation’ and the same context cannot be supplanted in the context of the MHADA Act.

77. Ms Uttara Babbar, senior counsel for one of the intervenors75 supplemented the arguments of the counsel for the appellants and made the following submissions: a. The decision in Sanjeev Coke and the observations in Mafatlal that ‘material resources of the community’ include privately owned resources are not good law. The interpretation of Article 39(b) advanced by Justice Krishna Iyer in Ranganatha Reddy relied on in these decisions was part of the minority opinion, from which the majority had distanced itself; b. Further, in Sanjeev Coke, the Court expressed its ‘misgivings’ about the decision in Minerva Mills. However, this was not permissible as Minerva Mills was rendered by a bench of co- equal strength. Similarly, observations in Sanjeev Coke about the validity of Article 31-C as amended by the Forty-Second Amendment were beyond the lis before it; c. In Mafatlal Industries, the nine-judge bench carried forward the error by relying on the decision in Sanjeev Coke and the observations of Justice Iyer in Ranganatha Reddy; d. The words “of the community” used in Article 39(b) must be understood as distinct from the ‘individual’. An interpretation of the Article that provides that resources of the individual are part of the community, renders the use of the phrase “of the community” otiose; e. Article 39(b) mandatorily requires “distribution” of “ownership and control” of the resources in question. This pre-supposes the acquisition of the resource by the state and cannot include 75 I.A. No. 28541 of 2024. Property Owners Association & Ors. v. State of Maharashtra & Ors. 98 [2024] 11 S.C.R. laws that provide for the acquisition of private resources by the state. The protection of Article 31-C and Article 39(b) comes in only at the stage of distribution and not at the anterior stage of acquisition of assets by the state or vesting; f. Acquisition of resources is permissible under the various other powers of the legislature, including the power of eminent domain and would get other protections such as the protection of Article 31-A. However, laws which provide for acquisition cannot be interpreted to be giving effect to Article 39(b) and must meet the muster of Articles 14 and 19; and g. The Constituent Assembly discussed the proposal for an amendment to the draft text of the present Article 39(b). The proposal entailed that the provision be read as “material resources…shall be vested in and belong to the country collectively”. However, this amendment was rejected. The assembly consciously chose to use the phrase “material resources…are so distributed”, rather than “material resources …shall be vested”, indicating that it does not encompass the acquisition or vesting of private resources.

78. The counsel for the appellants also sought to argue that the constitutional jurisprudence with regard to fundamental rights has undergone a sea change since Kesavananda Bharati. In I.R. Coelho, in the context of Article 31-B, a bench of nine judges of this Court held that even constitutional amendments by which laws are inserted in the ninth schedule are amenable to a basic structure challenge. This Court further held that the essence of Articles 21, 14 and 19 is a part of this basic structure and amendments inserting laws in the ninth schedule can be tested on this anvil. According to the appellants, in view of this judgement,it is difficult to envisage a situation where Articles 14 and 19 can be abrogated by a mere legislation under the protection of Article 31-C without even requiring a constitutional amendment. As noted during the course of the hearing, such arguments essentially involve a challenge to the constitutionality of Article 31-C itself, which falls outside the ambit of this judgement and has already been settled by a thirteen-judge bench of this Court in Kesavananda Bharati. We are not inclined to address these arguments. However, parties are at liberty to raise arguments relying on IR Coehlo to advance their submissions on the constitutionality of the MHADA Act before the regular bench. Digital Supreme Court Reports [2024] 11 S.C.R. 99 b. Submissions of the Respondents and Intervenors

79. Mr R Venkataramani, the learned Attorney General appearing on behalf of the respondents, contested the interpretation of Article 39(b) advanced by the appellants and advocated for a wider reading of the provision. He submitted: a. Given the constitutional context of Article 39(b) and its relevance towards realising an egalitarian social order, any narrow reading of the provision would offend the free play that is desirable in the working of the provision; b. Nothing in Article 39 suggests any limitation of the words used therein. The distinction between public and private resources, or natural and human-made resources is alien to the spirit of Article 39 (b) and (c); and c. A wide range of resources have been considered as part of the phrase ‘material resources of the community’ and within the ambit of Article 39(b). These include housing,76 contract carriages,77 land,78 coke oven plants,79 assets of sick textile undertakings,80 drugs,81 electricity,82 capital,83 licenses for felling bamboo,84 refractory plants,85 grant of dealerships of petroleum products,86 mines and minerals,87 mining lease,88 refund of excise,89 natural gas90 and the grant of natural resource.91 76 B Banerjee v Anita Pan (1975) 1 SCC 166 : 1974 INSC 246 77 State of Karnataka & Anr v. Shri Ranganatha Reddy & Anr. (1977) 4 SCC 471; State of Tamil Nadu & Ors. v. L. Abu Kavur Bai & Ors. (1984) 1 SCC 515 78 Maharao Sahib Shri Bhim Singhji v. Union of India & Ors. (1981) 1 SCC 166; Jijubhai Nanbhai Kachar v State of Gujarat (1995) Supp 1 SCC 596 79 Sanjeev Coke. 80 National Textile Corp Ltd v. Sitaram Mills Ltd, AIR 1986 SC 1234; 1986 INSC 61 81 Union of India v. Cynamide India Ltd. (1987) 2 SCC 720; 1987 INSC 100 82 Tinsukhia Electric Supply Co. Ltd. v. State of Assam & Ors. (1989) 3 SCC 709 : 1989 INSC 128 83 N. Parthasarathy v. Controller of Capital Issues (1991) 3 SCC 153 : 1991 INSC 104 84 Orient Paper and Industries Ltd. v. State of Orissa (1991) Supp 1 SCC 81 85 Assam Sillimanite Ltd & Anr v. Union of India & ors. (1992) Suppl 1 SCC 692 : 1990 INSC 89 86 Mahinder Kumar Gupta v. Union of India, Ministry of Petroleum and Natural Gas, (1995) 1 SCC 85 87 Tata Iron & Steel Co v UOI (1996) 9 SCC 709 : 1996 INSC 770 : 1996 INSC 770 88 Victorian Granites Pvt. Ltd. v. P. Rama Rao & Ors (1996) 10 SCC 665 : 1996 INSC 1018 89 Mafatlal Industries Ltd. & Ors. v. Union of India & Ors. (1997) 5 SCC 536 90 Reliance Natural Resources Ltd. v. Reliance Industries Ltd. (2010) 7 SCC 1 : 2010 INSC 290 91 In Re Natural Resources Allocation (2012) 10 SCC 1, Property Owners Association & Ors. v. State of Maharashtra & Ors. 100 [2024] 11 S.C.R.

80. Mr Tushar Mehta, the learned Solicitor General, supplemented the arguments of the learned Attorney General. He argued: a. The interpretation that Article 39(b) includes privately owned resources, has been a consistent position of this Court and has acquired the status of stare decisis. The opinion of Justice Krishna Iyer in Ranganatha Reddy has been followed in Sanjeev Coke, State of Tamil Nadu & Ors vs. L. Abu Kavur Bai & Ors.,92 and also by a bench of eleven judges in Mafatlal Industries. There is no conflict of opinion between different judgements; b. The observations in Mafatlal Industries on the interpretation of Article 39(b) do not constitute obiter dicta. The interpretation of Article 39(b) is discussed by three opinions in the decision, including the dissenting opinion and the issue was specifically argued; c. The meaning of the phrase “material resources of the community” cannot be whittled down to only include public resources and exclude private property. The phrase specifically uses the word ‘community’ to include the resources of every individual; d. The inclusion of the phrase “securing that the ownership and control” in Article 39(b) indicates that the phrase that follows it i.e. “material resources of the community” includes resources which are not public resources. The ‘ownership and control’ of public resources would not be required to be secured and it is only private property that is required to be “secured” for the purposes of ownership and control; e. The terms ‘ownership’ and ‘control’ are disjunctive and there may be situations where the state does not acquire ownership but only acquires control. For instance, if a mineral is found on private land, the ownership may remain with the private person, but control over the mineral and the land is taken over by the government. Therefore, the term ‘and’ must be read as ‘and/or’; 92 [1984] 1 SCR 725 : (1984) 1 SCC 515 : 1984 INSC 17 Digital Supreme Court Reports [2024] 11 S.C.R. 101 f. The securing of ownership and control must be of any identifiable class of “material resources” and not in general terms as a wholesale acquisition of all private property without any defined principle; g. Article 39(b) leaves it entirely to the wisdom of the legislature to decide what should constitute ‘material resources’ at a given point in time, keeping in mind the dynamics of national and international economic configurations. It allows the legislature to enact a law for the distribution of particular material resources, irrespective of its pattern of ownership; h. The debates in the Constituent Assembly indicate that the framers of the Constitution deliberately framed Article 39(b) in the broadest possible terms. The idea was to leave enough room for future governments to determine the best way of achieving ‘economic democracy’; i. j. k. The deletion of the right to property as a fundamental right, under the erstwhile Article 31 and Article 19(1)(f), points towards the inclusion of private property within the ambit of ‘material resources of the community’ under Article 39(b); Provisions akin to Article 39(b) are present in various constitutions across the world and have not posed any problems. Even in the absence of Article 39(b), the formation of any nation State, includes within itself, the power to acquire an identifiable class of property or “material resource” from an identifiable “community” for the larger public or “common good”; and The preservation of ‘material resources’, such as buildings constitutes the ‘common good’.The principle of ‘inter- generational equity’ propounded by this Court in the context of natural resources, provides that resources need to be used judicially to ensure that future generations are also able to enjoy the fruits of the resources.

81. Mr Rakesh Dwivedi, senior counsel appearing for the State of West Bengal advanced the view that this Court should refrain from laying down a water-tight interpretation of the resources and forms of distribution that fall within the ambit of Article 39(b). Such an exercise, Mr Dwivedi urged, is context-specific and must be left for Property Owners Association & Ors. v. State of Maharashtra & Ors. 102 [2024] 11 S.C.R. experimentation by the Parliament, in view of changing economic priorities. In the context of this formulation, he broadly made the following submissions: a. The phrase ‘material resources” includes privately owned resources within its ambit. Only resources that are earmarked for personal use and do not act as a source of income or wealth are excluded from the phrase; b. The proposal to amend the existing provision to include specific resources was rejected by the Constituent Assembly. Dr Ambedkar stated that it was a deliberate choice to keep the phraseology extensive to account for future economic priorities. Thus, Article 39(b) must be construed liberally.; c. The provision uses the term “community” instead of “State/ Government”. The phrase includes all citizens or sections of citizens or a community of individuals and thus, encompasses privately owned resources; d. Various forms of private property inherently have a bearing on ecology and the well-being of the community,for instance, privately owned forests, large ponds, fragile areas and wetlands. Such properties by their nature, would be included in the phrase “material resources of the community”. e. The word “distributed” in Article 39(b) has been used as a part of the phrase, “so distributed as best to subserve the common good” and must be widely interpreted. The intent is that the State may adopt any mode of distribution as long as it subserves the common good. Such distribution may be piecemeal or the resources may be kept in the control of a governmental or private agency, provided the benefits reach the people as a ‘common good’; and f. Articles 38, 39(b) and (c), must be read together. They indicate that the provisions are not limited to the material resources owned by the State and its agencies. They enable the state to make a law for distributing ownership and control of the material resources which may be in the hands of private persons to achieve economic justice and redistribution. Digital Supreme Court Reports [2024] 11 S.C.R. 103

82. Mr Gopal Sankarnaryanan, senior counsel, appearing for an intervenor, supplemented the arguments advanced by the counsel for the respondents and the State of West Bengal. He broadly made the following submissions: a. The purport of clauses (b) and (c) of Article 39 must be interpreted in the context of whether Article 31C was meant to apply to laws dealing with privately owned property or resources. Article 31C was inserted in the Constitution by the Parliament to overcome the judgement in RC Cooper, wherein this Court struck down the nationalisation of the private rights of shareholders and banks as violative of Article 14; b. Article 31C is part of a scheme, along with Articles 31A and 31B which were inserted by the first amendment. That both Article 31-A and 31-B apply to private property is uncontested.; c. If ‘ownership and control’ of ‘material resources of the community’ excluded private ownership, there would be no challenge under Article 19 to require protection under Article 31C; d. Article 39(c) seeks to prevent the “concentration of wealth and means of production” which could be to the common detriment. Such phrases cannot be construed to refer to public wealth and public means of production. A similar interpretation must be adopted for Article 39(b); and e. The concept of ‘common good’ alluded to in Article 39(b) is critical to determine whether the provision includes privately owned resources. The COVID-19 pandemic has shown us the need to pool resources, which may often be privately owned, to protect the health of the community. ii. Judicial Discipline: Observations in Sanjeev Coke and Mafatlal

83. Several arguments have been made with regard to the judicial discipline followed by and the precedential value of the judgements which lie at the heart of this reference. We will first address these arguments before analysing the correctness of the interpretation of Article 39(b) in these judgements. Property Owners Association & Ors. v. State of Maharashtra & Ors. 104 [2024] 11 S.C.R. a. The resurrection of the minority view in Ranganatha Reddy by Sanjeev Coke

84. As discussed in Part A of this judgement, the five-judge bench order referred the correctness of the decision in Sanjeev Coke to a larger bench of seven judges. One of the apprehensions of this Court in this reference order was that this Court in Sanjeev Coke, followed the observations of the minority judgement in Ranganatha Reddy, despite the majority expressly distancing itself from such observations. The appellants have also advanced similar contentions. They argue that the decision in Sanjeev Coke is not good in law as the judgement follows a minority view which was ‘disagreed’ with by the majority, and the same error was repeated by subsequent decisions that have followed Sanjeev Coke. Therefore, we first explore whether the decision in Sanjeev Coke can be faulted on the ground of judicial discipline.

85. The judgement at the heart of this controversy before us is Ranganatha Reddy rendered by a bench of seven judges of this Court. The issue before this Court related to the constitutional validity of the Karnataka Contract Carriages (Acquisition) Ordinance, 1976, followed by the Karnataka Contract Carriages (Acquisition) Act, 1976. The legislation provided for the nationalisation of contract carriages in the state. One opinion was authored by Justice NL Untwalia for the majority, speaking for himself, Chief Justice MH Beg, Justice YV Chandrachud and Justice PS Kailasam. Justice Krishna Iyer, speaking for himself, Justice Jaswant Singh and Justice PN Bhagwati, authored a separate but concurring opinion on behalf of a minority of the judges.

86. In Ranganatha Reddy, the issue arose before this Court in an appeal from the judgement of the Karnataka High Court which struck down the legislation and declared it to be unconstitutional. Justice Untwalia, speaking for the majority, briefly delineated the findings of the High Court in the following terms: “4. We now proceed to state the findings of the High Court on the various points argued before it not in the order as finally recorded in para 98 of its judgment at p. 1530 but in the order the points were urged before us by Mr Lal Narayan Sinha, learned Counsel for the appellants. They are as follows: Digital Supreme Court Reports [2024] 11 S.C.R. 105 “(1) The acquisition is not for a public purpose. (2) The compensation or the amount provided for or the principles laid down in the Act for payment in lieu of the various vehicles, permits and other assets is wholly illusory and arbitrary.” For the two reasons aforesaid, the Act is violative of Article 31(2) of the Constitution and is a fraud on it. It is, therefore, null and void. (3) The acquisition of contract carriages with inter-State permits and other assets pertaining to such operators is ultra vires the legislative power and the competence of the State Legislature. (4) Article 31-C does not bar the challenge to the Act as being violative of Article 31(2) of the Constitution as there is no reasonable and substantial nexus between the purpose of the acquisitions and securing the principles specified in clauses (b) and (c) of Article 39.” (emphasis supplied)

87. From the above, it is clear that the High Court declared the Act unconstitutional on several grounds, including a violation of Article 31(2)93 and on the ground of legislative competence. Significantly, as stated in point (4) of the above extract, the High Court also decided on the question of whether the legislation had a nexus with Articles  39(b) and (c) and was consequently protected by Article 31-C. In this regard, the High Court took the view that there was no substantial nexus between the purpose of the acquisition by the legislation and the principles laid down in Articles 39(b) and (c).

88. It was in the context of the above findings of the High Court that the appeal was heard by this Court. The majority judgement, authored by Justice Untwalia, upheld the constitutionality of the Act on the 93 Article 31(2) was part of the Constitution at the time. It has been subsequently omitted by Section 6 of the Constitution (Forty-fourth Amendment) Act, 1978, w.e.f. 20.06.1979. [It read: “(2) No property, movable or immovable, including any interest in, or in any company owning, any commercial or industrial undertaking, shall be taken possession of or acquired for public purposes under any law authorising the taking of such possession or such acquisition, unless the law provides for compensation for the property taken possession of or acquired and either fixes the amount of the compensation, or specifies the principles on which, and the manner in which, the compensation is to be determined and given.”] Property Owners Association & Ors. v. State of Maharashtra & Ors. 106 [2024] 11 S.C.R. ground that the legislation met the muster of Article 31(2). It was held that the provisions were for ‘public purpose’ and provided adequate compensation, as required by the provision. While arguments were made by the counsel on all the issues raised by the judgement of the High Court, the majority judgement eventually upheld the constitutionality of the Act only on the ground of Article 31(2). In fact, it appears that Justice Untwalia consciously refrained from making observations about whether the legislation had a nexus with Article 39(b) and the consequent protection under Article 31C. This is evidenced by the following observations of Justice Untwalia: “15. … For the purpose of deciding the point which falls for consideration in these appeals, it will suffice to say that still the overwhelming view of the majority of Judges in Kesavananda Bharati case is that the amount payable for the acquired property either fixed by the legislature or determined on the basis of the principles engrafted in the law of acquisition cannot be wholly arbitrary and illusory. When we say so we are not taking into account the effect of Article 31-C inserted in the Constitution by the 25th Amendment (leaving out the invalid part as declared by the majority). …

17. As already stated the High Court took the view that the amount payable under the Act for the property acquired would be such that it will be wholly arbitrary and illusory and leave the many operators in huge debts. Many of them were plying their contract carriages having taken loans of considerable sums of money from the various financiers on hire-purchase system, for whom also Mr A.K. Sen appeared and argued before us. They would not only be paupers but huge liability will remain on their shoulders if the interpretation put by the High Court were to be correct. Mr Lal Narayan Sinha, learned Counsel for the appellants, took a very just and proper attitude in advancing an argument before us which would take away the basis of the High Court judgment in this regard. With respect to each and every relevant section on the question of payment of the amount in lieu of the property Digital Supreme Court Reports [2024] 11 S.C.R. 107 acquired he suggested such a reasonable, harmonious and just construction by the rules of interpretation that we found no difficulty in accepting his argument — rather, were glad to do so. The other side on the interpretation so put, which we are going to mention hereinafter, felt satisfied to a large extent. Mr Sinha also advanced some argument with reference to the valid part of Article 31-C read with clauses (b) and (c) of Article 39 but very wisely did not choose to heavily rely upon it. On the interpretation of the statute as canvassed by him, there hardly remained any necessity of it.

27. On the interpretations aforesaid which we have put to the relevant provisions of the Act, it was difficult — rather impossible — to argue that the amount so fixed will be arbitrary or illusory. In some respects it may be inadequate but that cannot be a ground for challenge of the constitutionality of the law under Article 31(2). The respondents felt quite satisfied by the interpretations aforesaid and could not pursue their attack on the vires of the Act on that ground.” (emphasis supplied)

89. Justice Untwalia also expressly clarified that the majority opinion does not express any opinion on whether the Act has a reasonable nexus with Articles 39(b) and (c) and Article 31-C is applicable. Further, the learned judge observed that while Justice Krishna Iyer has rendered a separate opinion specifically dealing with the Article 39(b) and (c) question, the majority must not be understood to be in agreement with those findings. Justice Untwalia observed: “37. At the end we may also indicate that under sub- section (6) of Section 19 all sums deducted by the State Government under sub-section (3) of Section 10 which include the sums payable to the secured creditors stand transferred to the Corporation which is obliged to credit the sums transferred to the appropriate funds. The said provision would take within its ambit the liability of the Corporation to pay forthwith the sum found due to the secured creditors. Since we have upheld the constitutional validity of the Act on merits by repelling Property Owners Association & Ors. v. State of Maharashtra & Ors. 108 [2024] 11 S.C.R. the attack on it by a reasonable and harmonious construction of the Act, we do not consider it necessary to express any opinion with reference to Article 31-C read with clauses (b) and (c) of Article 39 of the Constitution. Our learned Brother Krishna Iyer, J. has prepared a separate judgment specially dealing with this point. We must not be understood to agree with all that he has said in his judgment in this regard.”

90. Justice Krishna Iyer began his separate opinion, on behalf of himself and two other judges, with the following question: “We go wholly with our learned brother Untwalia, J. Then why a separate afterword?”94The opinion then goes on to frame the questions that arose from the judgement of the High Court in the following terms: “50. Back to the challenging problems thrown up by the High Court’s decision. The facts are there in the leading judgment and the formulation of the controverted propositions also needs no reiteration. Broadly speaking, we strike no note of dissensus but seek to bring out some social nuances even in consensus. Let us project the pegs on which our discussion may hang. Incidentally, conceptual differences about the dimensions of the change visualised by Article 31-C read with Article 39(b) and (c) are bound to exist among Judges who, after all, professionally objectify the social philosophy of the Constitution through the subjective prism of their own mentalism.

1. What is a “public purpose”, set as a constitutional limitation in Article 31(2), compliance with which conditions the immunity from attack based on Article 19(1)(f) or inadequacy of recompense when any person is deprived of his property? 1(a). What is the degree of nexus between the public purpose and the acquisition desiderated by Article 31(2)? 1(b). Can Cooper be judicially resurrected, draped differently but with the same “compensation” soul, even after the amendment of Article 31(2)? 94 Ranganatha Reddy [40]. Digital Supreme Court Reports [2024] 11 S.C.R. 109

2. What are the pervasive ambience and progressive amplitude of the “directive principle” in Article 39(b) and (c) in the context of nationalisation of public utilities? 2(a). Can State monopoly by taking over private property be a modus operandi of distribution of ownership and control of the material resources of the community to subserve tile common good, within the framework of Article 39 (b)? 2(b). Are distribution and nationalisation antithetical or overlapping? 2(c). What is the connotation of the expression “material resources”? Can private buses be regarded as material resources of the community?”

91. The above formulation by Justice Krishna Iyer of the issues raised by the High Court is distinguishable from the formulation of the issues by the majority in paragraph 4 of the judgement, extracted above. Issues 2, 2(a), 2(b) and 2(c) identified by Justice Krishna Iyer on the interpretation of Article 39(b), and particularly the purport of the terms ‘distribution’ and ‘material resources’ were not even framed as issues by the majority, let alone answered. We will discuss in detail, the answers given by Justice Krishna Iyer to these questions at a later stage. For now, it is sufficient to note that Justice Krishna Iyer inter alia observed that all resources that satisfy material needs, including privately owned resources, fall within the ambit of the phrase ‘material resources of the community’ used in Article 39(b).95

92. There was a resurrection of these observations by Justice Krishna Iyer in the decision of five judges of this Court in Sanjeev Coke. As briefly noted above, in this case, the petitioners challenged the nationalisation of their coke oven plants on the ground that nationalising certain coke oven plants, while leaving others out violated Article 14 of the Constitution. The Court proceeded on the assumption that Article 31C remains in force and protects a legislation from challenge under Articles 14 and 19 when the Act bears a nexus 95 Ranganatha Reddy [80-84]. Property Owners Association & Ors. v. State of Maharashtra & Ors. 110 [2024] 11 S.C.R. with the principles in Article 39(b) or (c). This Court held that the Coking Coal Mines (Nationalisation) Act 1972 is a legislation that gives effect to the policy specified in Article 39(b) and therefore, is immune from a challenge to its constitutionality under Article 14. To establish the nexus between the Act and the principles laid down in Article 39(b), the bench of five judges of this Court (speaking through Chinappa Reddy, J) analysed the scope of Article 39(b) and the meaning of both ‘material resources of the community’ and the concept of ‘distribution to subserve the common good’.

93. The counsel for the petitioner in Sanjeev Coke mirrored the arguments made by some of the appellants in the case before us. It was urged that a coal mine or coke oven plant owned by private parties cannot constitute a “material resource of the community” until it is acquired by the state. It was argued that to qualify as a material resource of the community, the ownership of the resource must vest with the state. A legislation such as the Coking Coal Mines (Nationalisation) Act, it was urged, may be a legislation for the acquisition of coking coal mines and coke oven plants belonging to private parties but cannot be considered to be a legislation in furtherance of Article 39(b). In essence, the petitioners’ case was that acquisition is a pre-requisite for ‘distribution’ and cannot be considered synonymous with distribution.

94. This Court rejected this argument and quoted with approval paragraphs 82 to 83 of the judgment authored by Justice Krishna Iyer in Ranganatha Reddy for a minority of judges. Relying on the observations of Justice Krishna Iyer, this Court concluded that material resources of the community are not confined to public-owned resources but include “all resources, natural and man-made, public and private-owned”. In this way, the observations in the minority opinion authored by Justice Krishna Iyer in Ranganatha Reddy were resurrected by a five-Judge Bench of this Court in Sanjeev Coke. b. Sanjeev Coke erred in relying on the observations of the minority in Ranganatha Reddy

95. The first issue which arises is the precedential value of the observations made by Justice Krishna Iyer in his opinion in Ranganatha Reddy and whether a subsequent bench of lesser strength in Sanjeev Coke was in violation of judicial discipline by following these observations. Digital Supreme Court Reports [2024] 11 S.C.R. 111

96. The law laid down by this Court is binding on subsequent benches of lesser or coequal strength. A bench of lesser strength cannot disagree or dissent from the view taken by a bench of a larger quorum. In case of any doubt, such a bench may only invite the attention of the Chief Justice and request for the matter to be placed for hearing before a bench of a larger strength than the quorum of the bench whose decision was being considered. A bench of coequal strength may go one step ahead, and express an opinion doubting the correctness of the view taken by the earlier bench of coequal strength. Subsequently, the matter may be placed before a larger bench to lay down the law on the correctness of the decision which is doubted.96

97. Judges of this Court have the liberty to pronounce separate dissenting judgment(s). However, it is the decision of the majority of judges which constitutes the binding judgment.97The binding nature of the judgement depends on the bench strength and not the numerical strength of the majority taking a particular view. For instance, if a judgment is pronounced by a bench of seven judges, with four judges constituting the majority, and the remaining three judges dissenting from the view of the majority, the majority judgement will constitute a binding judgment by a bench of seven judges and not a bench of four judges. This position of law has been clarified and settled by a Constitution Bench of this Court in Trimurthi Fragrances (P) Ltd. v. State (NCT of Delhi).98

98. A dissenting judgment, however, must be distinguished from a concurring judgment.99 A dissenting judgment is a judgment signed by a minority of judges, with or without an accompanying opinion, which expresses non-concurrence with the decision of the majority of judges of the court.100 However, judges of this Court who agree with the decision of the majority may also author separate opinions. 96 Central Board of Dawoodi Bohra vs. State of Maharashtra (2005) 2 SCC 673 [12] : 2004 INSC 720 97 Article 145(5), Constitution of India. [It reads: “No judgment and no such opinion shall be delivered by the Supreme Court save with the concurrence of a majority of the Judges present at the hearing of the case, but nothing in this clause shall be deemed to prevent a Judge who does not concur from delivering a dissenting judgment or opinion.”] A similar provision was contained in Section 214(4) of the Government of India Act, 1935. 98 [2022] 15 SCR 516 : 2022 SCC OnLine SC 1247 : 2022 INSC 975 99 DD Basu, ‘Constitution of India’, Vol 9, p 9917. 100 ADVANCED LAW LEXICON BY RAMANATHAIER, 3rd Edn., Vol. III, p. 2509. Property Owners Association & Ors. v. State of Maharashtra & Ors. 112 [2024] 11 S.C.R.

99. In such ‘concurring opinions’, the judge (or judges) agree with the conclusion of the majority, though they separately state their views on the case or their reasons for concurrence. Such opinions may be based on different grounds and the judges may give separate reasons, even about observations on which they concur with the majority. The majority judgement too is not always contained in a single opinion. It is common practice for a plurality of judges of this Court to render separate opinions, and it is from the conclusions and concurring observations of each of their judgements that a majority opinion is identified. In order to determine whether the observations in the concurring opinion of a numerical minority of judges constitute a binding precedent, we must ask two questions. Firstly, when only the concurring opinion expounds the law on a particular point, does the majority opinion indicate a difference of opinion from that view or distance itself from such reasoning? Secondly, are the observations in the concurring opinion essential to the ratio decidendi and can they be regarded as an expression of opinion on behalf of this Court as a whole?101These requirements are cumulative. For observations in a concurring opinion to be binding on a smaller or coequal bench, the observations in the concurring opinion should be both free from disagreement or difference by the majority of judges and also be a part of the ratio decidendi of the judgment.

100. The disagreement with the concurring view in the majority opinion may be express or implied. The majority may expressly state that it disagrees with or distances itself from the view taken in a concurring opinion on a particular issue. Alternatively,the discussion in the majority judgment on that issue may be at odds with the observations in the concurring opinion. It is the latter situation that becomes more tricky, particularly, when a single opinion has not been authored on behalf of the majority. A Constitution Bench of this Court in Jaishri Laxmanrao Patil v. State of Maharashtra102 has provided some assistance about how to cull out the binding majority opinion in such a situation, where various judges,discuss the same question of law albeit differently. The Constitution Bench 101 DD Basu, ‘Constitution of India’, Vol 9, p 9849. 102 [2021] 15 SCR 715 : (2021) 8 SCC 1 : 2021 INSC 284 Digital Supreme Court Reports [2024] 11 S.C.R. 113 (speaking through Justice Ravindra Bhat) relied on the observations in Rajnarain Singh v. Patna Administration Committee103and held that to cull out the majority in such cases, the Court must attempt to ascertain the ‘greatest common measure’ of agreement. The Court held: “355. Before we proceed to notice the relevant paragraphs of the judgment of Indra Sawhney, we need to first notice method of culling out the majority opinion expressed in a judgment where more than one judgments have been delivered. The Constitution Bench of this Court in Rajnarain Singh v. Patna Admn. Committee, had occasion to find out the majority opinion of a seven-Judge Bench judgment delivered by this Court in Delhi Laws Act, 1912, In re. the Constitution Bench laid down that opinion which embodies the greatest common measures of the agreement among the Bench is to be accepted as the decision of the Court. Thus, for culling out the decision of the Court in a case where there are several opinions, on which there is greatest common measure of agreement is the decision of the Court.” (emphasis supplied)

101. Therefore, in situations where several opinions are authored, dealing with the same questions of law, to identify the propositions of law that are binding on subsequent benches, the greatest common measure of agreement by a majority of judges would be binding on future benches.

102. It must be noted, however, that there is a difference between whether an observation is a binding precedent and whether it is a position of law that may have persuasive value on subsequent benches. In the absence of disagreement by a majority of judges (either express or implied), nothing precludes subsequent benches of this Court from relying on observations made in a concurring opinion(on behalf of the minority of judges) which are not discussed by the other judges at all. It is assumed in such cases, that all judges on the bench have read the opinions of one another, and did not deem it necessary 103 [1955] 1 SCR 290 : (1954) 2 SCC 82 : 1954 INSC 69 Property Owners Association & Ors. v. State of Maharashtra & Ors. 114 [2024] 11 S.C.R. to either state their express disagreement with the opinion or lay down a different understanding of the proposition of law (implied disagreement).104

103. For instance, in Navtej Singh Johar v Union of India,105 one of us (DY Chandrachud, J) authored a concurring opinion, recognising the concept of ‘indirect discrimination’. While technically this was an opinion on behalf of only one judge, the other judgements in the case did not discuss this issue at all. Neither did the other judges expressly disagree with the view, nor did they present a view on the subject that could be seen as being at odds with the view taken in the concurring opinion. In the absence of such disagreement, express or implied, subsequent benches of this Court were not precluded from relying on the observations as having persuasive value. In Lt. Col. Nitisha & Ors. vs. Union of India & Ors,106 a two-Judge Bench of this Court relied on the conception of ‘indirect discrimination’ while analysing an evaluation criteria set by the army, which was facially neutral but disproportionately impacted women officers. The bench was not violating judicial discipline merely because a majority of judges did not expressly agree with the view or discuss the concept at all. The fact that the observations of the concurring opinion were not disagreed with or even discussed is sufficient for a subsequent bench to rely on the same if they choose to do so. In such cases, the court is not bound by the view but may choose to rely on it.

104. However, the above example is distinguishable from the situation in Ranganatha Reddy. The majority judgment in Ranganatha Reddy not only refrained from making observations about the interpretation of Article 39(b) but also indicated an express disagreement with the observations in the judgment of Justice Krishna Iyer on the point. It was to prevent future benches from relying on the observations of that judgment, by presuming concurrence, that the majority opinion clarified that it must not be understood to agree with the observations in the judgement of Justice Krishna Iyer. Thus, it is clear that a majority of judges of this Court did not adopt the view advanced by 104 Kaikhosrou (Chick) Kavasji Framji v. Union of India (2019) 20 SCC 705 [40-46] : 2019 INSC 378 105 [2018] 7 SCR 379 : (2018) 10 SCC 1 [442-446] : 2018 INSC 790 106 [2021] 4 SCR 633 : (2021) 15 SCC 125 [50] : 2021 INSC 210 Digital Supreme Court Reports [2024] 11 S.C.R. 115 Justice Krishna Iyer on the interpretation of Article 39(b). In such a situation, the bench of five judges in Sanjeev Coke was bound by the view of the majority in Ranganatha Reddy, which was a decision rendered by a bench of seven judges. The view taken by a minority of three judges and specifically disagreed with by the majority of four judges could not be relied on by a smaller bench of five judges in Sanjeev Coke. Not only was the opinion in the judgment of a minority of judges not binding, but it also could not be relied on as having persuasive value, since there was a majority opinion of a larger bench disagreeing with the view.

105. The majority in Ranganatha Reddy did not discuss its interpretation of Article 39(b) and merely expressed their disagreement simpliciter with the view of the concurring minority. Therefore, it is undoubtedly possible that the bench of a lower quorum in Sanjeev Coke was perplexed about the interpretation of Article 39(b) that it was bound to follow. In such a situation it was open to the bench to have brought this to the attention of the Chief Justice and requested for the matter to be placed before a larger bench. A part of the beauty of minority opinions undoubtedly lies in the hope of the author that, in some cases, they may become the law when adopted by a majority in a future case.107 However, this cannot be done by compromising on judicial discipline. To this effect, this Court in Sanjeev Coke erred in relying on the observations in the opinion of Justice Krishna Iyer in Ranganatha Reddy, when the binding opinion of the majority of judges expressly stated their inability to agree with those observations. c. The error has been carried forward in subsequent decisions

106. Mr Tushar Mehta, the learned Solicitor General of India, has argued that this Court has consistently upheld the observations of Justice Krishna Iyer in Ranganatha Reddy and this is not a case of jurisprudential inconsistency or conflicting decisions. The observations in Sanjeev Coke on Article 39(b), adopting the minority 107 The famous words of Chief Justice Hughes: “A dissent in a court of last resort is an appeal to the brooding spirit of the law, to the intelligence of a future day when a later decision may possibly correct the error into which the dissenting judge believes the court to have been betrayed...... Nor is this always in vain. In a number of cases dissenting opinions have in time become law.”[HUGHES, THE SUPREME COURT OF THE UNITED STATES, (1930) American BarAsson. Journal.] Property Owners Association & Ors. v. State of Maharashtra & Ors. 116 [2024] 11 S.C.R. view in Ranganatha Reddy, have been followed in subsequent decisions of this Court. These decisions include inter alia S Abu Kavur Bai, Basantibal Khetan, and Mafatlal. Thus, it was urged, that this Court should refrain from unsettling a position of law that has been consistent for several years and has “acquired the status of stare decisis”.

107. We are not inclined to accept this submission. In Sita Soren v Union of India,108 a Constitution Bench of this Court, speaking through one of us (DY Chandrachud, J) had occasion to clarify that the doctrine of stare decisis is not an inflexible rule of law. This Court may review its earlier decisions if it believes that there is an error, or the effect of the decision would harm the interests of the public or if “it is inconsistent with the legal philosophy of the Constitution”. In cases involving the interpretation of the Constitution, this Court would do so more readily than in other branches of law because not rectifying a manifest error would be harmful to the public interest and the polity. The period of time over which the case has held the field is not of primary consequence.

108. As noted above, the decision of the five-judge bench in Sanjeev Coke was based on an erroneous reliance on the minority opinion in Ranganatha Reddy. The same error committed in Sanjeev Coke has been carried forward in subsequent decisions of this Court ever since. The view of a minority of three judges, expressly disagreed with by a majority of four judges, has been relied on for several years, without its validity ever being tested by a larger bench. Similarly, the disagreement with the minority opinion expressed by the majority in Ranganatha Reddy has also remained untested, with the smaller bench in Sanjeev Coke adopting the minority view without any explanation. Therefore, this bench of nine judges must test the correctness of the decision in Ranganatha Reddy and the subsequent decisions relying on the minority opinion in the case. This exercise has eluded this Court for a long period of time. As noted above, it is only a bench of a larger quorum (nine judges) that can test the correctness of an opinion rendered by a smaller bench (seven judges) and thus, this Constitution Bench must reconsider the interpretation of Article 39(b) adopted in these judgements. 108 [2024] 3 SCR 462 : (2024) 5 SCC 629 [33] : 2024 INSC 161 Digital Supreme Court Reports [2024] 11 S.C.R. 117 d. The single-line observation in Mafatlal is obiter dicta

109. Another point of contention between the parties has been the precedential value of the single-line observation of a nine-judge bench of this Court in Mafatlal that the phrase ‘material resources of the community’ under Article 39(b) includes privately owned property. As noted above, the underlying seven-judge referral order notes that the attention of this Court was drawn to this observation in Mafatlal. It was in this context that the seven-judge bench order expressed doubts about the view and referred the question to this bench of nine judges.

110. The counsel for the appellants contend that the observations in Mafatlal on this point constitute obiter dicta and do not bind this bench of coequal strength. On the other hand, the counsel for the respondents have advanced the view that the issue arose directly in the case and the observations are binding on this bench.

111. Not every observation in a judgement of this Court is binding as precedent. Only the ratio decidendi or the propositions of law that were necessary to decide on the issues between the parties are binding.109 Observations by the judge, even determinative statements of law, which are not part of her reasoning on a question or issue before the court, are termed obiter dicta. Such observations do not bind the Court. More simply, a case is only an authority for what it actually decides.110

112. A Constitution Bench of this Court (speaking through Chief Justice Khare) in Islamic Academy of Education v. State of Karnataka111pithily observed: “2. […] The ratio decidendi of a judgment has to be found out only on reading the entire judgment. In fact, the ratio of the judgment is what is set out in the judgment itself. The answer to the question would necessarily have to be read in the context of what is set out in the judgment and not in isolation. In case of any doubt as regards any observations, reasons and principles, the other part of the 109 HALSBURY, 2nd Edn, Vol 19, para 556. 110 Secundrabad Club v. CIT, 2023 SCC OnLine SC 1004 [13] : 2023 INSC 736 111 [2003] Supp. 2 SCR 474 : (2003) 6 SCC 697 [2] : 2003 INSC 391 Property Owners Association & Ors. v. State of Maharashtra & Ors. 118 [2024] 11 S.C.R. judgment has to be looked into. By reading a line here and there from the judgment, one cannot find out the entire ratio decidendi of the judgment. […]”

113. In Secunderabad Club v. CIT,112 this Court, speaking through one of us (Justice BV Nagarathna), had occasion to delineate how to cull out the ratio decidendi of a judgement and identify the principles which have precedential value. This Court observed: “14. […] According to the well-settled theory of precedents, every decision contains three basic ingredients : (i) findings of material facts, direct and inferential. An inferential finding of fact is the inference which the judge draws from the direct or perceptible facts ; (ii) statements of the principles of law applicable to the legal problems disclosed by the facts ; and (iii) judgment based on the combined effect of (i) and (ii) above. For the purposes of the parties themselves and their privies, ingredient (iii) is the material element in the decision, for, it determines finally their rights and liabilities in relation to the subject-matter of the action. It is the judgment that estops the parties from reopening the dispute. However, for the purpose of the doctrine of precedent, ingredient (ii) is the vital element in the decision. This is the ratio decidendi. It is not everything said by a judge when giving a judgment that constitutes a precedent. The only thing in a judge’s decision binding a party is the principle upon which the case is decided and for this reason it is important to analyse a decision and isolate from it the ratio decidendi.” (emphasis supplied)

114. Further, a simple test that has been invoked by this Court to determine whether a particular proposition of law is to be treated as the ratio decidendi of a case is the “inversion test” formulated by Professor 112 [2023] 12 SCR 979 : 2023 SCC OnLine SC 1004 : 2023 INSC 736 Digital Supreme Court Reports [2024] 11 S.C.R. 119 Eugene Wambaugh.113 The test mandates that to determine whether a particular proposition of law is part of the ratio decidendi of the case, the proposition is to be inversed. This means that either that proposition is hypothetically removed from the judgement or it is assumed that the proposition was decided in reverse. After such removal or reversal, if the decision of the Court on that issue before it would remain the same then the observations cannot be regarded as the ratio decidendi of the case.114

115. In Mafatlal, a Bench of nine Judges of this Court adjudicated on the rights and remedies available to a citizen against the State in relation to the refund of unlawfully recovered taxes and imposts. The court dealt with whether a manufacturer or assessee who has passed on the burden of an illegally recovered tax is entitled to a refund or whether a refund in such cases will amount to unjust enrichment. One of the several arguments made by the counsel appearing for the Union of India was that this question must be decided in light of the constitutional values of social and economic justice, including those laid down in the Preamble and Articles 39(b) and (c). More specifically, it was urged that Article 265115 must be interpreted in the context of these constitutional values.

116. Faced with the above argument, the majority opinion authored by Justice Jeevan Reddy, on behalf of himself and four other judges, made certain observations which referred to Article 39(b). These observations are found in paragraphs 84 to 86 of the judgement. We must take a closer look at these observations, in the context of the issues before the Court, to determine whether they are part of the ratio decidendi and central to the decision of this Court.

117. Justice Jeevan Reddy attempted to locate the question of refund of unlawfully recovered duty within the framework of the “philosophy and core values” which guide our Constitution. In this context, it was observed that these values can be located inter alia in the Directive Principles contained in Part IV, including Article 39(b) and the Preamble of the Constitution. Justice Jeevan Reddy observed: 113 State of Gujarat v. Utility Users’ Welfare Assn. (2018) 6 SCC 21 [113-114] : 2018 INSC 329 114 Eugene Wambaugh, The Study of Cases (Boston: Little, Brown & Co., 1892) 115 Article 265, Constitution of India. [It reads: “265. Taxes not to be imposed save by authority of law – No tax shall be levied or collected except by authority of law”.] Property Owners Association & Ors. v. State of Maharashtra & Ors. 120 [2024] 11 S.C.R. “84. […] Unlike the economically neutral — if not pro- capitalist — Constitutions governing those countries, the Indian Constitution has set before itself the goal of “Justice, Social, Economic and Political” — a total restructuring of our society — the goal being what is set out in Part IV of the Constitution and, in particular, in Articles 38 and 39. Indeed, the aforesaid words in the Preamble constitute the motto of our Constitution, if we can call it one. Article 38 enjoins upon the State to “strive to promote the welfare of the people by securing and protecting as effectively as it may a social order in which justice, social, economic and political shall inform all the institutions of the national life”. Article 39 lays down the principles of policy to be followed by the State. It says that the State shall, in particular, direct its policy towards securing “(b) that the ownership and control of the material resources of the community are so distributed as best to subserve the common good; and (c) that the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment”. Refunding the duty paid by a manufacturer/assessee in situations where he himself has not suffered any loss or prejudice (i.e., where he has passed on the burden to others) is no economic justice; it is the very negation of economic justice. By doing so, the State would be conferring an unearned and unjustifiable windfall upon the manufacturing community thereby contributing to concentration of wealth in a small class of persons which may not be consistent with the common good. The Preamble and the aforesaid articles do demand that where a duty cannot be refunded to the real persons who have borne the burden, for one or the other reason, it is but appropriate that the said amounts are retained by the State for being used for public good […] (emphasis supplied)

118. In the next paragraph, Justice Jeevan Reddy made further observations about ‘philosophy and values’ which must be kept in Digital Supreme Court Reports [2024] 11 S.C.R. 121 mind while interpreting the Constitution. Significantly, Justice Jeevan Reddy borrowed from the observations by Justice Krishna Iyer in Ranganatha Reddy and noted: “85. […] As observed by Thomas Jefferson, as far back as in 1816, “laws and institutions must go hand-in-hand with the progress of the human mind … as new discoveries are made, new truths are discovered and manners and opinions change with the change of circumstances, institutions must advance also and keep pace with the time…”. The very same thought was expressed by Krishna Iyer, J. in State of Karnataka v. Ranganatha Reddy with particular reference to our constitutional philosophy and values: “Constitutional problems cannot be studied in a socio-economic vacuum, since socio-cultural changes are the source of the new values, and sloughing off old legal thought is part of the process of the new equity-loaded legality…. It is right that the rule of law enshrined in our Constitution must and does reckon with the roaring current of change which shifts our social values and shrivels our feudal roots, invades our lives and fashions our destiny.” The learned Judge quoted Granville Austin, saying: “The Judiciary was to be the arm of the social revolution, upholding the quality that Indians had longed for in colonial days…. The courts were also idealised because, as guardians of the Constitution, they would be the expression of a new law created by Indians for Indians.”

119. Having made these observations, this Court went on to accept the submission of the counsel for the Union of India and held that the ‘philosophy and core values’ of our Constitution must be kept in mind while understanding the provisions of the Constitution, including Article 265. Before reaching this conclusion, the judgement stated in a single sentence that “the ‘material resources of the community’ are not confined to public resources” but include all resources, including privately owned resources. The observations were as follows: Property Owners Association & Ors. v. State of Maharashtra & Ors. 122 [2024] 11 S.C.R. “86. That “the material resources of the community” are not confined to public resources but include all resources, natural and man-made, public and private owned” is repeatedly affirmed by this Court. (See Ranganatha Reddy, Sanjeev Coke Manufacturing Co. v. Bharat Coking Coal and State of T.N. v. L. Abu Kavur Bai), We are of the considered opinion that Shri Parasaran is right in saying that the philosophy and the core values of our Constitution must be kept in mind while understanding and applying the provisions of Article 265 of the Constitution of India and Section 72 of the Contract Act (containing as it does an equitable principle) — for that matter, in construing any other provision of the Constitution and the laws. Accordingly, we hold that even looked at from the constitutional angle, the right to refund of tax paid under an unconstitutional provision of law is not an absolute or an unconditional right. Similar is the position even if Article 265 can be invoked — we have held, it cannot be — for claiming refund of taxes collected by misinterpretation or misapplication of a provision of law, rules, notifications or regulation.”

120. The above observations indicate that the relevance of Article 39(b) to the judgement was limited to the larger socio-economic values which it espouses. The ratio decidendi of the majority judgement was that the constitutional values contained in the Preamble and Part IV of the Constitution, including Article 39(b) must be considered while interpreting Article 265 and determining whether a refund of taxes is permissible to a person who has passed on the burden. The single-line observation on Article 39(b) encompassing privately owned property was not relevant to this holding. To hold that this observation constitutes the ratio decidendi of the judgment would be to disregard the warning of Chief Justice Khare in Islamic Academy of Education that “by reading a line here and there from the judgment, one cannot find out the entire ratio decidendi of the judgment.”116 116 Islamic Academy of Education [2]. Digital Supreme Court Reports [2024] 11 S.C.R. 123

121. This Court in Mafatlal did not independently conclude that Article 39(b) encompasses private property or justify the relevance of this proposition to the issues before the court. It was merely stated that this has been “repeatedly affirmed” by this Court. Even if this proposition of law is inverted and it is presumed that this Court observed that private resources do not fall within the ambit of ‘material resources of the community’, it would not impact the decision or the issue in question. The underlying values of economic justice which run through Chapter IV of the Constitution and the Preamble would remain intact and this Court would have reached the same conclusion. The tax collected was already within the “ownership and control” of the government, and in the context of a refund, there is no question of distributing any privately owned resources. We are therefore inclined to accept the submission of the appellants that the issue of whether Article 39(b) includes privately owned property was not a matter in dispute in Mafatlal. The single-line observation of Justice Jeevan Reddy in the majority opinion constitutes obiter dicta and is not binding on this Court.

122. Mr Tushar Mehta, the learned Solicitor General of India contended that certain observations on Article 39(b) have been made not only in the majority opinion but also in two other opinions – a concurring opinion authored by Justice Paripoornan and a dissenting opinion authored by Justice SC Sen. It was urged that this indicates that the issue of Article 39(b) was central to the dispute and the observations of the majority on the inclusion of private property are part of the ratio of the judgement.

123. Justice Paripoornan concurred with the majority view and accepted the submission of the counsel for the Union of India that Article 265 of the Constitution must be construed in light of the values in the Preamble and Articles 39(b) and (c). The observations were in the following terms: “304. […] The plea urged was that, if the assessee, is denied the refund, the State Government could retain the amount illegally collected, and it would amount to violation of the constitutional mandate enshrined in Article 265 of the Constitution. An equitable principle will not hold good against a constitutional mandate. On the other hand the counsel for the Union of India, Shri K. Parasaran, brought to our notice the following portion of the Preamble and Property Owners Association & Ors. v. State of Maharashtra & Ors. 124 [2024] 11 S.C.R. Articles 39(b) and (c) of the Constitution to contend that Article 265 of the Constitution cannot be construed in a vacuo or isolation, but should be construed in the light of the basic principles contained in other parts of the Constitution — viz. — the Preamble and the Directive Principles of State Policy: “Preamble WE, THE PEOPLE OF INDIA, having solemnly resolved to constitute India into a Sovereign Socialist Secular Democratic Republic and to secure to all its citizens: Justice, social, economic and political: ***” Articles 39(b) and (c): “39. (b) that the ownership and control of the material resources of the community are so distributed as best to subserve the common good; (c) that the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment;”

305. Mr Parasaran also urged that it should be borne in mind that excise duty is an indirect levy or tax which could be passed on. Innumerable persons bear the brunt. And it is passed on, ordinarily by prudent businessmen. […] The scope of Article 39(b) of the Constitution, as laid down by this Court in State of Karnataka v. Ranganatha Reddy, Sanjeev Coke Mfg. Co. v. Bharat Coking Coal Ltd., State of T.N. v. L. Abu Kavur Bai,was highlighted. […]

306. On an evaluation of the rival pleas urged in the matter, I am of the view that the plea of the counsel for Union of India should prevail.” (emphasis supplied) Digital Supreme Court Reports [2024] 11 S.C.R. 125

124. On the other hand, Justice Sen disagreed with the view taken in the opinions authored by Justice Jeevan Reddy and Justice Paripoornan. He held that the provisions of Article 39 cannot curtail the interpretation of Article 265, and the Directive Principles do not permit the state to use unlawfully collected properties. He observed: “161. Article 39 of the Constitution has directed the State to formulate its policy towards securing that the ownership and control of the material resources of the community are so distributed as best to subserve the common good and that the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment. These provisions do not in any way curtail the scope and effect of Article 265. Article 39 does not enjoin that unlawfully collected properties should be used by the State for the common good. Nor does it say that the operation of the economic system should be so moulded as to prevent concentration of wealth, by unlawful means. Article 39 cannot be a basis for retaining whatever has been gathered unlawfully by the Government for common good. Simply stated the Directive Principles of State Policy do not license the Government to rob Peter to pay Paul.”

125. The above observations in the opinions of Justice Paripoornan and Justice SC Sen only further indicate that the argument of the counsel was limited to whether Article 265 of the Constitution must be interpreted in light of the constitutional values found inter alia in the Preamble and Part IV, including Article 39(b).The observations in these two opinions in no way assist the respondents in establishing that the single sentence in the majority judgement about the inclusion of private property constituted the ratio decidendi of the judgment.

126. In any event, the mere presence of an observation in multiple opinions of the court, be it concurring or dissenting opinions, does not automatically indicate that they form part of the ratio decidendi. In order to determine whether the observations form part of the ratio decidendi,one must go back to the drawing board and determine whether the observations pertained to an issue which actually arose between the parties and were necessary to the determination by the court. In other words, even if a numerical majority of judges or Property Owners Association & Ors. v. State of Maharashtra & Ors. 126 [2024] 11 S.C.R. opinions of the Court affirm an observation, it would not automatically constitute the ratio decidendi of the case. It must be independently established that the observation relates to an issue which was in dispute before the court.

127. Therefore, the single-line observation in Mafatlal that the phrase ‘material resources of the community’ used in Article 39(b) includes privately owned resources was obiter dicta and is not binding on this Court. iii. Interpreting Article 39(b)

128. Having addressed the contentions regarding judicial discipline and the precedential value of the judgments which gave rise to this reference, we turn to the substantive question before us: the interpretation of Article 39(b).

129. The counsel for the respondents contended that this Court should refrain from laying down a water-tight interpretation of Article 39(b) and it should be left to Parliament to determine the ambit of the provision based on the economic priorities of the day. We are not inclined to accept such an argument in its entirety. The interpretation of Article 39(b) has far-reaching consequences, involving judicial inquiry, which makes it incumbent on this Court to interpret the provision. These consequences, detailed below, underscore the necessity of a constitutional interpretation by this Court, while also highlighting the ramifications of adopting a wide and unmanageable construction of the provision. a. Article 39(b) as a pre-requisite to protection under Article 31C

130. As discussed in Part C of this judgement, Article 31C as upheld by the majority in Kesavananda Bharati remains in force under the Constitution. Under this provision (as it stands), no law giving effect to the policy of the State towards securing the principles specified in clauses (b) or (c) of Article 39(b) can be challenged on the ground that it is inconsistent with or takes away or abridges any of the rights conferred by Articles 14 and 19 of the Constitution. Therefore, the first and perhaps most significant consequence of this Court holding that a certain statute gives effect to the principles in Article 39(b) is that it falls within the immunity provided by Article 31C. The constitutionality of such a legislation cannot be challenged under Articles 14 or 19 of the Constitution. Digital Supreme Court Reports [2024] 11 S.C.R. 127

131. Prior to the decision in Kesavananda Bharati, if a law merely contained a declaration that it gives effect to the policy laid down in Article 39(b), it could not be questioned in any court on the ground that it does not actually give effect to such a policy. In Kesavananda Bharati, this part of the provision was struck down. All laws which purport to give effect to the principles in Articles 39(b) or (c) of the Constitution are subject to judicial inquiry and review on the question of whether they actually bear a nexus with the provision. In other words, the question of whether they do in fact give effect to the principles in Articles 39(b) and (c) is justiciable.

132. In Kesavananda Bharati, while striking down the second part of the erstwhile Article 31-C, Justice HR Khanna explained the importance of the court exercising judicial review on whether the legislation gives effect to the principles under Article 39(b) and (c). He was particularly apprehensive of giving the legislature the final authority to determine whether a law falls within the ambit of Article 39(b). The exclusion of judicial review was held to be violative of the basic structure of the Constitution. Justice Khanna observed: “(xiv) The second part of Article 31-C contains the seed of national disintegration and is invalid on the following two grounds: (3) It gives a carte blanche to the legislature to make any law violative of Articles 14, 19 and 31 and make it immune from attack by inserting the requisite declaration. Article 31-C taken along with its second part gives in effect the power to the legislature including a State Legislature, to amend the Constitution in important respects. (4) The legislature has been made the final authority to decide as to whether the law made by it is for the objects mentioned in Article 31-C. The vice of the second part of Article 31-C lies in the fact that even if the law enacted is not for the object mentioned in Article 31-C, the declaration made by the legislature precludes a party from showing that the law is not for the object and prevents a court from going into the question as to whether the law enacted is really for that object. The Property Owners Association & Ors. v. State of Maharashtra & Ors. 128 [2024] 11 S.C.R. exclusion by the legislature, including a State Legislature, of even that limited judicial review strikes at the basic structure of the Constitution. The second part of Article 31-C goes beyond the permissible limit of what constitutes amendment under Article 368.”

133. The sequitur to this Court striking down the second part of Article 31-C in Kesavananda Bharti is that the court may conduct a judicial inquiry into whether the legislation which is sought to be saved by Article 31-C, actually bears a direct and reasonable nexus with the principles laid down in Article 39(b) or (c), as the case may be. In this regard, the observations of Justice Mathew in Kesavananda Bharati are instructive: “1779. […] a Court will have to examine the pith and substance, the true nature and character of the law as also its design and the subject-matter dealt with by it together with its object and scope. If the Court comes to the conclusion that the declaration was merely a pretence and that the real purpose of the law is the accomplishment of some object other than to give effect to the policy of the State towards securing the Directive Principles in Article 39(b) and (c), the declaration would not be a bar to the Court from striking down any provision therein which violates Articles 14, 19 or 31. In other words, if a law passed ostensibly to give effect to the policy of the State is, in truth and substance, one for accomplishing an unauthorised object, the Court would be entitled to tear the veil created by the declaration and decide according to the real nature of the law.” (emphasis supplied)

134. In view of the decision in Kesavananda Bharati, it has been consistently affirmed by this Court that the declaration in a statute that the Act has a nexus with or seeks to give effect to the principles laid down in Article 39(b) or (c) is subject to judicial review. To determine whether a statute is within the folds of Article 31-C, the court may examine the nature and character of legislation to determine whether there is any direct and reasonable nexus between the law and the principles in Articles 39(b) and (c). On such an examination, if it Digital Supreme Court Reports [2024] 11 S.C.R. 129 appears that there is no such nexus, the legislation will not enjoy the protection of Article 31-C. It has been held by this Court that “to see the real nature of the statute, the court may also tear the veil”. If the court concludes that the object of the legislation was merely a pretence and the real object does not correspond with the principles laid down in Articles 39(b) and (c), Article 31-C would not be attracted and the validity of the statute would have to be tested independent of Article 31-C.

135. It cannot be gainsaid that the impact of a legislation being saved by Article 31C is significant. The impact of this ‘safe harbour’ was eloquently described by Chief Justice YV Chandrachud, speaking for a majority of judges in Minerva Mills. While detailing the consequence of legislation being protected from a challenge under Article 14 and 19, this Court observed: “61. Articles 14 and 19 do not confer any fanciful rights. They confer rights which are elementary for the proper and effective functioning of a democracy. They are universally so regarded, as is evident from the Universal Declaration of Human Rights. Many countries in the civilised world have parted with their sovereignty in the hope and belief that their citizens will enjoy human Freedoms. And they preferred to be bound by the decisions and decrees of foreign tribunals on matters concerning human freedoms. If Articles 14 and 19 are put out of operation in regard to the bulk of laws which the legislatures are empowered to pass, Article 32 will be drained of its life-blood.

74. Three Articles of our Constitution and only three, stand between the heaven of freedom into which Tagore wanted his country to awake and the abyss of unrestrained power. They are Articles 14, 19 and 21. Article 31-C has removed two sides of that golden triangle which affords to the people of this country an assurance that the promise held forth by preamble will be performed by ushering an egalitarian era through the discipline of fundamental rights, that is, without emasculation of the rights to liberty and equality which alone can help preserve the dignity of the individual” (emphasis supplied) Property Owners Association & Ors. v. State of Maharashtra & Ors. 130 [2024] 11 S.C.R.

136. In view of the above, the first consequence of the interpretation of Article 39(b) by this Court is linked to its reviewing role as a pre- condition to the protection of Article 31-C. Given that this Court may judicially review the question of whether a legislation bears a direct and reasonable nexus with the principles of Article 39(b), the interpretation of the provision cannot be left solely to the legislature. This Court must lay down a construction of the provision, which does not grant the legislature absolute authority to include any legislation within the fold of Article 39(b) without a governing principle. b. Article 39(b) as a Directive Principle

137. The unique consequence flowing from Article 39(b) as a pre-condition to receiving the protection of Article 31-C has been detailed above. However, the provision also has a special place in the Constitution, as a part of the Chapter on ‘Directive Principles of State Policy’.

138. Chapter IV of the Constitution is titled ‘ Directive Principles of State Policy’ and contains Articles 36 to 51. The preambular text of Chapter IV may be located in Article 37, which reads as follows: “37. Application of the principles contained in this Part.— The provisions contained in this Part shall not be enforceable by any court, but the principles therein laid down are nevertheless fundamental in the governance of the country and it shall be the duty of the State to apply these principles in making laws.”

139. From the text of Article 37, three major principles about the provisions contained in Chapter IV can be identified. Firstly, unlike fundamental rights and other provisions in the Constitution, they shall not be ‘enforceable’ by any court. In other words, a breach of a Directive Principle cannot ground a legal claim. Secondly, the principles laid down in the provisions are fundamental to the governance of the country. Thirdly, it is the ‘duty of the State’ to apply these principles in making laws. These principles raise questions about the purport of the term ‘fundamental’ in the context of Chapter IV and whether the duty of the state to apply these principles is a legal or merely a moral duty. It is undoubtedly true that Article 37 renders Directive Principles immune from judicial enforcement. However, such non- enforceability is predicated on the understanding that many of these principles require fiscal resources for implementation, and thus Digital Supreme Court Reports [2024] 11 S.C.R. 131 immediate accountability for their non-fulfilment would have burdened a nascent country. The non-justiciability of these principles does not diminish their significance and they remain significant despite their direct non-enforceability through judicial channels.117

140. The rest of the chapter, containing Articles 38 to 51 lays down the principles which constitute the Directive Principles. These principles range from equal pay for equal work to the organisation of village panchayats to humane conditions of work and maternity relief. Initially, between the 1950s and 1960s, the jurisprudence of this Court reflected the view that Directive Principles have no role to play in the decision- making of the courts – they are not directly enforceable, do not play a role in the interpretation of statutes, and cannot be used to abridge or interpret fundamental rights in any way. They were viewed as mere instructions to the legislature and executive, which lay outside the ambit of judicial inquiry. For instance, an early decision of this Court in State of Madras v Champakan Dorairjan118 declined to accord any weight to arguments that sought to invoke Directive Principles as a justification for allegedly abridging fundamental rights. In this case, the erstwhile State of Madras sought to justify caste-based affirmative action policies by invoking Article 46 of the Constitution.119 A seven-judge bench of this Court (speaking through Justice SR Das) rejected these arguments and opined: “15. […] The Directive Principles of the State policy, which by Article 37 are expressly made unenforceable by a court, cannot override the provisions found in Part III which, notwithstanding other provisions, are expressly made enforceable by appropriate writs, orders or directions under Article 32. The chapter of Fundamental Rights is sacrosanct and not liable to be abridged by any legislative or executive Act or order, except to the extent provided in the appropriate article in Part III. The Directive Principles of State policy have to conform to and run as subsidiary to the chapter of Fundamental Rights. In our opinion, 117 Ashok Kumar Thakur v Union of India (2008) 6 SCC 1 [173] : 2008 INSC 473 118 [1951] 1 SCR 525 : AIR 1951 SC 226 [15] : 1951 INSC 26 119 Article 46, Constitution of India: “The State shall promote with special care the educational and economic interests of the weaker sections of the people, and, in particular, of the Scheduled Castes and the Scheduled Tribes, and shall protect them from social injustice and all forms of exploitation.” Property Owners Association & Ors. v. State of Maharashtra & Ors. 132 [2024] 11 S.C.R. that is the correct way in which the provisions found in Parts III and IV have to be understood. […]” (emphasis supplied)

141. A similar view is advanced by the distinguished constitutional scholar, HM Seervai in his treatise, ‘Constitutional Law of India’.120 Seervai adopts the view that Directive Principles have no role to play in constitutional adjudication by the court and are mere exhortations to the legislature and executive. In his opinion, the only body that can hold the government accountable in relation to Directive Principles is the electorate and the courts must steer clear of this domain. If this position of law was true, there would be some merit in the argument of the respondents that this Court should refrain from laying down an interpretation of Article 39(b) and leave it to the legislature (and the electorate) to evolve an interpretation for themselves. However, the jurisprudence of this Court with regard to the role of Directive Principles has evolved significantly, and the construction of Directive Principles plays a vital role in various forms of judicial inquiry.

142. Early signs of a shift in the approach of this Court were visible in Mohd Hanif Qureshi v State of Bihar.121 This Court held that attempts must be made to harmoniously interpret Directive Principles and fundamental rights. However, this Court stopped short of granting Directive Principles any further role vis-à-vis interpreting fundamental rights. The role of Directive Principles was placed subordinate to fundamental rights. This Court adopted the view that the government should undoubtedly frame legislation advancing Directive Principles, but the fundamental rights in Part III, interpreted autonomously, would continue to serve as constraints on these endeavours. Similar observations were echoed by this Court in Golak Nath v. State of Punjab,122 marking an entry into the era of harmonious construction of Directive Principles and fundamental rights.

143. Subsequently, in the landmark decisions in Kesavananda Bharati and Minerva Mills, the insistence of this Court on a harmonious reading and interplay between fundamental rights and Directive Principles became even stronger. In Minerva Mills, this Court 120 HM Seervai, Constitutional Law of India, Vol 2 (4th ed, Universal Law Publishing 2002) 1934–40. 121 [1959] 1 SCR 629 : 1957 SCC OnLine SC 17 [12] 122 [1967] 2 SCR 762 : 1967 SCC OnLine SC 14 [16, 19] : 1967 INSC 45 Digital Supreme Court Reports [2024] 11 S.C.R. 133 (speaking through Chief Justice YV Chandrachud) quoted Granville Austin and observed that Part III and Part IV of the Constitution are “two wheels of a chariot, one no less important than the other”. This Court made the following observations: “56. The significance of the perception that Parts III and IV together constitute the core of commitment to social revolution and they, together, are the conscience of the Constitution is to be traced to a deep understanding of the scheme of the Indian Constitution. Granville Austin’s observation brings out the true position that Parts III and IV are like two wheels of a chariot, one no less important than the other. You snap one and the other will lose its efficacy. They are like a twin formula for achieving the social revolution, which is the ideal which the visionary founders of the Constitution set before themselves. In other words, the Indian Constitution is founded on the bedrock of the balance between Parts III and IV. To give absolute primacy to one over the other is to disturb the harmony of the Constitution. This harmony and balance between fundamental rights and directive principles is an essential feature of the basic structure of the Constitution.

57. […] It is in this sense that Parts III and IV together constitute the core of our Constitution and, combine to form its conscience. Anything that destroys the balance between the two parts will ipso facto destroy an essential element of the basic structure of our Constitution.” (emphasis supplied)

144. In the background of these decisions, which mandated that fundamental rights and Directive Principles must be construed harmoniously, an important principle began to emerge in the jurisprudence of this Court. Courts began to rely on Directive Principles while adjudicating on the ‘reasonableness’ of the restriction imposed on fundamental rights. This has been affirmed in a line of precedent of this Court.123