Government’s Right to Acquire Private Land Under Scrutiny: Supreme Court Issues New Guidelines

New Delhi, 5th November 2024: A nine-judge bench of the Supreme Court has reexamined the government’s authority to acquire private properties for public benefit under Article 39(B) of the Constitution, overturning a precedent set in 1978. In a 7:2 majority decision delivered on Tuesday, Chief Justice DY Chandrachud emphasized that not all private properties qualify as community resources, stating, “Only certain properties can be considered community resources by the government and can be used in the interest of the common people.”

This ruling challenges a previous interpretation by Justice Krishna Iyer, which asserted that state governments could take over all private properties. The Chief Justice noted that the earlier decision was influenced by a particular economic and socialist ideology, whereas the current judgment clarifies that state governments may claim only those resources that are physically maintained by the community for the public good.

The bench consisted of Chief Justice DY Chandrachud, along with Justices Hrishikesh Roy, JB Pardiwala, Manoj Mishra, Rajesh Bindal, SC Sharma, and Augustine George Masih, who all concurred with the majority opinion. Justice BV Nagarathna partially dissented, while Justice Sudhanshu Dhulia disagreed entirely with the decision.

The Supreme Court had reserved its verdict on May 1 after hearing arguments from various legal representatives, including Attorney General R Venkataramani and Solicitor General Tushar Mehta, on the matter.

The case involved 16 petitions, notably the principal one filed by the Mumbai-based Property Owners Association (POA) in 1992. The POA contested Chapter VIII-A of the Maharashtra Housing and Area Development Act (MHADA), which was amended in 1986 to empower the state government to acquire dilapidated buildings and their land if 70% of the owners consent.

Solicitor General Tushar Mehta, representing the Maharashtra government, asserted that the MHADA provision is safeguarded by Article 31C of the Constitution, introduced by the 25th Amendment Act of 1971 to protect laws that implement certain Directive Principles of State Policy (DPSP).

Under the Maharashtra Housing and Area Development Authority (MHADA) Act of 1976, the state government collects a cess from residents of dilapidated buildings for repairs, which is allocated to the Mumbai Building Repair and Reconstruction Board (MBRRB). The 1986 amendment to the MHADA Act aimed to fulfill the responsibilities outlined in Article 39(B), enabling the state to develop schemes for acquiring land and buildings to assist those in need. Chapter VIII-A specifically allows the government to acquire occupied buildings and their land, provided that 70% of the residents agree to the request.