A

PROJECT ON

“PROERTY AS A LEGAL RIGHT”

SUBMITTED TO: Mr. PARMESHWER DAS,

ASSISTANT PROFESSOR

SUBMITTED BY: ADITYA VERMA,

B.COM LLB, IX SEMESTER

SCHOOL OF LAW,

GURU GHASIDAS VISHWAVIDYALAYA,

KONI, BILASPUR,(C.G.)

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 DECLARATION

I, Aditya Verma, Roll Number 14002001, B.A.LL.B. 9 th Semester of Guru Ghasidas

University do hereby declare that, this project is my original work and I have not copied this
project or any of the book that I have referred in my project as well as the writers of the
articles and the owners of the information taken from website for it, it is only because of their
contribution and proper guidance of my faculty advisor, Mr. PARMESHWER DAS, which I
was able to gather light on subject.

Aditya Verma

B.com.LL.B, IX Semester

Roll no. 14002001

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 CERTIFICATE

I am glad to submit this project on “PROPERTY AS A LEGAL RIGHT” as a part of my

academic assignment. The project is based on Research Methodology. It further studies,
earning, sources and methods of Research Methodology and further discusses the interview
method. I hope this would be significant for academic purposes as well as prove informative
to all readers.

Here through I declare that this paper is an original piece of research and all borrowed texts
and ideas have been duly acknowledged.

Aditya Verma Faculty Signature:

B.com.LL.B, IX Semester

Roll No. 14002001

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 ACKNOWLEDGEMENT

I would like to express my earnest and deepest gratitude to assistant professor “Mr.
Parmeshwer Das” faculty for giving me this opportunity to do a project on such a valuable
topic of “PROPERTY AS A LEGAL RIGHT”. I am grateful for the assistance guidance and
support that were extended during the course of excellent research. I am also thankful to
college administration for providing the resources necessary for the research work. I thank
my parents and friends for their moral support and love throughout my research work and
project preparation. Above all I thank god almighty for blessing me with the health and
vitality to complete this project.

Aditya Verma

B.com.LL.B, IX Semester

Roll No. 14002001

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TABLE OF CONTENTS:

1. Introduction_________________________________________06

2. History_____________________________________________07

3. Indian Constitution and Property Rights___________________08

4. Further developments under right to property_______________09

5. Article 300A of The Constitution: Persons not to be deprived of property save by

authority of law; No person shall be deprived of his property save by authority of law.

___________________________________________________11

6. The Doctrine of Eminent Domain________________________12

7. The Ninth Schedule___________________________________13

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 Introduction

Right to property is framed as a human right under the Universal Declaration of Human
Rights1 and is recognized as a fundamental right in most democracies. It is one of the most
controversial of rights, always in need of an appropriate definition suited to a nation’s
political, social and economic conditions. While all liberal constitutions allow for certain
reasonable restrictions on an absolute right to property for some public good, the challenge
facing every country is where to draw the line against state interference into a person’s right
to own and enjoy property. In 1950, independent India drafted into its new Constitution a set
of fundamental rights for its citizens to free speech, peaceful assembly, association, to move
freely throughout the territory, to reside and settle in any part of the country, “to acquire, hold
and dispose of property”, and to practice any profession, or carry on any occupation, trade or
business. The Constitution also gave the nation an independent judiciary.
Of all the fundamental rights enshrined in the Indian Constitution, the right to property has
been persistently under attack from the executive. Political philosophies of the day claimed a
need to set right historical wrongs. Whittling down property rights through repeated
subversion of the Constitution was the chosen path. This pitted the executive against a
judiciary, which believed itself to be the final arbiter on the Constitution as framed by the
founding fathers.
Undermining of the right to property as a fundamental right precipitated by a weak rule of
law regime saw a corresponding rise in the abuse of the eminent domain power. The
justification for dilution of the right to property for a more equitable distribution of land by
taking from the large landlords, gave way to acquisition of land from small and marginal
farmers, for projects and activities that benefit the rich and powerful. This led to a growing
sense of injustice and numerous public protests.
This paper will trace the evolution of the right to property in India under the Constitution of
India since 1950 and through the substantial and often conflicting jurisprudence. The paper
will look at the executive’s role in the gradual dilution and eventual elimination of the right to
property as a fundamental right through the play of politics of equity and distributive justice.
Was the Supreme Court’s assertion of its supremacy over the Parliament’s powers to
determine the extent of property right commensurate with the Court’s abdication of its review
powers in the face of gross abuse of eminent domain?

1
1Universal Declaration of Human Rights, Article 17, “(1) Everyone has the right to own property alone as well
as in association with others; (2) No one shall be arbitrarily deprived of his property”.

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The property rights story in India is characterized by the dilution of the right to property in
the first 30 years, driven by socialist ideology and a sense of distributive of justice, as much
as populism, and the corresponding abuse of the land acquisition laws. The next 30 years
illustrate how the wheel has turned as citizenship deepened. The poorest are at the forefront
demanding protection of their property rights and reinforcing the criticality of rule of law.

History:

The concept of private property as understood in today’s constitutional sense evolved with
the interpretation of classical Hindu law by judges of the British Empire. The English
common law practices ironed out conflicting texts and divergent customary rules prevailing
across India and codified problematic elements of a Hindu’s right to property and its
alienation (Gandhi 1985).

Muslim rulers had introduced the Jagirdari system of creating temporary alienations on
military-revenue considerations, which evolved in the sixteenth century. Jagirs (land
holdings) were granted to nobles, scattered away from each other to prevent consolidation by
the assignees (Gandhi 1985). British rulers inherited the existing land settlement systems of
the Mughals that covered much of the Indian sub-continent. Waning Mughal rule had made
the jagirdars de facto owners of the land. It was politically expedient for the colonial rulers to
continue dealing with them to generate land revenue. By imposing the English common law
to determine property relationships, the British ironically laid the ground for recognition of
private property rights in India.

In 1793, the British government granted Permanent Settlements to zamindars (landed

aristocrats) in the region of Bengal with ownership rights over land. The settlement was
extended to Bihar, Madras and Orissa. Modified versions of such settlements, including
short-term alienations, were created in other parts of India also (Gandhi 1985; Mearns 1999).
The common feature of these diverse land tenure systems was that the zamindars did not
technically own the land and the tillers of the land were tenants of the zamindars.

The concept of eminent domain as an attribute of State sovereignty was first introduced by
the British through the Bengal Regulation I of 1824, which authorized compulsory
acquisition of private property by the State. The Land Acquisition Act of 1894 empowered
the State to acquire private land for a ‘public purpose’ on payment of compensation.

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Constitutional protection of property figured for the first time under the British rule in the
Government of India Act of 1935. Expropriation of private property, including land and
commercial and industrial undertakings, without ‘public purpose’ and full compensation was
illegal.

Indian Constitution and Property Rights

By the end of the British rule, zamindars held vast tracts of land with complete control over
the tillers’ rights. This land was however, hugely fragmented, because of the historical nature
of alienations made first by the Mughals and later by the British. In the run-up to the Indian
independence in 1947, socialism was the dominant ideology of the Indian National Congress,
the party that led India’s freedom struggle against British rule. Insecurity of land tenures
among the village communities, poverty and indebtedness and recurring famines preoccupied
negotiations on law-making with the British to secure independence and later, within the
Constituent Assembly drafting the Constitution for independent India.

The Constituent Assembly was strongly divided between government takeover of private
property and the continuance of property rights as it stood in the 1935 Act. Even among those
who favored expropriation, and no one really opposed abolition of zamindari, differences
arose over how much compensation should be paid. 2 The Constitution of India, which came
into effect in 1950, was therefore, a compromise. So while the citizens enjoyed fundamental
right “to acquire, hold and dispose property” under Article 19(1)(f), Article 19(5) made this
right subject to reasonable restrictions in public interest. This fundamental right could also be
taken away under Article 31, the eminent domain article, but taking of private property could
only be ‘by the authority of law’, ‘for public purposes’ and on payment of compensation.

Though compensation was a fundamental requirement, there was to be no ‘just

compensation’, only that the law should provide for compensation for the acquired property
and either fix the amount or specify the principles of determination of compensation. The
Constitution also placed ‘acquisition and requisitioning of property’ as a Concurrent List item
which meant that both Parliament and the State legislatures could enact laws on the subject.

2
The Social Revolution and the First Amendment, Chapter 3. While Rajendra Prasad, Jawaharlal Nehru and
Sardar Vallabhbhai Patel were on one page that Zamindari must be abolished, Mahatma Gandhi had earlier
expressed himself against unjustly dispossessing zamindars of their property and instead advocated converting
their mind-set to holding property in trust for their tenants.

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But authority of the Parliament was established as a fundamental principle and legislations
passed by the States required Presidential assent.

The founding fathers’ primary goal was to ensure social engineering through agrarian
reforms. Land was made a ‘state subject’ by the Government of India Act 1935, and this
position continued under the Indian Constitution. Individual States therefore, enacted a large
number of land reform legislations essentially to abolish intermediary tenures, regulate the
size of holdings (to enable ceiling-surplus redistribution of land to the landless), and for
consolidation (of fragmented land holdings) and settlement of tenures/ownership.

A series of judgments from the Supreme Court and High Courts in the first years of the
Constitution belied the expectation of the Constituent Assembly that the government would
be allowed a free hand with its social engineering. Courts repeatedly struck down laws
enacted by the State Legislatures as ultra vires of fundamental rights and rule of law
principles of the new Constitution.

Further developments:

It was in the Constitution that Right to Property was made a “fundamental right”. Since the
Constitution came into force in 1951, Article 19 (1) (f) and Article 31, the two articles which
guaranteed fundamental right to property, became the subject of constant and contentious
judicial interpretations and parliamentary interference.

Early decisions of the Supreme Court showed that it adopted two basic conditions namely,
public purpose and compensation in regulating the exercise of acquisition under the
Constitution. The Court was faced with two competing rights, the power of the state to
acquire property, and the individual’s fundamental right to property. It adopted a restrictive
view of on the state’s power of compulsory acquisition and inclined towards protecting the
right to property and payment to adequate compensation. This led to a series of decisions of
the Supreme Court wherein, it declared unconstitutional several laws and pursuant state
actions, in view of the Articles 14, 19 and 31 of the Constitution. On the other hand, the
Parliament initiated a series of amendments to cancel the effect of the decisions taken by the
Supreme Court against the discretionary powers of the State action.

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The case which led to the First Amendment to the constitution was West Bengal vs. Bela
Banerjee. It raised the question of constitutionality of the law which provided acquisition of
land for public purposes but limited the value of compensation to the extent of the market
value of the land as was on Dec. 31, 1945. The Supreme Court held that the ceiling of
compensation value on to a particular date as opposed to the market value of the land at the
time of acquisition was arbitrary and violated of the spirit of the constitution. As a result, the
First Amendment Act inserted two new articles, Article 31A and 31B. The Article 31A
broadly stated that, no law which provided acquisition for the state shall be deemed to be
void on the ground, that it is inconsistent with or takes away any of the rights conferred by
the part III of the Constitution. The validity of this amendment was challenged by zamindars
in Shankari Prasad Deo vs. Union of India. But, the challenge failed and the Court upheld the
validity of the Act. Later, the Fourth Amendment Act was enacted in 1954, which sought to
bring clarity as to the interpretation of Article 31A and 31B by declaring that the courts
should not deal with the question of adequacy of compensation and further, it laid down as to
what is meant by “compulsory acquisition of property (referring to State acquisition only)”.

Even after this Amendment, it was held by the judiciary that a law depriving a person of his
property could be judicially examined as to its reasonableness. The Seventeenth Amendment
Act, 1964 further made a special provision regarding compensation of land acquired from
small farmers, which should not be less than market value of the land. This was challenged in
Sajjan Singh vs. State of Rajasthan, the court upheld the validity of the said amendment.
Finally, the validity of first, fourth and seventeenth amendment acts, was challenged in
Golaknath vs. State of Punjab. The Supreme Court declared the above amendments as
invalid; however, the laws made thereunder continue to be valid. It further held that the State
could not take away fundamental rights by enacting laws, either in exercise of their
constituent or legislative power.

In the Bank nationalisation case, the Supreme Court held that the adequacy of compensation
and the principles laid down by the legislature to determine the amount of compensation are
justiciable. This led to the 25th amendment act of 1971, through which the word “amount”
was substituted in place of the word “compensation” and a new article, Article 31C was
inserted. This provided that any law made in furtherance to give effect to Directive Principles
of State policy in Clause (b) and (c) of Article 39, shall not be void on the ground that it takes
away or abridges Fundamental Right(s).

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Lastly, the validity of 25th amendment including others was challenged in the Supreme Court
in Keshavananda Bharti vs. Union of India. The Court upheld the validity of all property
related amendments, and negated the status of property right as a “basic feature” of the
Constitution. Nevertheless, the right to receive “amount” (compensation) was considered as
fundamental right. The Parliament, through 44th amendment Act gave the final blow to the
private property and repealed Article 19(1) (f) from Part III, completing the demise of right to
property as a fundamental right, and declared it merely as a constitutional right under Article
300A of the Constitution.

Article 300A of The Constitution: Persons not to be deprived of property save by

authority of law; No person shall be deprived of his property save by authority of law.

The Constitution (Forty fourth) Amendment, Act 1978 ended a journey of right to property as
a Fundamental right and continued the same under the constitutional right. Article 300 reads
as:

Persons not to be deprived of property save by authority of law—no person shall be deprived
of his property save by authority of law. These amendments are hereafter referred to as ―the
property amendments. This amendment had two instant repercussions:

(i) The Right to Property was no longer a fundamental right but a Constitutional
Right.
(ii) Due to the removal of Article 31 the Government no more owes an obligation
to pay compensation to the persons whose land had been acquired as per a law
passed by Parliament.

Also, Article 31 (1) contained, “no person shall be deprived of his property save by authority
of law i.e. the present article 300A”. The interpretation of this phrase has been clarified by
the Supreme Court in a number of cases.

In the case of Bishambhar Dayal Chandra Mohan v. State of U.P.,3 the apex court held that
“Art. 300A provides that no person shall be deprived of his property save by authority of law.
The State Government cannot while taking recourse to the executive power of the State under
Art. 162, deprive a person of his property. The word 'law' in the context of Article 300A must
3
1982 AIR 33, 1982 SCR (1)1137

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mean an Act of Parliament or of a State Legislature, a rule, or a statutory order, having the
force of law, that is positive or State-made law.

The Apex Court in the State of Jharkhand & Ors v. Jitendra Kumar Srivastava 4, held that
gratuity and pension are not bounties and an employee earns these benefits by dint of his
long, continuous, faithful and unblemished service and the same being hard earned benefit in
the nature of property, cannot be taken away without due process of law as provided under
Article 300A of the Constitution of India.

Doctrine of Eminent Domain:

Few hundred years old and first used when an English king needed salt petre (form of
Potassium Nitrate, used in the manufacturing of fire work) to make gun powder and when he
was not able to find any land, he grabbed hold of a private mine. The owner of the private
mine approached the House of Lords, the House of Lords held that, the sovereign can do
anything, if the act of sovereign involves public interest.

Basically this doctrine entitles sovereign to acquire private land for a public use, provided the
public-ness of the usage can be demonstrated beyond doubt.

In the present context this doctrine raises the classic debate of powers of State versus
Individual Rights. Here comes the Development Induced Displacement which means, the
forcing of communities even out of their homes, often from their home lands for the purpose
of economic development, which is viewed as a Human Right violation in the International
level.

Essentials ingredients of the doctrine:

● Property is taken for public use.

● Compensation is paid for the property taken.

The above said are the two limitations imposed on the power of Eminent Domain by the
repealed Article 31. Whereas the new Article 300 A imposes only one limitation on this
power i.e., Authority of Law.

4
Arising out of Special Leave Petition (Civil) No. 1427 of 2009

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The doctrine is based on the following two Latin maxims

i. Salus Populi est Suprema Lex: Welfare of The People of the Public Is the
Paramount Law;
ii. Necessita Public Major est Quam: Public Necessity Is Greater Than Private
Necessity.

Every government has an inherent right to take and appropriate the private property
belonging to individual citizen for public use. This power is known as Eminent Domain. It is
the offspring of political necessity. This right rests upon the above said two maxims. Thus
property may be needed and acquired under this power for government office, libraries, slum
clearance projects, public schools, parks, hospitals, highways, telephone lines, colleges,
universities, dams, drainages etc. The exercise of such power has been recognized in the
jurisprudence of all civilized countries as conditioned by public necessity and payment of
compensation. But this power is subject to restrictions provided in the constitution. In the
United States of America, there are limitations on the power of Eminent Domain- There must
be a law authorizing the taking of property. Property is taken for public use. Compensation
should be paid for the property taken.

The Ninth Schedule:

The constitutional history of right to property is incomplete without a discussion on the Ninth
Schedule. With the fundamental right to property gone, the Ninth Schedule containing laws,
which cannot be declared void on the ground that they violated any fundamental right, has
become a bottomless pit to protect laws “regardless of their quality or legality and for laws to
serve personal interests of the powerful.”5 The Ninth Schedule laws fall in the categories of
land redistribution, nationalization of private industries, tenancy, and rent and price controls
enacted by Central and State governments. The Schedule has also been used to protect laws
on elections and reservation policies. The current tally of the Ninth Schedule laws is 284
which include about 150 amendment acts.

5
Working a Democratic Constitution, A History of the Indian Experience, Austin (1999). The Social Revolution
and the First Amendment, Chapter 3.

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Article 31B, the source of the Ninth Schedule was not discussed in Keshavananda. It came up
for consideration in Waman Rao vs Union of India, 6 where the Supreme Court upheld
validity of the First Amendment that introduced this Article and the Ninth Schedule in the
Constitution and decided not to allow questioning of any law inserted after 24 April 1973
(date of the Keshavananda decision).

In IR Coelho (2007), the Supreme Court held that “Keshavananda Bharati’s case cannot be
said to have held that fundamental rights chapter is not part of basic structure.” The validity
of each new constitutional amendment is to be judged on its own merits and the actual impact
of the law on the fundamental rights has to be considered to determine whether or not it
destroys the ‘basic structure’. Soallpost-24 April 1973 laws, including those protected by the
Ninth Schedule, have to be teste don the touchstone of the basic or essential features of the
Constitution as reflected in Article 21 read with Article 14, Article 19, and the principles
underlying them.

Yet, a subsequent bench in 2010 equivocated on the issue when applying IR Coelho’s
principles on the validity of another law which was placed in the Ninth Schedule after 24
April 1973. The Court held that the validity of a law put in the Ninth Schedule would be
invalidated only if it breached some ‘overarching principles’ like secularism, democracy,
separation of powers, power of judicial review, rule of law and ‘egalitarian equality’. The
concept of ‘overarching principles’ was evolved in an earlier case presumably to dispel the
uncertainty caused by the Court’s own subjective and confusing articulation of the ‘basic
structure’ doctrine.

These rulings on the Ninth Schedule vis a vis the fundamental rights are irrelevant to the right
to property as it is no longer a fundamental right. The need to keep ‘progressive legislations’
on land reforms out of the purview of judicial scrutiny was felt necessary at a time when the
right to property could be asserted as a fundamental right. Other Ninth Schedule legislations
added, when India was riding high on a socialist style planned economy and needed to
control a concomitant rise in black markets, and were open to challenges for infringement of
other fundamental rights, are no longer valid in the current economic scenario. Even post
Keshavananda, by which time it was clear that right to property was not even a basic feature
of the Constitution, laws continued to be inserted in the Schedule.

6
1981 2 SCC 362.

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Yet the Supreme Court did not throw the Ninth Schedule out of the Constitution in these
cases. But it is interesting to note the decline in the use of the Ninth Schedule in the last two
decades, clearly the outcome of increased judicial scrutiny.7

Conclusion:

What separates fundamental from legal rights? Both are rights, scribed in the Constitution
and, important. But both aren’t equally protected. Restrictions on fundamental rights require
just, fair and reasonable laws; restriction on legal rights require laws. In other words,
restrictions on fundamental rights demand stronger justifications.

Pre-1978, ‘right to property’ was one of the Fundamental Rights as per Article 19(1)(f) of the
Constitution. After 44th Amendment to the Constitution in 1978, ‘right to property’ was
omitted as a ‘Fundamental Right’ and converted into a ‘legal right’ under Article 300-A of
the Constitution.

7
The last time a law was added to the Ninth Schedule was in 1995.

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Bibliography:

Books Referred:

● Dr. PANDEY J.N., CONSTITUTIONAL LAW OF INDIA, CENTRAL LAW

PUBLICATIONS, 52nd EDITION, ALLAHABAD.

Websites Referred:

● https://ccs.in/internship_papers/2002/25.pdf
● http://www.ijtr.nic.in/articles/art41.pdf

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