Abstract

This chapter examines the fundamental right to property as an important, albeit contentious,
provision in the Indian Constitution. It considers Article 19(1)(f) of the Constitution, which guaranteed
to all citizens the fundamental right to ‘acquire, hold and dispose of property’. It considers the shifts
and continuities concerning this right in India, in both colonial and Independent India. It analyses case
law relating to agrarian reform under the First, Fourth, and Seventeenth Amendments (Article 31(4)
and (6), Articles 31A and 31B). It also assesses the laws within the scope of Article 31(2) needed to

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satisfy the requirements of public purpose and compensation. It concludes by commenting on the
abolition of the fundamental right to property through the Forty-fourth Constitutional Amendment,
as well as attempts to reinstate this right in the Indian Constitution.

Keywords: agrarian reform, compensation, constitutional amendments, fundamental right, Government

of India Act 1935, Indian Constitution, public purpose, right to property
Subject: Constitutional and Administrative Law, Comparative Law, Law
Series: Oxford Handbooks
Collection: Oxford Handbooks Online

I. Introduction: The Property Paradox

THE fundamental right to property enjoys the unique distinction of not only being the second most
1
contentious provision in the drafting of the Constitution, but also the most amended provision, and the
only fundamental right to be ultimately abolished in 1978. Unlike other rights of life, liberty, and equality
that can at least theoretically be conceived as applying equally to all, the especially contentious nature of the
right to property arises because the protection of property rights inevitably results in entrenching unequal
distributions of existing property entitlements.

In line with the tenets of democratic socialism, the Constituent Assembly sought to transition to a liberal
democratic legal order, which guaranteed rights of liberty, equality, and property, while simultaneously
endeavouring to achieve social and economic transformation premised on land reform and redistribution of
resources. However, the inherent contradiction between conserving existing property rights and ushering in
a more egalitarian society through redistribution of land led to intense debate within the Constituent
Assembly, ending in an uneasy compromise between competing interests. As ultimately adopted, Article
19(1)(f) of the Constitution guaranteed to all citizens the fundamental right to ‘acquire, hold and dispose of
2
property’. This right was, however, subject to reasonable restrictions by the Union and State legislatures in
the public interest, stipulated in Article 19(6). Moreover, Article 31 of the Constitution provided that any
State acquisition of property must only be upon enactment of a valid law, for a public purpose, and upon
payment of compensation. Certain laws were exempted from these requirements.

The paradox implicit in guaranteeing a fundamental right to property, while simultaneously embarking on a
p. 944 developmental project of land reform and State-planned industrial growth, predictably resulted in
tensions between the legislature and the executive on the one hand, which sought to implement this
development agenda, and the judiciary on the other, which enforced the fundamental right to property of
those a ected. In the decades that followed, judicial enforcement of the property clause resulted in the
invalidation of several laws seeking to bring about social and economic reform including land reform
legislation, provoking several parliamentary amendments to the Constitution. These include the First
 (1951), Fourth (1955), Seventh (1956), Seventeenth (1964), Twenty-fourth (1971), Twenty- fth (1972),
Twenty-sixth (1972), Twenty-ninth (1972), Thirty-fourth (1974), and Thirty-ninth (1975) Constitutional
3
Amendments. Of these, the First (1951), Fourth (1955), Seventeenth (1956), and Twenty- fth (1972) were
the most signi cant Constitutional Amendments and are discussed in this chapter. The Forty-fourth
Constitutional Amendment 1978, deleted Articles 19(1)(f) and 31 from Part III, the chapter on fundamental
rights in the Constitution. Instead, it inserted Article 300A in a new Chapter IV of Part XII of the
Constitution, thereby depriving the ‘right to property’ of its ‘fundamental right’ status.

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II. The Fundamental Right to Property in the Constitution 1950 and
Section 299 of the Government of India Act 1935: Shi s and
Continuities

The controversy surrounding the guarantee of a fundamental right to property had centred chie y on the
wording of Article 31. Surprisingly, the wording of Article 19(1)(f) and (5) attracted little debate, even though
no such provision had existed in the Government of India Act. ‘Acquisition and requisitioning of property’
was included as a subject in the Concurrent List enabling both Parliament and the State legislatures to enact
4
laws on the subject.

5
Article 31 was taken almost verbatim from section 299 of the Government of India Act 1935, but with
certain key di erences that greatly strengthened the protection of certain kinds of property rights in post-
Independence India and weakened those of others. Section 299 in turn gave ‘constitutional’ or ‘entrenched’
status to restrictions on the State’s power of compulsory takeover of land that had been enshrined in a
series of colonial legislation starting from the Bengal Regulation I 1824 and culminating in the Land
6
p. 945 Acquisition Act 1894.

Section 299 of the Government of India Act had provided in relevant part: (1): No person shall be
deprived of his property in British India save by authority of law. (2): Neither the federal nor a
provincial legislature shall have the power to make any law authorising the compulsory acquisition
for public purposes of any land, or any commercial or industrial undertaking, unless the law
provides for the payment of compensation for the property acquired and either xes the amount of
the compensation, or speci es the principles on which, and the manner, in which it is to be
determined. (3): No bill or amendment making provision for the transference to public ownership
of any land or for the extinguishment or modi cation of rights therein, including rights or
privileges in respect of land revenue, shall be introduced or moved in either chamber of the Federal
Legislature without the previous sanction of the Governor General in his discretion, or in a
chamber of a Provincial Legislature without the previous sanction of the Governor in his discretion
…

Clause (1) embodied the fundamental principle of the common law that the executive may not extinguish
property rights without the authority of the legislature. Clause (2) was intended to apply only to the
7
compulsory acquisition of land and undertakings. This was done ostensibly so as not to compromise laws
8 9
relating to taxation. Clause (3) safeguarded certain vested interests, including zamindari and grants of land
or tenure of land free of land revenue or subject to remissions of land revenue like talukdaris, inamdaris, and
jagirdaris. As to these ‘particular classes of property’, there was a requirement that the Governor General (or
the Governor of a province) give his previous sanction for any legislation that would transfer such property
to public ownership or extinguish or modify the rights of individuals in it. It was precisely this colonial
legacy that the Constituent Assembly tried to reverse in the drafting of Article 31.
 The Constituent Assembly debate on the drafting of Article 31 had centred on the following aspects of the
provision.

1. How do we balance the individual right to property with social and economic reform?

2. Should the meaning of ‘public purpose’ be restricted to government purpose or could it also include
within its ambit broader social purposes?

3. What constitutes an ‘acquisition’ or ‘deprivation’ of property that would justify payment of

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compensation?

4. What do we mean by ‘compensation’ and ‘fair’, ‘equitable’ and ‘just’?

5. Who would be the ultimate arbiter of the quantum of compensation and the form in which it would be
paid?

As nally adopted, Article 31 provided as follows:

p. 946 (1) No person shall be deprived of his property save by authority of law.

(2) No property, movable or immovable, including any interest in, or any company owning, any
commercial or industrial undertaking, shall be taken possession of or acquired for public purposes
under any law authorising the taking such possession or such acquisition, unless the law provides for
compensation for the property taken possession of or acquired and either xes the amount of
compensation, or speci es the principles on which, and the manner in which, the compensation is to
be determined and given.

(3) No such law as is referred to in clause (2), made by the legislature of a State shall have e ect, unless
such law, having been reserved for the consideration of the President, receives his assent.

(4) If any Bill pending at the commencement of this Constitution in the Legislature of a State has, after it
has been passed by such Legislature, been reserved for the consideration of the President and
received his assent, then, notwithstanding anything in this Constitution, the law so assented to shall
not be called into question in any court on the ground that it contravenes the provisions of clause (2).

(5) Nothing in clause (2) shall a ect

a. The provisions of any existing law other than a law to which the provisions of clause (6) apply

b. The provisions of any law which the State will hereafter make

i. For the purpose of imposing or levying any tax or penalty, or

ii. For the promotion of public health or the prevention of danger to life or property, or

iii. In pursuance of any agreement entered into between the Government of the Dominion of
India or the Government of India or the Government of India and that of any other country,
or otherwise, with respect to property declared by law as evacuee property.

(6) Any law of the State enacted not more than 18 months before the commencement of the Constitution
may within 3 months of such commencement be submitted to the President for his certi cation; and
thereupon, if the President by public noti cation so certi es, it shall not be called in question in any
court on the ground that it contravenes the provision of clause (2) of this article or that it has
contravened the provisions of clause (2) of section 299 of the Government of India Act, 1935.
 Clauses (1) and (2) of Article 31 were taken almost verbatim from section 299(1) and (2) of the Government
of India Act 1935 with two di erences. First, section 299 was restricted to cases of ‘compulsory acquisition
of property’ but under Article 31, the protection for property also extended to ‘taking possession’ of
property for public purposes. Thus, Article 31 mandated the payment of compensation even in cases where
there was no transfer of title to the government. Secondly, Article 31(2) implicitly allowed legislatures to
provide for compensation in some form (eg, in bonds) other than monetary ‘payment’ as required under
section 299(2) of the Government of India Act.

Clauses (4) and (6) were specially designed to protect land reform legislation. They created exceptions to

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the protection for property rights guaranteed in clauses (1) and (2) but these exceptions were not
substantive, insofar as they did not de ne the property rights or interests that were exempted from the
protections of Article 31. Instead they referred to periods of time, laws enacted during which would be
exempt from the requirements of Article 31(2). Thus, clause 4 exempted laws enacted from bills that were
p. 947 pending at the time that the Constitution went into e ect. Clause (6) exempted laws that were enacted
eighteen months before that date. Laws of both types needed the assent of the President, in e ect that of the
Union executive.

Within the Constituent Assembly, there was a consensus on treating major land reform programmes on a
10
di erent footing from other kinds of State acquisition of property. There was, however, no consensus on
the exact terms on which such land reform should be carried out. Zamindari and other intermediary tenures
were to be abolished upon the payment of ‘some’ compensation, though not ‘just’ or ‘market value’
11
compensation. Cases of ‘individual’ acquisitions were justiciable even though many believed that the
12
legislators who represented the interests of the people should be the ultimate arbiters. When it came to
actual drafting, however, the only enactments protected from judicial review were those covered by the
express provisions of Article 31(4) and (6). Ultimately, these clauses proved to be inadequate for the purpose
of protecting land reforms throughout India, in part because the enactment and execution of all the State
land reform laws took much longer than was perhaps anticipated. This in turn created the need for further
amendments to the Constitution at a later date.

There were two other important di erences between section 299 and Article 31. First, Article 31(5)(b)(ii), for
which there was no corresponding provision in the Government of India Act 1935, enabled the State to make
laws for the protection of public health or the prevention of danger to life or property and stipulated that
such laws, even if they ‘acquired’ or ‘took possession’ of property within the meaning of clause (2), would
be exempt from the requirement of compensation contained in that clause. Zoning laws that limit
construction on an individual owner’s land or property, or laws requiring the destruction of dangerous
structures are examples of laws that would be saved by clause (5)(b)(ii).

Secondly, the inclusion of Article 19(1)(f) in the Constitution, for which there was no corresponding
provision in the 1935 Act, meant that not only must any deprivation of property take place after a validly
enacted law, but the law must satisfy the requirements of Article 19(5) insofar as it a ected the property of a
citizen.

From the very outset, there was considerable litigation with respect to the constitutional property clause.
Signi cantly, almost all of the cases where laws were challenged on grounds of violation of property rights
also involved a challenge on the basis of the Article 14 guarantee of the right to equality. In the following
sections, I review the most important Supreme Court and High Court cases that outlined the doctrinal
framework for interpretation of the property clause, at least until such time as this framework was
superseded by subsequent constitutional amendments.
p. 948
III. Agrarian Reform and the First, Fourth, and Seventeenth
Amendments [Article 31(4) and (6), Articles 31A and 31B]

Even before the Constitution was adopted in January 1950, zamindars challenged the constitutional validity
13
of the Bihar, Madhya Pradesh, and United Provinces zamindari abolition laws as violating the property and
equality guarantees of the Constitution. These challenges were made even though the drafters had sought
speci cally, though not expressly, to protect these laws through the adoption of clauses (4) and (6) in
Article 31.

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In each of these cases, the petitioners claimed that the impugned acquisition law served no ‘public purpose’,
did not adequately compensate them within the meaning of Article 31(2) of the Constitution, and
impermissibly discriminated against certain landlords in violation of Article 14 of the Constitution.

14 15
While the Allahabad and Bhopal High Courts upheld the constitutional validity of the UP and MP laws,
16
the Patna High Court invalidated the Bihar law for violating the right to equality. The Patna High Court
held that Article 31(4) only protected laws against judicial review under the compensation provisions of
Article 31(2), but not under the provisions of other fundamental rights contained in the Constitution.

All three decisions were appealed before the Supreme Court, but before the Court could give its decision, the
Constitution was amended to nullify the e ect of the Patna High Court decision in the Kameshwar Singh
17
case. The Constitution (First Amendment) Act 1951 enacted Articles 31A and 31B and also introduced the
Ninth Schedule in the Constitution. Through the adoption of these provisions, the amenders sought to do
p. 949 what had not been attempted in the original Article 31, namely to de ne the kinds of interests that should
be placed beyond the protection of the compensation requirement in clause (2) of Article 31 and also of the
other fundamental rights contained in Articles 14 and 19. Article 31A (1) provided that ‘no law providing for
the acquisition by the State of any estate or of any rights therein or for the extinguishment or modi cation
of any such rights’ would be deemed void on grounds of inconsistency with the fundamental rights
contained in Part III. Clause (2) de ned the expression ‘estate’. Clause (2)(a) de ned ‘estate’ to have the
‘same meaning as that expression or its local equivalent has in the existing law relating to land tenures in
force in that area’ and stated that it ‘shall also include any jagir, inam or mua or other similar grant’. Clause
(2)(b) de ned ‘rights, in relation to an estate’, to include ‘any rights vesting in a proprietor, sub-proprietor,
under-proprietor, tenure-holder, or other intermediary and any rights or privileges in respect of land
revenue’.

The First Amendment also introduced Article 31B and the Ninth Schedule into the Constitution. Article 31B
stipulated that no provision of any law in the Ninth Schedule ‘shall be deemed to be void, or ever to have
become void, on the ground that [it] … is inconsistent with, or takes away or abridges any of the rights
conferred by, any provisions of this Part’— that is, the fundamental rights. In other words, Article 13(1),
which provided that any law inconsistent with the fundamental rights was invalid to the extent of that
inconsistency, was in e ect repealed so far as laws listed in the Ninth Schedule were concerned. Thirteen
laws were listed in the Ninth Schedule, including the Bihar Land Reform Act.

The zamindars of Bihar then attacked the validity of the First Amendment in Shankari Prasad Deo v Union of
18
India, but the Supreme Court upheld it. The Court then went on to decide the appeals from the Patna,
Allahabad, and Bhopal High Courts.

19
In State of Bihar v Kameshwar Singh (hereinafter Kameshwar Singh), the Supreme Court upheld the
constitutional validity of the Bihar Land Reforms Act 1950, but by a majority of 3:2, found two provisions of
the Act to be unconstitutional. Barred from considering the law against the requirements of fundamental
rights in Part III, in a clear stretch on judicial reasoning, the Court found that these provisions o ended
against (a) an inherent need in eminent domain that an acquisition be for a ‘public purpose’; and (b) against
 Entry 42 in the Concurrent List, which mentioned ‘principles on which compensation for property acquired
or requisitioned … is to be given’.

For almost a decade after the First Amendment, the High Courts and the Supreme Court were involved in the
resolution of cases involving zamindari abolition. Yet despite its controversial pronouncement in the
Kameshwar Singh case, in all subsequent cases, the Supreme Court upheld zamindari abolition laws in their
entirety. While the Court emphasised that payment of compensation for acquisition of property was a
fundamental right under Article 31(2) of the Constitution, it recognised that judicial review of laws
infringing this fundamental right was excluded in the case of zamindari abolition laws in accordance with

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the Provisional Parliament’s intent as expressed through the enactment of the First Amendment to the
Constitution.

But although the question of zamindari abolition was fairly settled, the question of what else was covered by
the de nition of ‘estate’ in the First Amendment was not, when Parliament enacted the Constitution
p. 950 (Fourth Amendment) Act 1955. Described in greater detail in Section IV, the Fourth Amendment made
many changes to Article 31 and inserted Article 31(2A). Signi cantly, the Fourth Amendment also
20
substituted clause (1) of Article 31A, and amended Article 31A(2)(b) to add the terms ‘raiyats’ and ‘under
raiyats’ to the list of those whose ‘rights’ in an estate were removed from the protection of Articles 14, 19(1)
(f), and 31.

Apart from facilitating the abolition of intermediary tenures in the non-zamindari areas, the jagirdari,
mahalwari, ryotwari, and other miscellaneous land tenures, the Fourth Amendment also sought to facilitate
the next stage of land reform involving imposition of land ceilings and redistribution of holdings. Again, it
fell to the courts to delineate what kinds of land revenue arrangements constituted ‘estates’ and ‘rights in
relation to an estate’ within the meaning of the amended Article 31A(2)(a).

From 1955 to 1964, the Supreme Court interpreted this term expansively to uphold the constitutional
p. 951 validity of laws involving the abolition of intermediary rights in non-zamindari areas, including
21
intermediary rights in jagirdari tenures in Rajasthan, alienated and unalienated lands in the State of
22 23 24
Bombay, and mahalwari tenures in Punjab. In Atma Ram v State of Punjab, the Court interpreted the
expression ‘rights’ in relation to an estate to have an all-inclusive meaning comprising both horizontal and
vertical divisions of the estate. Thus, the expression included not just the interests of proprietors or sub-
proprietors, but also lower grade tenants, like ryots or under ryots.

Nevertheless, by fashioning the ‘agrarian reforms’ test in KK Kochuni v State of Madras (hereinafter
25
Kochuni), the Supreme Court made it clear that the ouster of judicial review on questions of compensation
was limited only to cases where the proposed acquisition of land had a connection with a scheme of agrarian
or land reform. In all other cases, compensation payable under Article 31(2) should be market value
compensation.

26
Moreover, in Karimbil Kunhikoman v State of Kerala (hereinafter Kunhikoman), the Supreme Court held that
27
lands held under ryotwari tenure in the State were not estates within the meaning of Article 31A(2)(b).
Wanchoo J, speaking for the Court, held that a ryot was not really a ‘proprietor’ but a ‘tenant’. This was
because a ryot could sell, mortgage, pass on to his heirs, or give away his holding, and he could not be
evicted from the land except in case of his failure to pay the land revenue. But in theory—and for Wanchoo J
28
this was the deciding point—the ryot could relinquish or abandon his land in favour of the government. As
a result, even though the Kerala Agrarian Relations Act 1960 was a law of agrarian reform, the petitioners’
lands were not ‘estates’ within the meaning of Article 31A and therefore in its application to the petitioners’
estates, the Act was subject to be tested on the anvil of fundamental rights. Here, like the Patna High Court’s
decision in the Kameshwar Singh case, the Supreme Court struck down the law for violating the petitioners’
fundamental right to equality and not their fundamental right to property because of the graduated scale of
 compensation payable for lands acquired over the ceiling. Wanchoo J’s highly conceptualistic approach to
the question of whether ryotwari lands were ‘estates’ within the meaning of Article 31A(2)(a) and
consequent conclusion that a ryot was merely a tenant, and not the owner of the land, and therefore ryotwari
lands were not covered by Article 31A, appears rather unconvincing in light of the actual practice of ryotwari
tenures.

By indicating that ryotwari lands did not fall within the meaning of Article 31A, an interpretation that
29
receives some support from the parliamentary debates on the First Amendment, the Court’s
pronouncement in Kunhikoman threatened land ceiling laws and agrarian reform in much of southern India.

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The Kochuni and Kunhikoman decisions led Parliament to amend the constitutional property clause for a
p. 952 third time by the Constitution (Seventeenth Amendment) Act 1964. The Seventeenth Amendment made
three important changes to the constitutional property clause. First, it inserted a proviso in Article 31A(1)
which enabled the State to acquire land over and above the prescribed land ceilings in each State at less than
market value compensation. Secondly, it amended the de nition of ‘estate’ in Article 31A(2)(a) to
speci cally include lands under ryotwari settlement. Moreover, the term ‘estate’ now also included all lands
‘held or let for purposes of agriculture or for purposes ancillary thereto, including waste land, forest land,
land for pasture or sites of buildings and other structures occupied by cultivators of land, agricultural
labourers and village artisans’. Finally, the amendment added forty-four laws to the Ninth Schedule,
thereby shielding them from judicial review on grounds of Articles 14, 19, and 31.

Once it became clear that land reform statutes could not be challenged on the basis of Articles 14 and 19(1)
(f), the questions of controversy shifted to the interpretation of the terms of Article 31(2) that had also been
contentious before the Constituent Assembly. These included the meaning of the words ‘compensation’,
‘acquisition’, and ‘taking possession’.

IV. Eminent Domain and Police Powers: The Relationship Between

Articles 19 and 31 and the Fourth Amendment (1955)

In any social system that recognises private property, the State restricts property rights in the exercise of
powers inherent in the State’s sovereignty. In countries that have a written Constitution, these restrictions
are often expressly embodied in the constitutional text. Broadly, these powers are classi ed as police powers,
eminent domain, and taxation. Distinguishing between these powers becomes important because even
though State action in the pursuance of each of them may involve restrictions on existing property rights,
the obligations on the part of the State in each instance are di erent.

Police power has been de ned as the power of promoting the public welfare by restraining and regulating the
30
use of liberty and property. In this chapter, we will con ne our discussion of police powers insofar as they
restrain or regulate the use of property. The power of eminent domain, in the broadest sense, may be
understood simply as the power of the sovereign to take property for public welfare, without the owner’s
31
consent.

When the State acquires property in the exercise of its eminent domain powers, the economic loss in icted
on the private owner is accompanied by a corresponding economic gain to the State or to someone
32
p. 953 nominated by the State. Here, the State does not attempt to regulate the use of the owner, but, on the
33
contrary, replaces him and deals with the property as if the State itself were the owner of the property.
Where the State regulates property in exercise of its police powers, the State does not make any economic
gain to itself or its nominee, although, as a consequence of the regulation, an economic loss is in icted on
the owner. The State deals with the property not as the owner, but as a sovereign having power over the
 owner and his property, directing the owner to observe the State’s instructions in the use and enjoyment of
34
his property.

In India, the key concepts used in Articles 19 and 31(1) and (2) were ‘restriction’, ‘deprivation’, and
‘acquisition’, respectively. The Supreme Court’s interpretation of these terms involved two main questions.
The rst question concerned the interpretation of the terms ‘deprivation’ in clause (1) and ‘acquisition’ in
clause (2) of Article 31 to determine whether they concerned the same or two di erent exercises of State
power. The second question concerned the interplay of Article 31 with Article 19(1)(f).

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1. Article 31(1) and (2): Police Powers and Eminent Domain
35
In the Supreme Court’s early decisions, SR Das J put forth an interpretation of Article 31 whereby Article
31(1) related to the police powers of the State and 31(2) related to eminent domain. When the State
compulsorily acquired property in the exercise of its eminent domain powers under Article 31(2), such
acquisition could only be pursuant to a valid law, for a public purpose and upon provision of compensation.
However, when it deprived a person of his property for the purposes of the State like ‘razing a building in
the path of re’, such deprivation occurred in the exercise of the police powers of the State under Article
36
31(1). Here the only requirement was that such deprivation must be pursuant to a validly enacted law.

However, another interpretation championed by Sastry CJ was that Article 31, clauses (1) and (2) should be
read together as stating three requirements for acquisitions pursuant to the exercise of the State’s powers of
eminent domain. Article 31(1) stated the general principle that there shall be no taking or deprivation of
property without a valid law, whereas Article 31(2) elaborated upon this principle by stipulating the
requirements of a valid law, including the existence of a public purpose and the provision of
37
compensation.

The adoption of one or the other interpretation would di erentially impact the extent of protection of
private property under the Constitution. Adopting the rst interpretation meant the State could take actions
short of acquisition or taking possession of the property that substantially deprived the owner of the
bene ts of ownership without the requirements of public purpose and just compensation stipulated in
p. 954 Article 31(2). Under Article 31(1), the law authorising such deprivation was also not required to be
‘reasonable’ as contained in the requirement for ‘reasonable’ restrictions under Article 19(1)(f).

Curiously, none of the judges found a basis for the exercise of the State’s police powers in Article 31(5)(2)(b)
(ii), even though it was the most likely encapsulation of the same, and Article 31(5)(2)(b)(i) expressly spoke
of the State’s power of taxation.
 2. Article 19(1)(f): ʻCapacityʼ v ʻConcrete Property Entitlementsʼ
On the second question, that of the interpretation of the relationship between Articles 19 and 31, the issue
was whether the right guaranteed to citizens ‘to acquire, hold and dispose of property’ and its companion
guarantee of a ‘right to carry on any occupation, trade or business’ under Article 19(1)(f) and (g) simply
concerned the capacity of all citizens or protected their concrete interests in a particular piece of property or
business enterprise. Put di erently, where there was an actual deprivation of a concrete property
entitlement, did only Article 31 apply? Here, Sastry CJ took the view that Articles 19 and 31 were mutually
exclusive. Article 19 merely referred to a citizen’s capacity to own property. This provision had no reference

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to the property that was already owned by him, which was dealt with in Article 31. In other words, Article 19
forbade the State from denying particular individuals or classes the right to own property or to carry on
business, but did not protect a citizen’s interest in a particular piece of property from State interference.
Sastry CJ noted that since Article 31, which was headed by the caption ‘right to property’, already protected
property rights of citizens as well as non-citizens, whereas Article 19(1)(f) only protected the rights of
38
citizens, any other interpretation would make Article 19(1)(f) redundant. But if Articles 19(1)(f) and (5)
were understood as dealing only with the capacity to acquire, hold, and dispose of property in general, this
distinction made sense. In that case, it would be justi able to exclude aliens from such capacity, as had been
done in several countries for the bene t of nationals, particularly with respect to rights in land. This
interpretation nds some support from the Constituent Assembly debates, particularly the statement of TT
Krishnamachari, later Finance Minister. But even on Krishnamachari’s statement, the right did not merely
protect the capacity to acquire, hold, and dispose of property, but some concrete though basic property
39
entitlements.

In contrast, other judges on the Court, including SR Das and Jagannadhadas JJ, took the view that Article
19(1)(f) applied both to abstract and concrete property rights. Jagannadhadas J noted that to:

[C]onstrue Article 19(1) (f) and (5) as not having reference to concrete property rights and
p. 955 restrictions on them would enable the legislature to impose unreasonable restrictions on the
enjoyment of concrete property (except where such restrictions can be brought within the scope of
40
article 31(2) by some process of construction).

40 Subodh Gopal Bose (n 35) [66].

 3. The Relationship Between Articles 19(1)(f) and 31: ʻRestrictionʼ v
ʻDeprivationʼ
41
In subsequent cases, Sastry CJ’s interpretation of the relationship between Article 31(1) and (2), and Das J’s
interpretation of the relationship between Article 19 and Article 31, both of which accorded stronger
protection to property entitlements, became the established reasoning of the Court. According to this
reasoning, Article 19(1)(f) and (g) not only protected citizens’ capacity to hold property or conduct a
business, but were also available to protect concrete property entitlements of citizens. These rights were

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subject to ‘reasonable’ State restrictions in the interest of the general public under Article 19(6). A
restriction so substantial as to amount to a ‘deprivation’ of property or of the ability to carry on business
would implicate the provisions of Article 31. In the case of a deprivation, which may or may not involve an
acquisition of property, Article 31(1) and (2) read together prescribed three requirements that must be met
—a legislative enactment, public purpose, and compensation. On this interpretation, it became possible for
an aggrieved citizen to challenge State interference with his property rights simultaneously as a deprivation
of his property without compensation under Article 31 and also as an unreasonable restriction of his right to
hold property or to carry on a trade or business under Article 19(1)(f) and (g), respectively. Initially, the
Supreme Court tended towards the conclusion that if a ‘restriction’ on the exercise of a property right or the
conduct of a trade or business was so severe as to be ‘total’, and therefore a ‘deprivation’ within the
meaning of Article 31, Article 19 would not apply. This approach derived from the Court’s approach to the
interpretation of the right to life under Article 21 and personal liberty under Article 19(1)(d) in AK Gopalan v
42
State of Madras. There, a majority of the Court (4:1) had held that the rights conferred by Article 19(1)(a) to
(g) could be enjoyed only so long as the citizen was free and had the liberty of his person. But the moment he
43
was lawfully deprived of his liberty pursuant to Article 21, he ceased to have the rights guaranteed under
Article 19.

4. The Relationship Between Articles 19 and 31 Following the Fourth

Amendment
In 1955, the Constitution was amended to adopt Das J’s interpretation of the relationship between Article
p. 956 31(1) and (2). This was unsurprising because this interpretation gave greater scope for State acquisitions
without compensation, which the government claimed was necessary for its economic development and
social redistribution agenda. The Fourth Amendment introduced a new clause 2A into Article 31, which
provided as follows:

Where a law does not provide for the transfer of the ownership or right to possession of any
property to the state or to a corporation owned or controlled by the state, it shall not be deemed to
provide for the compulsory acquisition or requisitioning of property, notwithstanding that it
deprives any person of his property.

As a result of the amendment, Article 31(2), with its requirements of public purpose and compensation, was
to apply only when the State formally took title or possession of the property. If it otherwise ‘deprived’ a
person of his property, the only safeguard under Article 31(1) was that such deprivation must be pursuant to
a law.

Following the Fourth Amendment’s comprehensive evisceration of the guarantees under Article 31, Article
19 assumed greater importance. The question in cases following the Fourth Amendment was whether a
regulation or ‘restriction’ of property within the meaning of Article 19(1)(f) and (g), no longer assailable
under Article 31, may still be attacked under Article 19. Two approaches were possible on this question.
According to the rst conceptualistic approach adopted in AK Gopalan, the notion of ‘restriction’ implied
something to be restricted. However, the deprivation or total restriction of something meant that there was
 44
nothing to restrict. The second approach sought to assess the intent of the drafters in including both
Articles 19 and 31 in the Constitution. According to this approach, if the State were to be barred from
unreasonable ‘restrictions’ on the rights to hold property or carry on business, could the Constitution
drafters have intended that unreasonable deprivations of property be unchallengeable? Prior to the Fourth
45
Amendment, the Supreme Court had adopted the rst approach in a few cases. However, given the danger
to property rights posed by the Fourth Amendment, the Supreme Court adopted the second approach in
46
subsequent cases, holding that the law authorising the deprivation of property under Article 31(1) must be
consistent with other fundamental rights, including Article 19. Every deprivation was also a restriction on

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the right to property, whose reasonableness must be assessed by the courts.

V. ʻPublic Purposeʼ and ʻCompensationʼ

The laws that fell clearly within the scope of Article 31(2) needed to satisfy the requirements of public
purpose and compensation.

1. Public Purpose
In all the agrarian reform cases, the Supreme Court had adopted a highly deferential approach to the
p. 957 requirement of public purpose. While this approach was especially evident in the zamindari abolition
cases, the Court largely deferred to the government’s articulation of public purpose even in cases involving
47 48
acquisition of urban land for resettlement of refugees, temporary takeover of a textile mill, and
49
nationalisation of road transport. In successive cases, the Court held that the expression ‘public purpose’
was ‘elastic and could only be developed through a process of judicial inclusion and exclusion in keeping
50
with the changes in time, the state of society and its needs’. The Court also clari ed that acquisitions that
bene ted particular individuals or entities could satisfy the requirement of public purpose so long as they
51
were in furtherance of a particular scheme of public bene t or utility. Over time, the list of public purposes
52
has been continually expanded to include acquisitions for private industry, cooperative housing
53 54
societies, and residential development, all of which have been upheld by the Supreme Court.

2. Compensation
One crucial di erence between section 299 of the Government of India Act 1935 and Article 31(2) of the
Constitution was the omission of the word ‘just’ before the term ‘compensation’. This was done to prevent
courts from requiring payment of market value compensation, particularly in, but not limited to, cases of
55
zamindari abolition.
 a. Zamindari Abolition Cases and the First Amendment
From section 3 it is clear that, except for and following the Kameshwar Singh case, while the Supreme Court
emphasised that payment of compensation for acquisition of property was a fundamental right under
Article 31(2) of the Constitution, it recognised that judicial review of laws infringing this fundamental right
was excluded in the case of land reform laws, including abolition of zamindari and other intermediary laws.
This was in accordance with the Provisional Parliament’s intent as expressed through the enactment of the
First Amendment to the Constitution. In all other cases, however, the Court insisted upon the payment of
compensation that was the ‘just equivalent’ of the property acquired. Thus, for instance, in State of West

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56
Bengal v Bela Banerjee, the Court invalidated a law that enabled acquisition of land by the State for
resettlement of refugees following the Partition of India, because the compensation was xed at an anterior
p. 958 date to the acquisition without regard to changes in market value of the property following that date.
Here the Court held that while the legislature could prescribe the principles on which compensation must be
57
calculated, such compensation must be a ‘just equivalent’ of the deprivation caused to the owner.

The Fourth Amendment was passed shortly after the decision in the Bela Banerjee case to oust judicial
58
review of the adequacy of compensation. Over the next decade, the Supreme Court gave a series of
inconsistent decisions. In Kunhikoman, the Court held that the ‘just compensation’ standard would not
apply to cases that were led post the Fourth Amendment. But in Vajravelu Mudaliar v Special Deputy Collector
59
(hereinafter Vajravelu), the Court made a distinction between the following cases: (a) just equivalent; (b)
just equivalent but inadequate; (c) not illusory compensation, but not adequate; and (d) illusory
compensation, which was a colourable exercise of power. The Court held that while it would not intervene in
the rst three cases, it was obligated under the Constitution even after the Fourth Amendment to intervene
60
in the last case. The Court noted that ‘compensation’ must ‘compensate’ and therefore could not be an
illusory sum. The decision in this case was followed by a series of inconsistent rulings. While the Court
61 62
applied the Vajravelu test in Union of India v Metal Corporation of India Ltd, in several other cases the Court
showed greater deference to Parliament on the question of compensation payable in case of State
acquisitions of property. The Metal Corporation case was later overruled in State of Gujarat v Shantilal
63 64
Mangaldass, which was in turn overruled in the Bank Nationalisation case, which restored the Court’s
powers of judicial review in cases where the compensation was illusory.

In 1972, the Constitution (Twenty- fth Amendment) Act was passed speci cally to overturn the ruling in
the Bank Nationalisation case. This amendment replaced the word ‘compensation’ in Article 31(2) with the
word ‘amount’ and expressly ousted judicial review of the adequacy of compensation. Nevertheless, in
65
Kesavananda Bharati v State of Kerala (hereinafter Kesavananda), a majority of the judges of the Court
emphasised that although the right to property was not part of the ‘basic structure’ of the Constitution,
even after the Twenty- fth Amendment, the Court must inquire whether what is given as compensation is
66
completely illusory or arbitrary. In State of Karnataka v Ranganatha Reddy, the Court held that following the
p. 959 Twenty- fth Amendment, the Vajravelu and Bank Nationalisation cases were no longer valid law and that
the Court could not review the adequacy of compensation, but reiterated the Kesavananda ruling that
compensation could not be completely arbitrary or illusory. But the Court did not clarify the test of ‘illusory
compensation’, implying that this must be determined on a case-by-case basis.
 VI. The Fundamental Right to Property Abolished: Forty-fourth
Constitutional Amendment

The Constitution (Forty-fourth Amendment) Act 1978 abolished Articles 19(1)(f) and 31 and inserted Article
300A into a new Chapter IV of Part XII of the Constitution, thereby depriving it of its ‘fundamental right’
status. Article 300A provides, ‘No person shall be deprived of his property save by authority of law.’
Following the Forty-fourth Amendment, there is no express provision requiring the State to pay
compensation to an expropriated owner except as provided in Article 30(1A) and the second proviso to

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Article 31A(1). Article 30(1A) provides for the payment of compensation when the property of a minority
institution has been acquired. The second proviso to Article 31A(1) mandates the payment of market value
compensation in the case of acquisition of estates where personal cultivation is being carried on. This has
created an anomalous situation, whereby, in all other cases of acquisition, there is no express constitutional
requirement for the State to pay market value compensation.

In the immediate aftermath of the Forty-fourth Amendment, some scholars opined that the amendment
would have little e ect because the requirements of ‘public purpose’ and ‘compensation’ would be read into
67
Article 300A. On the contrary, during the 1980s and 1990s, we see an almost complete abdication of
judicial review on these questions. As described in Section V, judicial scrutiny on the question of ‘public
purpose’, always lenient, was almost perfunctory during this period, resulting in continuous expansion of
the purposes for which government could acquire property without payment of market value compensation.
68
In Jilubhai Khachar v State of Gujarat, the Supreme Court reiterated that following the Forty-fourth
Amendment, it could not go into the adequacy of compensation awarded under an acquisition law. All it
could do was to determine that the principles on which the compensation was decided were relevant and the
compensation awarded was not illusory. The Court also rejected attempts to read the right to property into
69
the right to life guarantee under Article 21.

p. 960
VII. Reinstating the Fundamental Right to Property in the Indian
Constitution

Since the 2000s, widespread acquisition of land by the State for dams, infrastructure, and private industry
has received signi cant public attention owing to massive dispossession of poor peasants and traditional
communities such as forest dwellers, cattle grazers, shermen, and indigenous tribal groups. In 2009, a
70
public interest petition was led before the Supreme Court, in Sanjiv Agarwal v Union of India, seeking
invalidation of the Forty-fourth Constitutional Amendment and reinstatement of the fundamental right to
property. The petitioner cited the large-scale displacements caused by the creation of special economic
zones and by projects such as the Narmada dams and the land con icts in Singur and Nandigram as
71
motivating his demand. The petitioner argued that following the decision in IR Coelho v Union of India,
fundamental rights could not be excluded from the purview of the ‘basic structure’ as articulated by the
Supreme Court in Kesavananda. Since the right to property enshrined in Articles 19(1)(f) and 31 was a
fundamental right at the time Kesavananda was decided, its subsequent abolition by the Forty-fourth
Amendment violated the ‘basic structure’ of the Constitution, and was therefore unconstitutional. In 2010,
the Supreme Court dismissed the petition without reaching the merits on the grounds that the petitioner
was a public interest litigant, not directly a ected by the abolition of the fundamental right to property, and
that entertaining the petition would lead them to reopening settled constitutional case law on property.

Nevertheless, in recent years, the Supreme Court has reinstated the requirements of ‘public purpose’ and
72
‘compensation’ within Article 300A. In KT Plantation Private Ltd v State of Karnataka, the Supreme Court
held that the ‘rule of law’ prevailed in India and the Court was not ‘powerless’ in a situation ‘where a person
 73
was deprived of his property … for a private purpose with or without providing compensation’, as a result
of which any State acquisition of property must satisfy the requirements of ‘public purpose’ and
74 75
‘compensation’ under Article 300A. In Super Cassettes Industries Ltd v Music Broadcast Private Ltd, the
76
Court reiterated these requirements in the context of intellectual property. Noting that copyright was
‘property’ within the meaning of Article 300A, Chelameshwar in a concurring opinion emphasised that the
compulsory licensing provisions contained in section 31 of the Copyright Act 1957 must satisfy the
requirements stipulated therein, including that such deprivation must happen pursuant to a valid law and
77
must satisfy a public purpose.

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In September 2013, Parliament enacted the controversial Right to Fair Compensation and Transparency in
78
p. 961 Land Acquisition, Rehabilitation and Resettlement Act 2013 (hereinafter LARR Act). The Act enhances
79
the compensation payable in cases of forcible acquisition of land, and also provides for rehabilitation and
80
resettlement awards in cases of displacement. The Act also seeks to restrict the de nition of ‘public
81
purpose’ by providing a much more detailed listing of public purposes. Consequently, the LARR Act has
legislatively strengthened the requirements of public purpose and compensation that were weakened by the
dilution of the right to property in the Constitution.

While the LARR Act empowered the government to acquire land for the enumerated public purposes for
82
public–private partnerships as well as for private companies, in a signi cant departure, the Act mandates
that the consent of 70 per cent of project-a ected families be obtained for public–private partnerships and
83
80 per cent in the case of land being acquired by companies. However, no consent is necessary if the
84
government acquires land directly for its own use, hold, and control. Moreover, every such acquisition
85
would be subject to an elaborate social impact assessment (SIA) process stipulated in the LARR Act.

The LARR Act came into force on 1 January 2014. But land acquisition done under thirteen sector-speci c
land acquisition laws was exempted from its provisions for a period of one year from the Act’s coming into
86
force. On 31 December 2014, the President promulgated the Right to Fair Compensation and Transparency
in Land Acquisition, Rehabilitation and Resettlement (Amendment) Ordinance 2014 (‘LARR Amendment
Ordinance’). This Ordinance brought the thirteen exempted laws within the purview of the compensation
87
and rehabilitation provisions of the LARR Act. Simultaneously, however, it exempted several categories of
projects from the consent and SIA requirements stipulated in the LARR Act. The LARR Amendment
Ordinance proved to be even more controversial than the LARR Act. Due to lack of social and political
consensus, a Bill slated to replace the Ordinance (‘LARR Amendment Bill’) could not be passed into law. The
President repromulgated the Ordinance in April, and the government was forced to refer the LARR
Amendment Bill to a joint parliamentary committee in May 2015. Simultaneously, in April 2015, three Delhi-
based NGOs and a farmers’ organisation impugned the constitutional validity of the LARR Amendment
88
Ordinance before the Supreme Court. Thus, all institutions of government, the executive, the legislature,
p. 962 and the judiciary, were preoccupied with the content of the right to property as altered by the LARR Act
89
and the LARR Ordinance, contributed to continued political and legal uncertainty surrounding the right to
90
property. The controversy around the implementation of the LARR Act 2013 and its attempted amendment
by the LARR Amendment Bill 2015 also centred on narratives of economic development and social
91
redistribution of resources from the agrarian classes to industry.

As this chapter goes to print, the political and legal uncertainty continues. On 31 August 2015 the LARR
Amendment Bill lapsed. Subsequently, the government’s decision not to re-promulgate the Ordinance a
third time has left the Supreme Court challenge to its constitutional validity infructuous. While news reports
suggest that the government is still trying to build consensus in Parliament to pass the LARR Amendment
92
Bill, recent regional electoral losses make such passage unlikely. Instead, the Union government has
encouraged the States to amend the LARR Act, which they are empowered to do under Article 254(2) of the
Constitution as the Act is in a Concurrent List subject, so long as the President rati es such amendments.
93 94
The State of Tamil Nadu has already done so, and at least three other states are following suit.
 VIII. Conclusion

The fundamental right to property in India has come full circle. It started as a legal right against arbitrary
State action insofar as it limited the colonial State’s power to take away an individual’s property except
when this was done pursuant to a valid law, for a public purpose, and for just compensation. This right was
enshrined in a series of colonial legislation starting with the Bengal Regulation I 1824 and culminating in
the Land Acquisition Act 1894. The right was later elevated to the status of an ‘entrenched’ or
‘constitutional’ right by section 299 of the Government of India Act 1935. When the Constitution was

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adopted in 1950, the right to property was elevated to the status of a ‘fundamental right’, which ensured
that the State could not legislatively remove the limitations imposed upon its power to acquire property and
made the right judicially reviewable. However, through a series of constitutional amendments, exceptions
p. 963 were carved out of the fundamental right to property, as a result of which some of the limitations on the
State’s power to acquire property, speci cally the requirement to pay market value compensation, did not
apply in particular cases. The Forty-fourth Constitutional Amendment in 1978 deprived the right to
property of its ‘fundamental right’ status, thereby making the limitations on the State’s power to acquire
property non-justiciable. However, in the past ve years, there have been attempts made judicially to
restore the right to its fundamental right status, as it existed before the Forty-fourth Amendment.
Simultaneously, the requirements of ‘public purpose’ and ‘compensation’ have been strengthened
legislatively through the repeal and replacement of the Land Acquisition Act 1894 by the LARR 2013. The
LARR Act’s amendment by the thrice promulgated LARR Amendment Ordinance within a year of its
enactment, and yet the inability of the government to garner parliamentary support to pass the LARR
Amendment Bill 2015 into law testi es to the intense social and political contestation around the contours
of the right to property, both as a legal and constitutional right.

Importantly, however, the trajectory of the right to property in the Constitution, as seen from the drafting
of the original constitutional property clause, and its evolution through judicial interpretation, legislation,
and constitutional amendment, demonstrates the Indian State’s continual attempts to reshape property
relations in society to achieve its goals of economic development and social redistribution. Each version of
the property clause favoured property rights of certain groups and weakened those of others and was the
product of intense contestation between competing groups that used both the legislature and the judiciary
to further their interests.

Concomitantly, lurking behind the development of the Supreme Court’s doctrinal jurisprudence is the
Court’s fear of arbitrariness of State action. Almost all of the property cases also involved a challenge on
grounds of the equality guarantee in Article 14, and in a majority of these cases, the impugned law was
invalidated for violating the right to equality and not the right to property. This is not only evident in the
agrarian reform cases that led to the First, Fourth, and Seventeenth Amendments to the Constitution but is
also a recurring theme in recent cases that have sought to judicially reinstate the fundamental right to
property following its abolition by the Forty-fourth Amendment, as well as the debates on the enactment of
p. 964 the LARR Act and the LARR Amendment Bill.

Notes
1 The debate over property rights took place over two and a half years and the controversy was more prolonged and acute
than that over any subject except the choice of o icial languages. Granville Austin, The Indian Constitution: Cornerstone of
a Nation (Oxford University Press 2000).
2 Constitution of India 1950, art 19(1)(f).
3 In India, constitutional amendments do not add numbered addenda to the text; rather, they add Articles to the
Constitution.