Constitutional Right To Property As A Net Of Intersecting Sub-Rights: Supreme Court Elucidates

The Supreme Court remarked that the Right to Property must give way to more meaningful renditions where the larger right to property is seen as comprising intersecting sub-rights, each with a distinct character but interconnected to constitute the whole.

The Court was deciding an appeal preferred by Kolkata Municipal Corporation (KMC) which claimed to have acquired a property under Section 352 of the Kolkata Municipal Corporation Act, 1980.

The two-Judge Bench comprising Justice P.S. Narasimha and Justice Aravind Kumar observed, “The constitutional discourse on compulsory acquisitions, has hitherto, rooted itself within the ‘power of eminent domain’. Even within that articulation, the twin conditions of the acquisition being for a public purpose and subjecting the divestiture to the payment of compensation in lieu of acquisition were mandated. Although not explicitly contained in Article 300A, these twin requirements have been read in and inferred as necessary conditions for compulsory deprivation to afford protection to the individuals who are being divested of property. A post-colonial reading of the Constitution cannot limit itself to these components alone. The binary reading of the constitutional right to property must give way to more meaningful renditions, where the larger right to property is seen as comprising intersecting sub-rights, each with a distinct character but interconnected to constitute the whole.”

The Bench added that these sub-rights weave themselves into each other, and as a consequence, State action or the legislation that results in the deprivation of private property must be measured against this constitutional net as a whole, and not just one or many of its strands.

Senior Advocate Jaideep Gupta appeared on behalf of the appellants while Senior Advocates Mukul Rohatgi and Huzefa Ahmadi appeared on behalf of the respondents.

Facts of the Case -

The KMC claimed to have acquired the property of the respondent in exercise of powers under Section 352 of the KMC Act. A Single Judge and the Division Bench of the High Court concurrently held that there was no such power of compulsory acquisition of immovable property under Section 352. The property in question belonged to a person having succeeded it through a deed of settlement executed by his father. As that person was minor, his elder brother managed and administered the property and in that process, he also let out the premises in favour of a corporation. Upon attaining majority, the property was mutated in that person’s name and all municipal dues including taxes were paid regularly. KMC acknowledged the same and admitted that there were no outstanding dues of the property tax.

In 2009, when an attempt was made by KMC to forcefully enter and occupy the property, the said person filed a writ petition before the High Court seeking a restraint order against KMC. As there was no real contest about the title, the High Court disposed of the petition and directed KMC to hold an enquiry about the encroachments. In 2010, the person received information that KMC had deleted his name from the category of owner and inserted its own name in the official records. Aggrieved, he approached the High Court and it directed KMC to remove its men and material from the property. Thereafter, KMC filed an appeal before the Division Bench and the same affirmed the impugned order. As a result, it was before the Apex Court.

The Supreme Court after hearing the contentions of the counsel noted, “While it is true that after the 44th Constitutional Amendment, the right to property drifted from Part III to Part XII of the Constitution, there continues to be a potent safety net against arbitrary acquisitions, hasty decision-making and unfair redressal mechanisms. Despite its spatial placement, Article 300A which declares that “no person shall be deprived of his property save by authority of law” has been characterised both as a constitutional and also a human right.”

The Court said that there are following seven sub-rights or strands of ‘swadeshi’ constitutional fabric constituting the right to property –

i) duty of the State to inform the person that it intends to acquire his property – the right to notice;

ii) the duty of the State to hear objections to the acquisition – the right to be heard;

iii) the duty of the State to inform the person of its decision to acquire – the right to a reasoned decision;

iv) the duty of the State to demonstrate that the acquisition is for public purpose – the duty to acquire only for public purpose;

v) the duty of the State to restitute and rehabilitate – the right of restitution or fair compensation;

vi) the duty of the State to conduct the process of acquisition efficiently and within prescribed timelines of the proceedings – the right to an efficient and expeditious process; and

vii) final conclusion of the proceedings leading to vesting – the right of conclusion.

The Court emphasised that these seven rights are foundational components of a law that is tune with Article 300A, and the absence of one of these or some of them would render the law susceptible to challenge.

“It is, of course, precedentially sound to describe some of these sub-rights as ‘procedural’, a nomenclature that often tends to undermine the inherent worth of these safeguards. These seven sub-rights may be procedures, but they do constitute the real content of the right to property under Article 300A, non-compliance of these will amount to violation of the right, being without the authority of law. … These sub-rights of procedure have been synchronously incorporated in laws concerning compulsory acquisition and are also recognised by our constitutional courts while reviewing administrative actions for compulsory acquisition of private property”, it remarked.

The Court enunciated the following seven principles –

• The Right to notice: A prior notice informing the bearer of the right that the State intends to deprive them of the right to property is a right in itself; a linear extension of the right to know embedded in Article 19(1)(a). The Constitution does not contemplate acquisition by ambush. The notice to acquire must be clear, cogent and meaningful.

• The Right to be heard: Following the right to a meaningful and effective prior notice of acquisition, is the right of the property-bearer to communicate his objections and concerns to the authority acquiring the property. This right to be heard against the proposed acquisition must be meaningful and not a sham.

• The Right to a reasoned decision: That the authorities have heard and considered the objections is evidenced only through a reasoned order. It is incumbent upon the authority to take an informed decision and communicate the same to the objector-

• The Duty to acquire only for public purpose: That the acquisition must be for a public purpose is inherent and an important fetter on the discretion of the authorities to acquire. This requirement, which conditions the purpose of acquisition must stand to reason with the larger constitutional goals of a welfare state and distributive justice.

• The Right of restitution or fair compensation: A person’s right to hold and enjoy property is an integral part to the constitutional right under Article 300A. Deprivation or extinguishment of that right is permissible only upon restitution, be it in the form of monetary compensation, rehabilitation or other similar means. Compensation has always been considered to be an integral part of the process of acquisition.

• The Right to an efficient and expeditious process: The acquisition process is traumatic for more than one reason. The administrative delays in identifying the land, conducting the enquiry and evaluating the objections, leading to a final declaration, consume time and energy. Further, passing of the award, payment of compensation and taking over the possession are equally time consuming. It is necessary for the administration to be efficient in concluding the process and within a reasonable time. This obligation must necessarily form part of Article 300A.

• The Right of conclusion: Upon conclusion of process of acquisition and payment of compensation, the State takes possession of the property in normal circumstances. The culmination of an acquisition process is not in the payment of compensation, but also in taking over the actual physical possession of the land. If possession is not taken, acquisition is not complete.

The Court observed that these seven principles are integral to the authority of law enabling compulsory acquisition of private property.

“We have already held that Section 352 is only intended to enable the Municipal Commissioner to decide whether a land is to be acquired for public purpose. … We have also agreed with the decision of the High Court that Section 363 is not a provision for compensation for compulsory acquisition. In this context, we have also held that a valid power of acquisition coupled with the provision for fair compensation by itself would not complete and exhaust the power and process of acquisition. Prescription of the necessary procedures, before depriving a person of his property is an integral part of the ‘authority of law’, under Article 300A and, Section 352 of the Act contemplates no procedure whatsoever”, it concluded.

Accordingly, the Apex Court dismissed the appeal and imposed a cost of Rs. 5 lakhs to be paid to the respondent within 60 days.

Cause Title- Kolkata Municipal Corporation & Anr. v. Bimal Kumar Shah & Ors. (Neutral Citation: 2024 INSC 435)

Appearance:

Appellants: Senior Advocate Jaideep Gupta, Advocates Satish Vig, Sujoy Mondal, AOR Partha Sil, Advocates Sayani Bhattacharya, Abhiraj Choudhary, Chirag Joshi, and Sanjiv Kr. Saxena.

Respondents: Senior Advocates Mukul Rohatgi, Huzefa Ahmodi, AOR Ranjeeta Rohatgi, Advocates Sagnik Majumdar, Rishabh Karnani, Shrika Gautam, AOR Madhumita Bhattacharjee, Advocates Sandeep, Srija Chodhury, Osheen Bhat, Nitipriya Kar, AOR Chanchal Kumar Ganguli, Advocates Shreyas Awasthi, Ripul Swati Kumari, and AOR Astha Sharma.

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