CJI Chandrachud’s Judgment Doesn't Say That Krishna Iyer Doctrine Did "Disservice To Constitution"; But Justices Nagarathna & Dhulia Disapprove It

In her partly concurring opinion in Property Owners Association v. State of Maharashtra case , Justice BV Nagarathna opined that the comments made in majority judgment authored by CJI DY Chandrachud on Justice Krishna Iyer are unwarranted and unjustified. 

The judge said: "The Chief Justice further opines “thus, the role of this Court is not to lay down economic policy, but to facilitate this intent of the framers to lay down the foundation for an “economic democracy”. The Krishna Iyer doctrine does a disservice to the broad and flexible spirit of the Constitution.”

Interestingly, this sentence "The Krishna Iyer doctrine does a disservice to the broad and flexible spirit of the Constitution” cannot be found anywhere in the judgment authored by CJI.

Justice Sudhanshu Dhulia also recorded his strong disapproval on the remarks made on the Krishna Iyer Doctrine, This criticism is harsh, and could have been avoided, the judge said.

The CJI made certain remarks in today's judgment in which it was held that the phrase “material resources of the community” in Article 39(b) of the Constitution does not include all property that is privately held with potential to be taken over by the State to "subserve the common good".

CJI observed, “The Constitution was framed in broad terms to allow succeeding governments to experiment with and adopt a structure for economic governance which would subserve the policies for which it owes accountability to the electorate. According to Dr Ambedkar, if the Constitution laid down a particular form of economic and social organisation, it would amount to taking away the liberty of people to decide the social organisation in which they wish to live. He opined on several occasions that economic democracy is not tied to one economic structure, such as socialism or capitalism, but to the aspiration for a ‘welfare state’. Thus, the role of this Court is not to lay down economic policy, but to facilitate this intent of the framers to lay down the foundation for an ‘economic democracy’."

The Bench was deciding a batch of pleas in which the controversy concerning Article 31-C of the Constitution arose.

Senior Advocates Zal Andhyarujina and Advocate Sameer Parekh represented the appellants while Senior Advocate Uttara Babbar represented one of the intervenors. Attorney General R. Venkatramani, Solicitor General Tushar Mehta, Senior Advocates Rakesh Dwivedi, and Gopal Sankarnarayanan represented the respondents.

CJI had concluded the following points in this judgment –

a. Article 31C to the extent that it was upheld in Kesavananda Bharati v Union of India remains in force;

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

c. The single-sentence observation in Mafatlal to the effect that ‘material resources of the community’ include privately owned resources is not part of the ratio decidendi of the judgement.

d. The direct question referred to this bench is whether the phrase ‘material resources of the community’ used in Article 39(b) includes privately owned resources. Theoretically, the answer is yes, the phrase may include privately owned resources.

e. The inquiry about whether the resource in question falls within the ambit of Article 39(b) must be context-specific and subject to a non-exhaustive list of factors such as the nature of the resource and its characteristics; the impact of the resource on the well-being of the community; the scarcity of the resource; and the consequences of such a resource being concentrated in the hands of private players.

f. The term ‘distribution’ has a wide connotation. The various forms of distribution which can be adopted by the state cannot be exhaustively detailed. However, it may include the vesting of the concerned resources in the state or nationalisation. In the specific case, the Court must determine whether the distribution ‘subserves the common good’.

Justice Nagarathna concluded, “In my view, the judgments of this Court in Ranganatha Reddy, Sanjeev Coke, Abu Kavur Bai and Basantibai correctly decided the issues that fell for consideration and do not call for any interference on the merits of the matters and as explained above. The observations of the Judges in those decisions would not call for any critique in the present times. Neither is it justified nor warranted.”

Justice Dhulia on the other hand opined, “The incorporation of Article 38 as well as Article 39(b) and (c) in Part IV of our Constitution was based on the prevalent philosophy of the time and the path of development India chose to follow. The interpretation given to the above provisions by this Court, particularly in Ranganatha Reddy and Sanjeev Coke also has its contextual relevance. Perhaps in some ways situations have changed. What has not changed, however, is the inequality. There is today a political equality and there is also an equality in law, yet the social and economic inequalities continue as cautioned by Dr. Ambedkar in his speech in the constituent Assembly on November 25, 1949.”

He further said that the inequality in income and wealth and the growing gap between the rich and the poor is still enormous and it will therefore not be prudent to abandon the principles on which Articles 38 and 39 are based and on which stands the Three Judge opinion in Ranganatha Reddy and the unanimous verdict in Sanjeev Coke.

“The broad and inclusive meaning given to the expression “material resources of the community” by Justice Krishna Iyer and Justice O. Chinnappa Reddy in Ranganatha Reddy and Sanjeev Coke respectively has stood us in good stead and has lost none of its relevance, or jurisprudential value, nor has it lost the audience which appreciates these values”, he added.

Cause Title- Property Owners Association & Ors. v. State of Maharashtra & Ors. (Neutral Citation: 2024 INSC 835)

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