'Judgment Is A Constitutional Earthquake'

'It has changed the political character of India by ejecting socialism as an ideology from the Constitution of India.'

The recent nine-judge bench judgment by the Supreme Court limiting the State's control over private property became significant because of the strong dissenting opinions by two judges, Justice B V Nagaratna and Justice Sudanshu Dhulia.

The judgment overturned the interpretation of Article 39(b) of the Constitution, and criticised the 1977 judgment by Justice V R Krishna Iyer which they feel as 'unwarranted and unjustified'.

"Indian oligarchs and their supporters would naturally be celebrating this judgment: Greater protection of private property rights and the ending of socialism and re-distribution of economic wealth as guiding principles of the Republic," G Mohan Gopal, former director of the National Judicial Academy, and ex-director (vice-chancellor) of the National Law School of India, tells Shobha Warrier/Rediff.com in an e-mail interview.

The Supreme Court ruling that not all private property can be deemed material resources of the community has been praised by many. How do you look at it?

The Supreme Court judgment in Property Owners' Association vs. State of Maharashtra, 2024 does not alter the fundamental principle of law on the issue that was adjudicated in the case.

The judgment itself says, 'On the limited question of whether the acquisition of private resources falls within the ambit of the term 'distribution', 'we agree with the principles enunciated in previous decisions of this Court' (para 227).

However, the majority judgment authored by Chief Justice Chandrachud on behalf of seven judges is a Constitutional earthquake -- it has changed the political character of India by ejecting socialism as an ideology from the Constitution of India.

The judgment also rejects the Article 39 agenda of re-distribution of economic resources which is a part of the socialist ideology.

The majority judgment does not explain how its view squares with the express description of India in the Preamble of the Constitution as a socialist Republic and the settled understanding of the meaning of 'socialism' as a specific ideology.

In effect, the majority judgment has amended the Preamble and re-defined the word 'socialism' so as to strip it of its ideological content.

By ejecting socialism and rejecting the re-distribution of economic resources the majority judgment has implemented a long-standing demand of the Sangh Parivar.

Chief Justice Chandrachud holds on behalf of seven of the nine judges on the bench holds that the phrase 'material resources of the community' used in Article 39(b) may include privately owned resources and whether a privately-owned 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.

'The Public Trust Doctrine evolved by this Court may also help identify resources which fall within the ambit of the phrase 'material resource of the community.'

Article 39 of the Constitution says, 'The State shall, in particular, direct its policy towards securing

(b) that the ownership and control of the material resources of the community are so distributed as best to subserve the common good; and

(c) that the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment'.

Five of the six clauses of Article 39 deal with the problem of ending economic inequality.

Even a child would understand that the purpose of Article 39(b) and (c) is to re-distribute ownership of economic resources to correct maldistribution of wealth and promote economic equality.

Do you feel the Justice Krishna Iyer doctrine of 1977 echoed the socialistic sentiments of the then Indian society?

Reflecting the plain intent of the Constitution and years of interpretation by many judgments, Justice Krishna Iyer rightly said in a 1977 judgment about Article 39(b) (State of Karnataka v. Ranganatha Reddy).

'The key word is 'distribute' and the genius of the Article, if we may say so, cannot but be given full play as it fulfills the basic purpose of restructuring the economic order.

Each word in the Article has a strategic role and the whole Article a social mission.

It embraces the entire material resources of the community. Its task is to distribute such resources. Its goal is so to undertake distribution as best to subserve the common good. It re-organizes by such distribution the ownership and control.

This reasoning was followed by Justice O Chinnappa Reddy five years later in a 1982 judgment (Sanjeev Coke Manufacturing Company vs Bharat Coking Coal Ltd. And Another).

The Chief Justice was rather critical of Justice Krishna Iyer saying he was postulating a rigid economic theory which advocated for greater State control over private resources...

Chief Justice Chandrachud dismisses these well-reasoned and widely accepted views of two of India's greatest judges (Justice Krishna Iyer and Justice Chinnappa Reddy) about Article 39(b) and (c) as merely the personal doctrine of Justice Krishna Iyer saying

'According to Justice Iyer, if privately owned resources are excluded from the ambit of Article 39(b) it would defeat the underlying purpose of the provision, which is redistribution of wealth. (para 182) -- but of course Justice Krishna Iyer is right and the majority judgment's understanding of Article 39 is plainly ahistorical and wrong.

Using trolling style language, Chief Justice Chandrachud says, 'To scuttle this Constitutional vision by imposing a single economic theory, which views the acquisition of private property by the State as the ultimate goal, would undermine the very fabric and principles of our Constitutional framework' (para 216).

Justice Chandrachud goes on to say, 'In essence, the interpretation of Article 39(b) adopted [by Justice Iyer and Justice Chinappa Reddy] in these judgments is rooted in particular economic ideology and the belief that an economic structure which prioritises the acquisition of private property by the state is beneficial for the nation' (para 213).

Significantly, both Justice Krishna Iyer (in Ranganatha Reddy and Bhimsinghji) and Justice Chinappa Reddy (in Sanjeev Coke) consistently referred to the vision of the framers as the basis to advance this economic ideology as the guiding principle of the provision (para 214).

However the vision of the framers while drafting the Constitution was not to lay down a particular form of social structure or economic policy for future governments (para 214).

[Dr. Ambedkar] 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'(para 214).

In some cases, the mere vesting of the resource in the hands of the government serves the 'common good', while in other cases, a resource may be distributed amongst private players to achieve this purpose.

To illustrate, a large privately owned pond may be acquired and put in control of a governmental agency or a cooperative society so that the pond is preserved.

Similarly, the material resource of spectrum may be auctioned to the highest bidder who may be a private company, who would then utilise the spectrum along with their technology to best subserve the common good.

These are questions of economic and social policy which fall outside the ambit of judicial inquiry.

As noted above, this Court must not tread into the domain of economic policy or endorse a particular economic ideology while undertaking Constitutional interpretation.

To hold that the term 'distribution' cannot encompass the vesting of a private resource would amount to falling into the same error as the Justice Krishna Iyer doctrine -- to lay down a preference of economic and social policy (para 228).

To hold that the term 'distribution' cannot encompass the vesting of a private resource would amount to falling into the same error as the Justice Krishna Iyer doctrine -- to lay down a preference of economic and social policy (para 228).

Today, the Indian economy has transitioned from the dominance of public investment to the co-existence of public and private investment. 151 The doctrinal error in the Krishna Iyer approach was, postulating a rigid economic theory, which advocates for greater state control over private resources, as the exclusive basis for Constitutional governance (para 215)

The interpretation of Article 39(b), both as a precursor to the protection of Article 31C and as an aspirational Directive Principle, cannot run counter to the Constitutional recognition of private property.

To hold that all private property is covered by the phrase 'material resources of the community' and that the ultimate aim is State control of private resources would be incompatible with the Constitutional protection detailed above. (para 221).

Totally blind to the core goal of Articles 39(b) and (c) of reducing inequality through re-distributing the material resources of the community, Chief Justice Chandrachud says, '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'.

The majority judgment makes a naive and erroneous argument that the Constitution does not have an ideology (which is a naive and erroneous view) and the settled understanding of countless earlier judgments of the Court about socialism as an ideology was only an imposition by Justice V R Krishna Iyer (judge of the Supreme Court from 17 July 1973 to 15 November 1980) of his personal ideological views which the judgment calls 'the Krishna Iyer doctrine', which is not socialism and is not found in the Constitution.

Chief Justice Chandrachud terms Justice Krishna Iyer's narration of universally accepted ideas of socialism as an 'error'.

Justice Nagarathna and Justice Dhulia disagree with the CJI's observation.
Justice Dhulia spoke about Justice Krishna Iyer's judgement as one based on strong humanistic principles of fairness and equality...

Yes. The separate judgment delivered by Justice Nagararathna quotes the majority judgment of Chief Justice Chandrachud as saying that 'The Krishna Iyer doctrine does a disservice to the broad and flexible spirit of the Constitution.'

It is interesting that this phrase which must have been part of an earlier version of the Chief Justice's judgment seems to have been removed from the uploaded judgment.

Justice Nagarathna and Justice Sudanshu Dhulia (who wrote a stirring dissent explaining the judicially accepted idea of socialism) have in their judgment strongly rebuked the Chief Justice of India for his comments on Justice Krishna Iyer -- which is in itself very rare if not completely unprecedented.

Justice Nagarathna said, 'It has been observed by the learned Chief Justice that "the doctrinal error in the Krishna Iyer approach was, postulating a rigid economic theory, which advocates for greater State control over private resources, as the exclusive basis for Constitutional governance... a single economic theory, which views the acquisition of private property by the State as the ultimate goal, would undermine the very fabric and principles of our Constitutional framework. The above comments on Krishna Iyer are in my opinion unwarranted and unjustified.'

She added, 'Any interpretation which was found to be sound and in consonance with the socio-economic policy of the State during a particular period of time, cannot be critiqued at a later point of time in any quarter including by a court of law merely because the socio-economic policies of the State have changed over a period of time or there is a paradigm shift in the thinking and policies of the State.'

Justice Dhulia said, 'Before I conclude, I must also record here my strong disapproval on the remarks made on the Krishna Iyer Doctrine as it is called. This criticism is harsh and could have been avoided. The Krishna Iyer Doctrine, or for that matter the O. Chinnappa Reddy Doctrine, is familiar to all who have anything to do with law or life. It is based on strong humanist principles of fairness and equity. It is a doctrine which has illuminated our path in dark times. The long body of their judgment is not just a reflection of their perspicacious intellect but more importantly of their empathy for the people, as human being was at the centre of their judicial philosophy. In the words of Justice Krishna Iyer himself: "The Courts too have a constituency -- the nation -- and a manifesto -- the Constitution (Bangalore Water Supply & Sewerage Board. vs A. Rajappa & Others)'.

By ejecting socialism and rejecting the re-distribution of economic resources, the judgment provides a powerful bastion for the protection and maintenance of economic inequality in India, reinforcing the rule of the small caste oligarchy that controls power and wealth in the country.

Socialism and re-distribution of economic resources have always been a grave threat to the oligarchy.

Indian oligarchs and their supporters would naturally be celebrating this judgment: Greater protection of private property rights and the ending of socialism and re-distribution of economic wealth as guiding principles of the Republic.

However, the turning of our Apex court into an adversary of socialism is a dark day for the common masses of India.

What is being celebrated is the political coup against socialism.