New Delhi: Observing that the right to property was not just constitutional, but also a human right, the Supreme Court held Thursday that state acquisition of a private property should be carried out under a law, following the procedural safeguards entailed in it. Failure to abide by the procedure would render the acquisition invalid, it said.
A bench led by Justice P.S. Narasimha examined the contours of Article 300A of the Constitution, which empowers the state to deprive a person of his or her property through a law. It enables the government to legislate to execute the process of acquisition.
However, the bench said that the requirement of the law does not end with the mere presence of a legislation. The constitutional scheme under Article 300A, it added, requires the law to establish a procedure for the acquisition and the state to comply with it.
“Existence and adherence to procedural safeguards is crucial for the protection of the right to property as they ensure fairness, transparency, natural justice, and non-arbitrary exercise of power in the process of acquisition,” the bench said.
Absence of a procedure or the state’s failure to comply would invalidate the acquisition, the court added. “Therefore, a valid acquisition of property is premised on the law providing a procedure for such acquisition and the state complying with this statutory procedure,” the justices held.
Importantly, the apex court also said that acquisition does not become legal if reasonable and fair compensation is paid to the person who is deprived of his or her property. The phrase “no person shall be deprived of his property save by authority of law” in Article 300A would mean that compulsory acquisition would “still be unconstitutional if proper procedure is not established and followed” to take over someone’s private property.
The top court’s exposition on the mandates under Article 300A came on an appeal filed by the Kolkata Municipal Corporation, which challenged a Calcutta High Court judgment of 2021 setting aside the acquisition proceedings initiated by it in the city against a private property.
The SC upheld the high court’s decision to state that the corporation had relied on a provision of the Municipal Corporation Act that did not empower it to acquire a property, but authorised the civic body commissioner to only identify a suitable property for acquisition. Further, the said section did not prescribe any procedure to execute the acquisition.
The top court gave a historical background on how the right to property received protection in the current constitutional scheme. Once part III of the Constitution, right to property was treated as a fundamental right. It was omitted from there through the 44th constitutional amendment and was inserted in a new form through Article 300A, which provides that “no person shall be deprived of his property save by authority of law”.
The bench discussed the twin requirements – acquisition for public purpose and payment of compensation in lieu of acquisition — that are not explicitly contained in Article 300A, but have been read in and inferred as necessary conditions for compulsory deprivation to afford protection to the individuals who are divested of their property.
According to the judgment, Article 300A contains yet another protection. “It mandates that the state can deprive a person of his property only by the authority of law. In other words, the most fundamental requirement for the exercise of power of acquisition is that there must be an ‘authority of law’,” the judgment stated.
To assume that for a valid acquisition all that is necessary is to possess the power of eminent domain to acquire, followed by grant of reasonable and fair compensation, would not be the correct assessment of the constitutional position, the bench said.
The acquisition should be under the “authority of law,” which is not limited to the “power of eminent domain vesting in the state”.
“It is only through the prescription of mandatory procedures and processes of law that a person’s rights and liberties are safeguarded. The history of liberty has largely been the history of the observance of procedural safeguards. It is in procedural justice that the safeguards of this right rests,” the bench said, defining the term “authority of law” mentioned in Article 300A.
A legal procedure to erode someone’s right to property has always been an integral part of the right itself, the court observed.
The court studied the seven basic procedural rights that Article 300A conferred on a landowner. They are duty of the state to inform the person that it intends to acquire his property — the right to notice; the duty of the state to hear the objections to the acquisition — the right to be heard; the duty of the state to inform the person of its decision of acquisition — the right to a reasoned decision; the duty of the state to demonstrate that the acquisition is for public purpose — acquisition only for public purpose; the duty of the state to restitute and rehabilitate — the right to fair compensation; the duty of the state to conduct the process of acquisition efficiently and within prescribed timelines of the proceedings, which includes timely compensation and rehabilitation and conclusion of the acquisition proceedings by taking physical possession of the land.
Non-compliance with these procedures will amount to violation of the constitutional right to property as only these seven principles can justify compulsory acquisition of immovable property under Article 300A, the court said.
(Edited by Tikli Basu)
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