Chief Justice D Y Chandrachud on 23rd April noted the situation where tenants hold onto properties and landlords struggle with maintenance costs. The Supreme Court is reviewing a Maharashtra law aimed at acquiring old, unsafe buildings where tenants refuse to vacate and landlords lack funds for repairs.
New Delhi: The Maharashtra government devised a law to acquire old and dilapidated buildings considered unsafe, as tenants clung to the properties while landlords lacked funds for repairs, noted the Supreme Court on Tuesday as it assessed whether privately owned resources could be seen as “material resources of the community”
Chief Justice D Y Chandrachud made these observations while handling numerous petitions filed by landlords challenging the Maharashtra law. He leads a nine-judge constitution bench that is deliberating on the complex issue raised by the petitions regarding whether private properties can be deemed “material resources of the community” under Article 39 (b) of the Constitution, which forms part of the Directive Principles of State Policy (DPSP).
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Article 39(b) mandates that the State must formulate policies aimed at ensuring ,
“That the ownership and control of the material resources of the community are so distributed as best to subserve the common good.”
Mumbai, known for its dense population, features aged, deteriorating buildings accommodating tenants despite becoming unsafe due to neglecting repairs. To facilitate the repair and restoration of these buildings, the Maharashtra Housing and Area Development Authority (MHADA) Act of 1976 enforces a levy on its residents, directed to the Mumbai Building Repair and Reconstruction Board (MBRRB). This board oversees the refurbishment and rebuilding of these “cessed buildings.”
In compliance with the duty outlined in Article 39(b), the MHADA Act underwent an amendment in 1986. Section 1A added to the Act to facilitate the acquisition of lands and buildings for transfer to those in need who are in possession of such properties.
The amended law includes Chapter VIII-A, which empowers the state government to acquire cessed buildings and their associated land if requested by 70 percent of the occupants. The Property Owners Association contested Chapter VIII-A, arguing that its provisions discriminate against owners, violating their right to equality as per Article 14.
A total of 16 petitions, including one led by the Mumbai-based Property Owners Association (POW), reviewed by the bench, composed of Justices Hrishikesh Roy, BV Nagarathna, Sudhanshu Dhulia, JB Pardiwala, Manoj Misra, Rajesh Bindal, Satish Chandra Sharma, and Augustine George Masih.
POW initially filed its plea in 1992, which underwent three referrals to larger benches consisting of five and seven judges before finally reaching a nine-judge bench on February 20, 2002.
The Chief Justice of India (CJI) highlighted the difference between an individual’s private case and communal title. Using the example of private mines, he stated,
“They may be private mines. But in a broader sense, these are material resources of the community. The title may rest in a private individual but for the purpose of Article 39(b), our readings should not be constricted but must have that broad understanding.”
The CJI remarked,
“The buildings in Mumbai serve as a case in point. While technically they are privately owned, the rationale behind the law (MHADA Act) is not under discussion here; its legality and validity will be assessed separately,”
Justice Chandrachud explained,
“The state legislature introduced this Act due to the aging nature of these buildings dating back to the 1940s. Considering Mumbai’s intense monsoon and saline weather, these buildings deteriorate significantly.”
Referring to the minimal rent paid by tenants, particularly in Mumbai’s old buildings, the CJI noted,
“Because, honestly, the fact that the rent was so meagre that the landlord said no, they had no money at all actually to repair them and (with) the tenants sitting tight, no one would have the wherewithal to repair the whole building and hence the legislature came up (with the Act).”
Discussing the concept of ‘material resources of the community,‘ the bench emphasized the community’s significant interest, stating that if a building collapses, the community faces direct consequences.
Solicitor General Tushar Mehta, representing the Maharashtra government, informed the bench,
“The only issue that has been referred to a larger Bench of 9-judges is whether the expression ‘material resources of the community’ under Article 39 (b) covers privately owned resources or not.”
Regarding the 1973 Kesavananda Bharati judgment on the “basic structure” doctrine, the top law officer affirmed,
“It is clear that the un-amended Article 31-C, to the extent upheld by the judgment in the Kesavananda Bharati case, is valid and in operation.”
He highlighted that amendments implementing the DPSP, if they don’t affect the ‘basic structure’ of the Constitution, not subject to judicial review.
The hearing adjourned with plans to resume on Wednesday.