This  Bill  seeks to amend articles 31, 31A and 305 of, and the  Ninth Schedule to, the Constitution.

2.   Recent  decisions  of the Supreme Court have given  a  very  wide
meaning  to clauses (1) and (2) of article 31.  Despite the difference
in  the wording of the two clauses, they are regarded as dealing  with
the  same subject.  The deprivation of property referred to in  clause
(1)  is  to  be  construed  in  the  widest  sense   as  including  any
curtailment  of  a  right to property.  Even where it is caused   by  a
purely  regulatory  provision  of  law and is not  accompanied   by  an
acquisition  or taking possession of that or any other property  right
by  the  State,  the  law, in order to be  valid  according   to  these
decisions,  has  to provide for compensation under clause (2)  of  the
article.   It  is  considered necessary, therefore, to  re-state   more
precisely   the   State's   power  of    compulsory   acquisition   and
requisitioning of private property and distinguish it from cases where
the  operation of regulatory or prohibitory laws of the State  results
in  "deprivation of property".  This is sought to be done in clause   2
of the Bill.

3.   It will be recalled that the zamindari abolition laws which  came
first  in our programme of social welfare legislation were attacked by
the  interests  affected mainly with reference to articles 14, 19  and
31,  and  that  in order to put an end to the  dilatory  and   wasteful
litigation  and  place  these  laws above  challenge  in   the  courts,
articles  31A  and  31B  and the Ninth Schedule were  enacted   by  the
Constitution  (First  Amendment) Act.  Subsequent  judicial   decisions
interpreting  articles 14, 19 and 31 have raised serious  difficulties
in  the  way  of the Union and the States putting  through  other   and
equally  important  social welfare legislation on the  desired  lines,
e.g., the following:-

(i)  While the abolition of zamindaris and the numerous intermediaries
between the State and the tiller of the soil has been achieved for the
most part, our next objectives in land reform are the fixing of limits
to  the  extent of agricultural land that may be owned or occupied  by
any  person, the disposal of any land held in excess of the prescribed
maximum  and the further modification of the rights of land owners and
tenants in agricultural holdings.

(ii)  The  proper  planning  of   urban and  rural  areas  require  the
beneficial  utilisation of vacant and waste lands and the clearance
of slum areas.

(iii)  In the interest of national economy the State should have  full
control  over the mineral and oil resources of the country,  including
in  particular, the power to cancel or modify the terms and conditions
of  prospecting licenses, mining leases and similar agreements.   This
is  also  necessary in relation to public utility  undertakings  which
supply  power, light or water to the public under licenses granted  by
the State.

(iv)  It is often necessary to take over under State management for  a
temporary  period  a  commercial or industrial  undertaking  or   other
property  in  the  public interest or in order to  secure  the   better
management  of  the undertaking or property.  Laws providing for  such
temporary transference to State management should be permissible under
the Constitution.

(v)  The  reforms  in company law now under   contemplation,  like  the
progressive  elimination of the managing agency system, provision  for
the  compulsory amalgamation of two or more companies in the  national
interest,  the transfer of an undertaking from one company to another,
etc., require to be placed above challenge.

It is accordingly proposed in clause 3 of the Bill to extend the scope
of  article  31A so as to cover these categories of essential  welfare
legislation.

4.   As  a corollary to the proposed amendment of article 31A,  it  is
propsed  in  clause 5 of the Bill to include in the Ninth Schedule  to
the  Constitution two more State Acts and four Central Acts which fall
within  the  scope  of sub-clauses (d) and (f) of clause  (1)  of   the
revised article 31A.  The effect will be their complete, retrospective
validation under the provisions of article 31B.

5.   A  recent judgment of the Supreme Court in Saghir Ahmed  v.   the
State  of U.P.  has raised the question whether an Act providing for a
State  monopoly  in a particular trade or business conflicts with  the
freedom  of trade and commerce guaranteed by article 301, but left the
question  undecided.   Clause  (6) of article 19 was  amended   by  the
Constitution  (First  Amendment)  Act  in order  to  take   such  State
monopolies  out of the purview of sub-clause (g) of clause (1) of that
article,  but no corresponding provision was made in Part XIII of  the
Constitution  with reference to the opening words of article 301.   It
apears from the judgment of the Supreme Court that notwithstanding the
clear  authority of Parliament or of a State Legislature to  introduce
State  monopoly  in a particular sphere of trade or commerce, the  law
might  have to be justified before the courts as being "in the  public
interest"  under  article  301  or  as  amounting   to  a   "reasonable
restriction"  under  article 304(b).  It is considered that  any   such
question  ought  to be left to the final decision of  the  Legislatue.
Clause  4 of the Bill accordingly proposes an amendment of article 305
to make this clear.

NEW DELHI;                                           JAWAHARLAL NEHRU.

The 17th December, 1954.

THE CONSTITUTION (EIGHTH AMENDMENT) ACT, 1959