RC Cooper v Union of India (1970) | Bank Nationalisation Case Explained | Article 14, 19 & 31

RC Cooper v Union of India (1970): the Bank Nationalisation Case explained for LL.B., CLAT PG, UGC NET Law and Judiciary exams. Banking Law Case 01 of 29 by Law Easy. Court and year: Supreme Court of India, 1970. Facts: 14 banks were nationalised in 1969. Rustom Cavasjee Cooper owned shares in several of them, was a director of one and also held deposits, and challenged the nationalisation Act because of its effect on his rights. Legal issue: Can the State nationalise banks by law and still respect fundamental rights? Did the Act breach Article 14 (equality), Article 19(1)(f) (right to property, as it then stood) and Article 31(2) (compensation)? Judgment: The majority held that Parliament had power to make the law (banking is in the Union List and acquisition of property is in the Concurrent List) and that a shareholder can sue when state action impairs his own fundamental rights. But the Act was struck down. It was hostile discrimination under Article 14 to take over these banks and bar only them from banking in future, while other Indian and foreign banks could continue. It also violated Article 31(2) because it did not lay down relevant principles for compensation: it ignored items such as goodwill and the value of long leases. Principle to remember: A law must be judged by its direct effect on fundamental rights, not merely by its object or form. This effect test is the lasting legacy of the case. Article 19(1)(f) and Article 31 were not mutually exclusive. Provisions: Articles 14, 19(1)(f) and 31(2) as they stood in 1969. Exam note: Do not teach the old right to property as a present fundamental right. After the 44th Amendment, property is protected by Article 300A as a constitutional right. Banking Law playlist (all 29 cases in order): https://www.youtube.com/playlist?list=PLbhYsrMKgACA Complete Banking Law lecture (all 29 cases with chapters): https://youtu.be/ayAN7RLlfPM Notes and study material: https://www.thelaweasy.com Subscribe to Law Easy for more LL.B., CLAT PG, UGC NET Law and Judiciary case-law lectures. This video is for education and is not legal advice. #BankingLaw #RCCooper #CLATPG #UGCNETLaw #Judiciary #LLB #LawEasy