Article 296 lets the government seize any private property it wants.

It only applies to property that has genuinely become ownerless — through escheat (no heirs), lapse, or as bona vacantia — not to property with a living, identifiable owner.

All such property automatically goes to the Union government.

The default rule sends property to the State where it is located; only property outside any State's territory, or falling under the proviso's government-control exception, goes to the Union.

The Constitution of India

Article 296

Property accruing by escheat or lapse or as bona vacantia

Subject as hereinafter provided, any property in the territory of India which, if this Constitution had not come into operation, would have accrued to His Majesty or, as the case may be, to the Ruler of an Indian State by escheat or lapse, or as bona vacantia for want of a rightful owner, shall, if it is property situate in a State, vest in such State, and shall, in any other case, vest in the Union:§

Provided that any property which at the date when it would have so accrued to His Majesty or to the Ruler of an Indian State was in the possession or under the control of the Government of India or the Government of a State shall, according as the purposes for which it was then used or held were purposes of the Union or of a State, vest in the Union or in that State.§

Explanation. — In this article, the expressions “Ruler” and “Indian State” have the same meanings as in article 363.§

Why this exists

Before 1950, unclaimed or ownerless property (through escheat, lapse, or as bona vacantia) legally passed to the British Crown or to the Ruler of the princely state where it was located. When India became a republic and princely states merged into the Union, there was no monarch or Ruler left to inherit such property. Article 296 modernises this old common-law and princely-state rule, replacing the Crown/Ruler with the State or Union government as the new default owner, while protecting existing government control arrangements through the proviso.

Common misconceptions

Myth: Article 296 lets the government seize any private property it wants.
Fact: It only applies to property that has genuinely become ownerless — through escheat (no heirs), lapse, or as bona vacantia — not to property with a living, identifiable owner.
Myth: All such property automatically goes to the Union government.
Fact: The default rule sends property to the State where it is located; only property outside any State's territory, or falling under the proviso's government-control exception, goes to the Union.