There was no confiscation of territory. The Palestinians never had any territory of their own. In the beginning the Jews were just invited to return and live along side the Arabs. The Arabs, who never controlled anything, didn't like this, so they decided that if the Arabs couldn't share, they would divide the land. You can't take something away from someone who never had it, to begin with.
The Arabs were given what was thought to be separate, but equal. That was not good enough, they wanted it all.