IMPORTANT POINT
Appeal against arbitral award – When State uses its sovereign power of eminent domain and acquires land for a public purpose, such an exercise cannot be set at naught by beneficiary of such acquisition, by entering into a private agreement shortly after acquisition so as to reverse usage of power of eminent domain by State.

JUDGMENT

SANJAY KUMAR, J

1. Turning the law of land acquisition on its head, the astonishing events that this appeal is founded on need to be narrated in some detail.

2. An extent of 33 acres of land abutting the Narela-Bawana Road was acquired by the Government to enable the Delhi Agricultural Marketing Board (hereinafter, ‘the Board’) to shift and establish its grain market in Narela. Notification under Section 4(1) of the Land Acquisition Act, 1894 (for brevity, ‘the Act of 1894’), was issued on 30.10.1963. Declaration under Section 6 of the Act of 1894 was issued on 10.01.1969 and the Award, determining the compensation, was made on 19.09.1986. The acquired land included an extent of 6 bighas and 10 biswas situated in Khasra Nos. 296, 298 and 303 of Village Mamoorpur. Bhagwan Devi claimed ownership over this smaller extent under registered sale deeds of the years 1959 and 1971. Possession of the acquired land was taken and handed over on 22.09.1986 to the Agricultural Produce Marketing Committee, Narela, under the control of the Board. This ostensibly included the extent of 6 bighas and 10 biswas claimed by Bhagwan Devi. She, then, filed W.P. No. 149 of 1987 before the Delhi High Court challenging the acquisition of her land.

3. It is at this stage that the story took a curious turn. The Board resolved to settle the matter out of Court with Bhagwan Devi by releasing and returning to her half of the acquired extent claimed by her and retaining the remaining half, i.e., 3 bighas and 5 biswas. The agreement in this regard was executed on 30.09.1988 by the Board, through its then Chairman, with Bhagwan Devi. This agreement stated that Bhagwan Devi would claim compensation as per the Award dated 19.09.1986 from the Land Acquisition Collector and would have all the rights and remedies provided to her under the Act of 1894. The agreement further recorded that, with the prior consent of the Land Acquisition Collector, the Board, which had become the absolute owner of the acquired land that was mutated in its favour in the revenue records, would execute a proper conveyance deed in respect of the portion of land proposed to be returned to her thereunder, for valuable consideration. The consideration to be paid by Bhagwan Devi was quantified as the proportionate compensation for half the land, as was granted to her under the Award dated 19.09.1986, along with interest @ 12 per cent per annum from the date of deposit of the compensation amount by the Board with the Land Acquisition Collector till the date of actual payment by Bhagwan Devi to the Board.

4. Clause (k) of the agreement provided that any dispute arising between the parties touching upon the effect and meaning of the agreement should be referred to the Chairman of the Board, whose decision thereon would be final and binding upon the parties. This agreement is stated to have been executed on behalf of the Board by its then Chairman, just one day prior to his tenure coming to an end. Though it is asserted that this action of the then Chairman was based on the Minutes of the Board meeting held on 29.09.1988, there is no mention of the same in the body of the agreement.

5. In any event, Writ Petition No. 149 of 1987 was disposed of on 05.10.1988 in the light of this agreement. The Board seems to have then realized that the land acquired for its benefit could not be released in this manner and the issue was reconsidered in the Board’s meeting held on 22.11.1988. The Minutes of this meeting recorded that, upon enquiry, the authorities had informed the Board that though possession of the acquired land was handed over to the Board, the land still vested in the Government as no conveyance deed had been executed by the Government in favour of the Board. The Board, therefore, opined that it was necessary to review the whole matter. This was brought to the notice of the Delhi High Court by filing an application to recall the order dated 05.10.1988 passed in W.P. No. 149 of 1987. Bhagwan Dev