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TMI Blog2025 (3) TMI 1056X X X X Extracts X X X X X X X X Extracts X X X X ..... lishment of a grain market under the control of a statutory Board, such an exercise cannot be set at naught by the beneficiary of such acquisition, viz., the statutory Board, by entering into a private agreement shortly after the acquisition so as to reverse the usage of the power of eminent domain by the State. Validating this dubious enterprise by a statutory beneficiary of a compulsory acquisition would be nothing short of permitting a fraud on the exercise of such sovereign power by the State. Viewed thus, the agreement dated 30.09.1988 was clearly in contravention of the fundamental policy of Indian law and the Arbitral Award dated 10.07.2007, upholding the said agreement, was equally so. Further, the fact that the preparation of the agreement dated 30.09.1988, by purchase of stamp papers for the same and the drafting thereof, took place even before the matter was considered by the Board in the meeting held on 29.09.1988 clearly revealed that there was something suspect about the transaction. Given the further fact that the only objective of the said agreement was to thwart the compulsory acquisition of the subject land by returning a portion thereof to Bhagwan Devi, the agre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Arbitrator that the agreement dated 30.09.1988 was void ab initio and could not be implemented as the land acquisition authorities were not party to it and the acquired land could not be returned without their consent. It also pointed out that the agreement was brought into existence with undue haste, inasmuch as the stamp papers therefor were purchased on 26.09.1988; the agreement was drafted on 27.09.1988; the matter was put up before the Board in its meeting held on 29.09.1988; and without confirmation of the Minutes of the said meeting, the then Chairman signed the agreement on 30.09.1988, which happened to be his last day in office. 7. However, the learned Arbitrator passed Award dated 10.07.2007 in favour of Bhagwan Devi, holding that the Board was competent to enter into the agreement dated 30.09.1988 and return 3 bighas and 5 biswas of land to her. He accordingly directed the Board to comply with the said agreement by performing its obligations thereunder and execute a conveyance deed in favour of Bhagwan Devi. In turn, Bhagwan Devi was also directed to perform her part of the agreement. 8. Aggrieved by the Award dated 10.07.2007, the Board filed a petition, vide OMP N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and in terms of Section 5(3) thereof, it was to be a body corporate, having perpetual succession with power, subject to the provisions of the Act of 1976, to acquire and hold property. 12. Thereafter, the present Delhi Agricultural Produce Marketing (Regulation) Act, 1998 (for brevity, 'the Act of 1998'), replaced the Act of 1976. It contains similar provisions in Section 6 thereof, which states that the Board, constituted under Section 5 thereof, shall be a body corporate and a local authority, having perpetual succession with power, subject to the provisions of the said Act, to acquire, hold and dispose of property. Section 24(1) thereof deals with the acquisition of land for markets and states that when any land is required for the purposes of the Act of 1998 and the Board is unable to acquire the same by agreement, such land may, at the request of the Board, be acquired under the provisions of the Act of 1894 and on payment of the compensation awarded under the Act of 1894 by the Board and all other charges incurred in connection with such acquisition, the land shall vest in the Board. The proviso to Section 24(1), however, states that once a proposal has been made by the Boar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch document was ever issued by the Government actually transferring the subject land to the Board, whereby it could claim absolute rights over it. 15. The Board had raised these issues before the learned Arbitrator, apart from claiming that the agreement dated 30.09.1988 was contrary to public policy, but the Award dated 10.07.2007 came to be passed holding against the Board. Neither the Court exercising jurisdiction under Section 34 nor the Court exercising appellate power under Section 37 dealt with these crucial issues. Section 34(2)(b) of the Act of 1996 categorically provides that an Arbitral Award may be set aside if the Court finds that it is in conflict with the public policy of India. Explanation (1) thereto clarifies that an Award would be in conflict with the public policy of India if it is in contravention of the fundamental policy of Indian law or it is in conflict with the most basic notions of morality or justice. 16. When the State uses its sovereign power of eminent domain and acquires land for a public purpose, as in the case on hand, i.e., for establishment of a grain market under the control of a statutory Board, such an exercise cannot be set at naught by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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