Private Agreements Cannot Override Government's Eminent Domain Power to Acquire Land for Public Purpose

The SC held that a statutory board cannot nullify the State's eminent domain power by entering into a private agreement to return compulsorily acquired land. The Court emphasized that without a formal conveyance document transferring the land from the government to the Board, the Board had no absolute rights over the property. The agreement dated 30.09.1988 was deemed contrary to the fundamental policy of Indian law as it attempted to reverse a sovereign acquisition for public purpose. The Court noted suspicious circumstances surrounding the agreement's preparation before Board approval. The arbitral award upholding this agreement was invalid, and lower courts erred in not setting it aside under Sections 34 and 37 of the Arbitration and Conciliation Act, 1996. Appeal allowed. .....

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