THATin all cases where satisfactory proof shall be furnished to the district land office of the proper district that the whole or any part of section sixteen, in any township in said land district, is unfit for cultivation, or is included in any claim recognized by the United States, then the said township, by its authorized agent, or by the Governor of the State in which the land is situate, where there is no such agent, upon filing in the local land office a relinquishment of the whole of the said sixteenth section, or any part thereof, may select, by legal subdivisions, other lands equal in quantity to the portion so relinquished; and the selections thus made, when approved by the Secretary of the Treasury, shall be regarded and treated, in all respects, as school lands: Provided, That said selection shall in no case interfere with the previously acquired rights of private individuals.