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Wednesday, 10 April 2013

Orissa Govt showed undue favour to Posco: CAG



Orissa Govt showed undue favour to Posco: CAG

Posco3Bhubaneswar, April 7: The Comptroller and Auditor General (CAG) has found the State Government of extending undue benefits to Posco in allotment of a piece of land in the city.
"The company extended undue benefit in allotment of land disregarding zonal regulation and charging of premium at a reduced rate," the CAG said in its latest report tabled in the State Assembly, Saturday.
The CAG observation was made based on the performance audit on the land allotments by the State General Administration Department headed by Chief Minister Naveen Patnaik. The official national auditor has come across widespread irregularities in land allotments.
The CAG report said the South Korean steel major's India arm Posco-India had applied for allotment of a plot measuring 12,000 square feet for its Chairman-cum-Managing Director's (CMD) residence-cum-guest house in 2006.
However, later it enhanced the requirement twice to 25,000 sq ft in April 2007 and later to 2 acre for the same purpose.
"Though the same area was earmarked in the Comprehensive Development Plan (CDP) of the Capital city for commercial use, the company was allotted 1.7 acre land in January 2008 at a premium of Rs 25 lakh per acre against prevalent market value of the land of Rs 64 lakh per acre, resulting in a loss of Rs 66 lakh to the State Government," the CAG has observed.
The CAG report also observed that the land was lying vacant till June 2012. "The company, thus, was extended undue benefit in allotment of land disregarding zonal regulation and charging of premium at a reduced rate," it said.
Rapping the State Government for allotting government land to private players, CAG pointed out that the department, custodian of the Government land in municipal area, gave away land which remained unused for several years.
The department allotted 1.01 acre of land to Hotel Ambassador International at Unit-8 by changing the land use zone from 'residential' to 'commercial'. Notably, the piece of land for the hotel was given to the son of Revenue and Disaster Management Minister Surya Narayan Patro.
Interestingly, while the entire process of allotment was completed within 56 days, the applicant was allowed to pay premium at institutional rate (Rs 50 lakh per acre) against the commercial rate of Rs 75 lakh per acre.
Significantly, while he was allowed to pay in eight installments as per his request, the lease of the land was changed in favour of 'Hotel South Pac Private Limited' after first installment.
Showing undue favour to the applicants, the department allotted as much as 21.43 acre of land to seven parties (four pieces for hotels and one each for a guest house, a housing project and an individual) by deviating the norms of land use zone as per CDP prepared by Bhubaneswar Development Authority (BDA).
Since the land continued to remain unused except construction of boundary wall and a small hut, the State Government cancelled the lease in November last year.
The department also allotted as much as 6.832 acre of forest land to four parties without obtaining necessary forest clearance from the Ministry of Environment and Forests (MoEF). Medirad Tech India Limited (1.397 acre), BDA (0.588 acre), Hotel Mayfair and Resorts Private Limited (3.237 acre) and Hotel Rashmi Plaza (1.61 acre) are the four parties to whom the forest land was allotted, according to the CAG report.
Moreover, as much as 52.317 acre of land was allotted by the department to seven private parties – Hotel Mayfair and Resorts Private Limited (10.237 acre), Asian Hospitals and Research Centre (10.632 acre), Hemalata Hospital and Research Centre (2.594 acre), Bhubaneswar Eye Research Institute (10.608 acre), ODM Public School (2.646 acre), Siksha O Anusandhan University (10.6 acre) and Advance Medicare and Research Institute (5 acre) – without following any standard measures and sans any procedure regarding the adequacy of land.
Also, undue favour was extended to three allottees – DAV Public School, Kalinga Nagar; Gurukul, Ghatikia; and Bhubaneswar Eye Research Institute – ignoring the prescribed eligibility parameters in sanctioning the concession.
Furthermore, charge of premium for same category of allotment was varied and charged arbitrarily by the department, the CAG pointed out.
Though cases of encroachment were coming to the knowledge of the department, it failed to initiate action against the guilty. The CAG found that as much as 11.187 acre of land valued at Rs 84.21 crore was under unauthorised possession. PNN