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REPORTABLE  

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.6450  OF 2016 (Arising out of S.L.P. (Civil) 34373 OF 2014)

Orissa Olympic Association Th. General Secretary      ...  Appellant

                               Versus

State of Orissa & Anr. ...   Respondents

J U D G M E N T

Dipak Misra, J.

The assailment in the instant appeal, by special leave,

is to the legal acceptability of the judgment and order dated

29.11.2014 passed by the High Court of Orissa, Cuttack, in

First  Appeal  No.  158 of  2001 whereby the learned Single

Judge  has  set  aside  the  judgment  and  decree  dated

16.04.1999  and  21.04.1999  respectively  passed  by  the

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learned Additional Civil Judge, Senior Division, Cuttack in

T.S. No. 312 of 1991 wherein the learned trial Judge had

decreed the suit of the plaintiff-appellant and permanently

restrained  the  defendants,  the  State  of  Orissa  and  its

functionaries,  from  disturbing  the  peaceful  possession  of

the plaintiff-association over the suit land.  

2. The facts which are essential to be exposited for the

purpose  of  the  present  appeal  are  that  the

appellant-association was granted lease of land measuring

acres 20.808 decimals appertaining to Sabik Settlement Plot

No. 156 and portions of Plot Nos. 139, 143, 155 and 177 for

the construction of a stadium. The lease deed was executed

on  04.09.1949  and  registered  on  24.09.1949.  After

obtaining the lease of  the land, the appellant raised high

compound walls enclosing the lease hold area. However, to

the  north  eastern  side,  a  space  measuring  about  75

decimals was left outside the compound for the purpose of

parking in respect of  which also the possession remained

with the appellant.  

3. As  further  averred  in  the  plaint,  subsequent  to  the

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grant of lease in the year 1949, the association was granted

further areas for which fresh lease deed was executed. The

plaintiff has pleaded that the leasehold area of acres 20.808

decimals included an area of acres 6.520 decimals of Sabik

Plot No. 139. An area of 0.048 decimals of this plot was then

included  in  the  barbed  wire  compound  of  the  then

Secretariat which is in occupation of the Branch Recruiting

Office. It was put forth that though the recorded area of Plot

No.  139  was  acres  7.345  decimals,  yet  on  actual  spot

measurement, it was acres 6.568 decimals. It was asserted

that  the  entire  area  was  within  the  compound  of  the

association except the area of acres 0.075 decimals that was

left outside the compound for the purpose of parking and

the  area  of  acres  0.048  decimals  which  was  within  the

Secretariat enclosure.  

4. It was further asseverated in the plaint that during Hal

settlement  operation,  due  to  lack  of  supervision,  certain

mistakes occurred in recording of different plots. As far as

Sabik Plot No. 139 is concerned, a part of it measuring an

area of acre 0.705 decimals was included in the Hal Plot

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No.  7  out  of  which  acre  0.630 decimals  were  within  the

compound  of  the  plaintiff-association  and  acre  0.075

decimals  was  outside  (0.630  +  0.075  =  0.705)  the  land.

Thus, the total land was acre 0.705 decimals. It had been

further  set  forth  that  the  Hal  Plot  No.  7  also  included

portions of Sabik Plot Nos. 137 and 140 and thereby Hal

Plot No. 7 with a total area of  acre 0.880 decimals stood

included in the Hal Khata No. 203 which was recorded in

the name of the State as “rakhit”. It was contended that the

said record was erroneous in view of the fact that no part of

the  said  plot  was  in  Khas  possession  of  the  State.  As

indicated earlier, acres 0.705 decimals relating to Sabik Plot

No. 139 was in possession of the appellant. The remaining

area of acre 0.175 decimals relating to Sabik Plot No 137

and Plot No. 140 was in possession of the Branch recruiting

office. Prior to the settlement, there was no “rakhit” land by

the side of the road to be recorded in the name of the State.

A number of very old houses belonging to the plaintiff and

to the Branch recruiting office physically stood on this Hal

Plot No. 7. The Hal settlement Khatian was finally published

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on 11.04.1988 but it was not available to the public. It was

alleged that the land in question was in possession of the

association and further though a vast area covering about

twenty  four  acres  was  in  possession,  yet  the  incorrect

entry/inclusion in the Hal settlement could not be detected

earlier as the Hal Settlement Map was not available.  

5. As  set  forth  in  the  plaint,  the  Tahsildar  initiated

proceeding  against  the  appellant  under  the  Orissa

Prevention  of  Land  Encroachment  Act,  1972  (for  brevity,

“the Act”) vide Encroachment Case No. 213/1 of 1990/91

under  the  Act  for  eviction  and  the  said  proceeding  was

based on the wrong record as mentioned above.   

6.  Because  of  these  circumstances,  the  appellant,  after

serving notice u/s 80 CPC instituted the suit for right, title

and interest and permanent injunction in respect of the suit

property,  i.e.,  Khata  No.  203,  Plot  No.  7  measuring  acre

0.705 decimals corresponding to part of Sabik Plot No. 139

on the  ground  that  the  land  had  been  leased  out  in  its

favour. A relief was also sought to declare that the record of

Hal Plot No.7 in Hal Khata No. 203 so far as it related to

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acre  0.705  decimals  of  Sabik  Plot  No.  139  be  declared

incorrect.   That apart, the plaintiff alternatively prayed for a

declaration that it had perfected title over the suit land by

way of adverse possession.  

7. The defendants filed the written statement admitting

that the plaintiff-association was in possession of the area

as  claimed.   It  also  accepted  that  the  association  had

constructed a massive stadium and many other houses and

the entire area was enclosed by high compound walls.  The

defendants-respondents  denied that  the  leasehold  area  of

acres  20.808  decimals  included  an  area  of  acres  6.520

decimals of Sabik Plot No. 139.  It was their stand that it

included an area of acres 6.222 decimals.  It was averred

that an area acres 20.808 decimals had been leased out for

twenty years for construction of stadium as per Government

order in letter no. 17484 dated 29.6.1949 and lease deed

bearing  No.  4524  dated  29.9.1949  was  executed  and

subsequently renewed vide Deed No. 2526 dated 19.4.1974

for a period of  another twenty years.  It  was also pleaded

that  the  Government  sanctioned  an  area  acres  2.703

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decimals  in  their  Sanction  Order  No.  11680  dated

22.2.1959 for construction of Indoor Stadium and an area

of  acres  1.939  decimals  for  sinking  a  Swimming  Pool,

Swimming  Club  and  a  Restaurant,  but  no  lease  deed  in

respect  of  acres 1.939 has been executed.  It  was further

pleaded that during Hal settlement, the total area of acres

24.733  decimals  has  been  recorded  in  the  name  of  the

appellant-Association  including  an  area  of  acres  1.222

decimals out of acres 1.939 as referred to above for which

no lease  deed has yet  been executed and the  differential

area  measuring  acre  0.717  decimals  (acres  1.939-  acres

1.222)  has  been  recorded  during  Hal  settlement  in

Government Rakhit Khata and the plaintiff-Association is in

unauthorized possession of acre 0.634 decimals out of the

said area of acre 0.717 for which encroachment case was

initiated and an order of eviction has been passed.

8. On the basis of the pleadings, the learned trial Judge

framed the following issues:-

1. Whether the plaintiff is in possession of the suit

land from the year 1949 and has perfected title by

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adverse possession?

2.  Whether  the  suit  land  has  been  recorded  in

Rakhit  Khata  due  to  lapses  of  the  plaintiff

association?

3. Whether the suit land is liable to be settled on

lease basis in favour of the plaintiff?

4.  Whether  notice  U/s  80-  C.P.C.  has  not  been

served?

5. To what relief, if any, the plaintiff is entitled to?

9. To  prove  its  case,  the  plaintiff-association  examined

the manager of the association and the defendants did not

examine any witness in support of their stand.  As stated

earlier, the trial Judge, by its judgment dated 10.04.1999,

decreed the suit and permanently restrained the defendants

from disturbing the possession of  the plaintiff-association

over the suit land. It was contended before the High Court

that the State Government had filed before the High Court

Misc. Case No. 497 of 2001 seeking leave to produce the

final  order  passed  in  O.P.L.E.  Case  No.  213/1/90-91  as

additional  evidence  and  Misc.  Case  No.  121  of  2003  for

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appointment of a receiver.   

10. It  was further  urged that  the  suit  for  declaration of

right, title and interest was not maintainable in view of the

provisions contained in the O.P.L.E. Act and the suit was

barred  under  Section  16  of  the  said  Act.  It  was  further

submitted  that  since  the  land  had  been  recorded  in  the

rakhit khata, the direction to lease out the suit property and

the decree for permanent injunction as passed by the court

below was contrary to the provisions contained in Section 9

of C.P.C. and that from the conduct of some State officials,

it  appeared  that  the  interest  of  the  State  had  not  been

properly safeguarded and as a result, the decree had been

passed.  

11. It is apt to note here that an application under Order I

Rule 10 CPC was filed in Misc. Case No. 122 of  2003 to

implead M/s. Sanjit Samal  represented through Managing

Partner, registered office at Mahatab Road, Cuttack-12 as

respondent no. 3, Sanjit Samal, Managing Partner of M/s.

INCON  ASSOCIATES,  Mahatab  Road,  Cuttack  -  12  as

respondent  no.  4  and  Sanjaya  Behera,  partner  of  M/s.

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INCON ASSOCIATES, S/o. Ashirbad Behera, Seikh Bazar,

Chandinichowk, P.S.  Lalbag, Cuttack as respondent no.5.

The  application  was  allowed  on  17.11.2014  and  the

aforesaid persons stood impleaded as co-respondents.    

12. The  High  Court  referred  to  the  decisions  in  Gram

Panchayat  of  Village  Naulakha v.  Ujagar  Singh  and

others1 and  State  of  Rajasthan  v.  Harphool  Singh

(dead) through his LRs2 and came to hold as follows:-

“15. On perusal of the pleadings of the parties, it appears  that  the  Tahasildar,  even though,  was arrayed as a defendant, was never authorized by the Collector to file written statement admitting the claim. The Collector, under the Code of Civil Procedure,  represents  the  State.  No  written statement  without  the  authorization  of  the Collector  could  have  been  filed  admitting  the claim of the plaintiff and the trial court ought not to have accepted the said written statement as that  of  the  defendant  no.1  -  Collector,  who represented the State.  It  is  further pertinent to mention  that  the  case  record  of  the  OPLE Proceeding  was  kept  away  from the  trial  court and no evidence, either oral or documentary, was adduced from the side of the defence during the trial.  As  indicated  here-in-before,  the  present appeal was also not filed with due promptitude inasmuch as according to the Collector, Cuttack vide his  affidavit  filed  on  20.12.2002,  the conducting  Advocate  did  not  inform  him  the

1 AIR 2000 SC 3272 2 (2000) 5 SCC 652

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result of the suit till 17.4.2000 though the decree was passed on 21.4.1999.

I  have  also  perused  the  material  evidence adduced on behalf of the plaintiff-respondent. It appears to me that the Tahasildar colluded with the  plaintiff  and  a  collusive  decree  has  been passed. Therefore without expressing any opinion on merit  of  the suit,  I  set-  aside the judgment dated 16.04.1999 and decree dated 21.04.1999 passed by the learned First Additional Civil Judge (Senior Division),Cuttack, in Title Suit No.312 of 1991 and remit the matter back for adjudication in accordance with law. This being an order of open  remand  of  the  suit  as  per  the  provision under  Order  41,  Rule-23A  of  the  C.P.C.,  there shall  be  a  retrial  of  the  suit  before  the  court below. If so advised, the defendants may amend the written statement and adduce evidence which the  trial  court  shall  permit  in  accordance  with law. The plaintiff also shall not be precluded from amending  his  plaint  or  adducing  additional evidence. But this being a suit of the year 1991, the trial court shall make endeavour to dispose of the  same  within  six  months  from  the  date  of communication of this order. Both the parties are directed to cooperate with the trial court in this regard.”

13. After  so  holding,  the  High  Court  dealt  with  the

application for appointment of receiver.  It referred to the

agreement  dated  20-7-1998  between  the  association  and

M/s Incon Associates as a tenancy agreement for a monthly

rent of Rs. 17,000/-. It copiously produced the terms and

conditions  of  the  agreement  and,  thereafter,  it  observed

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thus:-

“The Orissa Olympic Association is a public body. Admittedly,  no  public  notice  was  given inviting applications  to  invest  in  the  construction  of KALYAN MANDAP.  It  may  be  remembered  that the suit was filed after receipt of the notice in the O.P.L. E. proceeding and the learned Civil Judge (Senior  Division),  Cuttack  by  order  dated 7.11.1991  passed  the  status  quo  order  even though  the  court  was  aware  that  for  the  self- same land, a proceeding under the OPLE Act was continuing.  It  is  also  admitted  in  the objection/counter affidavit filed before this Court that  a  portion  of  the  land is  situated  over  the alleged encroached area. The order of status quo was vacated by the learned Civil  Judge (Senior Division) by order dated 27.11.1996.

Therefore,  the  construction made appears, prima  facie,  to  be  in  violation  of  the  statutory prohibition and status quo order passed by the trial court.”

14. The  High  Court  took  note  of  the  fact  that  the

possession of the association was prima facie permissive in

nature  and  that  the  agreement  entered  into  by  the

association  with  M/s  Incon  Associates  was  under

mismanagement and, accordingly, appointed the Collector,

Cuttack to take over possession of the administration and

open an interest bearing Bank Account and deposit in the

said Account the rent collected from the tenants including

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the rent  received from the Kalyan Mandap by M/s Incon

Associates.   It further directed as follows:-

“20.  M/s.  INCON  Associates  is  also  directed  to deposit  the  advance  money  received  from  the prospective occupants from today with the Collector and the balance amount shall b.. e collected by the Collector and deposited in the Bank account during the pendency of the suit. The Collector, Cuttack is also directed to secure the property and the income thereof in due promptitude and to take all necessary steps for preventing the same from any damage or danger and report compliance to this Court through the trial court.”  

15. It is necessary to note here that looking to the affairs of

the association, the learned Single Judge directed:-

“… the Additional Director General of Police, Crime Branch, Cuttack to make an enquiry into the entire affairs  of  the  Olympic  Association,  which  in  my prima facie view, has become the parental property of  some  individuals.  If  prima  facie  materials emerged during enquiry, a case should be registered under  appropriate  sections   of  the  Indian  Penal Code or any other provisions of law, and the same should be investigated. The report of the Additional Director General of Police, Crime Branch and/or the Investigating  Officer,  shall  be  placed  before  this Court within three months from today.”

Again:-

“23.  If  the  trial  court  arrives  at  conclusion  that taking  advantage  of  the  suit,  the plaintiff-respondents have enriched themselves, the State will also be at liberty to recover the ill gotten by initiating appropriate legal proceeding. The State

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is also directed to make appropriate audit in respect of  the  financial  affairs  of  the  Olympic Association and take suitable  action as deemed proper under law.”

16. We have heard Mr. Gopal Subramaniam and Mr. Raju

Ramachandran,  learned  senior  counsel  appearing  for  the

appellant  assisted  by  Mr.  Raghavendra  S.  Srivatsa,

Mr.  Krishnayan  Sen  and  Mr.  Ashok  Panigrahi  learned

counsel for the State and Ms. Binu Tamta, learned counsel

for the Comptroller and Auditor General of India (CAG).

17. To  appreciate  the  controversy,  the  orders  passed  by

this Court from time to time are necessary to be adverted to.

Initially,  this  Court  had  passed  an  order  of  stay  of  the

judgment  of  the  High Court.   Thereafter,  the  matter  was

taken  up  on  19.1.2015  and,  on  that  day,  the  Court

formulated certain questions of law which are as follows:-  

“As  pure  questions  of  law arise  in  this  special leave petition, no counter affidavit need be filed. The questions that emerge for consideration are:

i) Whether the lessee of the present character, that  is,  the  Orissa  Olympic  Association,  could have  filed  a  suit  for  right,  title  and  interest against the State, that is, the superior landlord?

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ii) Whether the plea of adverse possession can be  set  forth  by  the  “Association”  against  the State,  if  the  suit  property  is  beyond  the  area granted under the lease deed?

 iii) Assuming the area in question is a part of the lease deed, whether the lessee can put forth a plea of adverse possession?   iv) Assuming the suit land/property is situate within the lease hold area, whether the grantor, that is, the State Government, cannot take steps to resume the land for violation of the terms and conditions of the lease deed?

v) Whether the income that is received by use of  the  suit  property  should  not  be  taken  into account  and  why  should  it  not  be  the  legal obligation of the petitioner-Association to satisfy the Court that the accounts have been audited and  the  amount  derived  has  been  properly accounted for?

 vi) If  the accounts have not  been audited,  as required in law, whether the individuals that look after the affairs of  the Association in respect of the  suit  property,  would be criminally  liable  or not?  

vii) Whether the persons in management of the property could not be criminally proceeded, if it is found that  they  have  mismanaged  and utilized the income for their individual benefit?  

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As  we  find,  the  High  Court  has  appointed  the Collector,  the  respondent  No.1,  as the  receiver. The said part of the order reads as follows:-   

“The  appellant  No.1  –  State  of  Orissa, represented  by  the  Collector,  Cuttack  is directed  to  take  over  possession  of  the property, whereafter, the Collector shall  open an interest bearing Bank Account and deposit in the said Account the rent collected from the tenants  including  the  rent  received from the Kalyan  Mandap  by  M/s.  INCON  associates. M/s.  INCON  Associates  is  also  directed  to deposit the advance money received from the prospective  occupants  from  today  with  the Collector  and  the  balance  amount  shall  be collected by the Collector and deposited in the Bank account during the pendency of the suit. The  Collector,  Cuttack  is  also  directed  to secure the property and the income thereof in due promptitude and to take necessary steps for preventing the same from any damage or danger  and  report  compliance  to  this  Court through the trial court.”  

We have asked Mr. Raju Ramachandran, learned senior  counsel  appearing  for  the  petitioner  to satisfy  us  whether  the  said  paragraph requires interference  and  also  whether  proper management  of  the  buildings,  whatsoever  the character/nature may be, situate on the disputed land, is warranted or not.”  

18. Thereafter, the Court referred to the directions issued

by the High Court for appointment of receiver and asked the

learned senior counsel appearing for the appellant to satisfy

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the Court whether the said paragraph required interference

and  also  whether  proper  management  of  the  buildings,

whatsoever  the  character/nature  may  be,  situate  on  the

disputed  land,  is  warranted  or  not.   The  matter  was

adjourned to 22.1.2015 for consideration of the necessary

arrangement pertaining to management and further hearing

of the special leave petition.  The interim order passed on

11.12.2014 was allowed to remain in force till the next date

of hearing, i.e., 22.1.2015.  On 22.1.2015, the Court, after

referring to the questions framed on the earlier  occasion,

recorded as follows:-  

“Mr. Gopal Subramaniam, learned senior counsel appearing for the petitioner-Association has very fairly conceded that as far as question No.(iii) is concerned, the petitioner was wrongly advised to put forth such a plea, for it is a well established principle of law that a lessee cannot set forth a plea  of  adverse  possession.  In  view  of  the aforesaid, issue no. (iii) stands closed.”  

19. Thereafter, the Court adverted to issue no. (v) and, in

that context, the following order was passed:-

“On a query being made, learned senior counsel, submitted that the suit was instituted in the year 1991  in  respect  of  0.705  acres  claiming  right, title and interest and other reliefs and the income received from the property situated on that area

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is regularly audited by a statutory auditor. In our considered opinion, there has to be audit for the purpose of verification so that we can eventually be  satisfied.  Considering  the  facts  and circumstances  in  entirety,  we  direct  that  the accounts in respect of “Kalyan Mandap” and 23 shops standing on the disputed area” (suit area 0,705 acres) be made by the Accountant General of Orissa at Bhubaneswar. The said exercise shall be completed within a period of six weeks. The report of the Accountant General shall be placed before this  Court.  The Registrar  (Judicial)  shall send  a  copy  of  the  order  passed  today  to  the Accountant General of Orissa at Bhubaneswar by fax/e-mail and regular post forthwith so that he can take steps in promptitude.  

As advised at  present,  we shall  delve upon the issue  whether  the  necessary  arrangement pertaining  to  management  of  the  aforesaid property  is  required  to  be  made.  Without expressing  any  opinion  finally,  as  we  cannot today as the special leave petition is pending, we think  that  there  should  be  a  Committee  of Management which shall take over possession of the “Kalyan Mandap” and the 23 shops standing on the area for the purpose of management. The committee shall consist of the Collector, Cuttack and  two  Additional  District  Magistrates  to  be nominated by the Collector. The Committee shall be  liable  to  be  supervised  by  the  Secretary, Revenue and Disaster Management. We hasten to clarify,  if  there is any contract which has been executed by the Association through M/s. INCON Associates  for  the  purpose  of  holding  any marriage that should be allowed to continue. But all  correspondence  and  discussion  on  every aspect  shall  be  done  with  the  Committee.  The Collector  may  nominate  one  of  the  Committee members for this purpose but the final decision

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shall  be  taken  by  the  Committee.  We  have  so directed, as we do not want that the 4 allocation of the marriage hall for the purpose of marriages be cancelled. However, after today, M/s. INCON Associates shall not enter into any fresh contract. The Committee shall take over the management by  25.01.2015  positively.  Mr.  Subramaniam, learned  senior  counsel  submitted  that  no  one shall  raise  any  obstruction  in  taking  over  the management.  The  Collector  is  at  liberty  to requisition the police assistance, if he has to take care of any obstruction regard being had to the situation.  

All the twenty-three shop keepers shall pay the rent to the Committee and the income shall  be collected  by  the  authorised  agent  of  the Committee. If anyone would deviate in doing so, he would be liable for contempt of this Court. It will  be the duty of  the Managing Committee to see that the buildings are properly maintained. We  have  modified  the  order  of  Stay  to  the aforesaid extent.  

The income derived from the date of taking over possession and any income that is derived earlier thereto  shall  be  kept  in  an  interest  earning account in the State Bank of India, Main branch, near the Collectorate, Cuttack.  

The documents that have been exhibited before the trial court are permitted to be filed by either of the parties.  

This is  an interim arrangement subject to final adjudication of the special leave petition.”  

20. The  aforesaid  order  clearly  states  that  it  was  an

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interim arrangement and that the matter was directed to be

listed on 24.3.2015.  Be it noted, on that day, keeping in

view the direction issued by this Court on 22.1.2015, the

Accountant General of State of Odisha had submitted his

report in a sealed cover.  Learned senior counsel appearing

for  the  appellant  put  forth  that  he  may  be  granted  an

opportunity to look into the report and file an objection duly

certified by the competent authority including the Auditor or

Chartered  Accountant.  A  copy  of  the  report  of  the

Accountant General, Odisha, was directed to be served on

the learned counsel  for  the appellant  as well  the learned

counsel for the State.  At that juncture, a submission was

canvassed by the learned senior counsel for the appellant

and,  after  hearing  at  length,  the  following  order  was

passed:-

“At  this  juncture,  another  aspect  need  to  be stated.  We  are  inclined  to  say  so,  as  it  is submitted by Mr. Gopal Subramanium, learned senior counsel appearing for the petitioner that the report submitted by the Accountant General cannot be accepted on the face value and that is why,  as  stated  earlier,  he  intends  to  file  an objection to the same. But a pregnant one, there has  to  be  finality  to  the  audit.  As  advised  at present, we may say, in case an occasion arises

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to  test  the  report  and the  objection to  be  filed thereto, this Court may think of sending both the reports to The Comptroller and Auditor General of  India,  who  shall  scrutinize  both  the  reports and, if required, by sending a team of auditors. We say no more on that  score for  the present. Only a thought expressed.  

At this juncture, we will be failing on our duty if we do not take note of the stand quite vehemently put  forth  by  Mr.  Gopal  Subramanium that  the constructions are within the lease hold area and they  have  been  constructed  to  raise  funds.  To deal with the said aspect, we would like the State to file the lease deed in original, as the petitioner has already filed the certified copy of  the lease deed. How the same would be addressed to shall be  thought  of  after  there  is  delineation  with regard to the accounts.  

An ancillary question may arise as to whether a lessee,  especially,  Orissa  Olympic  Association, which is involved in pubic duty, can be engaged in  this  kind  of  activities  on  a  mercurial  or spacious ground of raising funds to sustain the stadium without the consent of the lessor.

Let the objection to the report of the Accountant General  be  filed  within  two  weeks  hence.  The State  Government  shall  file  an  affidavit  duly sworn  by  the  competent  authority  giving  the nature of shops and the photographs thereof and the photograph of the Kalyan Mandap. The said affidavit  by  the  State  shall  be  filed  within  two weeks from today.”

21. It is apt to note here that the matter was directed to be

listed  on  21.4.2015  on  which  date  the  matter  stood

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adjourned to  7.5.2015.    Relying  on the  objection to  the

report that had been submitted by the learned Accountant

General  for  the  State  of  Odisha  along  with  some  other

reports, it was contended by the learned senior counsel for

the  appellant  that  the  Accountant  General  (General  and

Social Sector Audit) had travelled beyond the order of this

Court commenting on various aspects of the case.  For the

aforesaid purpose, he had referred to the relevant para of

the order dated 22.1.2015.  Keeping in view the objection,

the Court directed as follows:-

“In  view  of  the  aforesaid,  we  would  direct  the Accountant General, Odisha to restrict his audit and comments to the said facets. We know that the report submitted by him covers the same but still we do not intend to segregate the same and, therefore,  we  direct  that  a  specific  and precise report  be  submitted  to  this  Court  within  eight weeks  hence  keeping  in  view  the  passage reproduced hereinabove.”  

22. Be it  clarified,  the passage that was referred to was

part of the order dated 22.1.2015.  On that date, the State

of Odisha has produced certified copies of two lease deeds.

Keeping  that  in  view,  the  Court,  to  arrive  at  the  truth,

directed as follows:-

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“At this juncture, we may note with profit that in pursuance  of  our  order  dated  24.03.2015,  the State of Odisha has produced the certified copies of two lease deeds; one dated 04.09.1949 and the other dated 19.04.1974. Keeping in view the two lease  deeds  and  the  schedule  of  property mentioned  therein,  we  think  it  appropriate  to constitute  a  Committee  of  judicial  officers  who shall, with the help and assistance of the revenue authorities,  shall  measure  the  lease  hold  area and submit a report whether the 23 shops and the Kalyan Mandap are within the said lease hold area or not. Regard being had to the controversy involved, we appoint the District Judge, Cuttack to be the Chairman of the committee and request the  3  Chief  Justice/Acting  Chief  Justice  to nominate  two  other  Additional  District  Judges who  may  be  from  Cuttack  District  or  other districts.  Needless  to  say,  the  learned  Chief Justice/Acting Chief Justice shall  nominate the Additional  District  Judges who have experience in the field. The Principal Secretary, Revenue and Disaster  Management  shall  extend  the  fullest cooperation  in  consultation  with  the  Chief Secretary of  the State and shall  provide all  the facilities to the Committee so that there can be proper measurement and no deviancy is shown. At the time of  measurement,  the representative (only  one)  of  the  petitioner-Association  shall remain present.  A  notice  shall  be  given by  the Chairman of the Committee about the date the measurement  to  the  Association.  Mr.  Ashok Panigrahi,  learned  counsel  for  the  State submitted  that  apart  from  the  registered  lease deeds  which have  been filed  before  this  Court, the  original  lease  deeds  shall  also  be  made available to the Chairman of the Committee.”

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23. When the matter was taken up on the next occasion,

the  Accountant  and  Auditor  General,  Odisha,  had

submitted report pertaining to the accounts in respect of

Kalyan Mandap and 23 shops standing on the disputed area

(0.75 acre).  We shall refer to the said report when we advert

to it and the objections filed thereto.  

24. On that  day,  the  Court  referred to  the  earlier  order

dated  7.5.2015  wherein  a  direction  was  issued  for

measurement of the leasehold area and submission of the

report whether the 23 shops and the “Kalyan Mandap” are

within the said leasehold area or not.  A letter was received

by the Registrar from the competent authority of the High

Court  of  Orissa  as  well  as  the  District  Judge,  Cuttack,

seeking  extension  of  time  and,  accordingly,  time  was

extended till end of September, 2015 to submit the report.

Within  the  extended  time,  the  Committee  submitted  its

report  on 29.9.2015 along with certain maps in a  sealed

cover.  A direction was issued to hand over the copies of the

reports  to  the  learned  counsel  for  the  appellant,  learned

counsel  for  the  State  and  also  learned  counsel  for  the

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Accountant  General.   A  further  direction  was  issued  to

make photocopies of the maps and hand over the same to

the  learned counsel  for  the  parties  on payment  of  costs.

Liberty  was granted to  file  objections,  if  any,  within  four

weeks.   Even on that  day,  i.e.,  on  8.10.2015,  Mr.  Gopal

Subramaniam,  learned  senior  counsel  for  the  appellant,

submitted  that  though  the  appellant  would  be  filing  its

objections  to  the  report  submitted  by  the  Accountant

General,  yet  there  is  a  fundamental  fallacy  that  the  said

authority  has  not  taken  into  consideration  the  effect  of

capital  acquisition  of  assets  by  the  Orissa  Olympic

Association.   He further urged that the said stand would

withstand close scrutiny if,  in the ultimate eventuate, the

right, title and interest of the Association is established in

respect of the disputed 23 shops and the Kalyan Mandap.

Learned counsel for the State, at that juncture, read out a

passage from the judgment of the High Court.  Noting the

said submission, the Court stated thus:-

“At this juncture, Mr. Panigrahi, learned counsel for  the  State  has  read out  a  passage  from the impugned judgment which is quite shocking if it

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is factually correct. Submission of Mr. Panigrahi is  that  the  stand  of  the  Orissa  Olympic Association  had  invested  the  money  for  the benefit of the association is an absolute myth, for one of the partners of the M/s. INCON Associates is  the  son  of  the  General  Secretary  of  the petitioner-Association  before  this  Court.  Hence, submits Mr. Panigrahi, the arrangement was so made  with  the  sole  purpose  of  benefiting  M/s. INCON  Associates.  This  aspect  requires  to  be seriously  dwelt  upon,  for  there  is  a  conflict  of interest and it may enter into the realm of fiscal impropriety.

Learned counsel for the petitioner is at liberty to file  a  reply  to  the  said  assertion  and  Mr. Panigrahi is also given liberty 3 to file appropriate documents  and  response  to  bolster  his submission.”  

25. On the next date of hearing, we were apprised by the

learned counsel for the State that the two partners of M/s.

INCON Associates are the son and son-in-law of Mr. Asirbad

Behera,  General  Secretary  of  the  Orissa  Olympic

Association.  The  said  fact  was  disputed  by  the  learned

senior counsel for the appellant.  The Court, upon perusal

of the document, found that as far as the son is concerned,

he was a partner in M/s. INCON Associates.  It noted the

submission of the learned counsel for the appellant to the

effect that there is no malfeasance or misfeasance and that

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there were circumstances for which the tender was floated

and  the  firm came in.  Learned  senior  counsel  submitted

that when the contract was entered into for the first time in

1998, the son was not a partner.  In reply,  Mr.  Panigrahi

would submit that he was inducted as a partner at a later

stage.

26. Taking  note  of  these  facts,  the  Court  directed  as

follows:-  

“Be that  as  it  may,  prima facie,  the conflict  of interest is manifest. Regard being had to the facts and circumstances of the case, we direct that Mr. Asirbad Behera, General Secretary of the Orissa Olympic  Association  is  restrained  from functioning as the Secretary of the Association till the next date of hearing. Needless to say, this is without prejudice to the contentions to be raised in the special leave petition.”

27. Having referred to the record of proceedings, we should

record the submissions of learned counsel for the parties.  It

is urged on behalf of the appellant that by Orissa Act No. 1

of  1991,  the  Government  Land Settlement  Act,  1962 (for

short, “the 1962 Act”) was amended, and Section 3(4) of the

Act treated an expired lease as a deemed lease. By virtue of

this  provision,  the  lease  in  respect  of  the  Appellant

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Association  continued.   The  Appellant  Association  had

applied to the State Government for a permanent lease in

terms  of  Section  3(4)  of  the  Orissa  Government  Land

Settlement Act, 1962, as amended by Orissa Act No. 1 of

1991.  The  Tahsildar  recommended  that  the  lands  be

permanently  settled  in  favour  of  the  Association and the

Collector approved the same on 16.08.1995.  However, since

there were discrepancies in respect of some issues including

that in respect of the land comprised in Hal Plot No.7, the

Association  did  not  execute  the  lease  deed  and  sought

rectification  of  the  errors.   It  is  submitted  that  during

permanent lease proceedings, the Association objected that

the  demarcation  of  plot  comprising  of  an  area  of  acres

20.808 dec.  is  not  correct.  The appellant  objected to  the

same contending that Plot No.7 should form part of Sabik

Plot No. 139. Accordingly, the appellant requested that the

mistake  should  be  corrected  or  finalization  of  Plot  No.7

should await till the dispute attains finality and, thus, the

association did not execute the lease deed.  Be that as it

may, the said order having been set aside by the Revenue

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Divisional  Commissioner,  the  Association  challenged  the

order before the High Court on principle. That apart, in view

of the recent amendment to the 1962 Act on 26.02.2009,

the  Khasmahal  properties  are  to  be  permanently  settled

and, accordingly, the pending cases are to be disposed of in

accordance with the amendment.  The order for permanent

settlement has been set aside in appeal which is the subject

matter before the High Court, in Writ Petition (C) No. 5360

of 2002. In the writ petition, it has been prayed that the writ

petitioner be held to be deemed lessee and that the lease

subsists. The High Court has passed an interim order dated

4.12.2002 directing that status quo in respect of possession

of  the  land  be  maintained.  The  writ  petition  is  pending

before  the  High  Court.   It  is  submitted  that  even  if  the

permanent lease did not materialize, the 1991 amendment

provided  for  a  deemed  lease  and  in  view  of  the  2009

amendment  in  the  1962  Act,  the  lands  have  to  be

permanently settled in favour of the association.  

28. It  is  further  contended  by  Mr.  Gopal  Subramaniam

that a suit is not barred under the OPLE Act but the High

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Court has erred without appreciating the law in the field,

especially,  the  decisions  in  Government  of  Andhra

Pradesh v. Thummala Krishna Rao and another3, State

v.  Bhanu  Mali4,  Durgadevi  Agarwalla  v.  State  of

Orissa5,  and  Labangalata  Panda  v.  State  of  Orissa6.

Emphasis has also been laid on the stand put forth by the

State of Orissa in its written submissions, for it was not the

stand of  the State  in  the  written statement  that  the  suit

land was its property and not that of the association.   

29. Commenting on the report of the Committee headed by

the District Judge, it is contended that the committee was

conferred the responsibility to measure the leasehold area

(pertaining to the lease deed registered on 24.09.1949) and

to see if the 23 shops and the Kalyan Mandap are within the

same or not.   Criticising the said report, it is urged that the

said Report,  on measurement,  has based reliance on Hal

Settlement of  1988 which itself  is  the bone of  contention

between  the  appellant  association  and  the  State

3  (1982) 2 SCC 134 4  AIR 1996 Orissa 199 5  AIR 2014 Orissa 140 6  AIR 2002 Orissa 147

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Government and is, in fact, the very cause of action for the

present  lis.   Therefore,  the  very  basis  of  the  exercise

undertaken by the Committee is erroneous resulting in a

wrong  report.   It  is  put  forth  that  the  Committee  has

travelled  beyond  the  scope  of  reference  inasmuch as  the

scope of reference was restricted to measure the leasehold

area  of  acres  20.08  decimals  leased  out  vide  lease  deed

dated  24.9.1949  and  the  renewed  lease  deed  dated

19.4.1974.   The Committee, however, had not undertaken

the said exercise keeping in view the schedule to the original

lease deed of  1949 or  the  schedule  to the renewed lease

deed  of  1974.   It  is  also  contended  that  though  the

Committee  had  access  to  the  maps  prepared  by  the

government  authorities  which  are  contemporaneous  with

the  time  when  the  lease  deed  was  executed  in  the  year

1949, yet the same were not considered as a reference point

for  the  measurement.   On  the  contrary,  the  Committee

travelled  beyond the  scope of  the  reference  and recorded

erroneous  conclusions  by  taking  into  account  irrelevant

considerations.   That  apart,  the  Committee  has  omitted

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available relevant records and has proceeded on the basis

that measurement had to be carried out in the absence of

Government producing the relevant records.  It  is further

canvassed that Exhibit 1 is the copy of the application of the

Appellant Association, along with a map, for grant of lease

of an area of 20.808 acres; Exhibit 4 is the Sabik settlement

map of 1927-1928 as revised in 1949;  Exhibit 6 is the map

prepared by the Khasmahal Amin on 1.4.1953 showing the

lands, demarcated by the boundaries, that had been given

by the Government to the Appellant in 1949 and in 1950;

and Exhibit 7 is the Relay Map which is superimposed map

showing the Sabik Plot numbers that got converted into Hal

Plot  Numbers  at  the  Hal  Settlement  of  1988-1989.   It  is

urged  by  the  learned  senior  counsel  that  the  aforesaid

documents clinch the issue of the exact measurement and

the extent of land leased to the Appellant Association under

the lease deed dated 24.09.1949; that the issue of the exact

extent of land leased to the Appellant is the subject matter

of  the  Civil  Suit;  that  the  construction  made  thereon,

namely,  the  Kalyan  Mandap  and  23  shops  is  what  is

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covered by the order of this Court dated 07.05.15; that the

task assigned to the Committee by this Court was to find

out, by measurements, whether the Kalyan Mandap and the

23 shops are within the leasehold area; that the aforesaid

documents  which  are  part  of  record  and  were  readily

available  to  the  Committee  while  carrying  out

measurements to find out the extent of land covered by the

Lease Deed dated 24.09.1949 as renewed by the Deed dated

19.04.1974;  that  the  Committee chose  to  ignore  the  said

crucial  documents  which  would  clinch  the  issue  and

lamented that the government did not produce the relevant

records  but  nevertheless  proceeded  to  carry  out  the

measurements  as  per  its  own  understanding  and

parameters;  and  that  to  carry  out  the  exercise  of

measurement to determine the extent of land covered by a

grant/document, there has to be a starting point and the

boundaries  to  the  subject  matter  of  the  grant/document

have to be ascertained.  It is argued that while identifying a

piece of immovable property, the boundaries prevail over the

extent/measurements  and  that  has  been  held  in

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Sheyodyhan Singh v.  Sanicharakuer7 and for  the  said

purpose, the documents mentioned in the exhibits assume

great significance.  

30. Learned  counsel  appearing  for  the  appellant  would

further submit that Exhibit 1 is the application for grant of

lease along with a map identifying the land of which lease

was  sought.   Exhibit  4  is  the  Sabik  settlement  map  of

1927-28 as revised in 1949. This map shows the location of

Sabik Plot numbers in the relevant area. It is important to

note  that  this  map  is  relatable  to  the  General  Revenue

Record finalized after  25.10.1949 which is  subsequent  to

the  execution  of  lease  on  24.09.1949  in  favour  of  the

Appellant.  In this map, a sub division of Sabik Plot No. 139

as Plot No. 139/1370 is shown.  At the time the lease was

executed in favour of the Appellant, Sabik Plot No.139 was a

whole plot number and the Lease Deed specifically records

that a portion of Sabik Plot No. 139 forms part of the entire

leasehold  area.   Which  portion  of  Sabik  Plot  No.  139  is

within the leasehold area is actually the subject matter of

7  (1962) 2 SCR 753

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the  civil  suit  and  it  is  the  specific  case  of  the

plaintiff-Appellant that the leasehold area does not include

the land in the newly created Sabik Plot No. 139/1370 but

includes the land in the original Sabik Plot No. 139. It is

further pleaded that while recording the Record of Rights,

the individual extents of land in the original Plot No.139 and

newly  created  Plot  No.  139/1370 were  wrongly  recorded.

That is how the confusion was sought to be created as to

the identity of that portion of Sabik Plot No. 139 which is

within the leasehold area of the appellant. That portion of

the original Sabik Plot No.139 which is within the leasehold

area is clearly identified in Exhibit 6 map prepared by the

Khasmahal Amin in 1953 by showing the boundaries to that

plot number.  The details emerging from Exhibit 6 map will

be elucidated in the ensuing paragraphs.  Additionally, it is

contended that Exhibit 6 is the Government map prepared

by  the  Khasmahal  Amin  on  01.04.1953.   The  Appellant

Association had a  lease  for  20.808 Acres  in  1949 and a

further extent was granted in 1950.  The Association had

requested the Government to grant another extent of land in

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1953.   In  this  context,  the  Khasmahal  officer  directed  a

survey of the land already held by the Association and of the

land proposed to be given to the Association.  Upon survey

and measurement to scale, a detailed map was prepared in

parallel and one copy was given to the Association and the

other was retained by the Government. The map indicates

the  individual  plot  numbers  and  the  boundaries  on  all

sides.

31. Referring to the boundaries, it is urged that had the

Committee  carried  out  the  measurement  as  per  the

boundaries in the admitted map, the exact extent of land,

which is  the subject  matter  of  the  suit,  could  have been

ascertained.  Various other aspects have been highlighted to

show that the report of the Committee constituted by this

Court is wrong.  It is also highlighted that the report of the

Committee is wrong, that contemporaneous maps have not

been taken into consideration and the reliance placed on

Hal settlement was also incorrect.  Learned counsel would

submit  that  there  are  manifest  errors  in  the  findings

recorded by the Committee.   

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32. Mr.  Panigrahi,  learned  counsel  for  the  State,  would

submit  that  the  report  of  the  Committee  headed  by  the

District  Judge  is  absolutely  flawless  because  the  Sabik

Record of Rights of Holding No. 366 was finally published in

1931. Copy of the said ROR available in the District Record

Room  of  the  Collectorate,  Cuttack,  has  been  placed  on

record  as  Annexure-30  of  the  District  Judge  Committee

Report. Since the Settlement was closed prematurely and as

such the  record of  right  did  not  reach finality  with  final

publication,  the  map  showing  creation  of  part  plot  No.

139/1370  which  is  relied  upon  by  the  appellant  has  no

validity as it is not backed by an authentic finally published

record of right.  That apart, in the subsequent settlement

operation, the record of right and map of the village - Unit

No. 10, Cantonment, were finally published during the year

1988-89  under  the  provisions  of  Orissa  Survey  and

Settlement Act, 1958.  Learned counsel would submit that

at Khanapuri stage in the settlement operation, ‘Yadast’ is

prepared  by  the  Amin  visiting  each  and  every  plot  in  a

village and in this ‘Yadast’,  details of  information on field

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position are noted and map is prepared accordingly.  The

portion of land on which the ‘Kalyan Mandap’ and 23 shops

stand is in Hal Plot No. 7(p) of Holding No. 230 of mouza

Unit-10, Cantonment. In Yadast No. 60/1, which relates to

this land, there is mention of occupation of the Government

and  no  mention  of  occupation  of  the  Orissa  Olympic

Association.  It is contended by him that the so-called Bata

Plot No. 139/1370 co-relates to Hal Plot No. 165(p). From

the  Yadast  No.  67  it  is  evident  that  the  said  land  was

coming within the leased out area acres 20.808 and was

under occupation of the Odisha Olympic Association. The

sports hostel stands over the so-called Bata plot shown in

the Settlement map and still now, the sports hostel exists

there which corresponds to Hal Plot No. 165(p).  It is evident

that the portion of land on which the ‘Kalyan Mandap’ and

23 shops stand are outside the limit of the leased out area

of acres 20.808 dcl.  Therefore, he would urge that the land

on  which  the  ‘Kalyan  Mandap’  (Barabati  Palace)  and  23

shops stand does not come within the leased out area of

acres  6.222  from  out  of  Sabik  Plot  No.  139(p).   Mr.

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Panigrahi also contended that Section 16 of the OPLE Act

specifically  bars  the  institution of  any  such suit  or  legal

proceedings and, therefore, the conclusion of the High Court

on the said score cannot be found to be flawed.  He has also

raised the contention with regard to non-sustainability  of

the plea of adverse possession. 33. It is apt to mention here that learned counsel for the

parties have also highlighted many an aspect with regard to

the report of the Accountant General, which we shall advert

to  at  a later  stage.   First,  we shall  deal  with two facets,

namely, (i) whether the report of the Committee constituted

by this Court as regards the leasehold area is to be accepted

or not and (ii) assuming the land is a part of the leasehold

area, whether the same can be resumed keeping in view the

present use.

34. To appreciate the objection filed by the appellant, we

think it seemly to reproduce the reports.   The Report of the

Committee  comprising  of  District  &  Sessions  Judge,

Cuttack  and  two  Additional  District  &  Sessions  Judges

dated 29.09.2015 is reproduced below:-

“Accordingly,  the  committee  consisting  of

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Sri Satya Narayan Mishra, District and Sessions Judge,  Cuttack,  as  the  Chairman  of  the Committee  and  the  nominated  members  held several  rounds  of  meetings  to  carry  out  the direction given by the Hon’ble Apex Court in the matter.  

1.1 As  per  minutes  dated  04.07.2015  and 25.07.2015,  the  revenue  authorities  were requested to produce the following documents:-

1. Original Lease deeds 2. Sabik Settlement Maps of  Lease hold area

as well as the maps of corresponding to Hal plots.

3. Plot index. 4. Lease case record in Case No. 294 of 1995. 5. Government sanction order No. 7484 dated

29.06.1949. 6. Document  regarding  demarcation  of

leasehold  land  by  Revenue  Authorities  on measurement.

vide Annexure – 25, Annexure 25/a & Annexure 25/b.

1.2 Despite  repeated  requests  the  Revenue Authorities  did  not  produce  the  following documents:

(i) The original lease deeds of 1949 and 1975 (ii) Government of Orissa Revenue Department

Order No. 7484 dated 29.06.1949 and (iii)Document  regarding  demarcation  of

leasehold  land  by  Revenue  Authorities  on measurement.  

1.3 Since  the  two  lease  deeds  were  not produced  by  the  Revenue  Authorities  the Committee  issued requisition for  placing  of  the case record in T.S.  No.  312 of  1991 before the Committee  for  reference  of  the  original  lease

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deeds

2. The  Committee  examined  the  documents, the related case records, such as record in T.S. No. 312 of 1991, encroachment case etc., maps and other connected materials placed before it.

The  Committee  carried  out  elaborate discussions from various angles to determine the modalities  of  measurement  to  carry  out  the direction of the Hon’ble Apex Court.

3. Before  proceeding  further,  the  Committee resolved to place the following events in sequence for proper appreciation of the matter:-

(11    26/27.01.1949-

           Orissa Olympic Association (hereinafter to be referred as the OOA) made application to the Revenue Commissioner of Orissa for lease of Ac.20.808 decimals of land from Sabik Plot No. 156, portion of Sabik Plot Nos. 139, 143, 155 and 177 vide Annex – 1.

A  Sketch  map  was  attached  to  the application vide Annex-1/a.

(2)    29.06.1949- Lease  was  sanctioned  by  Government  of

Orissa,  Revenue  Department  Order  No.  7484 dated 29.06.1949.

(3) The Revenue Authorities demarcated the lease hold  area  on  measurement.  Date  and  order  of measurement are not available.

(4)    24.09.1949- Pursuant to sanction order the Lease Deed

bearing No.  4525 was executed before  the Sub

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Registrar,  Cuttack  on  dated  24.09.1949  vide Annex-2.

(5)    19.04.1974- Lease was renewed for a period of further 20

years from 04.09.1969 to 03.03.1989 vide Lease  Deed No. 2526 dated 19.04.1974 vide Annex – 3.

(6)    11.04.1988 – Hal ROR was published. Ac.21.549 decimals of land were published

in the name of the OOA under Khata No. 187 vide Annex-4.

(7)    19.10.1990- Encroachment  case  No.213/1  of  1990-91

was initiated against the OOA for encroachment made in Hal Plot No. 7 vide Annex-5.

(8)    02.07.1991- T.S.  No.312/1991  was  instituted  by  the

OOA  against  the  State  for  declaration  of  title claiming Hal Plot No. 7 as part of the leasehold property  and  in  alternative  through  adverse possession  in  respect  of  an  area  measuring Ac.0.705 decimals appertaining to Hal Plot No. 7 vide  the  plaint  Annex-6  and  the  written statement vide Annex- 6/a.

(9)     21.06.1995- The OOA made application on 21.06.1995

for permanent lease enclosing statement of land under  the  possession  of  the  OOA  inside  the boundary  relating  to  9  Hal  plots  vide  the application Annex-7 and statement of  land vide Annex-7/a & Annex-7/b.

This led to the institution of lease case No. 294/1995.

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(10)    21.06.1995-  On  the  same  day  i.e.  on  21.06.1995  the Tahasildar asked for the R.I. report vide Annex-8.

(11)   21.06.1995-  The R.I. submitted the report on the same day i.e on. 21.06.1995 vide Annex 8/a.

(12)   22.07.1995-  The Tahasildar permanently settled the land in favour of the OOA vide Annex-9.

(13)   16.08.1995- The  Collector  approved  the  order  of  the

Tahasildar dated 22.08.1995 vide Annex-10.

(14)  16.04.1999- The suit in T.S. No. 312/1991 was decreed

in favour  of  the  OOA vide  Judgment  Annex-11 and the Decree Annex-11/a.

(15)  01.11.2001- By order dated 01.11.2002 passed in OGLS

Appeal No. 2/2002 the RDC allowed the appeal and set aside the order dated 22.07.1995 of the Tahasildar  and  order  dated  16.08.1995  of  the Collector vide Annex-12.

(16)   05.11.2002- Pursuant  to  the  order  of  the  R.D.C.  the

Tahasildar,  Sardar  kept  the  lease  hold  land measuring  Ac.20.808  decimals  in  Government Khata  and  directed  for  correction  of  ROR vide Annex-13.

(17) 04.12.2002- Hon’ble High Court of Orissa by order dated

04.12.2002  passed  in  M.C.No.  3999  of  2002 arising  out  of  WP©  No.  5360/2002  directed, “status quo as on date in respect of possession of

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the  disputed  land  shall  be  maintained”  vide Annex-14.

(18)  29.11.2014- Hon’ble  High Court  of  Orissa allowed first

appeal No.158/2001, set aside the judgment and decree  passed  in  T.S.No.  312/1991  and remanded  the  suit  for  fresh  disposal  vide Annex-15.

(19)  The  Special  Leave  to  Appeal  (Civil)  No. 34373/2014 was instituted  by  the  OOA in  the Hon’ble Apex Court wherein direction has been given to this Committee to submit the report vide Annex-16.

(20) 19.08.1969- Lease deed for Ac.2.703 decimal comprising

of  plot  No.  145  (Ac.1.116  decimals),  plot  No. 148(Ac.1.147),  plot  No.  155 (Ac.0.440) executed in favour of the OOA vide Annex-17.

(21)   19.07.2003- By  order  dated  19.07.2003  passed  in

Resumption  Proceeding  Case  No.  19  of  2002, determined  the  lease  and resumed the  land to Government Khata vide Annex-18.

(22)  20.04.2015: Pursuant  to  above  order,  Tahasildar  took

the  land  into  the  Government  Khata  vide Annex-19.

(23)  ROR is accordingly corrected vide Annex-20.

(24)   22.05.2004: By  order  dated  22.05.2004,  passed  by

Tahasildar  in  R.P.  188/2003,  took  Ac.1.222 decimal of land out of plot No.165 area Ac.5.000 decimal into Government Khata vide Annex-21.

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(25)  19.08.2004 The  ROR  is  corrected  accordingly  vide

Annex-22.

4. Thus the real dispute between the parties is relating to Ac.24.733 decimal. Out of that lease hold  area of Ac. 2.703 of 1969 has already been taken in to Government Khata and similarly Ac. 1.222 decimal out of Hal Plot No. 165 has already been taken in to Government Khata as narrated earlier. The lease of Ac. 20.808 decimal has been cancelled  and  the  said  area  has  already  been taken into Government Khata but the matter has been stayed by Hon’ble High Court of Orissa in M.C. No. 3999 of 2002 arising out of W.P(C) No. 5360/2002.

Thus the present controversy is confined to measure the leasehold area of Ac. 20.808 decimal and to determine the location of Kalyan Mandap (Barabati Palace) and 23 shops.

5. Keeping the above facts in the background the Committee determined its course of action.

A  Team  consisting  of  Amins  having necessary training and sufficient experience was constituted  to  carry  out  the  measurement  in presence and the supervision of the Committee.

6. The names of the Amins with the names of their respective departments are as follows:-

1. Pradipta Kumar Biswal, A.S.O. Department of Survey   2. Bateswar Hota, Inspector               & Settlement, Cuttack 3. Chturbhuja Dhal, Inspector 4. Dhurba Charan Bhoi, Amin 5. Laxmidhara Mishra, Salarid Amin  Civil Courts, Cuttack 6. Trilochan Sahu, Salarid Amin

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7. Baikuntha Ch. Baral, Salarid Amin(Retd) Civil Courts                                                                      Kendrapara 8. Padmanabha Acharya, R.I.            Office of the                                                                     Tahasildar,  9.Dhanjaya Behera, Amin                Cuttack Sadar.

Vide the Minutes of the Committee dated 21.08.2015.

6.1 The  Committee  also  resolved  to  carry  out the  measurement  with  ETS  and  DGPS  by  the trained  technicians  under  supervision  of  the authority  of  Orissa  Space  Application Center(ORSAC),  Bhubaneswar  and  accordingly requisitions  were  issued  by  the  Tahasildar, Cuttack vide Annex-26 and Annex-26/a.

7. The  Committee  resolved  to  commence  the measurement from 9 .30 a.m. of 02.09.2015. The day, date and schedule of the measurement were duly  notified  to  all  concerned  in  advance  vide Annex-27.

8. The  Committee  examined  the  Sabik  Map exhibited by the OOA in T.S.  312/1991 under Ext.4 and the Sabik Map of 1927-28 settlement provided by Revenue Authority.

On close  scrutiny,  the  Committee  noticed variation in two maps i.e.  fraction plot bearing No. 139/1370 as reflected in Ext.4 found to be absent  in  the  map  provided  by  the  Revenue Authority.

The  point  for  consideration is  whether  to consider  fraction  Plot  No.  139/1370  while conducting  the  measurement  to  find  the leasehold area.

8.1 Undisputedly  Lease  was  executed  on 24.09.1949 for Ac.20.808 decimals of land which

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was renewed by another Registered Lease Deed in 1974.

As per pleading of the OOA at para-5 of the plaint, the leasehold area of Ac.20.808 decimals includes  an  area  of  Ac.6.520  decimal  of  Sabik Plot No. 139. As revealed from the application of the OOA, in Lease Case No. 294 of 1995 an area of Ac.6.222 decimal out of Sabik Plot No. 139 was leased  out  along  with  other  areas  in  total measuring Ac.20.808 decimals.

Though,  the  said  lease  of  1995  was subsequently cancelled by the RDC in the year 2002,  the  OOA  has  never  disputed/questioned allocation of Ac.6.222 decimals out of Sabik Plot No.  139. So it  is  clear that the OOA had been granted lease of an area of Ac.6.222 decimals out of Sabik Plot No. 139.  

The Settlement Officer, Measure Settlement Office,  Cuttack  reported  that  fraction  Plot  No. 1370  or  139/1370  was  not  in  existence  after 1927-28 settlement vide his letter No.3408, dated 26.09.2015, Annex-28.

The  fraction  plot  139/1370  was  created after 25.10.1949 vide the letter No. 3616, dated 26.09.2015 of the Collector, Cuttack, Annex-28/a and  as  per  Khasmal  ROR  published  after 25.10.1949. So it is apparent that the lease was executed  out  of  original  Sabik  Plot  No.139 measuring  Ac.9.290  decimal.  Extent  of  original Sabik Plot No. 139 was Ac.9.290 decimal as per 1932 Sabik ROR vide Annex-30.

Further after division of original Sabik Plot No. 139 into 139 and 139/1370 the residual of original  Sabik  Plot  No.  139  became  Ac.7.345 decimal. Adding of this residual Ac.7.345 decimal

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with  Ac.1.945  decimal  of  fraction  plot  No. 139/1370,  the  total  area  became  Ac.9.290 decimal which is thus to be measured entirely by the  Measurement  Team.  Since  lease  has  been granted to the extent of Ac.6.222 decimal out of the  Sabik Plot  No.139,  the leasehold area does not cover the entire residual area of Plot No. 139. Hence,  consideration  of  fraction  plot  NO. 139/1370 is of  little  consequence.   Accordingly the  Committee  resolved  to  carry  out  the measurement  ignoring  the  fraction  plot  No. 139/1370.

9. As  per  the  programme  the  Committee proceeded  to  the  spot  on  date  fixed.   The representative  of  the  Revenue  Authority  i.e. Tahasildar, Cuttack Sadar and representative of the  OOA,  Sri  Bhakta  Hari  Mohanty,  Senior Advocate were present. Spot notice was served on them vide Annex-31.

10. Before  the  commencement  of  the measurement  the  Committee  held  discussion with  the  members  of  the  Measurement  Team including DGPS and ETS Team.

Sabik and Hal Maps, Sabik and Hal RORs, Copies of the pleadings of the TS 312 of 1991 and the  direction  of  the  Hon’ble  Apex  Court  were handed  over  to  the  two  teams  of  the measurement.

11. The  specific  direction  of  the  Hon’ble  Apex Court passed by order dated 07.05.2015 in SLA © No. 34373/2014 as follows:

“Keeping  in  view the  two lease  deeds  and the schedule of property mentioned therein, we  think  it  appropriate  to  constitute  a Committee of the Judicial Offices who shall,

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with the help and assistance of the Revenue Authorities,  shall  measure  the  lease  hold area  and submit  a  report  whether  the  23 shops  and Kalyan  Mandap  are  within  the said lease hold area or not” vide Annex-32.

12. The  Lease  Deeds  of  1949  and  1974  bear identical  sabik  leasehold  plots  and  total  lease area as follows:-

“Cuttack  Cantonment  Khasmahal  Tauzi No.  5458  Mouza  Cantonment  Samil Bungalow block,  Thana and Sub-Registrar Sadar,  Cuttack(Thana  No.197),  plot  No. 156,  

and  

portions  of  plot  No.139,143,155  and  177 area Ac.20.808 decimals” vide Annex-2&3.

12.1 The relevant portion of the averments of the plaint of the OOA in TS 312 of 1991 regarding leasehold area reads as follows:-

“Para-3: The sketch map attached to the application  dated  26/27th January,  1949 and the sanction order 29th June 1949 will clearly indicate that the lease hold area was to  the  adjoining  south  of Cantonment-Tulasipur  Road.  After obtaining  the  lease  of  the  land  the Association  raised  high  compound  walls encroaching  the  lease  hold  area”  vide Anenx-33.

12.2    It is not out of place to mention that on 21.06.1995  the  OOA  applied  to  the  Tahasildar Cuttack for permanent lease with statements of land  under  its  possession  and  the  Tahasildar

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granted  lease  for  Ac.20.808  decimals  vide Annex-9.

The above lease deed of 195 clearly shows the details of the land leased out as follows:-

Mouza- Cantonment,          PS – Cuttack 197

Khata Plot No 349 139(Part) Ac.6.222

155(Part) Ac.3.856

177 (Part) Ac.0.220

81 156 Ac 7.272

30 143(Part) Ac 3.238

Total Ac 20.808 decimals.

Further  as  per  the  lease  deed  the  above Sabik  Plots  are  corresponding  to  following  Hal Plots-

Mouza                  Khata No              Plot No.               Area

Cuttack 187 193 Ac1.355 Town, 192 Ac.0.825 Unit No.10 190 Ac.1.452 Cantonment 187 191 Ac.4.359

                        203 Ac.0.823 200 Ac.0.456 201 Ac.0.315 202 Ac.1.130 204 Ac.4.335 189 Ac.1.258 167(Part) Ac.1.050 166(Part) Ac.0.082 168(Part) Ac.0.105

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165(Part)      Ac.3.263 Total            Ac.20.808dec

vide Annex-9.

12.3 Though the above lease has been cancelled by  the  RDC  and  such  cancellation  has  been stayed  by  the  Hon’ble  High Court  of  Orissa  in WP©  No.  5360/2002  filed  by  the  OOA,  the location of lease hold area of Ac.20.808 decimals with  specific  portions  of  the  Sabik  Plots  and corresponding Hal Plots has not been disputed by the OOA.

12.4 Accordingly the committee resolved to carry out  the  entire  land  in  possession  of  the  OOA within the boundary and to determine the lease hold  area  with  specific  area  of  the  Sabik  Plots mentioned in the lease deed Annex-9.

The Measurement Team accordingly carried out the measurement in respect of the possession of the OOA in the field.

13. The  members  of  the  Committee  were present  throughout  the  measurement  that  took place  from  02.10.2015  to  15.10.2015  and 26.10.2015 with breaks on holidays.

Sri.  B.H.  Mohanty,  Senior  Advocate  on behalf  of  the  OOA and  Tahasildar,  Cuttack  on behalf of the Revenue Authorities were present on the dates of measurement.

14. The  Measurement  Team  pointed  out  the fixed points in the field as per the Hal settlement map and cross-checked the same with reference to  Sabik  settlement  map.   The  correctness  of fixed  points  were  also  checked  by  forming triangles.   The measurement of  the land inside

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the boundary wall of the OOA was undertaken by Chain Triangulation Method. The triangles were formed to determine the area. The measurements of the diagonals were checked and verified with the  help  of  DGPS of  ORSAC where obstruction because  of  construction  was  found.   The calculations  done  for  determining  the  area  of triangles were cross-checked.

15. After  the  measurement  in  the  field,  the Measurement Team prepared the report including the relay etc. in presence and under supervision of the Committee and submitted the reports  vide Annex-34 series.  The abstract of the report of the Measurement  Team  has  been  filed  vide Annex-34/a.

The  ORSAC  submitted  their  reports  vide Annex-35 series (3 in numbers – 35,35/a & 35/b)

16. The  Committee  carefully  examined  all  the materials  placed  before  it  including  reports submitted by Measurement Team and ORSAC.

17. As  per  the  Measurement  by  the Measurement Team the OOA is in possession of Ac.26.502 decimal vide Annex-34.

As per the DGPS and ETS measurement the OOA is in possession of Ac.27.044 decimals vide Annex-35.

In the Hal Settlement ROR of 1988 the OOA was  found  to  be  in  possession  of  Ac.21.549 decimals vide Annex-4.

18. On examination of Hal Map with Sabik Map, report submitted by the Measurement Team it is found  that  the  leasehold  land  of  Ac.20.808

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decimals  appertaining  to  Sabik  Plots 156,139,143,155 and 177 are corresponding to Hal Plots193,192,190,191,203,200,201,202,204,189, 167(P),166(P),  168(P)  and  165(P)  shown  within yellow colour in the map.

18.1 The excess land in possession of the OOA which has been shown within green colour in the map is not within the leasehold land of the OOA.

18.2 On scrutiny it  is found that the 23 shops and the Kalyan Mandap(Barabati  Palace) are in Hal Plot Nos.7(Part) and 165(Part), situated over an area measuring Ac.1.138 decimal and they are corresponding to Sabik Plot No.139.

A  portion  of  Kalyan  Mandap(Barabati Palace)  measuring  Ac.0.433  decimals  situated over Hal Plot No.165(Part) is within the leasehold area as shown within yellow colour in map. The remaining  portion  of  the  Kalyan  Mandap (Barabati  Palace)  and  the  23  shops  measuring Ac.0.705  decimals  are  in  Hal  Plot  NO.  7(Part), shown within green color in the map, are situated outside the leasehold area.

18.3 As per the Hal ROR the area of Hal Plot No.7 under  Khata  No.203  is  Ac.0.880  decimal  vide Annex-36 and out of  that  Ac.0.175 decimals  is within the compound of Army Recruitment Office and remaining land of Hal Plot No. 7 measuring an area of Ac.0.705 decimal is within possession of the OOA where the 23 shops and a portion of Kalyan  Mandap  (Barabati  Palace)  are  situated shown within green colour in the map.

19. Finally the Committed unanimously comes to  the  conclusion  and  accordingly  reports  that the  leasehold  area  of  Ac.20.808  decimals

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appertaining to Sabik Plot No. 156 and portion of 139,143,155 and 177 are corresponding to Hal Plot  Nos.  193,192,190,191,203,  200,  201,  202, 204,  189,  167(  Part),166  (Part),168(Part)  and 165(Part)  shown within yellow color in the map and  23  shops  and  part  of  Kalyan  Mandap (Barabati  Palace)  measuring  Ac.0.705  decimals situated  over  Hal  Plot  No.7(Part)  shown  within green  colour  in  the  map  are  not  within  (i.e. beyond) the leasehold area.

20. During measurement the representatives of the OOA and the Revenue Authority requested for the copies of the field book, report etc. for their reference. In absence of any specific instruction to that effect from the Hon’ble Apex Court and to avoid premature disclosure prior to submission of the  report  before  the  Hon’ble  Apex  Court  the Committee  humbly  declined  to  accede  to  the request of the parties to provide any copy of the report, filed book etc. to them.

21. The  Committee  is  submitting  this  report along  with  the  annexures  as  directed  for  kind perusal of the Hon’ble apex court in Special Leave to  Appeal  ©  No.  34373/2014  and  necessary orders.”   

35. The Committee has perused certain documents which

have been appended as Annexure under the heading ‘Table

of  Annexure  to  the  Report’.   We  think  it  appropriate  to

reproduce the said table of annexure which is as under:-

Annexure No. Subject Annexure -1 Application dated 26/27.01.1949 for lease  

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of the OOA Annexure -1/a Sketch Map attached to the lease  

application of the OOA Annexure -2 Lease deed dated 24.09.1949 Annexure -3 Lease deed dated 19.04.1974 Annexure -4 Hal ROR of 1987-88 Annexure -5 Encroachment case No. 213/1 of 1990-91 Annexure -6 Copy of the plaint in T.S. 312/1991 Annexure -6/a Written Statement in T.S. 312/1991 Annexure -7 Application dated 21.06.1995 of the OOA  

for permanent lease Annexure -7/a Statement of the land of the OOA Annexure -7/b Statement of the land of the OOA Annexure -8 Order of the R.I. dated 21.06.1995 in lease

case no. 294/1995 Annexure -8/a Report of the R.I. dated 21.06.1995 Annexure -9 Order dated 22.07.1995 regarding  

permanent lease by the Tahasildar in  favour of the OOA

Annexure -10 Approval of the Collector dated 16.08.1995 Annexure -11 Judgment of T.S. 312 of 1991 Annexure -11/a Decree in T.S. 312 of 1991 Annexure -12 Lease cancellation order dated 01.11.2002

of the R.D.C Annexure -13 ROR Correction dated 05.11.2002 Annexure -14 Status quo order passed by the Hon’ble  

High Court of Orissa in M.C. No.  3999/2002 arising out of W.P ©  5360/2002

Annexure -15 Judgment of Hon’ble High Court of Orissa  dated 19.11.14 in Appeal No. 158/2001

Annexure -16 SLA(Civil) No. 34373/2014 Annexure -17 Lease deed dated 19.08.1969 Annexure -18 Resumption order dated 19.07.2003 in  

Resumption Case No. 19/2002 Annexure -19 Land taken into Government Khata on  

20.04.2015 Annexure -20 Corrected R.O.R Annexure -21 Order dated 22.05.2004 of R.P. 188/2003  

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for taking land into Govt. Khata Annexure -22 ROR corrected dated 19.08.2004 Annexure -23  & 24

Committee Members Nomination letters of  the Hon’ble High Court, Orissa

Annexure  -25,25/a &  25/b

Letters to Revenue Authority for  production of documents

Annexure -26  & 26/a

Requisitions to ORSAC for DGPS and ETS  measurement.

Annexure -27 Notice regarding day,date and schedule of  the measurement

Annexure -28 Letter of the S.O. dated 26.09.15 Annexure  -28/a

Letter of the Collector dated 26.09.2015

Annexure -29 Khasmal ROR published after 25.10.1949 Annexure -30 Sabik ROR of 1932 Annexure -31 Spot notice at Measurement site Annexure -32 Direction of the Apex Court in order dated  

07.05.2015 in SLA © 34373/14 Annexure -33 Pleading at para-3 of the plaint in T.S.  

312/91 Annexure -34 Report of the Measurement Team Annexure -34/a Abstract of the report of the Measurement  

Team Annexure -35,  35/a & 35/b

Reports of the ORSAC team

Annexure -36 Hal ROR of Hal Plot No. 7”

36. The appellant filed its objections to the Report of the

Committee  of  the  Judicial  Officers  who  along  with  other

authorities were directed to carry out the measurement of

the  leasehold  area  and  submit  a  report  on  whether  the

Kalyan Mandap and 23 shops are constructed within the

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leasehold area or not.  The main grounds of objections are:-

(i) Though the committee did conduct the measurement,

yet the same was neither with reference to the schedule in

the  original  lease  deed  of  1949  nor  the  schedule  in  the

renewed lease deed of 1974, and, as such, was an exercise

in contradiction to and not in compliance of the direction of

this  Court.  The  Committee  omitted  available  relevant

records and proceeded on the basis that measurement had

to  be  carried  out  in  the  absence  of  the  Government

producing the relevant records.  (ii) The report is criticised on the score that it refers to the

record of the civil  suit that was made available to it.  The

appellant-plaintiff had exhibited all the relevant documents

in the suit  and they formed part  of  the record.  The task

assigned to the Committee by this Court was to find out, by

measurements,  whether  the  Kalyan  Mandap  and  the  23

shops are within the leasehold area. Therefore, the aforesaid

documents  which are  part  of  the  record and which were

readily  available  to  the  Committee  were  indispensable  to

arrive  at  the  correct  conclusion  while  carrying  out

measurements to find out the extent of land covered by the

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Lease Deed dated 24.9.1949 as renewed by the Deed Dated

19.4.1974,  but  the  Committee  chose  to  ignore  the  said

crucial documents which would have clinched the issue.  It

is further asserted that the government did not produce the

relevant records but the Committee nevertheless proceeded

to  carry  out  the  measurements  as  per  its  own

understanding and parameters.  (iii) The further objection of the appellant is that Exhibit 4

is the Sabik Settlement map of 1927-28 as revised in 1949

and the said map shows the location of Sabik Plot numbers

in the relevant area. It is contended that the said map is

relatable  to  the  General  Revenue  Record  finalised  after

25.10.1949 in favour of the association and a sub-division

of Sabik Plot No. 139 as Plot No. 139/1370 is shown. At the

time  the  lease  was  executed  in  favour  of  the  appellant,

Sabik Plot No. 139 was a whole plot number and the Lease

Deed specifically  records that  a portion of  Sabik Plot  No.

139 forms part  of  the entire  leasehold area.  On the said

foundation, it is put forth that which portion of Sabik Plot

No. 139 is within the leasehold area is actually the subject

matter  of  the  civil  suit  and it  is  the  specific  case  of  the

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appellant-petitioner that the leasehold area does not include

land  in  the  newly  created  Sabik  Plot  No.  139/1370  but

includes land in the original Sabik Plot No. 139. It is further

asserted that in the Record of Rights the location of land in

the  original  Plot  No.  139  and  newly  created  Plot  No.

139/1370 were wrongly recorded. That is how the confusion

was caused as to the identity of that portion of Sabik Plot

No. 139 which is within the leasehold area of the appellant.

Reference has been made to certain assertions in the plaint.

It is also set forth that the Committee failed to appreciate

the fact that during 1949, i.e., after leasing out an area of

acres  20.808  decimals  to  the  Association,  a  settlement

operation exclusively for Khasmahal area was undertaken

which  is  commonly  known  as  “Pati  Settlement”.  The

settlement prepared the Record of Rights and sub-divided

Plot No. 139 into two parts, i.e., Plot No. 139 and the other

Plot  No.  139/1370. Plot  No.  139 comprises of  an area of

acres 1.945 decimals.  Though the field position reveals that

Plot No. 139 comprises of an area of acres 2.712 decimals,

yet  the  said  settlement  could  not  attain finality  and was

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closed  prematurely.   However,  the  revenue  map  was

published with sub-division of plots which has been referred

to in the suit and the written statement. Though the State

Government  is  aware  of  these  developments  of  “Pati

Settlement”, yet it did not produce the relevant information

before  the  Committee  and,  thus,  left  the  Committee  in

ambiguity  in  this  regard.  It  is  contended  that  had  the

Committee  carried  out  the  measurement  as  per  the

boundaries  of  the  admitted  and  undeniable  map  Ex.  6

(Government  map  prepared  by  Khasmahal  Amin  on

1.4.1953),  the  exact  extent  of  land,  which is  the  subject

matter  of  the  suit,  could  have  been  ascertained.

Contemporaneous  crucial  records  which were  part  of  the

same lease transaction were omitted by the Committee. In

pursuance of the application for the grant of lease by the

appellant  association,  the  Government  issued  a  sanction

order  dated  29.6.1949  in  which  it  was  specifically

mentioned  that  an  area  of  20.808  acres  south  of  the

cantonment road towards Tulsipur, comprising of Plot No.

156 and portions of Plot Nos. 139, 143, 155 and 177, was to

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be  leased  to  the  association.  Therefore,  the  northern

boundary to the land leased out  to the appellant  can be

inferred  from  this  sanction  order.  The  lease  deed  dated

24.9.1949 is in continuation of the sanction order and it

describes the land in the schedule. However, the boundary

to the land or the extent of land in each plot number is not

mentioned in the lease deed. Therefore, the boundaries and

the  location  of  the  land  have  to  be  gathered  from  the

contemporaneous records, namely, the application with the

sketch annexed and the sanction order.  (iv) Bearing  in  mind that  the  schedule  to  the  two lease

deeds only mention the total extent of  the leasehold area

and  the  Plot  Nos.  and  there  is  no  description  of  the

boundary,  it  was  this  document,  i.e.,  the  Government  of

Orissa  Revenue  Department  Order  No.  7484  dated

29.6.1949 which described the  northern boundary  of  the

leasehold area in as much as the said sanction order states

that the area of acres 20.808 decimals is to the south of the

Cantonment Road towards Tulsipur comprising Plot No. 156

and portions of Plot Nos. 139, 143, 155 and 177. Had this

document been looked into by the Committee, it would have

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known  the  reference  point  or  the  starting  point  for

measurement,  i.e.,  acres  20.808  decimals  southwards  of

Cantonment  Road  towards  Tulsipur.  It  would  have  also

been  clear  that  the  land  which  was  leased  out  was

contiguous with the Cantonment Road towards Tulsipur.  (v) The Committee referred to the lease file in Lease Case

No. 294 of 1995 wherein the appellant association applied

for  permanent  lease.  As  per  the  report  in  para 8.1,  it  is

stated that the association applied for permanent lease for

acres 6.222 dec. of land out of Sabik Plot No. 139, which is

an error apparent on the face of the record. The association

never applied for lease on the basis of Sabik Plot Nos. but it

did so in respect of plots under Hal Khata including Plot No.

7, because by that time, the Sabik plot numbers were not in

vogue due to Hal Settlement of 1988-89 wherein new Hal

Plot Nos. were assigned.  

37. The  Committee  has  noted  that  though  the  revenue

authorities  were  requested  to  produce  the  original  lease

deeds, sabik settlement maps of leasehold area as well as

the maps corresponding to Hal plots, plot index, lease case

record in Case no. 294 of 1995, government sanction order

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no.  7484  dated  29.6.1949  and  document  regarding

demarcation  of  leasehold  area,  yet  three  documents,

namely,  the  original  lease  deeds  of  1949  and  1974,

Government  of  Orissa,  Revenue  Department  order  dated

29.6.1949  and  document  regarding  demarcation  of

leasehold  land by  local  authorities  on measurement  were

not produced.  The Committee, then, issued requisition of

the case record of  title suit  and examined the document.

Thereafter,  the  Committee  chronologically  narrated  the

events,  referred to various aspects  and,  as is  discernible,

centred the controversy involved in the case by stating that

the  dispute  is  confined to  measure  the  leasehold  area of

acres  20.808  decimals  and  to  determine  the  location  of

Kalyan Mandap (Barabati  Palace)  and 23 shops.   Regard

being had to the same, it  decided its course of  action by

having a team of Amins who have necessary training and

sufficient experience.  The Committee also resolved to carry

out the measurement with ETS and DGPS by the trained

technicians under the supervision of the authority of Orissa

Space  Application  Center  (ORSAC),  Bhubaneswar.   The

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Committee further found on scrutiny that there is variation

in two maps, for fraction plot bearing No. 139/1370 which

is reflected in Ext.4 to the suit that is absent in the map

provided by the Revenue Authority and, accordingly, felt it

necessary to determine whether to consider fraction Plot No.

139/1370 while  conducting  the  measurement  to  find the

leasehold area.  The Committee referred to the application

in Lease Case No. 294 of 1995  to find out whether an area

of acres 6.222 decimal out of Sabik Plot No. 139 was leased

out along with other areas in total measuring acres 20.808

decimals.  It also noted that though the lease was cancelled

subsequently  by  the  Revenue  Divisional  Commissioner  in

the year 2002, yet the Association had never disputed the

same.  The Settlement Officer, Measure Settlement Office,

Cuttack reported that fraction Plot No. 1370 or 139/1370

was not in existence after the 1927-28 settlement vide his

letter  No.3408,  dated  26.09.2015.   Thereafter,  the

Committee  noted,  certain aspects,  which we think apt  to

reproduce despite having quoted earlier:-

“Further after division of original Sabik Plot No. 139  into  139  and  139/1370  the  residual  of

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original  Sabik  Plot  No.  139  became  Ac.7.345 decimal. Adding of this residual Ac.7.345 decimal with  Ac.1.945  decimal  of  fraction  plot  No. 139/1370,  the  total  area  became  Ac.9.290 decimal which is thus to be measured entirely by the  Measurement  Team.  Since  lease  has  been granted to the extent of Ac.6.222 decimal out of the  Sabik Plot  No.139,  the leasehold area does not cover the entire residual area of Plot No. 139. Hence,  consideration  of  fraction  plot  No. 139/1370 is of  little  consequence.   Accordingly the  Committee  resolved  to  carry  out  the measurement  ignoring  the  fraction  plot  No. 139/1370”.

38. The  measurement  took  place  in  association  and

collaboration with both the teams.  The Committee referred

to the lease deeds of 1949 and 1974 which bore identical

sabik leasehold plots and total  lease area as acres 20.80

decimals.   Referring  to  the  application  dated  21.06.1995

filed by the association for grant of permanent lease, it is

noticed  that  Tahsildar  granted  lease  of  acres  20.808

decimals.   The lease  deed shows the  details  of  the  land,

which is as follows:-

“Mouza- Cantonment,              PS – Cuttack 197

Khata Plot No 349 139(Part) Ac.6.222

155(Part) Ac.3.856 177 (Part) Ac.0.220

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81 156 Ac 7.272 30 143(Part) Ac 3.238

Total Ac 20.808 decimals.”

39. As per the lease deed, the said sabik plots correspond

to the following Hal plots:-

“  Mouza                Khata No              Plot No.               Area

Cuttack 187 193 Ac1.355 Town, 192 Ac.0.825 Unit No.10 190 Ac.1.452 Cantonment 187 191 Ac.4.359

                        203 Ac.0.823 200 Ac.0.456 201 Ac.0.315 202 Ac.1.130 204 Ac.4.335 189 Ac.1.258 167(Part) Ac.1.050 166(Part) Ac.0.082 168(Part) Ac.0.105 165(Part)      Ac.3.263 Total            Ac.20.808 dec.”

40. The  Committee  noted  that  the  said  lease  has  been

cancelled but it did not reflect on the same as the matter is

subjudice before the High Court in a writ petition and we

think  it  rightly  did  so.   In  this  appeal,  we  are  also  not

concerned  with  the  said  cancellation.   We  are  only

concerned, as we have noted, with regard to the existence of

acres  20.808  decimals  of  leasehold  area  and  anything

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constructed  beyond  the  said  leasehold  area.   After  the

measurement, it is interesting to note that the Committee

found there  are  variations  in  the  measurement.   We  are

compelled to reproduce the same at the cost of repetition:-

“17. As  per  the  Measurement  by  the Measurement Team the OOA is in possession of Ac.26.502 decimal vide Annex-34.

As per the DGPS and ETS measurement the OOA is in possession of Ac.27.044 decimals vide Annex-35.

In the Hal Settlement ROR of 1988 the OOA was  found  to  be  in  possession  of  Ac.21.549 decimals vide Annex-4.

18. On examination of Hal Map with Sabik Map, report submitted by the Measurement Team it is found  that  the  leasehold  land  of  Ac.20.808 decimals  appertaining  to  Sabik  Plots 156,139,143,155 and 177 are corresponding to Hal plots no. 192, 190, 191, 203, 200, 201, 202, 204,  189,  167(P),  166(P),  168(P)  and  165(P) shown within yellow colour in the map.

18.1 The excess land in possession of the OOA which has been shown within green colour in the map is not within the leasehold land of the OOA”.

41. Thereafter, it opined:-

“18.2 On  scrutiny  it  is  found  that  the  23 shops and the Kalyan Mandap(Barabati  Palace) are in Hal Plot Nos.7(Part) and 165(Part), situated over  an  area  measuring  Ac.1.138  decimal  and

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they are corresponding to Sabik Plot No.139.

A  portion  of  Kalyan  Mandap  (Barabati Palace)  measuring  Ac.0.433  decimals  situated over Hal Plot No.165(Part) is within the leasehold area as shown within yellow colour in map. The remaining  portion  of  the  Kalyan  Mandap (Barabati  Palace)  and  the  23  shops  measuring Ac.0.705  decimals  are  in  Hal  Plot  NO.  7(Part), shown within green color in the map, are situated outside the leasehold area.

18.3 As per the Hal ROR the area of Hal Plot No.7 under  Khata  No.203  is  Ac.0.880  decimal  vide Annex-36 and out of  that  Ac.0.175 decimals  is within the compound of Army Recruitment Office and remaining land of Hal Plot No. 7 measuring an area of Ac.0.705 decimal is within possession of the OOA where the 23 shops and a portion of Kalyan  Mandap  (Barabati  Palace)  are  situated shown within green colour in the map.

19. Finally the Committed unanimously comes to  the  conclusion  and  accordingly  reports  that the  leasehold  area  of  Ac.20.808  decimals appertaining to Sabik Plot No. 156 and portion of 139,143,155 and 177 are corresponding to Hal Plot  Nos.  193,  192,  190,  191,  203,   200,  201, 202, 204,189, 167( Part),166 (Part),168(Part) and 165(Part)  shown within yellow color in the map and  23  shops  and  part  of  Kalyan  Mandap (Barabati  Palace)  measuring  Ac.0.705  decimals situated  over  Hal  Plot  No.7(Part)  shown  within green  colour  in  the  map  are  not  within  (i.e. beyond) the leasehold area”.

42. The  objections  that  have  been  filed  are  essentially

based on the plea that the Committee had omitted available

relevant  records  and  proceeded  for  measurement  in  the

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absence of the Government producing the relevant records.

A perusal of the report of the Committee clearly shows that

it has complied with the order of this Court in its letter and

spirit and we find no reason to have a different view than

what has been taken by the Committee.

43. Thus,  two  aspects  are  clear.   One,  the  association

encroached upon the property of the State Government and

built 23 shops and, as the report of the Committee would

reflect,  Kalyan  Mandap  stands  partly  on  the  government

land  and  second,   the  property  that  stands  on  the

government land has to go back to the government.  There

are two options with this Court, that is, to issue a direction

for demolition of Kalyan Mandap or direct the government

for  resumption  of  that  part  of  the  land  belonging  to  the

association  where  the  Kalyan  Mandap  has  been

constructed.  It is beyond any dispute that Kalyan Mandap

is  functional  for  more  than  two  decades.   There  is  no

justification to direct demolition of the same.  It would be

appropriate if we direct the land on which Kalyan Mandap is

constructed  to  be  resumed  by  the  government  and  the

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Kalyan Mandap should vest in the State Government and

shall be managed as it is presently managed by the District

Collector, Cuttack.  

44. That settles the aforesaid land dispute but the other

issue that has come before this Court, as the learned Single

Judge  has  reflected,  deserves  to  be  addressed.   In  this

regard, it is necessary to state that this Court had called for

a  report  from  the  Accountant  General  of  Odisha  who

submitted its report on 10.03.2015. An objection was filed

to  the  said  report  on the  ground that  the  authority  had

travelled  beyond  the  directions  issued  by  this  Court.

Accepting the said objection, this Court called for a specific

report to be submitted by the Accountant General. The said

authority  submitted  the  report  dated  02.07.2015  in

pursuance of  this Court’s order.  The findings recorded in

the report are to the following effect:-  

“Report on Audit  of  “the accounts in respect of Kalyan Mandap and 23 shops standing  on the disputed area” in Barabati Stadium, Cuttack

1. Scope of Audit

As  per  order  dated  22  January  2015  of  the Hon'ble  Supreme  Court  of  India  as

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communicated  vide  letter  No.D-446/14/XIA dated 24 January 2015 of Assistant Registrar of the Surpeme Court of India, Accountant General (General  and  Social  Sector  Audit),  Odisha  was directed (22 January 2015) by the Apex Court to audit the accounts of 23 shops and the Kalyan Mandap  erected  on  0.705  acre  parcel  of disputed/encroached  land.   Accordingly,  one Report  was  filed  in  the  Apex  Court.   However, vide order dated 7 May 2015, Honorable Court directed to submit a specific and precise Report within eight weeks.

In  compliance  of  above  orders  of  Hon'ble  Apex Court,  Principal  Accountant  General  (G&SSA), Odisha conducted audit of the accounts of OOA during  30  January  2015  to  28  February  2015 and 8 to 12 June 2015 with respect to income received by it by renting out the property on land under  dispute.   This  consists  of  23 shops and one  Kalyan  Mandap,  known  by  the  name  of Barabati Palace.  The latter was leased out to one private  firm  (M/s.  Incon  Associates)  till  full adjustment  of  cost  of  construction  (Rs.80.47 lakh)8 out of 50 per cent of rent payable.

1.2 Introduction

The Government of Odisha in erstwhile Revenue Department  sanctioned  25.450  acre9 land  in favour of OOA, on lease, in three different phases during  July  1949  to  February  1969.   Out  of 25.450 acre of land, an area of 24.733 acre10 was recorded in the name of OOA in 1988 settlement indicating  that  the  Record  of  Rights  (RoR)  was valid upto 1989.  Out of the above, lease period for  20.808 acre  has  lapsed in  September  1989

8 Vide agreement dated 9 July 1996 (17 years) subsequently amended vide agreement dated 24  April 1998 and 28 March 2002

9Three (3) parcels of land measuring 20.808 acre, 2.703 acre and 1.939 acre. 100.717 acre out of 25.450 acre of land was not settled.

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and has not been renewed so far and the matter is sub-judice11 in High Court of Odisha.  Out of two  other  parcels  of  land  viz.  1.939  acre  and 2.703 acre, land measuring 1.222 acre and 2.703 acre settled in 1988 settlement respectively, has already  been  reverted  back  to  government khata12.  Out of the remaining 0.717 acre, land measuring  0.634  acre  remained  under unauthorized occupation (encroachment) of OOA on which a Kalyan Mandap (Barbati Palace) and 23  shops  were  constructed  (1990-99) Encroachment case13 was filed by the Tahsildar in  1990-91,  but  the  matter  has  remained sub-judice (February 2015).

2. Audit findings

Audit  noticed that  OOA started construction of 23 shops on the disputed land during 1990-91 out  of  its  own  resources,  completed  the construction  in  1995-96  at  a  cost  of  Rs.14.21 lakh  and  let  out  the  same  in  March  1996. Further  it  permitted  construction  of  a  Kalyan Mandap  by  M/s.  Incon  Associates,  a  private partnership  firm,  on  the  disputed  land  in 1996-97.  OOA started receiving rent from the 23 shops  from  March  1996  and  from  Kalyan Mandap from January 1999.  List of proprietor of these  23 shops and their  business  activities  is indicated in Annexure 1.

2.1 Levy and collection of  rent  from 23 shops and Kalyan Mandap

OOA could  not  produce  counter-foils  of  money receipts  used  during  1995-96 to  2007-08,  rent ledger for 1995-96 to 2003-04 and stated that all

11WP (C) No.5360/2002 and Misc. Case No.3999/2002 12 RP Case No.188/2003, Mutation Case No.1801/2004 (1.222 acre) and Vide Misc. Case  

No.19/2002 (2.703 Acre) 13Enroachment Case No.213/01/1990-91, Misc. Case 263/91 arising out of T.S. Case No.312/91

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records up to 2003-04 and all vouchers upto to 2007-08  had already been destroyed instead it furnished to Audit a statement of rent due and collected during the period from March 1996 to March 2004 in respect of Kalyan Mandap and 23 shops, which Audit has relied upon in absence of the  above  basic  records.   Further,  during 2008-09 to 2013-14, though money receipts were produced,  however,  rent  collected  by  OOA through  money  receipts  from  M/s. Incon-Associates  towards  Kalyan  Mandap (Barabati  Palace)  was  mixed  up  with  that  of Barbati Guest house (another building taken on hire from OOA by the same firm) due to which Audit had to rely on the rent ledger and audited annual accounts.  Besides, cashbook was found (June  2015)  to  be  not  written  after  31  March 2014.

2.1.1 Rent collected by OOA from 23 shops

As  per  the  accounts  certified  by  the  Chartered Accountant  and  other  records  produced  before Audit, OOA had earned revenue of Rs.55.35 lakh towards  rent  (Rs.52,52,788)  and  donation (Rs.2,82,100) from 23 shops during March 1996 to December 2014.  Out of this Rs.50,28,069 was received and Rs.2,24,719 was outstanding as on 31 December 2014.  However, full donation was realized  Shop  wise  rent  due,  received  and outstanding is indicated at Annexure 2.

2.1.2. Rent due and collected by OOA from M/s. Incon  Associates  for  Kalyan  Mandap  (Barabati Palace)

As per the rent ledger, during January 1999 to December 2014 rent of Rs.41,99,17414 was due to OOA towards rent  of  Kalyan Mandap (Barabati

14Up to March 2014 Rs.40,04,718 and April to December 2014 Rs.1,94,456

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Palace).   Out of  this,  rent  of  Rs.13,28,470 was received  by  OOA  from  M/s.  Incon  Associates, Rs.21,51,809 was adjusted15 towards the cost of construction  as  per  the  agreements  while Rs.5,24,439  remained  outstanding  as  of  31 March 2014.   During  April  to  December  2014, Rs.2,57,816 was shown as collected by OOA in the  rent  ledger  but  the  same included rent  for Barabati Palace and other dues for which actual rent  paid  for  Barabati  Palace  could  not  be ascertained by Audit as annual accounts of OOA for 2014-15 has not been finalized (June 2015).

Rent  due,  collected and adjusted by OOA from Barabati  Palace  during  January  1999  to December 2014 are indicated at Annexure 3.

Thus,  OOA  had  earned  a  revenue  of  Rs.97.33 lakh during 1996-97 to 2014-15 (upto December 2014) by utilizing the property i.e. 23 shops and Kalyan  Mandap  (Barabati  Palace)  lying  on  the disputed land.

2.1.3 Difference in income as per the accounts of M/s.  Incon  Associates  and  by  the  new management (Collector, Cuttack)

M/s. Incon Associates earned revenue amounting to Rs.2.44 crore16 from Barabati Palace towards booking  charges  for  different  events  during January 1999 to December 201417 as per records produced by it.

At the direction of the Honorable High Court of Odisha/Honourable Supreme Court of India, the

15 The cost of construction was borne by the private party viz. M/s. Incon Associates who  adjusted fifty per cent of rent from monthly rent towards cost of construction.

16 As per financial statement of M/s. Incon Associates for the years 1998-99 to 2013-14 (except  2000-01 and 2006-07 which were not produced to Audit).  Moreover, money Receipts in  respect of these receipts could also not be furnished to Audit.

17Excepting for 2000-01 and 2007-08 for which annual accounts were not produced to Audit.

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management of  Barabati  Palace was taken over by  the  District  Collector,  Cuttack  during  the period from 30 November 2014 to 12 December 2014 and then from 24 January 2015.

Audit  attempted  to  make  a  comparison  of  net earnings  from  Barabati  Palace  under  both  the managements and noticed that  in the books of M/s. Incon Associates though income relating to Barabati  Palace  was  shown  distinctly  however, expenditure incurred thereon was not shown in its  accounts  separately  but  mixed  with  other business  like  running  Barabati  Guest  House, Barabati Palace and Catering.

However, as per certified financial statements for 2007-08 to 2013-14, total income of M/s. Incon Associates  from  Barabati  Palace  was  Rs.1.71 crore.

Present management (i.e. Collector, Cuttack from 30 November 2014 to 12 December and then 24 January 2015 onwards) confirmed that they were charging  Rs.70,000  plus  service  tax  per  social events  up to  18 February  2015 and Rs.80,000 plus service tax thereafter and 78 bookings had been made with collection of booking charges of Rs.77.50 lakh during same period and incurring expenditure  of  Rs.2.61  lakh  within  about  five months (up to May 2015).   This indicated that Barabati  Palace  had  more  revenue  earning potential than that disclosed in the accounts of M/s. Incon Associates.

2.1.4  Advance  rent  collections  payable  to  the District Administration by M/s. Incon Associates

M/s. Incon Associates vide letter No. Nil dated 2 December  2014  intimated  that  during  the  first phase  (i.e.  from  30  November  2014  to  12

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December 2014) of  taking over of the charge of the  Kalyan  Mandap  by  the  District Administration, the mandap was booked by nine (9) persons and an amount of Rs.1.86 lakh was collected by it as per the details furnished below :

(Source: Information furnished by the Manager, Barabati Palace)

As  the  hiring  charges  of  the  Mandap  was Rs.70,000  per  day,  the  District  Administration collected  an  amount  of  Rs.4.45  lakh  from  the users  of  Kalyan  Mandap.   Similarly,  Collector also collected Rs.1.20 lakh on advance booking of said  mandap  during  the  period  when management  remained  with  M/s.  Incon Associates.  However, the differential amount of

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Sl. No.

Date  of function

Name  of the User of Mandap (S/Shri)

Money Receipt No.  Of Barabat i Palace

Advance Received by Manager, Barabati Palace  (in Rs.)

District Adminsit-r ation money receipt number

Amount received by District Administr ation (in Rs.)

Total Collection (in Rs.)

1. 30-Nov- 14

Bibekanad a Swain

144 20000 86/672130 50000 70000

2. 01-Dec- 14

Muna Jain 153 21000 86/672131 50000 71000

3. 02-Dec- 14

R.K. Mohapatra

159 20000 86/672143 50000 70000

4. 03-Dec- 14

Gyanaranja n Swain

147 15000 87/672155 55000 70000

5. 06-Dec- 14

S.S. Sharma

154 30000 87/672157 40000 70000

6. 07-Dec- 14

Sibu Khuntia

140 10000 87/672160 60000 70000

7. 09-Dec- 14

B C Rout 168 20000 87/672164 50000 70000

8. 10-Dec- 14

Pragyan Mohapatra

151 30000 87/672163 40000 70000

9. 12-Dec- 14

Jayanti Rath

117 20000 87/672159 50000 70000

TOTAL 186,000 445,000 631,000

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Rs.0.66 lakh due to the District Administration has not been deposited by M/s. Incon Associates (June 2015).  Besides, service tax amounting to Rs.90,000  was  neither  collected  from  the concerned  users  by  the  Collector  nor  by  M/s. Incon Associates.

2.2. Accounting issues

2.2.1 Accounting of 23 shops in OOA records

The  OOA constructed  23  shops  out  of  its  own sources during 1990-91 to 1995-96 at a cost of Rs.14.21  lakh.   Since  OA  could  not  provide vouchers in support of  such expenditure, Audit relied upon the balance appearing in the Annual Accounts and Ledgers and noticed that:

In the accounts of  OOA, expenditure18 incurred towards  repair  and  maintenance  relating  to  23 shops were clubbed with repair maintenance of other  civil  structures  like  stadium,  office building,  etc.   Similarly,  separate  metering and billing for electricity charges upto 2004-05 for 23 shops was not done.  Therefore, identification of expenditure  against  receipts  from  23  shops standing on disputed/encroached land could not be possible in Audit.

2.2.2 Accounting  of  Kalyan  Mandap  (Barabati Palace) in OOA records

Audit examined the annual accounts of both OOA relating  to  the  Barabati  Palace  and  M/s  Incon Associates  running  the  Barabati  Palace  (as produced by them) and noticed that:

• OOA  accounted  for  Rs.80.47  lakh

18 Export in one year i.e. 2005-06 when OOA spent Rs.76,700 for repair and maintenance of one shop

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being  construction  cost  of  Barabati Palace and other installations (plant and machinery) as its own asset in 1998-99 (Rs.57.66  lakh)  and  2000-01  (Rs.22.81 lakh)  and  booked  matching  amount under  liabilities  as  Deposit  (accrual  of assets  against  self-construction  of buildings)  received  from  M/s.  Incon Associates,  as  cost  of  construction  was not met by OOA.

• In the annual accounts of OOA for the period 1999-2014, Audit noticed that a sum of Rs.21,51,809 being 50 per cent of  rent  received  from  M/s.  Incon Associates  was  adjusted  from  Deposit (accrual  of  assets  against self-construction of buildings) head.

Though  said  Kalyan  Mandap building  was  constructed  on  disputed land,  accounting  the  same  as  a permanent asset  of  OOA in its  account was,  thus,  irregular  as  per  Accounting Standard (AS 10)

• Besides,  said  asset  (Building: Rs.61.35 lakh) was not capitalized based on expenditure incurred but on estimated construction  cost  and  so  did  not represent the actual cost of the building. OOA  also  irregularly  charged depreciation  for  Rs.26.45  lakh  during 2003-04  to  2013-14  on  said  building, even  though  title  of  the  land  was disputed.   Besides,  M/s.  Incon Associates, the lessee of Barabati Palace, incurred expenditure towards repair and maintenance  as  well  as  electricity charges of the Barabati Palace.

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2.2.3. Non-reconciliation of accounts between OOA and M/s. Incon Associates

As  per  terms  of  agreement  with  M/s.  Incon Associates, 50 per cent of the rent in each month was to be adjusted towards construction cost of Barabati Palace.  In the accounts of OOA, while cost  of  construction  was  booked  under  fixed assets to be reduced by depreciation each year, in the accounts of M/s. Incon Associates, same was shown under current assets, loan and advances (OOA account) till 2006-07 to be reduced by 50 per cent of rent payable each year.  Investment in Barabati  Palace  was  distinctly  shown  from 1999-2007  in  the  accounts  of  M/s.  Incon Associates,  but  thereafter  the  same was  mixed with other investments  due to which amount of investment made in Barabati Palace alone could not be ascertained in Audit.  During 1999-2007, OOA  adjusted  Rs.11.79  lakh  in  its  account whereas  M/s.  Incon  Associates  had  shown adjustment  of  Rs.13.76  lakh  during  the  same period as detailed at Annexure 4.  The difference of Rs.1.97 lakh was not reconciled (June 2015).  

2.2.4  Accounting  of  Kalyan  Mandap  (Barabati Palace) in the accounts of  M/s.  Incon Associates

Working  results  and  financial  position  of  M/s. Incon  Associates  (as  per  its  Annual  Accounts from 1999-00 to 2013-1419) revealed that it had three  different  businesses  viz.  letting  out  of Barabati  Palace,  Barabati  Guest  House  and Catering. Expenditure relating to Barabati Palace alone could not  be assessed as expenses of  all businesses  were  clubbed.   Moreover,  following records could not be produced to Audit:

192000-01 and 2007-08 were not furnished to Audit

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• Cash books from 1998-99 to 2009-10; • Booking  and  Collection  Register  from

1999-00 to December 2014; • Money Receipts from 1999-00 onwards; • Bill Copies from 1999-2000 to 2009-10; • Bill Register; • Tariff  charges  of  Kalyan  Mandap  with

detailed break-up.

Hence, accounts of M/s. Incon Associates could not be relied upon by Audit.

2.3 Absence of  requisite  due diligence in fixing revenue share

2.3.1. High payback period

The details of rent structure for Kalyan Mandap as agreed in the agreements and adjustments to be done for cost of  construction is indicated in table below:-

Sl. No.

Features  of agreement

1st Agreement dated 9 July 1996

2nd Agreement dated  24 April 1998

3rd Agreement dated  20 July 1998

4th Agreement dated  28 March 2002

1 Cost  of construction permitted (Rs.)

10.00 lakh 25.00 lakh 40.00 lakh 80.47 lakh

2 Monthly  rent payable (Rs.)

10,000 15,000 17,000 21,000

3 Whether  prior approval of General Body taken?

Yes No No No

4 Rent as percentage of capital

1.00 0.6 0.425 0.26

5 Provision  for revision of rent

No provision No provision No provision Five  (5)  per cent increase once  in three years

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6 Amount per month to  be  adjusted  by OOA  towards  cost of  construction  as reflected  in advance  deposit account  of  M/s. Incon Associates

50  per  cent of  monthly rent

50  per  cent of  monthly rent

50  per  cent of  monthly rent

50  per  cent of  monthly rent

7 Actual  cash  inflow per month to OOA after  adjustment towards construction (Rs.)

5,000 7,500 8,500 10,500

8 Tenure  of agreement

Till adjustment of  cost  of construction in full or 17 years whichever is earlier

Till adjustment of  cost  of construction in  full  or  28 years whichever  is earlier

Till adjustment of  cost  of construction in full or 28 years whichever is earlier

Till  full adjustment of  cost  of construction

9 Date  from  which agreed  rent  was payable

1-Dec-1997 1-Dec-1998 1-Dec-1998 1-Apr-2002

(Source: Information furnished by the Manager, Barabati Palance)

As can be seen from the table, M/s. Incon Associates  kept  on  increasing  the  cost  of construction  and  OOA  regularized  the expenditure by signing agreements without prior approval  of  General  Body.   The  rent  was  not increased  commensurate  with  the  incerease  in construction  cost  as  reflected  above  by  ratio between  rent  agreed  and  cost  of  construction. OOA could not produce any record to justify the basis of determination of such monthly rent.  As per  agreement  (July  2002)  50  per  cent  of  rent would be adjusted towards expenditure incurred on construction of  said Kalyan Mandap and so full  adjustment  of  cost  of  construction  would have happened after 47 years in 2044 (Annexure 5).

2.3.2. Arbitrary  fixation  of  rent  for  Kalyan Mandap: Actual rent vis-a-vis fair rent

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Revenue sharing is a major bidding parameter to ensure  that  the  parties  willing  to  share  the highest  revenue  would  get  selected.   Audit noticed  that,  OOA  did  not  exercise  any  due diligence  for  revenue  sharing  like  the  actual income  stream  of  the  private  partner  from utilizing this building, mutually acceptable level of  Internal  Rate  of  Return  (IRR)  and  fixing  of minimum  reserve  percentage  of  revenue  share etc.  Rather, it seemed to have fixed the annual rent arbitrarily without examining the anticipated revenue earning.   

Since competitive bidding was not followed while entering  into  agreements  with  M/s.  Incon Associates,  Audit  compared  the  actual  rent charged  for  Barabati  Palace  with  'Fair  Rent' which  is  prescribed  in  Paragraph  4.1.14  read with  Annexure  XIII  of  Orissa  Public  Works Department  (OPWD)  Code  Volume  II. Government hires private buildings at such rate.

Audit got the fair rent of such shops and kalyan Mandap  (Barabati  Palace)  calculated (February-March  2015)  by  the  competent authority and compared the same with rent fixed in  the  agreement  which  is  indicated  in  table below:

Statement  showing  comparison  of  actual  rent charged versus fair rent from 1999 to 2014 for Barabati Palace:-

Year Actual Rent  Fixed (Rs.)

Fair Rent (Rs.) Difference (Rs.)

1999 2,40,000 8,32,728 5,92,728

2000 2,49,000 8,32,728 5,83,728

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2001 2,52,000 8,32,728 5,80,728

2002 2,40,000 8,88,480 6,48,480

2003 2,52,000 8,88,480 6,36,480

2004 2,52,000 8,88,480 6,36,480

2005 2,52,000 8,66,400 6,14,400

2006 2,64,600 8,66,400 6,01,800

2007 2,64,600 8,66,400 6,01,800

2008 2,64,600 14,10,120 11,45,520

2009 2,74,500 14,10,120 11,35,620

2010 2,77,800 14,10,120 11,32,320

2011 2,77,800 22,13,184 19,35,384

2012 2,88,213 22,13,184 19,24,971

2013 2,91,684 22,13,184 19,21,500

2014 2,91,684 41,49,684 38,58,000

Total 39,92,481 2,19,49,692 1,79,57,211

(Source:  Fair  rent  furnished by R & B and rent charged  as  per  agreement  with  M/s.  Incon Associates)

Thus,  it  is  evident  from the  above  comparison that the rent structure was not  fixed rationally keeping in view the cost of land, cost of capital investment,  the  market  rent  accruable,  time value of money, rate of return and the payback period.  Even in 2002, when the last agreement was  signed,  rent  fixed  was  substantially  below the  fair  rent.   Over  the  years,  fair  rent  has increased substantially but rent charged by OOA has only increased marginally.”

45. Keeping in view the aforesaid report, it was observed:-

“From the aforesaid report,  the differential  sum that  comes  into  existence  is  Rs.1,79,57,211/- (Rupees  one  crore  seventy  nine  lac,  fifty  seven thousand two hundred and eleven only).  Certain documents have been annexed in support of the

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report.   A copy of  the  report  has been handed over  in  Court  to  Mr.  Raghvendra  Srivastsa, learned counsel for the petitioner.  It is open to the  petitioner  to  file  an  objection  to  the  same within four weeks hence.

46. The  appellant  has  filed  an  expert  opinion  on  the

Accountant General’s Report II. The said report is by Shri

Haraprasad  Das,  an  expert  who  is  a  former  Additional

Deputy  Comptroller  and  Auditor  General,  Former  Vice

Chairman  and  Acting  Chairman  State  Administrative

Tribunal,  Odisha.   As  per  Shri  Das,  the  report  of  the

Accountant General is wrong and the reasons for saying so

are below:-

“  Para 2.3.1 (i) The calculation and the projection up to  2044  is  wrong.  The  correct  position  is worked out below.  It would be seen there from  that  the  Kalyan  Mandap  (Barabati Palace)  would  be  wholly  owned  OOA  by 2026 i.e. after 11 years.  The decision of the OOA Executive  Council  has  proved  highly rewarding  as  OOA  has  acquired  the property  without  any  capital  investment. The gain to OOA is huge in real terms. (ii) In  regard  to  fixation  of  rent  it  is pointed out that OOA had only given a piece of land to Incon and rent was for the land. As  the  cost  of  construction  was  to  be

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capitalized   eventually  by  OOA,  it  is  not understood  how  increase  in  cost  of construction  would  have  warranted proportionate increase in rent.

The  capital  applied  was  that  of  Incon,  so how would OOA charge Incon for increased cost  during  the  period  of  construction? Audit  have  missed  the  essence  of  the Agreement.  The  agreement  was  for acquisition  of  asset  by  OOA  created  by Incon and not for sharing revenue.

(iii) The  observations  of  the  Audit  are wrong and are far from facts. Audit had not gone through the arrangements entered into from  time  to  time  and  subsequent correspondence.  In all the arrangements it is mentioned that the vacant land is given for  construction of  Kalyan Mandap on the terms that the period of lease is 28 years or till  the  adjustment  of  the  amount  of expenditure of Rs. 80,47,157/- incurred on construction of Kalyan Mandap out of rent payable  whichever  is  earlier.  Audit  has referred to the Agreement dated 18.3.2002 and the calculation has been made on that basis.  Audit  has  not  referred  to  the corrigendum issued immediately  after  that providing  the  lease  period  of  28  years, agreed to by both parties.

Hence the maximum tenure of license is 28 years  only.  The  payback  schedule  for  28 years is as follows:

Year Period Rent Rent Rent to be Cumulative

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payable per month

receivable during the year  as per agreement

adjusted as  per agreement

rent adjusted

1 Jan-Mar 1999

20,000 60,000 30,000 30,000

2 1999-2000 20,000 2,40,000 1,20,000 1,50,000

3 2000-2001 20,000 2,40,000 1,20,000 2,70,000

4 2001-2002 20,000 2,40,000 1,20,000 3,90,000

5 2002-2003 21,000 2,52,000 1,26,000 5,16,000

6 2003-2004 21,000 2,52,000 1,26,000 6,42,000

7 2004-2005 21,000 2,52,000 1,26,000 7,68,000

8 2005-2006 22,050 2,64,600 1,32,300 9,00,300

9 2006-2007 22,050 2,64,600 1,32,300 10,32,600

10 2007-2008 22.050 2,64,600 1,32,300 11,65,200

11 2008-2009 23,152 2,77,824 1,38,912 13,04,112

12 2009-2010 23,152 2,77,824 1,38,912 14,43,024

13 2010-2011 23,152 2,77,824 1,38,912 15,81,936

14 2011-2012 24,310 2,91,720 1,45,860 17,27,796

15 2012-2013 24,310 2,91,720 1,45,860 18,73,656

16 2013-2014 24,310 2,91,720 1,45,860 20,19,516

17 2014-2015 25,525 3,06,300 1,53,150 21,72,666

18 2015-2016 25,525 3,06,300 1,53,150 23,25,816

From  the  above  table  it  would  be seen concluded that only Rs. 39,99,786/- would  be  adjusted  by  the  time  license expires.  In other words, Orissa Olympic Association  would  receive  rent  of  Rs. 39,99,786/- during the tenure of license (being 50% of the rent) and the building

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at  the  end  of  the  license  period.  The present  value  of  the  developed  property (calculated till financial year 2015-16) is Rs.  2,38,31,773/- based on the indexed cost  prescribed  by  the  Central Government under Income Tax Act, 1961. The indexed value of the construction at the end of 28 years will be approximately doubled,  i.e.  Rs.  4,76,63,546/- considering  the  increase  in  index  cost from  year  to  year.   The  calculation  of indexed cost of property is as follows:

Details of amount spent on construction of Kalyan Mandap are as follows:

Financial Year

Amount spent

Index  for the  said financial year

Index  for the financial year 2015-201 6

Indexed cost  of constructio n

1998-199 9

57,66,20 7

351 1081 1,77,58,603

2000-200 1

22,80,95 0

406 1081 60,73,170

Besides, if it is assumed that the licensee had  kept  the  amount  spent  on construction in bank as fixed deposit at the  rate  of  interest  of  8%  per  annum (Quarterly Compounded), then the Incon would  have  got  Rs.  5,74,22,569/-  after the expiry of 28 years.  In other words the cost of license to the  license (Incon) for 28 years is Rs. 6,54,69,355/- (Rent Paid +  Interest  Lost  +  Unadjusted  cost  of construction)  which  comes  to  Rs. 1,94,849/- per month.  The licensee has

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borne  the  burden  and  the  OOA  has become the final beneficiary. This would show  that  no  favour  was  shown  to INCON.

Para 2.3.2 Revenue  sharing  was  not  a  bidding parameter,  firstly  because  there  was  no bidding  and  secondly  because  OOA did not contemplate revenue sharing when it rented out the vacant a piece of land. The presumptions  of  Audit  are  ab  initio wrong.  

Audit  has  presumed  that  a  constructed building  was  rented  out  to  Incon  and therefore  the  OPWD  fair  rent  standard was  to  be  applied.  Actually  the  vacant land was leased out at Rs. 1.18 per sq ft which  was  marginally  increased periodically. The rent per sq ft was arrived at on the basis of fair rent prevailing for vacant  land,  without  any  intention  of profiting from rent. The real intention was to gain through acquisition of asset.

It  would  be  seen  from  the  previous paragraph  that  the  index  cost  of construction  till  date  works  out  to  Rs. 2.38 crores which would further increase by  the  time  the  license  would  expire (2025-26). The index cost at that point of time would be Rs. 4.76 crores.

The  superficial  calculation  done erroneously  by  audit  is  required  to  be wholly  rejected.  The  presumed  loss  on rent  differential  Rs.  1.79  crores  is therefore without any basis.

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In sum:

1. The  Principal  Accountant-general  has audited  the  accounts  of  the  Odisha Olympic Association again as directed by  the  Hon’ble  Supreme  Court,  to verify  if  the  income  by  way  of  rent earned by the OOA from 23 shops and Kalyan  Mandap  have  been  duly accounted for.

2. Audit  has confirmed (Para 2.1.2)  that OOA had earned revenue of Rs. 97.33 lakhs  by  way  of  rent  from 23  shops and Kalyan Mandap and that amounts have been duly accounted for by OOA in  its  books.  Hence  there  is  no defalcation or non accounting of rental income.

3. Audit  has  erred  in  telescoping  the payback  period  up  to  2044.  The agreement provided for maximum lease tenure  of  28  years.  Thus  the  lease would be over by 2025-26. OOA would come  to  acquire  the  property index-valued  at  around  Rs.  4  crores without  spending  a  rupee.  The arrangement  is  loaded  in  favour  of OOA and not  Incon.   For  Incon it  is bad  business  and  for  OOA  it  is  a crowning success.

4. Comparison  between  actual  rent charged and fair rent as determined by Roads and buildings is not tenable as R & B rent is far constructed space.

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Thus the Audit  Report (II)  establishes the contention of OOA that the revenue accounting of OOA is aboveboard. In so far  as  the  incorrect  finding  of  Audit regarding the revenue potential of the Kalyan Mandap is concerned, we have shown how there has  been a gain in real  terms  for  OOA  while  Incon  has suffered huge loss.  Therefore  there is no  question  of  any  concession  or favour done to Incon.”

47. On a perusal of the objection, it is noticeable that Shri

Das has opined that the auditor has not gone through the

agreements entered into from time to time and subsequent

correspondence wherein it has been mentioned that vacant

land is given for construction of Kalyan Mandap on the term

that the period of lease is 28 years or till the adjustment of

the amount of expenditure of Rs. 80,47,157/- incurred on

construction  of  the  Kalyan  Mandap  out  of  rent  payable

whichever is earlier.  He has also referred to the pay back

schedule and observed that the association would receive

rent of Rs. 39,99,786/- during the tenure of licence (being

50% of the rent) and the building period.  The present value

of the developed property (calculated till the financial year

2015-16)  is  Rs.  2,38,31,773/- based on the  indexed cost

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prescribed  by  the  Central  Government  under  the  Income

Tax Act, 1961.  Additionally, he has observed that Audit has

confirmed that OOA had earned revenue of Rs. 97.33 lakhs

by way of rent from 23 shops and Kalyan Mandap and those

amounts have been duly accounted for by OOA in its books.

Hence, there is no defalcation or non-accounting of rental

income.  Shri Das has opined that the association would

acquire the property indexed-valued at around Rs. 4 crores

without spending any amount.

48. We  have  accepted  the  report  submitted  by  the

Committee headed by the District Judge, Cuttack. 23 shops

are situated on the Government land and part of the Kalyan

Mandap  is  also  situated  on  the  Government  land.   This

makes  it  quite  clear  that  the  association  has  raised

construction by encroaching upon the Government land and

the expert engaged by the association gives the opinion that

Rs. 97.33 lakhs by way of rent had been earned.   There is a

lot of gap between the figure arrived at by the Accountant

General of Orissa on the basis of the market rent and the

figure arrived at by the expert.  That apart, the State has

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shown the revenue generated after it was handed over to it

which  indubitably  shows  that  either  the  23  shops  were

given on lower rent and similarly, Kalyan Mandap had been

let out at a very low price or there had been collusion to

show lower receipt though actually there was high collection

on rents.  This would require investigation.

49. The  controversy  does  not  end  here.   In  earlier

proceedings, this Court had noted about the induction of

the son-in-law of the Secretary as a partner in the firm M/s

Incon Associates that has entered into agreement with the

association. He might have been inducted at a later stage.

There was also allegation that the son and son-in-law are

also partners.  In such a situation, the conflict of interest

arises.  

50. Objections have been filed to the said report.  As per

the  report  submitted  by  the  CAG  and  the  revenue

generation  of  the  State,  it  is  crystal  clear  that  it  is

incumbent to look at how and under what circumstances

the agreements were entered into at a low rate and what

amount was actually collected and what happened to the

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said sum.  It has to be borne in mind that the revenue has

been generated by constructing on the government land and

profit  has  been  earned  from  the  same.   That  warrants

further scrutiny and investigation.   

51. Another  aspect  which  cannot  be  ignored  relates  to

conflict of interest.   Vide order dated 9.3.2016, this Court

had  noted  that  the  son  and  son-in-law  of  Mr.  Asirbad

Behera,  General  Secretary  of  the  Orissa  Olympic

Association, were partners.  In this regard, we may refer

to  a  two-Judge  bench decision  in  Board of  Control  for

Cricket  in  India  v.  Cricket  Association of  Bihar  and

others20 wherein the Court, taking note of the finding of the

probe committee, has held that serious issues of conflict of

interest adversely affects the game of Cricket which is so

popular in this county. It is bound to shake the confidence

of the public in general.  The said finding was recorded in

the  context  of  the  affairs  of  the  BCCI.   The  concept  of

conflict  of  interest  is  well  established.  A  person  who  is

accountable to the public and deals with public affairs is

20 (2015) 3 SCC 251

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not  expected,  as  required  under  the  law,  to  have  any

personal interest. He is not to act in a manner where it is

perceived that he is directly or indirectly the beneficiary; or

for that matter, extends the benefit to a person of immediate

proximity.  In  this  context,  we  may  usefully  reproduce  a

passage  from  the  authority  in  Board  of  Control  for

Cricket in India (supra):-

“BCCI  is  a  very  important  institution  that  dis- charges important public functions. Demands of institutional  integrity  are,  therefore,  heavy  and need to be met suitably in larger public interest. Individuals are birds of passage while institutions are  forever.  The  expectations  of  the  millions  of cricket lovers in particular and public at large in general, have lowered considerably the threshold of tolerance for any mischief, wrongdoing or cor- rupt practices which ought to be weeded out of the system. Conflict of interest is one area which appears to have led to the current confusion and serious misgivings in the public mind as to the manner in which BCCI is managing its affairs”.

52. In  this  regard,  reference  to  the  authority  in  V.C.

Rangadurai v. D. Gopalan and others21 is seemly.  In the

said case, it  has been held that where an advocate finds

that there would be conflict of interest in taking up a case of

his  client,  he  should  not  accept  the  brief  of  such  client 21 (1979) 1 SCC 308

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against the interest of his earlier client.   Though it has been

rendered in the context of misconduct of an advocate, yet

the concept of conflict of interest has been lucidly set out

therein.

53. In  Noratanmal  Chouraria  v.  M.R.  Murli  and

another22, while dealing with the aspect of misconduct of

an advocate under the Advocates Act, 1961, a three-Judge

Bench laid down thus:-

“10. This Court in State of Punjab v. Ram Singh, Ex-Constable23 noticed:  

“5.  Misconduct  has  been  defined  in  Black’s Law Dictionary, 6th Edn. at p. 999 thus:

‘A  transgression  of  some  established  and definite  rule  of  action,  a  forbidden  act,  a dereliction  from duty,  unlawful  behaviour, wilful  in character,  improper or wrong be- haviour,  its  synonyms  are  misdemeanour, misdeed, misbehaviour, delinquency, impro- priety,  mismanagement,  offence,  but  not negligence or carelessness.’

Misconduct in office has been defined as: ‘Any unlawful behaviour by a public officer in relation to the duties of his office, wilful in character. Term embraces acts which the office-holder had no right  to perform, acts performed improperly, and failure to act in the face of an affirmative duty to act.’

Aiyar, P. Ramanatha: Law Lexicon, Reprint Edn., 1987, at p. 821 defines ‘misconduct’ thus:

22 (2004) 5 SCC 689 23 (1992) 4 SCC 54

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‘The term misconduct implies a wrongful in- tention,  and  not  a  mere  error  of  judgment. Misconduct is not necessarily the same thing as  conduct  involving  moral  turpitude.  The word misconduct is a relative term, and has to be  construed  with  reference  to  the  subject- matter and the context wherein the term oc- curs, having regard to the scope of the Act or statute which is being construed. Misconduct literally  means  wrong  conduct  or  improper conduct.  In  usual  parlance,  misconduct means  a  transgression  of  some  established and definite rule of action, where no discretion is left, except what necessity may demand and carelessness,  negligence  and  unskilfulness are  transgressions  of  some  established,  but indefinite, rule of action, where some discre- tion is  necessarily  left  to  the actor.  Miscon- duct is a violation of definite law; carelessness or abuse of discretion under an indefinite law. Misconduct is a forbidden act; carelessness, a forbidden quality of an act, and is necessarily indefinite. Misconduct in office may be defined as unlawful behaviour or neglect by a public officer,  by  which  the  rights  of  a  party  have been affected.’

6. Thus it could be seen that the word ‘miscon- duct’ though not capable of precise definition, on reflection receives its connotation from the con- text, the delinquency in its performance and its effect  on  the  discipline  and  the  nature  of  the duty. It may involve moral turpitude, it must be improper  or  wrong behaviour;  unlawful  behav- iour, wilful in character; forbidden act, a trans- gression of established and definite rule of action or code of conduct but not mere error of judg- ment, carelessness or negligence in performance of the duty; the act complained of bears forbid- den quality or character. Its ambit has to be con-

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strued with reference to the subject-matter and the context wherein the term occurs, regard be- ing had to the scope of the statute and the pub- lic purpose it seeks to serve. The police service is a disciplined service and it requires to maintain strict discipline. Laxity in this behalf erodes dis- cipline in the service causing serious effect in the maintenance of law and order.”

(See also Probodh Kumar Bhowmick v. University of Calcutta24 and B.C. Chaturvedi v.  Union of In- dia25.)”

54.  We  have  referred  to  the  aforesaid  passages  to

highlight that when an administrator is discharging public

function, he is also required to avoid any type of conflict of

interest.  It  has  been  so  held  in  the  case  of  Board  of

Control  for  Cricket  in  India (supra).  Any  action  that

would  show  conflict  of  interest  is  a  transgression  of  the

fundamental  principle  of  fair  administration  and

governance.   It  can  be  stated  with  certitude  that  the

principle of rule of law does not countenance such conflict

of interest. It is clear as day that the relationship between

the two individuals  and their  different  obligations expose

conflict of interest.  It is an interest where one may abuse

the public office to gain personal benefit either directly or 24 (1994) 2 Cal LJ 456 25 (1995) 6 SCC 749

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indirectly.  In the instant case, the son of the Secretary of

the association is a partner in the firm that had been given

the  contract.   The  son  might  have  been  inducted  as  a

partner at a later stage but the fact remains that the father

was the Secretary of the association.  In such a situation, it

does not require Solomon’s wisdom or, for that matter, the

wisdom  of  an  adjudicator  as  described  in  “Tripitak”  to

understand that there is conflict of interest. The Secretary

of the association, as it seems, had sent his conscience on

vacation.  

55. In  view  of  the  foregoing  analysis,  we  arrive  at  the

conclusion that the suit land, whereon 23 shops have been

constructed  and  rented  out,  belongs  to  the  State

Government; that a part of the ‘Kalyan Mandap’ is built on

the Government land and a portion of it on the leasehold

area of the association; that the association could not have

constructed  the  ‘Kalyan  Mandap’  in  this  manner  and,

therefore, the portion of the land deserves to be resumed by

the State Government; that the arrangement entered into by

the association with M/s.  INCON Associates is  absolutely

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illegal and there is a conflict of interest since the Secretary’s

son and son-in-law have been inducted as partners in the

concerned  firm;  that  there  is  revenue  loss  as  the  audit

report of  the Accountant General  is  appreciated;  that  the

Secretary  of  the  association  could  not  have  been

instrumental  in  unauthorised  construction  on  the

government land and in generating revenue therefrom; that

there  is  a  serious  concern  about  the  nature  of  revenue

generation utilisation and the loss sustained; and that the

whole thing makes us feel that there is something rotten in

the management of the affairs in fiscal aspects.

56. Having  so  concluded,  we  issue  the  following

directions:-

(i) The Collector,  Cuttack, shall  take over possession of

23 shops and the ‘Kalyan Mandap’.

(ii) The  Department  of  Revenue  shall  be  entitled  to

continue  the  tenancy  and  maintain  the  Kalyan

Mandap and manage the affairs of the said property

through District Collector, Cuttack.

(iii) No tenant or anyone shall be entitled to institute any

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litigation in any manner in respect of the said property

involved in this appeal that has arisen from T.S. No.

312 of 1991 instituted in the Court of Additional Civil

Judge, Senior Division, Cuttack.  

(iv) The government, if it decides to manage the properties

by entering into fresh agreement, is at liberty to do so.  

(v) The  agreement  between  the  association  and  M/s.

INCON Associates is declared null and void.  

(vi) As the conflict of interest is obvious and the Secretary,

who is accountable to the public, has failed to conduct

himself as required under the law, he is debarred from

contesting for any post in the association.

57. Keeping in view the report of the Accountant General

and the grave doubt that emerges with regard to realisation

of rent or otherwise, as we have already indicated earlier,

there has to be investigation and, accordingly, it is directed

that  the  Central  Bureau of  Investigation shall  investigate

into the matter keeping in view the report of the Accountant

General and the other aspects which pertain to 23 shops

and the Kalyan Mandap.  If anything ancillary is required,

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needless to say, the investigating agency can also look into

those aspects.   The Registry is directed to hand over a copy

of this order to Mr. P.K. Dey, learned counsel who ordinarily

appears for the Central Bureau of Investigation.

58. In view of the aforesaid premises,  the judgment and

order passed by the High Court remitting the matter as well

as the judgment and decree of the trial court are set aside.

The  conclusions  arrived  at  by  the  trial  court  and  the

directions given by the High Court are substituted by our

aforesaid conclusion and directions.  There shall be no order

as regards to the costs of this appeal.  

.............................J. [Dipak Misra]

............................ J.          [Praffula C. Pant] New Delhi; April  3, 2017

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