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 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 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 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 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 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 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 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 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. 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 others[1] and State of Rajasthan v. Harphool
Singh (dead) through his LRs[2] 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 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 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 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 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:
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?
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?
Assuming the area in question is a part of the lease deed, whether the
lessee can put forth a plea of adverse possession?
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?
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?
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?
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?
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 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 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 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 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 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 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:-
“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.”
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 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 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 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 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 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 Court has erred without appreciating
the law in the field, especially, the decisions in Government of Andhra
Pradesh v. Thummala Krishna Rao and another[3], State v. Bhanu Mali[4],
Durgadevi Agarwalla v. State of Orissa[5], and Labangalata Panda v. State
of Orissa[6]. 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 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 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 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 Sheyodyhan Singh v. Sanicharakuer[7] 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 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 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.
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 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. 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 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.
As per minutes dated 04.07.2015 and 25.07.2015, the revenue authorities
were requested to produce the following documents:-
Original Lease deeds
Sabik Settlement Maps of Lease hold area as well as the maps of
corresponding to Hal plots.
Plot index.
Lease case record in Case No. 294 of 1995.
Government sanction order No. 7484 dated 29.06.1949.
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:
The original lease deeds of 1949 and 1975
Government of Orissa Revenue Department Order No. 7484 dated 29.06.1949 and
Document regarding demarcation of leasehold land by Revenue Authorities on
measurement.
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 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:-
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 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.
(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 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.
(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
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 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 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, 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 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
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 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 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
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 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 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|Letters to Revenue Authority for production of |
|& 25/b |documents |
|Annexure -26 & |Requisitions to ORSAC for DGPS and ETS |
|26/a |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, |Reports of the ORSAC team |
|35/a & 35/b | |
|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 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 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 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 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 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 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 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
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 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
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 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 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 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 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
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
acre[9] 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
acre[10] 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 and has not been
renewed so far and the matter is sub-judice[11] 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 khata[12]. 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
case[13] 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 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.41,99,174[14] was due to OOA towards rent of Kalyan Mandap (Barabati
Palace). Out of this, rent of Rs.13,28,470 was received by OOA from M/s.
Incon Associates, Rs.21,51,809 was adjusted[15] 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 crore[16] from
Barabati Palace towards booking charges for different events during January
1999 to December 2014[17] as per records produced by it.
At the direction of the Honorable High Court of Odisha/Honourable Supreme
Court of India, the 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 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 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, expenditure[18] 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 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.
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 2013-14[19]) 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:
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. |Features of |1st |2nd |3rd |4th |
|No. |agreement |Agreement |Agreement |Agreement |Agreement |
| | |dated 9 |dated 24 |dated 20 |dated 28 |
| | |July 1996 |April 1998|July 1998 |March 2002|
|1 |Cost of |10.00 lakh|25.00 lakh|40.00 lakh|80.47 lakh|
| |construction | | | | |
| |permitted (Rs.)| | | | |
|2 |Monthly rent |10,000 |15,000 |17,000 |21,000 |
| |payable (Rs.) | | | | |
|3 |Whether prior |Yes |No |No |No |
| |approval of | | | | |
| |General Body | | | | |
| |taken? | | | | |
|4 |Rent as |1.00 |0.6 |0.425 |0.26 |
| |percentage of | | | | |
| |capital | | | | |
|5 |Provision for |No |No |No |Five (5) |
| |revision of |provision |provision |provision |per cent |
| |rent | | | |increase |
| | | | | |once in |
| | | | | |three |
| | | | | |years |
|6 |Amount per |50 per |50 per |50 per |50 per |
| |month to be |cent of |cent of |cent of |cent of |
| |adjusted by OOA|monthly |monthly |monthly |monthly |
| |towards cost of|rent |rent |rent |rent |
| |construction as| | | | |
| |reflected in | | | | |
| |advance deposit| | | | |
| |account of M/s.| | | | |
| |Incon | | | | |
| |Associates | | | | |
|7 |Actual cash |5,000 |7,500 |8,500 |10,500 |
| |inflow per | | | | |
| |month to OOA | | | | |
| |after | | | | |
| |adjustment | | | | |
| |towards | | | | |
| |construction | | | | |
| |(Rs.) | | | | |
|8 |Tenure of |Till |Till |Till |Till full |
| |agreement |adjustment|adjustment|adjustment|adjustment|
| | |of cost of|of cost of|of cost of|of cost of|
| | |constructi|constructi|constructi|constructi|
| | |on in full|on in full|on in full|on |
| | |or 17 |or 28 |or 28 | |
| | |years |years |years | |
| | |whichever |whichever |whichever | |
| | |is earlier|is earlier|is earlier| |
|9 |Date from which|1-Dec-1997|1-Dec-1998|1-Dec-1998|1-Apr-2002|
| |agreed rent was| | | | |
| |payable | | | | |
(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
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 |Fair Rent (Rs.)|Difference |
| |Fixed (Rs.) | |(Rs.) |
|1999 |2,40,000 |8,32,728 |5,92,728 |
|2000 |2,49,000 |8,32,728 |5,83,728 |
|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 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
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.
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 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.
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 |
| | |payable |receivable|adjusted |rent |
| | |per month|during the|as per |adjusted |
| | | |year as |agreement | |
| | | |per | | |
| | | |agreement | | |
|1 |Jan-Mar |20,000 |60,000 |30,000 |30,000 |
| |1999 | | | | |
|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 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 |Amount |Index for |Index |Indexed |
|Year |spent |the said |for the |cost of |
| | |financial |financia|constructio|
| | |year |l year |n |
| | | |2015-201| |
| | | |6 | |
|1998-1999 |57,66,207|351 |1081 |1,77,58,603|
|2000-2001 |22,80,950|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 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.
In sum:
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.
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.
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.
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.
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 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 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 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 others[20] 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
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 discharges 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
corrupt 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 others[21] 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
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 another[22], 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-Constable[23] 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 behaviour, its synonyms are misdemeanour,
misdeed, misbehaviour, delinquency, impropriety, 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:
‘The term misconduct implies a wrongful intention, 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 occurs, 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 discretion is necessarily left to the actor.
Misconduct 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 ‘misconduct’ though not capable of
precise definition, on reflection receives its connotation from the
context, 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 behaviour, wilful in
character; forbidden act, a transgression of established and definite rule
of action or code of conduct but not mere error of judgment, carelessness
or negligence in performance of the duty; the act complained of bears
forbidden quality or character. Its ambit has to be construed with
reference to the subject-matter and the context wherein the term occurs,
regard being had to the scope of the statute and the public purpose it
seeks to serve. The police service is a disciplined service and it requires
to maintain strict discipline. Laxity in this behalf erodes discipline in
the service causing serious effect in the maintenance of law and order.”
(See also Probodh Kumar Bhowmick v. University of Calcutta[24] and B.C.
Chaturvedi v. Union of India[25].)”
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 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
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 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, 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
-----------------------
[1] AIR 2000 SC 3272
[2] (2000) 5 SCC 652
[3] (1982) 2 SCC 134
[4] AIR 1996 Orissa 199
[5] AIR 2014 Orissa 140
[6] AIR 2002 Orissa 147
[7] (1962) 2 SCR 753
[8] Vide agreement dated 9 July 1996 (17 years) subsequently amended vide
agreement dated 24 April 1998 and 28 March 2002
[9] Three (3) parcels of land measuring 20.808 acre, 2.703 acre and 1.939
acre.
[10] 0.717 acre out of 25.450 acre of land was not settled.
[11] WP (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)
[13] Enroachment Case No.213/01/1990-91, Misc. Case 263/91 arising out of
T.S. Case No.312/91
[14] Up to March 2014 Rs.40,04,718 and April to December 2014 Rs.1,94,456
[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.
[17] Excepting for 2000-01 and 2007-08 for which annual accounts were not
produced to Audit.
[18] Export in one year i.e. 2005-06 when OOA spent Rs.76,700 for repair
and maintenance of one shop
[19] 2000-01 and 2007-08 were not furnished to Audit
[20] (2015) 3 SCC 251
[21] (1979) 1 SCC 308
[22] (2004) 5 SCC 689
[23] (1992) 4 SCC 54
[24] (1994) 2 Cal LJ 456
[25] (1995) 6 SCC 749
-----------------------
|Sl.|Date of|Name of |Money |Advance |District |Amount |Total |
|No.|functio|the User |Receip|Received|Adminsit-|receive|Collecti|
| |n |of Mandap|t No. |by |ration |d by |on |
| | |(S/Shri) |Of |Manager,|money |Distric|(in Rs.)|
| | | |Baraba|Barabati|receipt |t | |
| | | |ti |Palace |number |Adminis| |
| | | |Palace|(in Rs.)| |tration| |
| | | | | | |(in | |
| | | | | | |Rs.) | |
|1. |30-Nov-|Bibekanad|144 |20000 |86/672130|50000 |70000 |
| |14 |a Swain | | | | | |
|2. |01-Dec-|Muna Jain|153 |21000 |86/672131|50000 |71000 |
| |14 | | | | | | |
|3. |02-Dec-|R.K. |159 |20000 |86/672143|50000 |70000 |
| |14 |Mohapatra| | | | | |
|4. |03-Dec-|Gyanaranj|147 |15000 |87/672155|55000 |70000 |
| |14 |an Swain | | | | | |
|5. |06-Dec-|S.S. |154 |30000 |87/672157|40000 |70000 |
| |14 |Sharma | | | | | |
|6. |07-Dec-|Sibu |140 |10000 |87/672160|60000 |70000 |
| |14 |Khuntia | | | | | |
|7. |09-Dec-|B C Rout |168 |20000 |87/672164|50000 |70000 |
| |14 | | | | | | |
|8. |10-Dec-|Pragyan |151 |30000 |87/672163|40000 |70000 |
| |14 |Mohapatra| | | | | |
|9. |12-Dec-|Jayanti |117 |20000 |87/672159|50000 |70000 |
| |14 |Rath | | | | | |
| | |TOTAL | |186,000 | |445,000|631,000 |
-----------------------
101
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 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 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 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 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 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 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 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 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. 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 others[1] and State of Rajasthan v. Harphool
Singh (dead) through his LRs[2] 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 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 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 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 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:
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?
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?
Assuming the area in question is a part of the lease deed, whether the
lessee can put forth a plea of adverse possession?
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?
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?
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?
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?
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 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 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 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 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 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 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:-
“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.”
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 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 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 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 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 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 Court has erred without appreciating
the law in the field, especially, the decisions in Government of Andhra
Pradesh v. Thummala Krishna Rao and another[3], State v. Bhanu Mali[4],
Durgadevi Agarwalla v. State of Orissa[5], and Labangalata Panda v. State
of Orissa[6]. 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 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 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 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 Sheyodyhan Singh v. Sanicharakuer[7] 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 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 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.
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 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. 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 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.
As per minutes dated 04.07.2015 and 25.07.2015, the revenue authorities
were requested to produce the following documents:-
Original Lease deeds
Sabik Settlement Maps of Lease hold area as well as the maps of
corresponding to Hal plots.
Plot index.
Lease case record in Case No. 294 of 1995.
Government sanction order No. 7484 dated 29.06.1949.
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:
The original lease deeds of 1949 and 1975
Government of Orissa Revenue Department Order No. 7484 dated 29.06.1949 and
Document regarding demarcation of leasehold land by Revenue Authorities on
measurement.
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 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:-
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 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.
(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 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.
(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
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 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 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, 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 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
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 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 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
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 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 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|Letters to Revenue Authority for production of |
|& 25/b |documents |
|Annexure -26 & |Requisitions to ORSAC for DGPS and ETS |
|26/a |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, |Reports of the ORSAC team |
|35/a & 35/b | |
|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 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 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 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 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 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 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 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
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 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
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 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 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 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 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
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
acre[9] 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
acre[10] 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 and has not been
renewed so far and the matter is sub-judice[11] 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 khata[12]. 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
case[13] 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 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.41,99,174[14] was due to OOA towards rent of Kalyan Mandap (Barabati
Palace). Out of this, rent of Rs.13,28,470 was received by OOA from M/s.
Incon Associates, Rs.21,51,809 was adjusted[15] 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 crore[16] from
Barabati Palace towards booking charges for different events during January
1999 to December 2014[17] as per records produced by it.
At the direction of the Honorable High Court of Odisha/Honourable Supreme
Court of India, the 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 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 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, expenditure[18] 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 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.
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 2013-14[19]) 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:
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. |Features of |1st |2nd |3rd |4th |
|No. |agreement |Agreement |Agreement |Agreement |Agreement |
| | |dated 9 |dated 24 |dated 20 |dated 28 |
| | |July 1996 |April 1998|July 1998 |March 2002|
|1 |Cost of |10.00 lakh|25.00 lakh|40.00 lakh|80.47 lakh|
| |construction | | | | |
| |permitted (Rs.)| | | | |
|2 |Monthly rent |10,000 |15,000 |17,000 |21,000 |
| |payable (Rs.) | | | | |
|3 |Whether prior |Yes |No |No |No |
| |approval of | | | | |
| |General Body | | | | |
| |taken? | | | | |
|4 |Rent as |1.00 |0.6 |0.425 |0.26 |
| |percentage of | | | | |
| |capital | | | | |
|5 |Provision for |No |No |No |Five (5) |
| |revision of |provision |provision |provision |per cent |
| |rent | | | |increase |
| | | | | |once in |
| | | | | |three |
| | | | | |years |
|6 |Amount per |50 per |50 per |50 per |50 per |
| |month to be |cent of |cent of |cent of |cent of |
| |adjusted by OOA|monthly |monthly |monthly |monthly |
| |towards cost of|rent |rent |rent |rent |
| |construction as| | | | |
| |reflected in | | | | |
| |advance deposit| | | | |
| |account of M/s.| | | | |
| |Incon | | | | |
| |Associates | | | | |
|7 |Actual cash |5,000 |7,500 |8,500 |10,500 |
| |inflow per | | | | |
| |month to OOA | | | | |
| |after | | | | |
| |adjustment | | | | |
| |towards | | | | |
| |construction | | | | |
| |(Rs.) | | | | |
|8 |Tenure of |Till |Till |Till |Till full |
| |agreement |adjustment|adjustment|adjustment|adjustment|
| | |of cost of|of cost of|of cost of|of cost of|
| | |constructi|constructi|constructi|constructi|
| | |on in full|on in full|on in full|on |
| | |or 17 |or 28 |or 28 | |
| | |years |years |years | |
| | |whichever |whichever |whichever | |
| | |is earlier|is earlier|is earlier| |
|9 |Date from which|1-Dec-1997|1-Dec-1998|1-Dec-1998|1-Apr-2002|
| |agreed rent was| | | | |
| |payable | | | | |
(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
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 |Fair Rent (Rs.)|Difference |
| |Fixed (Rs.) | |(Rs.) |
|1999 |2,40,000 |8,32,728 |5,92,728 |
|2000 |2,49,000 |8,32,728 |5,83,728 |
|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 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
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.
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 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.
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 |
| | |payable |receivable|adjusted |rent |
| | |per month|during the|as per |adjusted |
| | | |year as |agreement | |
| | | |per | | |
| | | |agreement | | |
|1 |Jan-Mar |20,000 |60,000 |30,000 |30,000 |
| |1999 | | | | |
|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 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 |Amount |Index for |Index |Indexed |
|Year |spent |the said |for the |cost of |
| | |financial |financia|constructio|
| | |year |l year |n |
| | | |2015-201| |
| | | |6 | |
|1998-1999 |57,66,207|351 |1081 |1,77,58,603|
|2000-2001 |22,80,950|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 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.
In sum:
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.
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.
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.
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.
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 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 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 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 others[20] 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
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 discharges 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
corrupt 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 others[21] 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
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 another[22], 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-Constable[23] 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 behaviour, its synonyms are misdemeanour,
misdeed, misbehaviour, delinquency, impropriety, 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:
‘The term misconduct implies a wrongful intention, 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 occurs, 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 discretion is necessarily left to the actor.
Misconduct 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 ‘misconduct’ though not capable of
precise definition, on reflection receives its connotation from the
context, 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 behaviour, wilful in
character; forbidden act, a transgression of established and definite rule
of action or code of conduct but not mere error of judgment, carelessness
or negligence in performance of the duty; the act complained of bears
forbidden quality or character. Its ambit has to be construed with
reference to the subject-matter and the context wherein the term occurs,
regard being had to the scope of the statute and the public purpose it
seeks to serve. The police service is a disciplined service and it requires
to maintain strict discipline. Laxity in this behalf erodes discipline in
the service causing serious effect in the maintenance of law and order.”
(See also Probodh Kumar Bhowmick v. University of Calcutta[24] and B.C.
Chaturvedi v. Union of India[25].)”
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 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
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 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, 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
-----------------------
[1] AIR 2000 SC 3272
[2] (2000) 5 SCC 652
[3] (1982) 2 SCC 134
[4] AIR 1996 Orissa 199
[5] AIR 2014 Orissa 140
[6] AIR 2002 Orissa 147
[7] (1962) 2 SCR 753
[8] Vide agreement dated 9 July 1996 (17 years) subsequently amended vide
agreement dated 24 April 1998 and 28 March 2002
[9] Three (3) parcels of land measuring 20.808 acre, 2.703 acre and 1.939
acre.
[10] 0.717 acre out of 25.450 acre of land was not settled.
[11] WP (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)
[13] Enroachment Case No.213/01/1990-91, Misc. Case 263/91 arising out of
T.S. Case No.312/91
[14] Up to March 2014 Rs.40,04,718 and April to December 2014 Rs.1,94,456
[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.
[17] Excepting for 2000-01 and 2007-08 for which annual accounts were not
produced to Audit.
[18] Export in one year i.e. 2005-06 when OOA spent Rs.76,700 for repair
and maintenance of one shop
[19] 2000-01 and 2007-08 were not furnished to Audit
[20] (2015) 3 SCC 251
[21] (1979) 1 SCC 308
[22] (2004) 5 SCC 689
[23] (1992) 4 SCC 54
[24] (1994) 2 Cal LJ 456
[25] (1995) 6 SCC 749
-----------------------
|Sl.|Date of|Name of |Money |Advance |District |Amount |Total |
|No.|functio|the User |Receip|Received|Adminsit-|receive|Collecti|
| |n |of Mandap|t No. |by |ration |d by |on |
| | |(S/Shri) |Of |Manager,|money |Distric|(in Rs.)|
| | | |Baraba|Barabati|receipt |t | |
| | | |ti |Palace |number |Adminis| |
| | | |Palace|(in Rs.)| |tration| |
| | | | | | |(in | |
| | | | | | |Rs.) | |
|1. |30-Nov-|Bibekanad|144 |20000 |86/672130|50000 |70000 |
| |14 |a Swain | | | | | |
|2. |01-Dec-|Muna Jain|153 |21000 |86/672131|50000 |71000 |
| |14 | | | | | | |
|3. |02-Dec-|R.K. |159 |20000 |86/672143|50000 |70000 |
| |14 |Mohapatra| | | | | |
|4. |03-Dec-|Gyanaranj|147 |15000 |87/672155|55000 |70000 |
| |14 |an Swain | | | | | |
|5. |06-Dec-|S.S. |154 |30000 |87/672157|40000 |70000 |
| |14 |Sharma | | | | | |
|6. |07-Dec-|Sibu |140 |10000 |87/672160|60000 |70000 |
| |14 |Khuntia | | | | | |
|7. |09-Dec-|B C Rout |168 |20000 |87/672164|50000 |70000 |
| |14 | | | | | | |
|8. |10-Dec-|Pragyan |151 |30000 |87/672163|40000 |70000 |
| |14 |Mohapatra| | | | | |
|9. |12-Dec-|Jayanti |117 |20000 |87/672159|50000 |70000 |
| |14 |Rath | | | | | |
| | |TOTAL | |186,000 | |445,000|631,000 |
-----------------------
101
