CAG blows lid off land grab in Odisha

Central audit report shows how state acquired land forcibly for Posco, Vedanta and other industries

Published on:

30 Mar 2012, 10:56 am

A decade ago, the Naveen Patnaik government had gone all out to woo industries to Odisha by offering its three abundant natural resources—mineral, water and land. Businesss house lost no time in making a beeline to the state with projects involving thousands of crores of rupees.

But did the state utilise its resources properly? The answer is no if one goes by the report of the Comptroller and Auditor General (CAG) of India, presented in the state Legislative Assembly on Thursday. The report exposes how the government doled out land to industries without determining how much land they required.

Land blocked for Vedanta

The Comptroller and Auditor General's report dwells on the over-enthusiasm shown by the Odisha government to favour industries. Article 300 A of the Constitution envisages that no citizen could be deprived of his land except under authority of law. However, it was noticed that in anticipation of land for Sterlite Industries (India) Limited (read Vedanta) for its alumina refinery plant at Lanjigarh in Kalahandi district, the collector of Kalahandi imposed ban on sale of land in 18 villages under Lanjigarh tehsil with a view to prevent purchase by outsiders.

For further expansion of the project, the ban continued to remain in force (June 2011), thereby depriving the land-owners of their right to dispose of their property. There was no provision in the Land Acquisition Act for prohibiting sale of land.

The continuation of the ban to favour Sterlite Industries has potentially deprived land owners, mostly tribals, of the benefit of appreciation in the value of their land. What's more, in the absence of any registered sale and purchase of land, the bench-marked price of land in the area was kept artificially low. This was to allow further acquisition of land for promoters of industry at rates below their economic value, the report says.

For setting up the Vedanta University in Puri, the Anil Agarwal Foundation signed an MoU with the Higher Education department for setting up a proposed university at Puri and sought 4047 ha. The government set up a core committee headed by senior bureaucrat to monitor the project.

The CAG audit noticed that no norm or scale had been prescribed by the state for assessing land requirement for a university. Administrative approval for allotment of 2,907 ha was accorded without reference to any standards and without assigning any reason for reduction on lower side.

The land allotted to the foundation up to March 2011 was 1,597 ha. Neither any assessment of land requirement was made nor any justification for allotment of such huge area of land was found on record.

Acquisition of land for this promoter was made under Chapter VII of the Land Acquisition Act, which is meant to facilitate acquisition of land for companies. The land acquisition has since been challenged in the court.

At the cost of agriculture

Public purpose, private use

Assessed below market value

In six test checked districts, the Comptroller and Auditor General (CAG) noticed that in 35, out of 208 land acquisition cases, 1,620 ha of private land was acquired between 2006-07 and 2010-11 for Rs 318.38 crore for 10 private industries and the industrial development corporation.

Cross verification of records of concerned sub-registrars revealed compensation was under-assessed by Rs 224.29 crore due to erroneous fixation of market value of land. For assessing the market value of land to be acquired for payment of compensation, the government considers the highest market value of similar land in the concerned village on the date or nearby date of publication of notification under the Section 4 (1) of the Land Acquisition Act. In case of non availability of sales statistics of the concerned village, the same of the neighbouring village is to be considered.

The beneficiaries of the under-assessment of land are POSCO (India) Limited, Vedanta Aluminium Limited, Anil Agarwal Foundation, Dhamra Port Company Limited, ESSAR Steel Limited and Aditya Aluminium.

Land requirement not assessed

Hoarding of land

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