A plot allotted for a hotel at Nayapalli in Bhubaneswar lies unused. Telegraph picture

Bhubaneswar, April 11: The state government has suffered a loss of about Rs 300 crore by doling out prime land to individuals, companies, hotel owners and school managements at less than the benchmark value.

These allottees had promised to utilise the land for their intended projects within a stipulated time. But most of them have failed to do so and not even returned the land to the general administration department, the custodian of all land in the city.

According to the general administration department’s land allotment procedure, an allottee is required to utilise the land for the intended purpose within 36 months from the date of taking possession.

But a joint physical inspection of 98 sites by an audit team of the Comptroller and Auditor General (CAG) and the general administration department officials revealed that in 33 cases the land was not utilised even after lapse of the stipulated time. In some cases, the land has not been used even after 10 years of allotment.

“It’s just a tip of the iceberg. Many pieces of land allotted by the government near Khandagiri, Damana, Chandrasekharpur, Chandaka and Dhauli are lying unutilised,” said a senior officer of the department. The current market value of land in the audited cases is estimated to be Rs 84 crore.

A glaring example of this violation of rule is South Korean company Posco that has not been able to build a residence-cum-guest house for its chief managing director in the city though the land was given to them at a throwaway price.

Posco India Private Limited had applied for a 12,000sqft plot, but later, enhanced the requirement by two acres. Though the area was earmarked for commercial use, the company was allotted 1.7 acres on the recommendation of the department’s site selection committee at a premium of Rs 25 lakh per acre against the prevalent market value of Rs 64 per acre resulting in a loss of Rs 66 lakh.

“The land had been lying vacant since June 2012. The company, thus, was extended undue benefit in allotment of land disregarding the zonal regulation and charging of premium at a reduced rate,” the CAG report stated.

Similarly, it questioned the government’s motive in regularising the land in favour of encroachers rather than evicting them. “In 11 of 17 selected cases, the department, instead of evicting the land encroachers, allotted the land in their favour at a premium less than the market value and thereby sustained a loss of Rs 14.15 crore to the government,” the report stated.

According to the Orissa Prevention of Land Encroachment Act, 1972, acres under encroachment cannot be regularised unless the encroacher is a landless person.

Similarly, it observed that in eight of the 17 checked cases of encroachment, though 11.87 acres valued at Rs 84.21 crore was under the possession of eight encroachers, the department failed to evict them.

“The committee recommended allotment of 2.5 acres to a hospital. But, it could not be handed over as 50 to 55 persons started constructing their houses over it, and later, a slum came up there,” the report stated.

It also said that as the department did not take any step to retrieve the land from the encroachers, it lost possession of the land valued at Rs 41 crore at the current benchmark value in that locality.