Breaking Bulletin
Home / BUSINESS / IDCO Land Scam
IDCO Land Scam

IDCO Land Scam

IDCO Land Scam perpetuated by  Naveen Pattnaik Govt.  in Odisha ( Bulletin-2)

Srikanta ku pakal,​Core Body Member ,OSAA​,Human Rights Defender : Comptroller and Auditor General of India has undertaken performance audit of Acquisition and Allotment of land for industrial purpose by IDCO ( Odisha Industrial Infrastructure Development Corporation )   from 2000 to 2012.  The CAG has examined procedure followed in allotment of land, its purpose and identified  huge irregularities and illegalities  in  respect of allotment of land  and undue benefit granted  by IDCO  causing  crores of revenue loss to State exchequer. KIIT  and other institutions and industries   in connivance with IDCO officials  have committed  severe  irregularities  to get benefit out of land  at the cost of  state  exchequer.  In 2014, I have written extensively  about it  bring to the notice of the  readers   with the objective to sensitize them  about it. I am again reproducing the same for reference of the readers to understand how the State has been ruined by the present Govt.   reducing Odisha as most poverty-stricken state in the  country.

Irregular grant of right to mortgage land and issue of ‘No Objection Certificate’ to promoters

Government land is sanctioned in favour of IDCO for different industries under the provisions of Odisha Govt. Land Settlement Act  read with  Section 32 of OIIDC Act ( Odisha Industrial Infrastructure Development Corporation Act). The acquired land and Government land is leased to IDCO under Sections 31 and 32 of the OIIDC Act, 1980. IDCO, then sub-leases the land to concerned industries.  As Government is the primary lessor and IDCO is itself a lessee, permission of the primary lessor was to be obtained in order to confer mortgage rights to the sub-lessee, i.e., the industries in order to raise loans for their industrial projects on the basis of the land allotted to them.

Audit however, noticed that:

IDCO irregularly conferred mortgage rights in the lease deeds executed with 52 MoU based and 54 non-MoU industries while handing over of possession of 46732.894 acre land, even though such power was not vested with IDCO by the State Government.

Besides, IDCO irregularly issued ‘No Objection Certificates’ (NOC) to 26 MoU based industries for mortgaging 13846.238 acre land allotted in order to raise loans from financial institutions, even though it was not authorised to do so. Audit further noticed that on the basis of NOCs issued by IDCO, loans of  ` 52423.50 crore was sanctioned by financial institutions in case of 12 promoters of MoU based industries, for mortgage of 8489.828 acre of allotted land. As per information collected from these financial institutions, five out of above 12 industries have been released loan of ` 8625.89 crore. In case of remaining 14 industries, quantum of actual loan sanctioned/ availed on mortgage of land was not made available by IDCO to Audit.

However, from the audited annual accounts of seven out of  these 14 industries to whom NOC was given by IDCO, Audit noticed that the land was mortgaged with the financial institutions along with other fixed assets to avail a total loan of ` 28214.45 crore. In 32 Industrial Estates, IDCO also irregularly issued NOC to 736 small and medium industrial units allowing mortgaging land allotted to them during 2001-12.

Thus, IDCO unauthorisedly issued such NOCs, thereby enabling industries to raise loans on the basis of land allotted for industrial purpose, without adequate safeguards to ensure that such capital would actually be used in the industrial projects concerned.

RDM Department stated (April 2013) that as IDCO had not been conferred with the power for grant of such permission to industries/ promoter companies, the  matter was examined in consultation with Law Department and IDCO has been advised to move the Industries Department to bring enabling provision in OIIDC Act/ Rules for the purpose. The Department also instructed IDCO to submit necessary proposal with detailed justification for examination on case to case basis.

About Srinivas Mohanty

Leave a Reply

Your email address will not be published.

Scroll To Top