ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARYversusSTATE OF ORISSA & ANR.

                       [2017] 6 S.C.R. 813



ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                    A
                                v.
                   STATE OF ORISSA & ANR.
                  (Civil Appeal No. 6450of2016)
                         APRIL 03, 2017                              B
       [DIPAK MISRA AND PRAFFULA C. PANT, JJ.]
Orissa Prevention of Land Encroachment Act, 1972:
       Encroachment on Government land - Appellant-association
was granted lease of land for construction of stadium - Dispute c
arose regarding a part of a plot on which 23 shops and a part of
Kalyan mandap was built by the appellant-association - State
contended that the said portion of land was outside the limit of the
leased out area to the appellant-association - Appellant contended
that the said part was also granted under lease and erroneously
                                                                      D
excluded by the State records - Held: A committee ofjudicial officers
was constituted to measure the lease hold area and submit report
whether the 23 shops and Kalyan mandap were within the said lease
hold land - On perusal of report of the Committee and other
materials on record, two aspects were clear (i) the appellant-
association encroached upon the property of the State Government E
and built 23 shops and, as the report of the Committee would reflect,
Kalyan mandap stands partly on the government land; (ii) the
property that stands on the government land has to go back to the
government - Further, the Ka(van Mandap should vest in the State
Government and shall be managed by the District Collector.
                                                                      F
       Audit of income derived from suit land -Appellant-association
was granted lease of land for construction of stadium - Dispute
arose regarding part of a plot on which 23 shops and a part of
Kalyan mandap was built by the appellant-association, ·which was
 also claimed by the State Government - Whether the income received
from the said land were audited and the amount derived properly G
accounted by the appellant-association - Held: The association
 has raised construction by encroaching upon the Government land
- There is a lot of gap between the figure arrived at by the
 Accountant General on the basis of the market rent and the figure
                                                                     H
                             813
814            SUPREME COURT REPORTS                        [2017] 6 S.C.R..


A    arrived at by the expert engaged by the appellant-association -
     State has shown the revenue generated after it was handed over to
     it which indubitably shows that the 23 shops were given on luwer
     rent and similarly Kalyan mandap h.ad been let out at a very low
     price or there had been collusion to show lower receipt though
     actually there was high c.ollection on rents - It has to be borne in
 B
     mind that the revenue has been generated by constructing on the
     government land and profits has been earned from the same - That
     warrants scrutiny and investigation - Central Bureau of
   - Investigation directed tu investigate into the matter keeping in view
     the report of the Accountant General and other aspects.
 c            Conflict of Interest - Appellant-association was granted lease
      of land for construction of stadium - Dispute arose regarding·a
      part of a plot on which 23 shops and a part of Kalyan mandap was
      built by the appellant-association, which was also claimed by the
      State Government - Appellant-association executed contract with
 D    Mis. 'I' for purpose of holding marriages and sun of associations
      general secretary was partner in Mis. 'I' - Further. there was
      allegation that sun and sun-in-law were also partners - In such a
      situation conflict of interest arises - Held: The suit land whereon
      23 shops were constructed and rented out, belongs to the State
      Government and a part of Kalyan Mandap is also built on the
 E    Government land - In the instant case, the son of the Secretary of
      the association is a partner in the jihn that had been given contract
      - The son might have been inducted as a partner at a later stage
      but the fact remains that the father was the Secretm:v of the
      association - The arrangement entered into by the association with
 F    A1/s. 'I' was absolutely illegal and there was conflict of interest since
      the Secreta1y s son and son-in-law were inducted as partners in the
      concerned firm; also there was revenue loss as the audit re1jort of
      the Accountant General is appreciated; the Secretary of the
       association could nut have been instrumental in unauthorised
      construction on the government land and in generating revenue
 G     therefrom; furthe1; there was serious concern about the nature of
      revenue generation utilisation and the fuss sustained - Therefore.
      the agreement between the association and Mis. 'I' declared null
      and void - The Secretary, who is accountable to the public, failed
      to conduct himself as required under law - He is debarred from
 H    contesting for any post in the association.
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                       815
                 v. STATE OF ORIS SA & ANR.

      Issuing the directions, t~e Court                                A
      HELD: 1. The report subl'nitted by the Committee headed
by the District Judge, Cuttack regarding the measurement of
lease hold area was accepted. Further, a report on audit of the
accounts in respect of 23 shops and Kalyan Mandap on disputed
land was also submitted by the Accountant General· of Odisha. 23 B
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 ha.s 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 c
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 D
let out at a very low. price or there had been collusion to show'
lower receipt tho~gh actuall)'. there was high collection on rents.
This would require investigation, [Para. 48] [874-F-H; 875-A]
      2. The controversy does not end· here; In earlier
proceedings, this Court had noted about· the indudioit of the son-     E
in-Iaw of the Secretary as a partner' in the firm Ml!! 'I' Assodates
that has entered into agreement with the association. l:{e miglit
have been inducted at a later stage. There was also all~gation
that the son and son-in-law are also partn~rs. In such a situation,
the conflict of interest 11rises. [Para 49] [~75-B] ·
                                                                       F
      3. 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             G
government land and profit has been earned from the same. That
warrants further scrutiny and investigation. [Para 50] (875-C]
      4.1 Another aspect which cannot be ignored relates to
conflict -of interest. This Court had noted that. the son and
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816            SUPREME COURT REPORTS                      [2017] 6 S.C.R.


A     son-in-law of the General Secretary of the Orissa Olympic
      Association, were partners. 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
 B
      beneficiary; or for that matter, extends the benefit ·to a person of
      immediate proximity. [Para 51) [875-D-G)
             4.2 When an administrator is discharging public function,
      he is also required to avoid any type of conflict of interest. Any
      action that would show conflict of interest is a transgression of
 c    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
 D    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. [Para 54) [878-B-E]
 E
         5. It is concluded 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
 F '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 Mis. 'I'
   Associates is absolutely illegal and there is a conflict of interest
   since the Secretary's son and son-in-law have been inducted as
 G 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
 H
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                      817
                 v. STATE OF ORI SSA & ANR..

sustained and that there is something rotten in the management        A
of the affairs in fiscal aspects. (Para 55] (878-E-H; 879-A]
      6. Having so concluded, the following directions are
issued:-
      (i) The Collector, Cuttack, shall take over possession of
23 shops and the 'Kalyan Mandap'.                                     B
       (ii) The Department of Revenue shall be entitled to continue
the tenancy and maintain the Kalyan Mand:ip and manage the
affairs of the said property through District Collector, Cuttack.
       (iii) No tenant or anyone shall be entitled to institute any   C
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.             0
     (v) The agreement between ·the association and M/s. 'I'
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 · E
post in the association. (Para 56] (879-B-E]
      · 7. Keeping in view the report of the Accountant General
and the grave doubt that emerges with regard to realisation of
rent or otherwise, there has to be investigation and, accordingly,
it is directed that the Central Bureau of Investigation shall         F
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,
the investigating agency can also look into those aspects. [Para
57] [879-F]
                                                                      G
      Gram Panchayat of Village Naulakha v. Ujagar Singh
      and others AIR (2000) SC 3272; State of Rajasthan v.
      Ha1phool Singh (dead) through his LRs. (2000) 5 SCC
      652 : (2000] 3 SCR 958; Government of Andhra
      Pradesh v. Thummala Krishna Rao and another (1982)
                                                                      H
818            SUPREME COURT REPORTS                       [2017] 6 S.C.R.


A           2 SCC 134 : (1982] 3 SCR 500; State v. Bhanu Mali
            AIR 1996 Orissa 199; Durgadevi Agarwal/a v. State
            of Orissa AIR 2014 Orissa 140; Labangalata Panda
            v. State of Orissa AIR 2002 Orissa 147; Sheyodyhan
            Singh v. Sanicharakuer [1962] 2 SCR 753; Board of
            Control for Cricket' in India v. Cricket Association of
B
            Bihar and others (2015) 3 SCC 251 : [2015] 1 SCR
            1~5; V. C. Rangadurqi v. D. Gopalan and others (1979)
            1 SCC 308 : [1979] 1 SCR 1054; Noratanmal
            Chouraria v. M.R. Murli and another (2004) 5 SCC
            689 : (2004] 1 Suppl. SCR 266 -'- referred to.
 c                           Case Law Reference
      AIR (2000) SC 3272              referred to              Para 12
       (2000] 3 SCR 958               referred to            . Para 12
      [1982) 3 SCR 500                referred to              Para 28
 D
      AIR 1996 Orissa 199             referred to              Para 28
      AIR 2014 Orissa 140             referred to              Para 28
      AIR 2002 Orissa 147             referred to              Para 28
      · [1962} 2 SCR 753              referred to              Para 29
 E
       (2015) 1 SCR 165               referred to              Para 51
       [1979) 1SCR1054                referred to              Para 52
       [2004] 1 Suppl. SCR266        . referred to             Para 53

 F          CIVIL APPELLATE JURISDICTION: Civil Appeal No. 6450
       of2016.             <>

             From the Judgment and Order dated 29.11.2014 of the High Court
       of Orissa at Cuttack in First Appeal No. 1.W of 2001.
             Raghavendra S. Srivatsa, Gaurav Khanna, Advs. for the Appellant.
 G
             Krishnayan Sen, ·uddyam Mukherjee, Himanshu Bhushan,
       Ms. Binu Tamta, Vika~ Bansal, G. S. Makkar, D. S. Mahra, Advs. for
       the Respo_udents.
             Th~ Judgment of the Court was delivered by

 H
 ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                                819
                     v. STATE OF ORISSA& ANR.

         DIPAK MISRA, J. 1. The assailment in the instant appeal, by             A
 special leave, is to the legal acceptability of the judgment and order
 dated 29.11.2014 passed by the High Court ofOrissa, Cuttack, in First
 Appeal No. 158of2001 whereby the learned Single Judge ha_s set aside
 the judgmt::nt and decree dated 16.04.1999 and 21.04.1999 respectively
 passed by the learned Additional Civil Judge, Senior Division, Cuttack in
                                                                                 8
 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 tiie 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         c
 lease of land measuring acres 20.808 decimals appertaining to Sabik
 SettlementPlotNo.156andportionsofPlotNos.139, 1.43, 155and 177
 for. the construction of a stadium. The lease deed was executed on
 04.09.!949 and registered on 24.09.1949. After obtaining the lease of
 the land, the appellant raised high compound walls enclosing the lease          D
 hold area. However, to the north eastern silie, 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 theojJlaint, subsequent to the grant of
  lease in the year 1949, the association was granted further areas for          E
· 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 compo~nd of the then Secretariat
  which is in occupation of the Branch Recruiting Qffjce. It was put forth
  that though the recorded area of Plot No. 139 was acres 7.345 decimals,        F
  yet on actual spot measurement, it was acres 6.568 decimals. It was
  asserted that the entire area was within the compound of the associatiorr
' except the area of acres 0.075 decimals that was left outside the compound
  for the purpose of parking anll the area of acres 0.048 decimals which
  was within the Secretariat endosure.                                           G
        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                 H
820             SUPREME COURT REPORTS                             [2017] 6 S.C.R.


A 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
B
  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
c 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
D
  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
 E    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
 F    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
 G    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
 H    plaintiff-association was in possession of the area as claimed. It also
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                              821
     v. STATEOFORISSA&ANR. [DIPAKMISRA,J.]

accepted that the association had constructed a massive stadium and A
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
                                                                           B
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 c
22.2.1959 for construction oflndoor 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
                                                                           D
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 E
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:-
      !. Whether the plaintiff is in possession of the suit land from the
      year 1949 and has perfected title by adverse possession?                F

      2. Whether the suit land has been recorded in Rakhit Khata due
      to lapses of the plaintiffassociation?
      3. Whether the suit land is liable to be settled on lease basis in
      favour of the plaintiff?
                                                                              G
      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
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822               SUPREME COURT REPORTS                          [2017] 6 S.C.R.



A     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
B
      No. 21311/90-91 as additional evidence and Misc. Case No. 121 of2003
      for appointment of a receiver.
             I 0. It was further urged that the suit for declaration of right, title
      and interest was not maintainable in v·iew of the provisions contained in
      the O.P.L.E. Act and the suit was barred under Section 16 of the said
 c    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 ofC.P.C. and that from the conduct
      of some State officials, it appeared that the interest of the State had not
 D    been properly safeguarded and as a result, the decr~e had been passed.
            11. It is apt to note here that an application under Order I Rule I 0
      CPC was filed in Misc. Case No. 122 of 2003 to implead Mis. Sanjit
      Sama) represented through Managing Partner, registered office at
      Mahatab Road, Cuttack-12 as respondent no. 3, Sanjit SamaL Managing
 E    Partner of Mis. INCON ASSOCIATES, Mahatab Road, Cuttack - 12
      as respondent no. 4 and Sanjaya Behera, partner of Mis. INCON
      ASSOCIATES, Slo. 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 imp leaded as co-respondents.

 F           12. The High Court referred to the decisions in Gram Panc/myat
      of Village Nau/aklia v. Ujagar Singh and others1 and State of
      Rajastltan v. Harpliool Singh (dead) through Iris LRs1 and came to
      hold as follows:-                                              ·
               "15. On perusal of the pleadings of the parties, it appears'that the
 G             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
      I   AIR 2000 SC 3272
 H    2 (2000)  s sec 652
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                              823
     v. STATE OF ORIS SA & ANR. [DIPAK MISRA, J.]

       and the trial court ought not to have accepted the said written        A
       statement as that of the defendant no. I - 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-
                                                                              B
       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
       on21.4.1999.
      I have also perused the material evidence adduced on behalf of          C
      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           D
      (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         E
      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      F
      directed to cooperate with the trial court in this regard."
       13. After so holding, the High Court dealt with the application for
appointment ofreceiver. It referred to the agreement dated 20-7-1998
between the association and M/s !neon Associates as a tenancy
agreement for a monthly rent of Rs. 17,000/-. It copiously produced the       G
terms and condiHons of the agreement and, thereafter, it observed thus:-
      "The Orissa Olympic Association is a public body. Ad1riittedly, no
      public notice was given inviting applications to invest in the
      construction ofKALYAN MANDAP. It may be remembered that
      the suit was filed after receipt of the notice in the O.P.L. E.         H
824            SUPREME COURT REPORTS                          [2017] 6 S.C.R.



A           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
B
            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."
 c
            14. The High Court took 1iote 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 Mis !neon Associates
      was under mismanagement and, accordingly, appointed the Collector,
      Cuttack to take over possession of the administration and open an interest
 D    bearing Bank Account and deposit in the said Account the rent collected
      from the tenants including the rent received from the Kalyan Mandap
      by Mis Incon Associates. It further directed as follows:-
             "20. Mis. INCON Associates is also directed to deposit the
             advance money received from the prospective occupants from
 E           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
 F           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,
 G           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 oflaw, and the same should be investigated. The report
 H
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                                   825
          v. STATE OF ORIS SA & ANR. [DIPAK MISRA, J.]

       of the Additional Director General of Police, Crime Branch and/             A
       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,             B
      the State will also be at liberty to recover the i II 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                         c
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          D
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          E
      counter affidavit need be filed. The questions that emerge for
      consideration are:
      i) Whether the lessee of the present character, that is, the Orissa
      Olympic Association, could have filed a suit for right, title and
      interest against the State, that is, the superior landlord?                  F
      ii) Whether the plea ofadverse possession can be set forth by the
      "Association" against the State, ifthe suit property is beyond the
      area granted under the lease deed?
      iii) Assuming the area in question is a part of the ·lease deed,
      whether the lessee can put forth a plea of adverse possession?               G

      iv)Assuming the suit land/property is situate within the lease hold
      area, whether the grantor, that is, the State Government, cannot
      take steps to resume the land for violation of the terms and
      conditions of the lease deed?
                                                                                   H
826            SUPREME COURT REPORTS                           [2017].6 S.C.R.



A          v) Whether the income that is received by use of the suit property
           should not be taken into account and why should it not be the legal
           obligation of the petitioner-Association to satisfy the Court that
           the accounts have been audited and the amount derived has been
           properly accounted for?
B           vi) If the accounts have not been audited, as required in law,
            whether the individuals that look after the affairs of the Association
            in respect of the suit property, would be criminally liable or not?
            vii) Whether the persons in management of the property could
            not be criminally proceeded, if it is found that they have mismanaged
 c          and utilized the income fortheir individual benefit?
            As we find, the High Court has appointed the Collector, the
            respondent No. I, as the receiver. The said part of the order reads
            as follows:-
              . "The appellant No. I - State of Orissa. represented by the
 D              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 Mis. INCON associates. M/s. INCON Associates
 E              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
 F              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
 G          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

 H
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                                827
     v. STATE OF ORISSA & ANR. [DIPAK MISRA, J.]

counsel appearing for the appellant to satisfy the Court whether the said       A
paragraph required interference and also whether proper managemei1t
of the buildings, whatsoever the character/nature may be, situate on the
disputed land, is warranted or not. The matter was adjourned tu 22.1.2015
for consideration of the necessary arrangement pertaining to management
and further hearing of the special leave petition. The interim order passed
                                                                                B
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       c
      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:-                                       D
      "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        E
      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              F
      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.                                                           G
       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,
                                                                                H
828       SUPREME COURT REPORTS                            [2017] 6 S.C.R.



A       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
        Coinmittee shall be liable to- be supervised by the Secretary,
B
        Revenue and Disaster Management. We hasten to clarify, ifthere
        is any contract which has been executed by the Association
        througq J\1/s. INC ON Associates for the purpose of holding any
        marriage that should be allowed to continue. But all correspondence
        and discussion on ev.ery aspect shall be done with the Committee.
c       The Collector may nominate one of the Committee members for
        this purpose butthe 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, Mis. INCON Associates shall not enter
        irito any fresh contract. The Committee shall take over the
 D
        management by 25.01.201 S positively. Mr. Subramaniam, learned
        senior counsel submitted that no one shat I 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. .
 E      All "tlie 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 anypne would deviate in doing so, he
        would be )fable for contempt of this Court. It will be the duty of
        the Managing Committee to see that the buildiflgs are properly
 F      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
 G     Collectorate, Cutt_ack.
       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."
 H
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                               829
     v. STATE OF ORISSA& ANR. [DIPAK MISRA, J.]

       20. The aforesaid order clearly states that it was an interim           A
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      B
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   C
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 D
      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 E
      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 F
       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.                  G
       An ancillary question may arise as to whether a lessee, especially,
       Orissa Olympic Association, which i~ involved in pubic duty, can
       be engaged in this kind of activities on a mercurial or spacious
       ground ofraising funds to sustain the stadium without the consent
       of the lessor.                                                          H
        830             SUPREME COURT REPORTS                            [2017) 6 S.C.R.



        A            Let the objection t(),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."
         B
                       21. It is apt to note here that the matter was directed to be Iisted
                on 21.4.2015 on which date the matter stood adjourned to 7.5.2015.
                Relying on the objection fo 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
         c      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:-
         D            "In view of the aforesaid, we would direct the Accountant General,
                      Odisha to restri.ct 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
         E            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
        ·F     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
         G
                     . 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 anithe
                       Kalyan Mandap are within the said lease hold area or not. Regard
                       being had to the controversy involved, we appoint the District
         H
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                               831
     v. STATE OF ORISSA&ANR. [DIPAKMISRA,J.]

       Judge, Cuttack to be the Chairman of the committee and request A
       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
                                                                            8
       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 c
       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."
                                                                            D
       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 ofKalyan 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.
                                                                               E
       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       F
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      G
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,
ifany, within four weeks. Even on that day, i.e., on 8.10.2015, Mr. Gopal
Subramaniam, learned senior counsel for the appellant, submitted that
                                                                               H
832             SUPREME COURT REPORTS                            [2017] 6 S.C.R.



A     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 scmtiny if, in the ultimate
      eventuate, the right, title and interest of the Association is established in
B
      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 forthe State has
 c           read out a passage from the impugned judgment which is quite
             shocking ifit 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 Mis. INCON Associates is the son of
 D           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 Mis. IN CON 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.
 E
             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
 F    counsel for the State that the two partners of Mis. 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 Mis.
      INCON Associates. It noted the submission of the learned counsel for
 G    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
 H    later stage.
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                                 833
     v. STATE OF ORISSA&ANR. [DIPAK MISRA, J.]

      26. Taking note of these facts, the Court directed as follows:-            A
      "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,         B
      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 qn behalf
of the appellant that by OrissaAct No. 1of1991, the Government Land C
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.th.e Orissa Government
Land Settlement Act, 1962, as amended by Orissa Act No. 1 of 1991. D
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_ E
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 dee. 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 F
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 G
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 of2002. In the writ petition,
it has been prayed that the writ petitioner be held to be deemed lessee
                                                                                 H
834             SUPREME COURT REPORTS                           [2017] 6 S.C.R.



A     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 ifthe 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
B
      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 anotlter3, State
 c    v. Bhanu Ma/i4 , Durgadevi Agarwal/a v. State of Orissa 5 , and
      Labanga/ata 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.
D         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 lt1e 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
 E 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
 F 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
 G 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
      '(1982) 2 sec 134
      4
        AIR 1996 Orissa 199
      'AIR 2014 Orissa 140
 H    0
        AIR 2002 Orissa 14 7
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                           835
              v. STATE OF ORISSA & ANR. [DIPAK MISRA, J.]

as a reference point for the measurement. On the contrary, the Committee A
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
                                                                             B
that Exhibit 1 is the copy of the application of the Appellant Association,
along with a map, for grant of lease of an area of20.808 acres; Exhibit
4 is the Sabik settlement map of! 927-1928 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 c
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
                                                                             D
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 orderofthis Court dated 07.05.15; that the task assigned
to the Committee by this Court was to find out, by measurements,
wliether the Kalyan Mandap and the 23 shops are within the leasehold E
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 ofland 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
                                                                             F
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 G
that while identifying a piece of immovable property, the boundaries prevail
over the extent/measurements and that has been held in Slteyodyhan
Singh v. Sanicharakuer 7 and for the said purpose, the documents
mentioned in the exhibits assume great significance.
7
    (   1962) 2 SCR 753                                                    H
836            SUPREME COURT REPORTS                          [2017] 6 S.C.R.



A        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
B
  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 favouroftheAppellant, Sabik Plot No.139 was a whole
  plot number and the Lease Deed specifically records that a portion of
 cSabik 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,
D the individual extents ofland 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
E 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 Am in on 01. 04 .1953. The Appellant Association had
   a lease for 20.808 Acres in 1949 and a further extent was granted in
F
   1950. The Association had requested the Government to grant another
   extent ofland 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
G 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
 H    have been ascertained. Various other aspects have been highlighted to
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                                837
     v. STATE OF ORISSA&ANR. [DIPAKMISRA,J.]

show that the report of the Committee constituted by this Court is wrong.       A
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.
                                                                                B
        32. Mr. Panigrahi, learned counsel for the State, would submit
thatthe 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                C
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          D
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 theAmin 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        E
of land on which the 'Kalyan Mandap' and 23 shops stand is in Hal Plot
No. 7(p) of Holding No. 230 ofmouza Unit-10, Cantonment. In Yadast
No. 60/1, which relates to this land, there is mention ofoccupation 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.            F
 139/1370 co-relates to Hal Plot No. 165(p). From the YadastNo. 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. I 65(p ). It is evident that the portion of land   G
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           H
838            SUPREME COURT REPORTS                          [2017] 6 S.C.R.



A     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.
B            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)whetherthe 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
 c    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 29.09.20 l 5 is reproduced be low:-
 D
             "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.
 E
             I. I As per minutes dated 04.07.2015 and 25.07.2015, the revenue
             authorities were requested to produce the foll1111 ing documents:-
             !. Original Lease deeds
             2. Sabik Settlement Maps of Lease hold area as wel I as the maps
 F               of corresponding to Hal plots .
            . 3. Plot index.
             4. Lease case record in Case No. 294 of 1995.
             5. Government sanction order No. 7484 dated 29.06.1949.
 G           6. Document regarding demarcation ofleasehold 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:
 H
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                       839
     v. STATE OF ORISSA&ANR. {DIPAKMISRA, J.]

    (i) The original lease deeds of 1949 and 1975                      A
    (ii) Government ofOrissa Revenue Department Order No. 7484
        dated 29 .06.1949 and
    (iii)Document regarding demarcation ofleasehold land by Revenue
        Authorities on measurement.
    1.3 Since the two lease deeds were not produced by the _Revenue    B
    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    C
    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.
                                                                       D
    3. Before proceeding further, the Committee resolved to place
    the following events in sequence for proper appreciation of the
    matter:-
   "(1)26/27.01.1949-
          Orissa Olympic Association (hereinafter to be referred as    E
    the OOA) made application to the Revenue CominissionerofOrissa
    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- I.
           A Sketch map was attached to the application vide
    Annex- I/a.                                                        F
    (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 - G
    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 videAnnex-2.                                            H
840     SUPREME COURT REPORTS                         [2017] 6 S.C.R.


A     (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 videAnnex-3.
                 '
      (6) 11.04.1988 - Hal ROR was published.
B
          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.
 c
      (8)02.07.1991-
           T.S. No.31211991 was instituted by the OOAagainst the State
      for declaration of title claiming Hal Plot No. 7 as part of the
      leasehold property and in alternative through adverse possession
 D    in respect of an area measuring Ac.0.705 decimals appertaining
      to Hal Plot No. 7 vide the plaintAnnex-6 and the written statement
      vide Annex- 6/a.
      (9) 21.06.1995-
          The OOA made application on 21.06.1995 for permanent lease
 E    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-7lb.
      This Jed to the institution oflease case No. 294/1995.
      (I 0) 21.06.1995-
 F        0n 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 vi de Annex 8/a.
 G
      (12) .22.07.1995-
      The Tahasildar permanently settled the land in favour of the OOA
      vide Annex-9.


 H
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                         841
     v. STATE OF ORIS SA & ANR. [DIPAK MISRA, J.]

    (13) 16.08.1995-                                                     A

         The Collector approved the order of the Tahasildar dated
    22.08.1995 vide Annex- I 0.

    (14) 16.04.1999-
                                                                         B
       The suit in T.S. No. 312/1991 was decreed in favour of the
    OOA vide Judgment Ailnex-11 and the Decree Annex- I I/a.

    (15) 01.11.2001-

        By order dated 01.11.2002 passed in OGLS Appeal No. 21           C
    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 videAnnex-12.

    (16) 05 .11.2002-

         Puisuant to the order of the R.D.C. the Tahasildar, Sardar      D
    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-                                                     E
          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" videAnnex-14.
                                                                         F
    (18) 29.11.2014-

         Hon'ble High Court ofOrissa allowed first appeal No.158/
    200 I, set aside the judgment and decree passed in T.S.No. 312/
    1991 and remanded the suit for fresh disposal vide Annex-IS.
                                                                         G
    (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.

                                                                         H
842     SUPREME COURT REPORTS                           [2017] 6 S.C.R.



A     (20) 19.08.1969-
         Lease deed for Ac.2. 703 decimal comprising of plot No. 145
      (Ac.1.116 decimals), plot No. 148(Ac.l.147), plot No. 155
      (Ac.0.440) executed in favour of the OOA vi de Annex-17.
      (21) 19.07.2003-
B         By order dated 19.07 .2003 passed in Resumption Proceeding
      Case No. 19 of2002, 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
c     Government Khata videAnnex-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.
 D    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 i~ corrected accordingly vide Annex-22.
      4. Thus the real dispute between the parties is relating to Ac.24.733
 E    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
 F    taken into Government Khata but the matter has been stayed by
      Hon'ble High Court ofOrissa in M.C. No. 3999 of2002 arising
      out ofW.P(C) No. 5360/2002.
           Thus the present controversy is confined to measure the
      leasehold area ofAc. 20.808 decimal and to determine the location
      ofKalyan Mandap (Barabati Palace) and 23 shops.
 G
      5. Keeping the above facts in the background the Committee
      determined its course of action.
           A Team consisting of Amin.s having necessary training and
      sufficient experience was constituted to carry out the measurement
 H    in presence and the supervision of the Committee.
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                           843
       v. STATE OF ORISSA&ANR. [DIPAK MISRA, J.]

      6. The names of the Am ins with the names of their respective        A
      departments are as follows:-
1. Pradipta Kumar Biswal, A.S.O.       Department of Survey
2. Bateswar Rota, Inspector            & Settlement, Cuttack
3. Chturbhuja Dhal, Inspector                                              B
4. Dhurba Charan Bhoi, Amin
5. Laxmidhara Mishra, SalaridAmin      Civil Courts, Cuttack
6. Trilochan Sahu, SalaridAmin
7. Baikuntha Ch. Baral, Salarid Amin(Retd) Civil Courts                    c
                                                Kendrapara
8. Padmanabha Acharya, R.I.                     Office of the
                                                Tahasildar,
9.Dhanjaya Behera, Amin                          Cuttack Sadar.
                                                                           D
      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
                                                                           E
      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.
                                                                           F
      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   G
      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.
                                                                           H
844     SUPREME COURT REPORTS "                       [2017] 6 S.C.R.


A     8: I Undisputedly Lease was executed on 24.09.1949 for Ac.20.808
      decimals ofland 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 ofAc.20.808 decimals includes an area ofAc.6.520
 B    decimal of Sabik Plot No. 139. As revealed from the application
      of the OOA, in Lease Case No. 294of1995 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
 c    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
 D    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,
 E    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.

 F         Further after division oforiginal Sabik Plot No. 139 into 139
      1rnd 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
 G    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.
 H
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                        845
     v. STATEOFORISSA&ANR. [DIPAKMISRA,J.]

    9. As per the programme the Committee proceeded to the spot on      A
    date fixed. The representative of the Revenue ·Authority i.e.
    Tahasildar, Cuttack Sadar and representative of the OOA, Sri
    Bhakta Harl Mohanty, Senior Advocate were present. Spot notice
    was served on them vide Annex-31.
    10. Before the commencement of the measurement the Committee        B
    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 312of1991 and the direction of the Hon'ble
    Apex Court were handed over to the twci teams of the                c
    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 D
       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"
       vi de Annex-32.                                                   E
    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 Samii Bungalow block, Thana and Sub-Registrar
       Sadar, Cuttack(Thana No.197), plot No. 156,                      F
       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     G
    OOA in TS 312 of1991 regarding leasehold area reads as follows:-
              "Para-3: The sketch map attached to the application
       dated 26/27th January, 1949 and the sanction order 291h June
       1949 will clearly indicate that the lease hold area was to the
       adjoining south ofCantonment-Tulasipur Road. After obtaining     H
846                SUPREME COURT REPORTS                     [2017] 6 S.C.R.



A               · the lease of the land the Association raised high compound
                  walls encroaching the lease hold area" vi de 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 ofland under its possession and the Takasildar granted
B          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,

 c            PS - Cuttack 197
              Kha ta             Plot No
              349                139(Part) Ac.6.222
                                 155(Part) Ac.3.856
 D                               177 (Part) Ac.0.220
              81                 156            Ac 7.272
              30                 143(Part)      Ac 3.238
                                 Total          Ac 20.808 decimals.
 E                  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             Acl.355
 F    Town,                                     192             Ac.0.825
      Unit No.IO                                190             Ac.1.452
      Cantonment           187                   191            Ac.4.359
                                                203              Ac.0.823
 G                                              200              Ac.0.456
                                                201              Ac.0.315
                                                202              Ac.1.130
                                                204              Ac.4.335
 H
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                          847
     v. STATE OF ORISSA& ANR. [DIPAK MISRA, J.]

                                         189              Ac.1.258        A
                                         167(Part)        Ac.1.050
                                         166(Part)        Ac.0.082
                                         168(Part)        Ac.0.105
                                         I 65(Part)       Ac.3.263        B

                                 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 C
    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       D
    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.     E
    13. The members of the Committee were present throughout the
    measurement that took place from 02.10.2015 to 15.10.2015 and
    26.10.20 I 5 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     F
    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 rriap. The correctness of
    fixed points were also checked by forming triangles. The G
    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.
                                                                   H
848      SUPREME COURT REPORTS                         [2017) 6 S.C.R.


A     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
 B    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
 c    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.
 D         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
 E
      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 193, 192, 190, 191, 203, 200, 201, 202, 204, 189, 167(P),
      l 66(P), 168(P) and l 65(P) shown within yellow colour in the map.
 F
      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
 G     l 65(Part), situated over·an area measuring Ac.1.13 8 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
 H
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                          849
      v. STATE OF ORISSA&ANR. [DIPAK MISRA, J.]

     remaining portion of the Kalyan Mandap (Barabati Palace) and         A
     the 23 shops measuring Ac.0.705 decimals are in Hal Plot NO.
     ?(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 isAc.0.880 decimal videAnnex-36 and outofthatAc.0.175         B
     decimals is within the compound of Army Recruitment Office
     and remaining land of Hal Plot No. 7 measuring an area ofAc.0.705
     decimal is within possession of the OOA where the 23 shops and
     a portion ofKalyan Mandap (Barabati Palace) are situated shown
     within green colour in the map.
     19. Finally the Committed unanimously comes to the conclusion
                                                                          c
     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 D
     map and 23 shops and part ofKalyan 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 E
      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'bleApex Court the Committee humbly declined to accede .
      to the request of the parties to provide any copy of the report, F
      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            G
      orders."
      35. The Committee bas 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:-
                                                                          H
850         SUPREME COURT REPORTS                     (2017] 6 S.C.R.


A
        Annexure No.                       Sub.iect
      Annexure-1       Application dated 26/27.01.1949 for lease of
                       theOOA
      Annexure -1/a    Sketch Map attached to the lease application
                       oftheOOA
B     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/l of 1990-91
      Annexure-6       Copy of the plaint in T.S. 312/1991
 c    Annexure -6/a    Written Statement in T.S. 312/1991
      Annexure-7       Application dated 21.06.1995 of the OOA for
                       oennanentlease
      Annexure -7la    Statement of the land of the OOA
      Annexure -7/b    Statement of the land of the OOA
 D    Annexure-8       Order of the RI. dated21.06.1995 in lease
                       case no. 294/1995
      Annexure -8/a    Reoort of the RI. dated21.06.1995
      Annexure-9       Order dated 22.07.1995 regarding permanent
                        lease by the Tahasildar in favour of the OOA
      Annexure -10      Aooroval of the Collector dated 16.08.1995
 E    Annexure -11      Judgment ofT.S. 312of1991
      Annexure -11/a    Decree in T.S. 312 of! 991
      Annexure -12      Lease cancellation order dated 01.11.2002 of
                        theR.D.C
      Annexure -13      ROR Correction dated 05.11.2002
 F    Annexure -14      Status quo order passed by the Hon'ble High
                        Court ofOrissa in M.C. No. 3999/2002
                        arising out of WP© 5360/2002
      Annexure -15      Judgment ofHon'ble High Court ofOrissa
                        dated 19.11.14 in Aooeal No. 158/2001
 G
      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
 H
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                              851
       v. STATE OF ORISSA & ANR. [DIPAK MISRA, J.]

                                                                              A
    Annexure -20            Corrected R.0.R
    Annexure -21            Order dated 22.05.2004 ofR.P.
                            188/2003 for taking land into Govt.
                            Khata
    Annexure -22            ROR corrected dated 19.08.2004
    Annexure -23 & 24       Committee Members Nomination letters              B
                            of the Hon'ble High Court, Orissa
    Annexure -25,25/a       Letters to Revenue Authority for
    & 25/b                  production of documents
    Annexure -26 &          Requisitions to ORSAC for OOPS and
    26/a                    ETS measurement.
    Annexure -27            Notice regarding day,date and schedule
                                                                              c
                            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
    Annexlire -29           Khasmal ROR published after
                            25.10.1949                                        D
    Annexure -30            Sabik ROR of 1932
    Annexure -31            Spot notice at Measurement site
    Annexure -32            Direction of the Apex Court in ord,er
                            dated 07.05.2015 in SLA © 343:73;14
    Annexure -33            Pleading at para-3 of the plaint in T.S.
                            312/91                                            E
    Annexure -34            Report of the Measurement Team
    Annexure -34/a          Abstract of the report of the
                            Measurement Team
    Annexure -35, 35/a      Reports of the ORSAC team
    & 35/b                                                                    F
    Annexure -36            Hal ROR of Hal Plot No. 7"

       36. The appellant filed its objections to the Report ofthe 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          G
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,
                                                                              H
852             SUPREME COURT REPORTS                            [2017] 6 S.C.R.



A     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
B     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
 c    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 cmcial documents which
      would have clinched the issue. It is further asserted that the government
D     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
 E    shows the location of Sabik Plot numbers in the relevant area. It is
      contendeq that the said map is relatable tl'! the General Revenue Record
      finalised after 25.10.1949 in favour of the association and a sub-divisio.n
      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
 F    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 appell~nt-petitioner that the leasehold
      area does not include land in the newly created Sabik Plot No. 139/1370
 G    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. 13911370 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 al.so set
 H
 ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                             853
      v. STATE OF ORISSA&ANR. [DIPAK MISRA, J.]

   forth that the Committee failed to appreciate the fact that during 1949, A
    i.e., after leasing out an area ofacres 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. 13911370. Plot No. 139 comprises B
   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'', c
   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,
                                                                                D
   which is the subject matter of the suit, could have been ascertained.
    Contemporaneous crucial records which were part 9f 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 E
    cantonment road towards Tulsipur, comprising of Plot No. 156 and portions
    of Plot Nos. 139, 143, 155and177, 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
                                                                                F
    schedule. However, the boundary to the land or the exterit 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     G
 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
                                                                              H
854             SUPREME COURT REPORTS                             [20 I 7] 6 S.C.R.


A     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. I 56 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,
 B    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
 c    for permanent le_ase for acres 6.222 dee. 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 includin~ Plot No. 7, because by that
      time, the Sabik plot numbers were not in vogue due to Hal Settlement of
 D    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
 E sanction order no. 7484 dated 29 .6.1949 and document regarding
   demarcation ofleasehold 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
   ofleasehold land by local authorities on measurement were not produced.
   The Committee, then, issued requisition of the case record of title suit
 F 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
 G 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
 H
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                            855
       v. STATE OF ORIS SA & ANR. [DIPAK MISRA, J.]

variation in two maps, for fraction plot bearing No. 139/1370 which is      A
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
                                                                            8
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,
C'uttack reported that fraction Plot No. 1370 or 139/1370 was not in        c
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           D
      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
                                                                            E
      leasehold area does not cover the entire residual area of Plot No.
      139. Hence, consideration of fraction plot No. 13911370 is of
      little consequence. Accordingly the Committee resolved to carry
      out the me~surement 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 F
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:-                G
      "Mouza- Cantonment,
         PS - Cuttack 197
      Kha ta           Plot No
      349              139(Part) Ac.6.222
                         155(Part) Ac.3.856                                 H
856                SUPREME COURT REP<?RT~                       [2017] 6 S.C.R.



A                               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
B     following Hal plots:-
      "Mouza           Khata No          Plot No.          Area
      Cuttack          187               193               Acl.355
      T9wn,                              192               Ac.0.825
 c    UnitNo.10                          190               Ac.1.452
      Cantonment        187              191               Ac.4:359
                                         203               Ac.0.823
                                         200               Ac.0.456
 D                                       201               Ac.0.315
                                         202               Ac.1.130
                                         204               Ac.4.335
                                         189               Ac.1.258
 E                                       167(Part)         Ac.1.050
                                         166(Part)         Ac.0.082
                                         168(Part)         Ac,0.105
                                          165{Part}        Ac.3.263
 F
                                         Total             Ac.20.808 dee."
             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,.
 G    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 ofleasehold 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:-
 H
ORISSAOLYMPIC ASSOCIATION TH. GENERAL SECRETARY                          857
     v. STf..TE OF ORIS SA & ANR. [DIPAK MISRA, J.]

    "17. As per the Measurement by the Measurement Team the              A
    OOA is in possession of Ac.26.502 decimal vide Annex-34.
        As per the DGPS and ETS measurement the OOA is iii
    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.                 B

     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 C
     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:-
                                                                         D
    "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
     l 65(Part), situated over an area measuring Ac.1.138 decimal and
    they are corresponding to Sabik Plot No.139.
                                                                         E
        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.
    ?(Part), shown within green color in the map, are situated outside   F
    the leasehold area.
    18.3 As per the Hal ROR the area of Hal Plot No.7 under Khata
    No.203 isAc.0.880 decimal vide Annex-36 and out ofthatAc.0.175
    decimals is within the compound of Army Recruitment Office
    and remaining land of Hal Plot No. 7 measuring an area ofAc.0.705    G
    decimal is within possession of the OOAwnere the 23 shops and
    a portion ofKalyan Mandap (Barabati Palace) are situated shown
    within green colour in the map.
    19. Finally the Committed unanimously comes to the conclusioo,
    and accordingly reports that the 1.easehold area of Ac.20.808        H
858            SUPREME COURT REPORTS                           [2017] 6 S.C.R.



A           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 ofKalyan Mandap (Barabati Palace)
            measuring Ac.0.705 decimals situated over Hal Plot No.7(Part)
B
            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
c     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
D     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 directiclll for demolition of
 E    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
 F    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
 G    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.
 H
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                                    859
     v. STATE OF ORISSA&ANR. [DIPAK MISRA,.J.]

The said authority submitted the report dated 02.07.2015 in pursuance               A
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                                                                      B
       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 thi;: Surpeme
       Court of India, Accountant General (General and Social Sector                C
       Audit), Odisha was directed(22 January 2015) by the Apex Court
       to audit the accounts of23 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.             D
       and precise Report within eight weeks.
       In compliance of above orders ofHon'ble Apex Court, Principal
       Accoi.intant 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               E
       renting out the property on land under dispute. This consists of23
       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.80.4 7
       lakh) 8 out of 50 per cent ofrent payable.
                                                                                    F
       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 of25.450
       acre of land, an area of 24. 733 acre'° was recorded in the name
       ofOOA in 1988 settlement indicating that the Record of Rights                G
       (RoR) was valid upto 198~. Out of the above, lease period for
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.           •
"0.717 acre out of25.450 acre ofland was not settled.                               H
860            SUPREME COURT REPORTS                              [2017] 6 S.C.R.



A            20.808 acre has lapsed in September 1989 and has not been
             renewed so far and the matter is sub-judice'' in High Court of
             Odisha. Out of two other parcels ofland 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
B
             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).
 c          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
 D          Kalyan Mandap by M/s. !neon 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 I.

 E          2.1 Levy and collection of rent from 23 shops and Kalyan Mandap
            OOA could not produce cow1ter-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
 F
            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 Mis. !neon-Associates towards Kalyan Mandap (Barabati
 G          Palace) was mixed up with that of Barbati Guest house (another
            building taken on hire from OOA by the same firm) due to which
      11 WP (C) No.5360/2002 and Misc. Case No.3999/2002
      12
         RP Case No.188/2003, Mutation Case No.180112004 (l.222 acre) and Vide Misc.
         Case No.19/2002 (2.703 Acre)
 •    13 Enroachment Case No.213/0111990-91. Misc. Case 263/91 arising out ofT.S. Case

 Ii      No.312/91
                                   .
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                                       861
     v. STATE OF ORIS SA & ANR. [DIPAK MISRA, J.]

       Audit had to rely on the rent ledger and audited annual accounts.               A
       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                     B
       of Rs.55.35 lakh towards rent (Rs.52,52, 788) and donation
       (Rs.2,82, I 00) 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.                                                        C
       2.1.2. Rent due and collected by OOA from M/s. lncon 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                   D
       Mandap (Barabati Palace). Out of this, rent ofRs.13,28,470 was
       received by OOA from Mis. 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                  E
       for Barabati Palace and other dues for which actual rent paid for
       Barabati Palace could not be ascertained by Audit as annual
       accounts ofOOA 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                  F
       3.
       Thus, OOA had earned a revenue ofRs.97.33 lakh during 1996-
       97 to 2014-15 (upto December2014) by utilizing the property i.e.
       23 shops and Kalyan Mandap (Barabati Palace) lying on the
       disputed land.                                                                  G
       2.1.3 Difference in income as' per the accounts of Mis. Jncon
       Associates and by the new management (Collector, Cuttack)
"Up to March 2014 Rs.40,04,718 and April to December 2014 Rs.1,94.456
"The cost of construction was borne by the private party viz. M/s. !neon Associates
 who adjusted fifty per cent of rent from monthly rent towards cost of construction.   H
862             SUPREME COURT REPORTS                                  .
                                                                     [2.017] 6 S.C.R.



A           Mis. !neon 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 ofOdisha/Honourable
            Supreme Court oflndia, the management ofBarabati Palace was
B
            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
 c          the books of Mis. 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.
 D          However, as per certified financial statements for 2007-08 to 2013-
             14, total income of Mis. Incon Associates from Barabati Palace
            was Rs. I. 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
 E
            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 ofRs.2.61 lakh within about five months (up to May
             2015). This indicated that Barabati Palace had more revenue
 F           earning potential than that disclosed in the accounts of Mis. Ineon
             Associates.
             2.1.4 Advance rent collections payable to the District
             Administration by Mis. !neon Associates
             Mis. Incon Associates vide letter No. Nil dated 2 December2014
 G           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
      16
         As per financial statement ofM/s. lncon 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 a~o not be furnished to Audit.
      17
         Excepting for 2000-01 and 2007-08 for which annual accounts were not produced to
 H       Audit.
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                                       863
     v. STATE OFORISSA&ANR. [DIPAK MISRA, J.]

       Mandap by the District Administration, the mandap was booked                    A
       by nine (9) persons and an amount ofRs.1.86 lakh was collected
       by it as per the details furnished below :
SL bate    of Name     of Money     Advance    District     Amount      I;otal
No. ~ction    the User of Receipt   Received   Adminsit-    received by tollection
              Mandap      No.    Of by         ration       District     (in Rs.)
              (S/Shri)    Barabati Manager,    money        Administ-                  B
        -                 Palace    Barabati   receipt      ration
                                    Palace     number       (in Rs.)
                                    (in Rs.)
 I.   30-Nov-   Bibekanada     144     20000    86/672130            50000    70000
      14        Swain

 2.   01-Dec-   Muna Jain      153     21000    86/672131            50000    71000    c
      14

 3.   02-Dec-   R.K.           159     20000    86/672143            50000    70000
      14        Mohapatra

 4.   03-Dec-   Gyanaranja     147     15000    87/672155            55000    70000
      14        n Swain
                                                                                       D
 5.   06-Dec-   S.S.           154     30000    87/672157            40000    70000
      14        Sharma

 6.   07-Dec-   Si bu          140     10000    87/672160            60000    70000
      14        Khuntia

 7.   09-Dec-
      14
                BC Rout        168
                                      .20000    87/672164            50000    70000
                                                                                       E
 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   F

(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 ofRs.4.45 lakh from
       the users ofKalyan Mandap. Similarly, Collector also collected
                                                                                       G
       Rs. l .20 lakh on-advance booking_of said mandap during the period
       when management remained with Mis. Incon Associates.
       However, the differential amount ofRs.0.66 lakh due to the District
       Administration has not been deposited by Mis. Incon Associates
       (June 2015). Besides, service tax amounting to Rs.90,000 was
                                                                                       H
864                 SUPREME COURT REPORTS                                [2017] 6 S.C.R.


A               neither collected from the concerned users by the Collector nor
                by Mis. lncon 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
B
                1990-91to1995-96 at a cost ofRs.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
c               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/
D               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 Mis !neon Associates running the Barabati
 E               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
 F                 as Deposit (accrual of assets against self-construction of
                   buildings) received from Mis. !neon 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
 G                  received from Mis. InconAssociates 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
      18
           Export in one year i.e. 2005-06 when OOA spent Rs.76,700 for repair and maintenance
 H of one shop
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                                 865
                                                                                       .,
     v. STATE OF ORISSA & ANR. [DIPAK MISRA, J.]

              OOA in its account was, thus, irregular as per Accounting          A.
              Standard (AS 10)
          • Besides, said asset (Building: Rs.61.3 5 lakh) was not capitalized
            based on expenditure incurred but on estimated construction
            cost atld so did not represent the actual cost of the building.
            OOA also irregularly charged depreciation for Rs.26.45 lakh          B
            during 2003-04 to 2013-14 on said building, even though title of
            the land was disputed. Besides, Mis. !neon Associates, the
            lessee of Barabati Palace, incurred expenditure towards repair
            and maintenance as well as electricity charges of the Barabati
            Palace.
                                                                                 c
      2.2.3. Non-reconciliation of accounts between OOA and Mis.
!neon Associates
          As per terms of agreement with Mis. 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, D
          while cost of construction was booked under fixed assets to be
          reduced by depreciation each year, in the accounts of Mis. !neon
          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 Mis. E
          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 Mis.
          !neon Associates had shown adjustment of Rs.13.76 lakh during F
          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 Mis. !neon Associates
          Working results and financial position of Mis. lncon Associates        G
          (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
19
     2000-01 and 2007-08 were not furnished to Audit                             H
866              SUPREME COURT REPORTS                             · [2017] 6 S.C.R.



A          businesses were clubbed. Moreover, following records could not
           be produced to Audit:
           • Cash books from 1998-99 to 2009-1 O;
           • Booking and Collection Register from 1999-00 to December
             2014;
 B
           • Money Receipts from 1999-00 onwards;
           • Bill Copies from 1999-2000 to 2009-1 O;
           • Bill Register;
 C         • Tariff charges ofKalyan Mandap .with detailed break-up.
           Hence, accounts of Mis. Incon Associates could not be relied
           upon by Audit.
           2.3 Absence of requisite due diligence in fixing revenue share
 D         2.3.1 High payback period
           The details ofrent structure for Kalyan Mandap as agreed in the
           agreements and adjustments to be done for cost of construction is
           indicated in table below:-
      SJ. Features  of l st Agreement 2"• Agreement 3" Agre<oment 4" Agreement
      No. agreement    dated 9 July dated 24 April dated 20 July dated 28 March
 E                     1996           1998          1998          2002


      1   Cost        of 10.00 lakh    25.00 lakh     40.00 lakh      80.47 lakh
          construction
          permitted
          (Rs.)
 F    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
 G        percentage of
          capital
      5   Provision for No provision   No provision   No provision     Five (5) per cent
          revision   of                                               increase once in
          rent                                                         three years


 H
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                              867
      v. STATE OF ORISSA&ANR. [DIPAK MISRA, J.]
                                              .



 6   Amount per 50 per cent of 50 per cent of 50 per cent of 50 per cent of   A
     month to be monthly rent monthly rent monthly rent monthly rent
     adjusted by
     OOA towards
     cost         of
     construction
     as reflected in
     advance                                                                  B
     deposit
     account      of
     Mis.     !neon
     Associates
 7   Actual cash 5,000           7,500            8,500        10,500
     inflow
     month
                per
                  to
                                                                              c
     OOA       after
     adjustment
     towards
     construction
     (Rs.)
 8   Tenure    of Till           Till         Till          Till      full    D
     agreement    adjustment of adjustment of adjustment of adjustment of
                  cost        of cost      of cost       of cost        of
                  construction construction construction construction
                  in full or 17 in full or 28 in full or 28
                  years          years        years
                  whichever is whichever is whichever is
                  earlier        earlier      earlier                         E
 9   Date    from l-Dec-1997     l-Dec-1998       l-Dec-1998   l-Apr-2002
     which agreed
     rent     was
     payable

(Source: Information furnished by the Manager, Barabati Palance)              F
          As can be seen from the table, Mis. 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 coristruction cost as reflected above by ratio
                                                                              G
     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
                                                                              H
868     SUPREME COURT REPORTS                           [2017] 6 S.C.R.



A     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
 B    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 oflriterrial
      Rate ofReturn (IRR) and fixing of minimum reserve percentage
 c    ofrevenue 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 Mis. Incon Associates, Audit compared the actual
      rent charged for Barabati Palace with 'Fair Rent' which is
 D    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 fairrent of such shops and kalyan Mandap (Barabati
      Palace) calculated (February-March 2015) by the competent
 E    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
 F                  Fixed (Rs.)                          (Rs.)

        1999          2,40,000         8,32,728         5,92,728
        2000          2,49,000         8,32,728         5,83,728

 G      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
 H
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                              869
       v. STATE OF ORISSA& ANR. [DIPAK MISRA, J.]

                                                                              A
     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         14,10,12~          11,35,620
                                                                              B
     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
                                                                              c
     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 Mis. /neon Associates)                               D

      Thus, it is evident from the above comparison that the rent structure
      was not fixed rationally keeping in view the cost ofland, 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       E
      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        F
      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        G
      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

                                                                              H
870             SUPREME COURT REPORTS                           [2017] 6 S.C.R.


A     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 .I
             (i) The calculation and the projection up to 2044 is wrong. The
 B           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
 c           OOA is huge in real terms.
             (ii) In regard to fixation ofrent 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
 D           warranted proportionate increase in rent.
             The capital applied was that oflncon, 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 lncon and not for
 E           sharing revenue.
              (iii) The observations of the Audit are wrong and are far from
              facts ..Audit had not gone through the arrangements entered into
              from time to time and subsequent correspondence. In all the
              arrangements it is mentioned that the vacant land is given for
              construction of Kalyan Mandap on the terms that the period of
 F
              lease is 28 years or till the adjustment of the amount of expenditure
              of Rs. 80,47,157/- incurred on construction ofKalyan 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
 G            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:

 H
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                          871
       v. STATE OF ORISSA&ANR. [DIPAKMISRA,J.]

                                                                          A
Year    Period         Rent      Rent         Rent to be   Cumulative
                       payable   receivable   adjusted     rent
                       per       during the   as     per   adjusted
                       month     year    as   agreement
                                 per
                                 agreement
                                                                          B
1       Jan-Mar 1999    20,000      60,000       30,000         30,000
                                                               .
2       1999-2000       20,000    2,40,000     1,20,000       1,50,000

3       2000-2001       20,000    2,40,000     1,20,000       2,70,000
                                                                          c
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
                                                                          D
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
                                                                         • E
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

                        23,152    2,77,824      1,38,912
                                                                          F
13      2010-2011                                            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    G
                                                       .



 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

                                                                          H
872          SUPREME COURT REPORTS                            [2017] 6 S.C.R.



A              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-
 B
          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
 c        indexed cost of property is as follows:
           Details of amount spent on construction of Kalyan Mandap are
           as follows:
      Financial      Amount         Index for   Index for th< Indexed cost of
      Year           spent          the said    financial     construction
 D                                  financial   year 2015-
                                    year        2016

      1998-1999         57,66,207     351          1081           1,77,58,603

      2000-2001       .22,80,950      406          1081             60,73,170
 E
           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
           of8% per annum (Quarterly Compounded), then the Incon would
           have got Rs. 5,74;2.2,569/- after the expiry of 28 years. In other
 F         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 INC ON.
 G         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
           ofland. The presumptions of Audit are ab initio wrong.
 H
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                         873
     v. STATE OF ORIS SA & ANR. [DIPAK MISRA, J.]

    Audit has presumed that a constructed building was rented out to A
    !neon 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
                                                                           B
    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.
                                                                          c
    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:
    I. The Principal Accountant-general has audited the accounts of D
       the Odisha Olympic Association again as directed by the Hon 'ble
       Supreme Court, to verify ifthe income by way ofrent earned
       by the OOA from 23 shops and Kalyan Mandap have been
       duly accounted for.
    2. Audit has confirmed (Para 2.1.2) that OOA had earned revenue       E
       of Rs. 97.3 3 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 ofrental income.
    3. Audit has erred in telescoping the payback period up to 2044.      F
       The agreement provided for maximum lease tenure of28 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 !neon. For Incon it is bad business and for
                                                                          G
       OOA it is a crowning success.
    4. Comparison between actual rent charged and fair rent as
       determined by Roads and buildings is not tenable as R & B
       rent is far constructed space.

                                                                          H
874            SUPREME COURT REPORTS                           [2017] 6 S.C.R.


A           Thus the Audit Report (II) establishes the contention of OQA
            that the revenue accounting ofOOA 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 Ineon has suffered huge
            loss. Therefore there is no question of any concession or favour
B           done to lncon."                                     ·
             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 ofKalyan Mandap
 c    on the term that the period oflease 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
 D    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
 E    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
 F 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
 G    by way of rent had been earned. There is a lot of gap between the figure
      arrived at by the Accountant General ofOrissa 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
 H
ORISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                                875
                                                           '
          v. STATE OF ORIS SA & ANR. [DIPAK MISRA, J.]

had been collusion to show lower receipt though actually there was high         A
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 Mis Incon Associates that has entered into
agreement with the association. He might have been inducted at a later          B
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             c
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.
                                                                                D
       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 Bi/tar and otlters10 wherein the Court, taking           E
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            F
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           G
(supra):-
         "BCCI is a very important institution that discharges important
         public functions. Demands of institutional integrity are, therefore,
20
     (2015) 3 sec 251
                                                                                H
876                SUPREME COURT REPORTS                          [2017] 6 S.C.R.


A            heavy and need to be met suitably in larger public interest.
             Individuals are birds of passage while institutions are forever. The
             expectations ofthe 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
B
             area which appears to have led to the current confusion and serious
             misgivings in the public mind as to the manner in wh_ich BCCI is .
             managing its affairs".
              52. In this regard, reference to the authority in V.C. Rangadurai
      v. D. Gopalan and others21 is seemly. In the said case, it has been held
c     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 contl ict
      of interest has been lucidly set out therein.
D            53. In Noratanmal Chouraria v. M.R. Murli and another22 ,
      whi-le 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 ofPunjab v. Ram Singh. Ex-Constable23
             noticed:
 E
              0
                  "5. Misconduct has been defined in Black's Law Dictionary,
                  6th Edn. at p. 999 thus:
                   'A transgressi_on of some established and definite rule of action,
                   a forbidden act, a dereliction from duty, unlawful-behaviour,
 F                 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:
 G                  'Any unlawful behaviour by a public officer in relation to the
                    duties of his office, wilfol in character. Term embraces acts
                    which the office-holder had no right to perform, acts performed

      21
        (t979) 1 sec 308
      22
        (2004) s sec 689
 H    "(1992) 4 sec 54
ORISSA OLYMPIC ASSOCIATION TR GENERAL SECRETARY                           877
     v. STATE OF ORISSA&ANR. [DIPAKMISRA,J.]

      improperly, and failure to act in the face of an affirmative duty   A
      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 ofjudgment. Misconduct is not necessarily the same B
      thing as conduct involving moral turpitude. The word
      misconduct is a relative term, and has to be construed with
      referenc-e 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 c
      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 an.d unskilfulness are
      transgressions of some established, but indefinite, rule of action,
      where some discretion is necessarily left to the actor. D
      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 E
      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 coonotation
     from the context, the delinquency in its performance and its effect
     on the discipline and the nature of the duty. It ma)' involve moral F
     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 G
     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
                                                                          H
87~             SUPREME COURT REPORTS                           [2017] 6 S .C.R.



A             discipline in the service causing serious effect in the maintenance
              of law and order."
              (See also Probodh Kumar Bhowmick v. University of
              Ca/cutta2 4 and B.C. Chaturvedi v. Union of lndia15 .)"
             54. We have referred to the aforesaid passages to highlight that
B     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
c     that the principle of rule of law does not countenance such conflict of
      interest. It is clear as day thatthe relationship between the two individuals
      and their different obligations expose conflict ofinterest. 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
D     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,
 E    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
 F    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 Mis. IN CON 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.
 G    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
      24
        (1994) 2 Cal LJ 456
 H    "(1995) 6 sec 749
OR.ISSA OLYMPIC ASSOCIATION TH. GENERAL SECRETARY                               879
      v. STATE OF ORISSA& ANR. [DIPAK MISRA, J.]

nature of revenue generation utilisation and the loss sustained; and that       A
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 of23 shops
          and the 'Kalyan Mandap'.                                              8

      (ii) The Department ofRevenueJihall 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   c
            in any manner in respect of the said property involved in this
           appeal that has arisen from T.S. No. 312of1991 instituted in
            the Court ofAdditional 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.
                                                                                D
      (v) The agreement between the association and Mis. INCON
          Associates is declared null and void.
      (vi) As the conflict ofinterest 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 E
           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 tharthe Central Bureau oflnvestigation shall        F
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. Ifanything 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.                     G
      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

                                                                                H.
880                SUPREME COURT REPORTS                      [2017] 6 S.C.R.


A     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.


      Ankit Gyan                                                  Directions issued.
B