The district collector Prem Chandra Chaudhary also cancelled the transport license of contractor Maheswar Parida of Aska.
The collector took action against the two after he found that wheat seized recently from a flour mill at Ralaba in Ganjam district, was meant for distribution under public distribution system and was diverted to the mill illegally.
The inquiry report was submitted to the collector yesterday.
The collector asked the civil supply officers to lodge a case against flour mill owner Sarat Mohapatra.
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