The Andhra government has clarified that it is not cancelling the land allotted to Satyam Computer Services Ltd [Get Quote] for the proposed special economic zone in Visakhapatnam.

Had the state government cancelled the land allotted to the company -- which is under probe after its founder confessed to manipulating accounts -- the SEZ would have been scrapped, said experts.

"An SEZ gets notified after state revenue agencies confirm that the land is under the possession of the developer. In cases like these, unless a state government withdraws its approval, it cannot be scrapped," said an official.

Last week, the 20-hectare zone had got embroiled in a controversy amid reports that the state government was taking back the land. This was after allegations that the land was allotted in an unfair manner.