The Bureau has held that Kumud Bhushan Educational Society, headed by Bhushan, was allotted 122 kanal of tea estate land in Palampur for constructing an educational insitute but the rules had been "violated".
It is "required to be confiscated to the account of the Himachal government," the Bureau had recommended.
Bhushan attacked the government move, saying it was "absurd" and "motivated".
The Vigilance Bureau had allegedly found that no educational institute existed on the land allotted to the Society.
Bhushan attacked the government move, saying it was "absurd" and "motivated" because the issue is raised whenever he had raised alleged corruption matter against Chief Minister Virbhadra Singh.
"This is an old issue which is being repeatedly raised. When I filed a complaint with CBI against Virbhadra Singh, the issue was first raised. Then when I filed a writ petition in the High Court seeking a court monitored investigation, the issue was raised. Then when the court starts hearing the matter next Wednesday, the issue is being raised," he said.
Rejecting the charge of the case being motivated, the Chief Minister said the Kangra District Collector had begun "legal proceedings" against the society "in February 2012, during BJP regime for non-utilisation of land and violation of terms and conditions of the permission".
He said the allegations by Bhushan that the inquiry had been initiated "out of vengeance" are "totally false and incorrect".