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TORONTO -- Joseph Chetti, the developer who helped drag the Ontario Realty Corp. onto the front pages this spring (inadvertently, of course), is getting ready to do it once again. But this time his action seems wholly intentional.

With auditors for the provincial real estate firm still scrutinizing the Brampton land flip that earned Mr. Chetti $2.65-million, the developer is pressing hard to close another deal he subsequently made with our obedient servants in the real estate branch, this one for a large vacant lot on the northeast corner of Ellesmere Road and McCowan Avenue in Scarborough.

Mr. Chetti hasn't managed to buy it yet, despite the fact that his deal with the ORC was supposed to close in March. (The property was appraised at $6.9-million and offered to Mr. Chetti at "five million and something," according to his lawyer, Alan Price.)

The ORC has prevailed on Mr. Chetti to accept four consecutive extensions on the Scarborough deal while his other transaction remains "under review." But Mr. Chetti appears to have lost his patience. This week, he submitted an application for a large-scale development on the Scarborough site.

Mr. Chetti's move represents the most significant challenge the ORC investigation has faced since it began. By going ahead as if he already owned the land, he is forcing the government either to come along with him in a mutually beneficial partnership, as previously agreed -- or suffer the consequences.

There's no middle ground, and the decision is nigh.

Mr. Price states boldly that the auditors hired to probe the ORC, from Grant Thornton LLP, have completed their scrutiny of his client's deals and have scheduled a meeting with government officials to bestow their "final blessing" on him.

"So far as I know, it's happening this week," he said.

ORC spokesman Judith Baird says she knows of no such meeting. But she wouldn't expect to, she added, because the audit is an independent operation.

On the other hand, the decision could be made at the ORC's scheduled board meeting this week.

If the ORC decides to close the Scarborough deal -- the fourth extension expires next week -- Mr. Chetti's application to build two high-rise condominiums, a hotel and a cluster of restaurants proceeds normally through the municipal approval process.

If the ORC balks again, there has to be a powerful reason. The government can't risk cancelling the Scarborough deal unless its auditors have uncovered bombproof evidence to justify cancelling the deal in Brampton. Mr. Chetti has a binding contract. To get out of it, the government will have to prove in court that cancelling the contract is justified.

Letting the Scarborough deal go ahead, of course, means the government owns full responsibility for the Brampton flip. It says, in effect, "There's nothing the matter with that deal we did in which Mr. Chetti paid us $1.27-million for a piece of land and sold it for $3.92-million. That was just business as usual."

Mr. Chetti's recent application to the city forces its hand. In order to register it, city officials need written authorization from the ORC that his company, McCowan Centre Inc., can act on its behalf.

"We're not going to redesignate this land on behalf of someone who has no interest in it," city planner Edward Watkins said yesterday. In light of the controversy, he added, the city "will follow up fairly aggressively on the issue of authorization."

In that light, it will be difficult for the ORC to ask for another extension while the auditors scramble to assemble a case. It has to answer yes or no to the same basic question: Is Mr. Chetti entitled to represent the interests of Ontario taxpayers?

And if not, why?

The auditors got off to a quick start when they first received the ORC file, deftly uncovering bid-rigging and cleanup scams that were news to everyone at the time. But the land deals are trickier terrain, where clear views of right and wrong are harder to come by.

The government should hope they come up soon with some sensational stuff to prove it was ripped off. Staggering incompetence is the only other alternative.