The council appointed Susan Law after a global search

Susan Law, who became managing director two years ago, contacted police over allegations about Mayor Martin Winter's involvement with the scheme.

After a lengthy inquiry prosecutors decided there was no case to answer.

Doncaster Council said Ms Law was leaving office with no admission of fault or liability on either side.

In September 2006 Doncaster Council referred allegations about Ms Law's conduct to a "Designated Independent Person".

In a statement the council said it had become clear to both parties that an investigation was going to be very long and costly.

"The parties have therefore agreed Ms Law will leave the council's employment on 31 March in order that she can continue her career elsewhere, and that the council can continue on its journey of improvement and renewal.

"It is a matter of public record that the working relationship between the Mayor Winter, members of the cabinet and the managing director have been strained for some time.

"Both parties accept that at least part of that strain arose after Ms Law referred some information relating to the Glass Park regeneration project to the police for investigation.

Doncaster's elected mayor Martin Winter was cleared by police

"That investigation did not result in any charges or action being taken against the elected mayor, or anyone else, but the council acknowledges that Ms Law was correct and was acting in accordance with her duties and advice, to refer the matters in question to the police.

"The council and Mayor Winter reaffirm their commitment to the highest standard of propriety and conduct of its affairs.

"The council emphatically denies that it is, or has, victimised Ms Law or allowed her to suffer any detriment in her employment as a result of making the (Glass Park project) report."