Warning that a Vijay Mallya-type debacle might unfold in Karnataka too with the controversial NICE project, the Legislative Committee on Bangalore-Mysore Infrastructure Corridor (BMIC) project have demanded a probe by CBI into land allotments made for the project.
The committee submitted its report to the state assembly on Friday and recommended various actions against the promoters of BMIC project.
Law and Parliamentary affairs minister TB Jayachandra who is also the chairman of the committee alleged that the NICE company has violated as many as 16 clauses out of the original 22 clauses mentioned in the original Framework Agreement signed with the state government way back in 1997 for setting up a six-lane highway between Bengaluru and Mysuru, peripheral ring road and a link road to provide access to the Highway around Bengaluru. “The company, as per the agreement, should have constructed a concrete road but it only laid out a bitumen road and thereby violating the original agreement. Even though the technical specifications pertaining to concrete road had been eased till 2012, no effort has been made subsequently to change the composition and texture of the road,” the minister said.
Jayachandra has suggested the government to finalise “Event of Default’ for project promoter, Nandi Infrastructure Corridor Enterprise (NICE), as well as the state government to fix mutual accountability. (Event of Default refers to a circumstance where the lending party is authorised to seize any collateral to recoup a loan or property).
“Considering the modifications made to the profile of the project and the irregularities in the framework management, there is
an urgent need to institute and inquiry and fix accountability,” the minister said. Committee member S Vishwanath (BJP) termed the NICE project as a multi-crore scam. “We do not want the state to be shamed by a Mallya-type incident again. It’s a multi-crore scam and we want the government to act against the project promoter before something goes wrong,” he said.
The committee also charged the NICE Company with illegally collecting Rs 1,350 cr as toll from motorists since the road was open to public use. “The toll levied on the road from 2011-12 to 2015-16 is about Rs 1,350 crore and this is illegal as the road is not in conformity with the original agreement,” Jayachandra said. The committee has recommended the state government to forfeit the toll fee collected so far from the road users.
This apart, the committee also advised the government to withdraw over 11,600 acres of land from the acquisition process.
Explaining that the entire project from being an infrastructure project has turned into a land litigation project, Jayachandra commented, “Ultimately the sufferers are the people and farmers who have lost their land for the project. The committee noted that the project finance evaluation was itself a joke compared to the ratio of investment and returns were seen as very high.”
This apart, 605 acres of excess land is still in the hands of the company, according to the committee.
Joining the argument again, Yelahanka MLA Vishwanath said, “What is worrying even more is the callousness of the state government officials as they too have been mute about the illegalities. Had they been more alert, a high level committee headed by then chief secretary should have conducted a review and ordered cancellation of toll. Unfortunately the committee has not even met once till date.”
Further, at various phases of the project, several agreements were signed. “A tripartite agreement dated 9 August 2002 has illegally incorporated selling of land at inter-charge limit. As per the original Framework Agreement the company’s income mode should have been toll collection and selling of sites at its townships along the highway. However, taking shelter under this agreement, the company carried out transaction to the tune of Rs 4,956 cr by selling and signing joint development and mortgaging acquired land,” the committee found.
The committee which was constituted in 2014 has held 27 meetings so far and visited several sites of the NICE road. During the course of investigation into the lapses, the committee members also pointed out that they could not access several important and crucial documents pertaining to the project.