Belagavi: The House committee of the Legislative Assembly has recommended a high level investigation by either the CBI, Central Vigilance Commission or Enforcement Directorate into alleged irregularities by Nandi Infrastructure Corridor Enterprises(NICE) in implementation of the BMIC project over the last 19 years.
Tabling the report in the Assembly on Friday, Law and Parliamentary Affairs Minister, T.B. Jayachandra said the project had lost its purpose and the losers were the thousands of people, who gave up their land for it.
Claiming that the company had violated 16 of the 22 clauses laid down in the Action Plan Agreement for the project, the committee has also recommended denotifying of over 11,600 acres from the acquisition process on the basis of its assessment of NICE's land requirement through a joint survey. In its view the company already has 605 acres more than it needs.
In another recommendation it has suggested recovery of the “illegal” toll, amounting to Rs 1350 crore, collected by NICE since 2008. Recalling that the government had relaxedsome technical parameters till 2012 to help the company, the committee said it had misused this for collection of toll on the road. Also, NICE had built tar roads as against the concrete roads required under the Action Plant Agreement, it added.
Noting that during different phases of the BMIC project, many agreements were signed, it said selling of land at inter-change limits was illegally incorporated in a tripartite agreement signed on August 9, 2002.
And while NICE’s income mode should have been toll collection and selling of sites in townships, it had earned upto Rs 4956 crore through selling land, signing joint development projects and mortgaging the acquired properties.
“The private partners, during various stages of implementation, submitted different requirements of land, which led to problems. And even after 19 years the project is being implemented through theme approval without submission of Claudestel Maps. NICE has not submitted necessity, utility and excess land details to the government and has refused to provide documents using the Action Plan Agreement confidentiality clause.
Despite the government issuing comfort letters to financing agencies, the balance sheet containing project cost, investment and other details has not been submitted to it either and the returns on investment have not been specified.
Moreover, the private partners have not invested to the tune of assurances made before the courts,” the report said.
Concluding that NICE had not made any progress in the project, it recommended, “ To ascertain the role of government and private partners and fix accountability, a high level investigation has to be held.”
The not so NICE facts
Since accountability has to be fixed, investigation has to be conducted by agencies like CBI, Enforcement Directorate or Central Vigilance Commission.
As per the Framework Agreement, NICE should have executed the project within 10 years of financial closure. As it took place on March 28, 2004, the project should have been completed by 2014. And phases 1 and 2 should have been completed within eight years of financial closure, in 2012. But presently, the company has completed only 41 kms of the peripheral road in Bengaluru and 5 kms of the Express Highway
When MoU was signed in 1996 and the Framework Agreement signed in 1997, the company had not invested anything in the project. In 2001, Kalyani group industries invested Rs 21 crore, but only after government and private land was allotted to the project. The three partners , Kalyani group, VHBMIC and Sab Engineering indulged in transferring share of NICE among themselves and did not maintain personal balance sheets. Though they claim to have invested Rs 522 crore, investment is only Rs 78.37 crore.
When Mr Somashekhar Reddy filed a PIL, the company committed before the court that it would invest Rs 522 crore. However, during financial closure, the company raised a loan of Rs 150 crore by pledging the government land allotted to it and the KIADB reduced the land acquisition fee from Rs 20 crore to Rs 7.5 crore, revealing that the company did not make any investment of its own in the project.
As per the project report submitted to UTI Bank, the company said its revenue was through sale of land, proving it was into real estate business.
Of the 439 files with the PWD, 137 are missing. Many files were opened under a single number. A lower level staff admitted that some of the files were destroyed on the direction of senior officials.
The draft Framework Agreement with a foreign consortium and the state government is not available.
Captain C.R. Ramesh, the then PWD secretary, who joined NICE after retirement was instrumental in changing the original allotment of
land from 5119 acres to 6999 acres.
