Bengaluru: Serious allegations have emerged against the Karnataka Public Works Department (PWD) over the award of a ₹3,190 crore road development project covering the Malur–Hoskote and adjoining stretches, by passing tender norms and financial guidelines in favour of a second-ranked bidder.
According to official records and documents accessed through the Right to Information (RTI) Act, the project involving a 123 km road corridor, later revised to 110.41 km, was originally structured under a hybrid annuity model and split into three major packages. The total estimated project cost stands at ₹3,190 crore, including construction and long-term maintenance components.
The controversy centres around Package 3 of the project, executed through the Karnataka Road Development Corporation Limited (KRDCL), where the MP 24 Constructions–Ramalingam Constructions consortium reportedly emerged as the L1 bidder during the initial technical and financial evaluation process.
However, subsequent developments indicate that the L1 bidder was later disqualified over allegations of submission of falsified work experience certificates and disputed financial credentials.
Following this, instead of issuing a fresh tender as recommended by the Finance Department, the PWD reportedly moved ahead by considering Bharat Commercial Eastern Private Limited (L2 bidder) for award of the contract worth Rs 2,477.40 crore.
The Finance Department, in its recorded opinion, had reportedly advised that in cases where the L1 bidder is disqualified before contract execution, the appropriate course of action is to forfeit the Earnest Money Deposit (EMD) and initiate a re-tender process under Karnataka Transparency in Public Procurements (KTPP) rules.
Officials had also cited provisions under Rule 25 and Rule 28, stating that only technically qualified bidders should proceed to financial evaluation and award stages.
Despite this, the PWD is alleged to have bypassed the recommendation and proceeded with awarding the contract to the L2 bidder for Rs 2,477.40 crore, triggering concerns over procedural compliance and administrative precedent.
Documents reviewed from a 935-page RTI file reportedly include correspondence between departments, tender evaluation summaries, and financial assessments. These suggest that internal disagreements existed between the Finance Department and PWD over interpretation of procurement rules.
The selected L2 bidder, Bharat Commercial Eastern Private Limited, has also come under scrutiny, with allegations that it was previously named in a Central Bureau of Investigation (CBI) FIR in an unrelated matter.
Critics argue that awarding a multi-crore infrastructure contract to a company facing ongoing scrutiny raises questions for the Congress government in Karnataka regarding due diligence and risk assessment.
The project itself involves major infrastructure upgrades, including road widening, elevated corridors in Malur industrial zones, and connectivity improvements from Devanahalli–Vemagal–Kolar to the Tamil Nadu border.
The first package is estimated at ₹958 crore, the second at ₹1,054 crore, and the third at ₹1,178 crore, with long-term operational and maintenance obligations extending up to 13 years.
Officials defending the decision argue that re-tendering the project would lead to significant delays, cost escalation, and land acquisition complications, and that the move was aimed at avoiding delays in a strategically important transport corridor.
The PWD has reportedly stated that the Finance Department’s circulars are advisory in nature and not binding statutory provisions, and therefore do not prevent awarding the contract to the next eligible bidder.
A high-level committee chaired by senior officials of the department later reviewed the matter and observed that the L2 bidder met technical eligibility requirements.
Following this, negotiations were reportedly held, and the L2 bidder agreed to execute the project at a competitive rate identical to the disqualified L1 bid, reducing the potential financial burden on the government.
However, critics argue that this justification undermines established procurement safeguards and could set a precedent for bypassing re-tender norms in future projects, potentially leading to future scams in the PWD.
Legal observers have also pointed out that Karnataka public procurement rules generally mandate fresh bidding in cases of disqualification before contract award, raising questions about procedural interpretation.
