4 ex-CMs named accused in ‘NICE scam’

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The controversy surrounding the Bangalore-Mysore Infrastructure Corridor (BMIC), a project taken up by Nandi Infrastructure Corridor Enterprise Ltd (NICE), reached the Lokayukta special court on Wednesday. Social activist T.J. Abraham filed a private complaint against 102 accused, including former chief ministers Deve Gowda, S.M. Krishna, Dharam Singh and B.S. Yeddyurappa, former deputy CM Siddaramaiah and NICE managing director Ashok Kheny. Terming the project the biggest fraud, the complainant alleged that several irregularities have taken place throughout the project since its launch in 1995.

Mr Abraham listed as accused then Governor of Massachusetts William Weld, present minister C.M. Udasi and former ministers D.K. Shivakumar and R.V. Deshpande, apart from bureaucrats, including Chief Secretary S.V. Ranganath. He claimed that the alleged NICE scam started with the MoU signed by a consortium of four groups sponsored by Mr William Weld in 1995 when Mr Deve Gowda was chief minister.

He submitted the complaint running into 147 pages with 3,368 pages of annexure. Mr Abraham stated: “The consortium promised to invest Rs 550 crore and to raise loan for the remaining Rs 1,000 crore. The state government leased out 1,913 acres of land at Rs 10 per acre per annum. NICE mortgaged the land with ICICI Bank and raised Rs 150-crore loan. The company deposited Rs 10 crore to KIADB from this loan.” Mr Abraham said that eight offences were committed in the project since 1995. He alleged that then ICICI Bank Chairman N. Vaghul was on the board of NICE’s sister concern – Nandi Economic Corridor Enterprises Ltd (NECEL).

It was to be originally implemented by a consortium comprising Kalyani Group, Boston-based VHB and another US-based company SAB Engineering. But in 2002, the state government allowed NICE to assign its rights to NECEL. He alleged that successive CMs allowed irregularities to continue. “Mr B.S. Yeddyurappa, who opposed the project initially, acted on the instructions of Mr Kheny and granted more land. The land for the project increased even after reducing the number of townships from seven to five. The compensation for land was fixed at the 1995 market price but distributed in 2002,” he stated. He alleged that Mr Kheny and Mr Baba Kalyani manipulated the documents to cheat the government. The Lokayukta special court posted further hearing in the complaint to Thursday.