The Karnataka government has cancelled eight tenders floated by Bengaluru Smart Infrastructure Limited (B-SMILE) for nine flyovers after a review committee found deviations and inconsistencies in the tender documents, including conditions that had not received government approval and could undermine transparency under the Karnataka Transparency in Public Procurements Act, 1999.
The Urban Development Department issued the cancellation order on October 1 based on a report submitted by a subcommittee led by Greater Bengaluru Authority Chief Commissioner Maheshwar Rao. Although the order is dated October 1, it was published on October 7. The government has directed B-SMILE to invite fresh tenders for the projects.
The order said that changing tender terms and conditions after a notification and after the tender had been opened was not reasonable from the standpoint of transparency, accountability and equal opportunity for bidders. Continuing with the tenders at the current stage would also undermine the basic purpose of the KTPP Act, according to the summary cited in the order.
The subcommittee found that documents for all eight tenders had been prepared in a similar format by combining provisions from the Union Ministry of Road Transport and Highways with the K/W-4 conditions. The documents also included provisions that were not present in either set of standards. The combined document was described as containing National Highways Authority of India standards and K/W-4 conditions, but the government had not approved the combined tender framework.
The review also identified gaps in payment and delay provisions. Payments linked to milestones after completion of the work had no specified time limit, while the tenders did not provide for interest payments in case of delays. The documents referred to MoRTH standards but framed important eligibility conditions differently from those standards.
One disputed condition required the length of a similar flyover project completed by a bidder to be at least 20% of the total length of the proposed corridor. The committee report said that MoRTH standards did not contain such a requirement. The same condition was used to reject a joint venture bidder for the proposed Minerva Circle flyover project, according to the report.
The tender documents also specified different turnover requirements for different projects without recording the source or reason for the variation. For the Rs 327-crore Pipeline Road flyover project, the required bidder turnover was considered at Rs 654.92 crore. For the Rs 538-crore flyover project from Sirsi Circle to Nayandahalli, the required turnover was set at Rscrore.
The subcommittee report said that 13 conditions outside the MoRTH and K/W-4 standards had been imposed across the eight tenders. The cancellation means that the projects will have to go through a fresh procurement process, although the government order cited in the report does not specify a new tendering schedule.
Contractors welcomed the government’s decision but called for the re-tendering process to apply the law and rules transparently. They also sought action against executive engineers and senior officials responsible for preparing or approving the disputed conditions. The government order, as reported, directs fresh tenders but does not announce disciplinary action against officials.
