Days after the Karnataka High Court gave a scathing judgement on the pathetic implementation of the Bangalore Mysore Infrastructure Corridor (BMIC) project by the Nandi Infrastructure Corridor Enterprise (NICE), Karnataka’s politicians have focused on the lowest hanging fruit.
Most of the responses by politicians have focused on the toll collected by NICE, but there is scant attention on the company’s spectacular failure to deliver on the project nearly 30 years after it was formalised. What is conspicuous by its absence is the absolute lack of outrage from the political establishment that a private company built practically nothing despite obtaining thousands of acres of land for the project, and instead of delivering on its legal obligations, it went on to sell some of the land to private players allegedly illegally.
While BMIC has been in the news for all the wrong reasons for well over a decade, it has made headlines again due to the recent HC ruling. Dozens of landowners who had not been paid compensation for more than 20 years after their land had been acquired approached the High Court asking the court to quash the land acquisition. In 2025 a single-judge bench of the HC quashed the acquisition in favour of the landowners. A division bench upheld the order on July 29.
“The facts as disclosed would clearly suggest that there is nothing nice about the NICE project except that the farmers have been robbed of their lands and livelihood of generations without payment of compensation,” the HC said, while upholding the claims of the landowners.
But in the process, the HC also came down heavily on NICE saying it had “utterly failed” in delivering on its legal obligations and criticised the state government for failing to take action in “one of the biggest scams” in Karnataka.
“It appears that this BMICP may be one of the biggest scam in the State of Karnataka and it demonstrates how a State, which is the trustee of the natural resources on behalf of the citizens, can allow the private interest to flourish in utter violation of the constitutional mandate and the law to the detriment of environment, ecology and against the public interest for questionable considerations,” the HC said.
It continued: “The State cannot be a party in concentrating wealth in a private person, by exercising eminent domain at the cost of the innocent citizens/farmers, as the same goes against the Rule of law.”
Since HC’s ruling, Janata Dal (Secular) leader HD Kumaraswamy has been demanding that the state government take over NICE, even going to the extent of placing full page advertisements in newspapers detailing the HC’s observations. But the party’s alliance partner, the BJP, has been largely silent on the issue, except for a joint press conference after the judgement was pronounced.
Neither of the two parties, however, raised the issue during the monsoon session of the legislature which was held between August 13 and 24.
The most recent allegation that Kumaraswamy has made is to accuse Chief Minister DK Shivakumar of attempting to take over Nandi Infrastructure Corridor Enterprise (NICE), through “benami” companies.
Even though Kumaraswamy has been raising the issue of multiple illegalities involved in the BMIC project, he too has not touched on one thorny subject: the fact that Ashok Kheny, the promoter of NICE, joined the Congress two years after a legislature committee found several irregularities in the BMIC project.
Once a showpiece of the Karnataka government’s ambitions to take development beyond Bengaluru to Mysuru, the BMIC project now appears to be little more than a castle in the sky sold to the people of the state.
While NICE shows no signs of ever completing the project, consecutive state governments have largely ignored the allegations of illegalities in the project which two government reports laid bare in 2016.
Now, a decade later, the Karnataka HC’s ruling has exposed Karnataka Industrial Areas Development Board (KIADB) and the state government as little more than real estate agents who facilitate private profit under the garb of public purpose and use the legal principle of eminent domain to defend it.
BMIC: A showpiece project
The Bangalore Mysore Infrastructure Corridor project (BMIC) was conceived as a
project to provide connectivity between Bengaluru and Mysuru and promote industrial and commercial growth along the route.
A framework agreement (FWA) was signed between the government of Karnataka headed by JH Patel and Nandi Infrastructure Corridor Enterprise (NICE) on April 3, 1997. However, the project’s origins date back to 1995, when the Janata Dal government headed by HD Deve Gowda, Kumaraswamy’s father, was the Chief Minister. The FWA mandated that every component of the project be implemented strictly in accordance with the specifications in the FWA and Project Technical Report (PTR).
The FWA envisioned the construction of a 111km expressway with interchanges and toll plazas, a peripheral road of approximately 41 kilometres; and a link road of approximately 9.8 kilometres.
The project also included the construction of five self-sustaining townships with supporting infrastructure such as power, telecommunications, waste management and other civic amenities such as schools and hospitals.
Each township, ranging between an area of between 1,600 and 4,000 acres, was to have a distinct functional character—corporate, industrial, eco-tourism, heritage and commerce.
The state government acquired 20,193 acres in Bengaluru Urban and Bengaluru South districts (formerly Ramanagara) under the Karnataka Industrial Areas Development Act for the project. Initial land acquisition notices were issued between 1998 and 2009 and the final notifications between 2003 and 2009.
Although the acquisitions were challenged in the courts, the Supreme Court upheld the acquisition in judgements in 2006 and 2011.
What is the fuss about?
Although the SC upheld the land acquisition, dozens of land owners approached the Karnataka High Court seeking redressal. They alleged that although their land was acquired, the state government had not taken any steps to determine the compensation that they would be awarded. During this time, the land owners were forced into hardship as they could neither use the land, nor sell it, as it belonged to the government.
These cases were clubbed together and a single-judge bench of Justice R Devdas quashed the land acquisition of the petitioners on July 4, 2025. NICE and the Karnataka Industrial Areas Development Board then appealed the single-judge order.
In their judgement, Justices DK Singh and TM Nadaf upheld the single-judge order. But while giving its reasons for doing so, the two judges did not mince words on what they thought of the manner in which the project’s implementation—or rather lack of it—had played out.
Delivered on July 29, the judgement criticised the state government for “allowing the private interest to flourish in utter violation of the constitutional mandate” and NICE for having benefitted from the BMIC project “in an astronomical way at the expense of the landowners and the public interest in general”.
In short, the HC said what many land rights experts have alleged all along—that the legal concept of eminent domain, which gives the state to take over private property for public purpose, has often been used to facilitate private profit at public expense, with serious consequences for those whose land is acquired.
BMIC: The castle in the sky
On August 23, Kumaraswamy placed full-page advertisements in several English and Kannada dailies, to create “public awareness” about “one of the biggest scams in the state of Karnataka.”
The full page ad cited portions of the HC judgement of the project, including its sharp remarks against the state for failing to take action against NICE despite the company having failed to deliver on any of the project’s components, and NICE’s alleged illegalities and profiteering.
The advertisement also cited the findings and recommendations of a 11-member legislative committee headed by TB Jayachandra which submitted its report in 2016. One of the recommendations was that the state government take over NICE.
There was one error in the advert. Kumaraswamy claimed that the HC had recommended that an independent investigation and forensic audit be carried out.
But it would be a stretch to interpret the HC’s words as a recommendation.
The HC did say that the BMIC project was a “fit case” for an independent investigation by a special team of experts who could conduct a forensic audit of NICE and BMIC’s accounts, to unearth “fraud and other criminal acts of commissions and omissions”.
But what followed was rather cynical.
“However, we have doubt that such an exercise will ever be taken up as the State itself is accomplice in allowing the project proponents to earn huge profits illegally by diverting the lands against the FWA, capitalizing the assets, drying up the lakes, collecting huge toll in violation of the FWA and sitting over the huge land bank without payment of compensation etc.”
The HC noted that out of the 111km expressway that NICE was supposed to build, it had only managed 5km as of July 2026, according to an affidavit filed by the Additional Chief Secretary Anjum Parwez.
While NICE spent the past 25 years building just 5km of road, it also sat on over 20,000 acres of land, the HC noted, citing the 2020 Supreme Court judgement in Bangalore Mysore Infrastructure Corridor Area Planning Authority vs Nandi Infrastructure Corridor Enterprise.
A reading of the judgement provides an explanation for why the HC said what it did.
The HC had two major questions before it: although the acquisition had been upheld, could it still be sustained when the government had failed to determine compensation and were the violations of the FWA enough to disentitle NICE from appealing the single-judge order?
The HC said that the grievance of the land owners arose from the state’s failure to complete acquisition by determining the compensation.
“The real question which arises in the present appeals is whether the State, having invoked the power of eminent domain and deprived the citizens of their property, can indefinitely postpone the determination of compensation without any explanation and still insists that the acquisition must remain operative solely because vesting has taken place… Such a state of affairs, if permitted to continue indefinitely, would reduce the constitutional rights guaranteed under Article 300A to a mere formality,” the HC said, noting that no satisfactory explanation had been given for an inordinate delay of around 23 years since land had been acquired.
On the second question—were the violations of the FWA enough to disentitle NICE from appealing the single-judge order—the HC was unequivocal.
“Since the appellant-NICE has repeatedly urged that the acquisition must be protected on the ground that it forms part of a major public infrastructure project, it becomes necessary to examine whether the material now placed before this Court lends support to that submission,” the HC said.
The HC said that the landowners had produced “considerable material to demonstrate the manner in which the BMICP has been implemented which has materially deviated from the public purpose for which the lands were originally acquired.”
Joint development agreements were executed with Umang Realtech Private Limited covering 10 acres 21 guntas in Madavara and with Dhammanagi Developers Private Limited covering 20 acres 33 guntas in Kengeri in Bengaluru.
Similarly, NICE sold 12 acres in Pillaganahalli village to SBK Properties Private Limited and 13 acres 30 guntas in the same village to Darshita Housing Private Limited, and approximately 54 acres in Varahasandra, BM Kaval and Kengeri Gollahalli villages to Ajmera Housing Corporation.
In all, the court noted that there were irregularities regarding 110 acres of land that was acquired and handed over to NICE for the BMIC project. NICE’s financial statements show that the company received Rs 207 crore from the sale of the developed land and Rs 187.9 crore from toll collections in 2014-15. The following fiscal year NICE received Rs 27 crore from land sales while toll revenue stood at Rs 219 crore.
“These financial disclosures are not isolated entries. They depict a continuing commercial pattern extending over several financial years… Though these disclosures may not by themselves determine the legality of every transaction, they undoubtedly constitute relevant materials while appreciating the manner in which the project has been implemented,” the HC said.
The land owners also pointed out that NICE had in its financial statements shown completed portions of the link road and peripheral road as assets.
“The significance of such disclosures lies not in conclusively establishing any illegality, but in appreciating whether the implementation of the project has remained confined to the public purpose for which compulsory acquisition was undertaken,” the HC said.
Then came the most scathing part. “In our view, it is a fraud on the statute and Constitution. The State authorities are accomplices in this fraud and gross breaches and violations of the FWA. The proposed project has not done any public good or served any public purpose except to benefit the project proponent in unimaginable properties. The project was conceived for public purpose, but it has served only private interests of the project proponents,” the HC said.
The HC then also noted that documents submitted to the court by the state government itself showed that NICE had violated the FWA on several occasions without seeking prior approval from the state. It is this illegality that the political establishment remains focused on.
Government panel flags BMIC irregularities
Two government reports that flagged many alleged illegalities way back in 2016 are simply gathering dust.
An 11-member committee headed by the then Law Minister TB Jayachandra found that the project violated 24 out of the 30 guidelines in the Framework Agreement.
Tabled on December 2, 2016, the report recommended the withdrawal of 11,060 acres of both private (7,532 acres) and government land (3,528 acres) allotted to the project, and cancellation of NICE Road toll collection; recovery of royalty from NICE for alleged illegal mining on 242 acres of land acquired for BMIP. The panel also recommended that the land acquired for the project be returned to the original landowners.
Jayachandra has stuck to his guns and recommended that the state government take over NICE without waiting for the lease period to end.
Public Works Department Minister Satish Jarkiholi only said that the government was helpless to address the allegations against NICE’s toll collection as the Framework Agreement (FWA) would only expire in 10 years.
This, despite the fact that the department he heads had commissioned the Institute of Social and Economic Change (ISEC) to study the BMIC project in 2016.
Asked about the tolls, Home Minister Priyank Kharge told the media to pose the question to the BJP which is heading the Union government.
Both Jarkiholi and Kharge were technically correct, but their answers still did not touch on the fact that studies commissioned by their own government had slammed NICE for alleged irregularities.
Responding to allegations regarding toll collection, former Bidar MLA and Managing Director of NICE Ashok Kheny, dared the media to show the order stating that the toll collection was illegal and maintained that he followed the law.