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The one-man judicial commission led by Justice PC Ghose has pinned responsibility on former Chief Minister K Chandrashekar Rao (KCR), former Irrigation Minister T Harish Rao, and former Finance Minister Eatala Rajender for lapses in the Kaleshwaram lift irrigation project (KLIP).
Conceived as KCR’s flagship project at a cost of over Rs 1 lakh crore, the project has been mired in corruption allegations, which heightened ahead of the 2023 Assembly elections, when BRS was ousted from power after nine years.
The Ghose Commission found "rampant and brazen procedural and financial irregularities” in the project’s execution.
The Commission found that KCR was the sole decision-maker for constructing the three main barrages of KLIP at Medigadda, Annaram and Sundilla. “The Chief Minister acted not as the head of the government but as the administrative executive himself," the Commission’s findings said.
It held him liable for irregularities and illegalities in the project, along with then Minister Harish Rao.
Then Minister for Finance and Planning Eatala Rajender was a “tacit perpetrator,” “oblivious/ignorant of financial implications and rules,” and “lacked commitment and integrity in safeguarding state finances,” it said.
The Committee also recommended action against the then Chief Secretary SK Joshi, then Secretary to CM, Smitha Sabharwal, several other IAS officers, and engineers who worked on the project.
The Kaleshwaram Lift Irrigation Project or KLIP, is a multi-purpose irrigation project on the Godavari River. It was touted by the KCR government to be the world’s largest multi-stage lift irrigation project. KCR inaugurated the project in June 2019.
In October 2023, weeks before the Assembly elections, six piers of the Medigadda barrage sank, amplifying allegations of corruption and mismanagement.
After the Congress party came to power, it announced a judicial probe into the allegations of irregularities, embezzlement of public funds, and corrupt practices.
On Monday, August 4, Irrigation Minister Uttam Kumar Reddy presented a few findings of the Ghose Commission report to the media, following a Cabinet meeting.
‘KCR sole decision maker’
The Commission held KCR "directly and also vicariously accountable for the irregularities and the illegalities in planning, construction, completion, operation and maintenance of the three barrages."
The reason given for shifting one of KLIP’s key barrages from Tummidihatti to Medigadda by the previous BRS government – unavailability of water at Tummadihetti – ”does not appear to be sincere and honest,” the report said.
The decision to construct the three barrages at their present locations was solely that of KCR, it said, stating, “The then Chief Minister was pre-determined and bent upon constructing the barrage at Medigadda of his free choice, and the authorities associated with the decision-making facilitated them."
KCR’s involvement caused distress to the three barrages, it said, alleging “rank irregularity” from the conceptualisation to the issuance of administrative approvals for the Kaleshwaram project.
One of the reasons the Medigadda barrage had improper operation and maintenance, and eventually had its piers sink, is because of the impounding of water, Justice PC Ghose found. This, he alleged, was a result of KCR instructing to store water in the barrages to their full capacity for the lifting of water through the pump houses.
“[Eatala] remained as a tacit perpetrator, and [Harish Rao] allowed [KCR] to fulfil his desire,” the report said.
On Eatala, the Commission said that he demonstrated "lack of commitment and integrity in safeguarding the financial and economic health of the newly formed state," pleading ignorance of crucial financial decisions related to the project.
Eatala Rajender was the Finance Minister under the first KCR government from 2014 to 2018. He was later made Home Minister but resigned in 2021 following his unceremonious removal as Minister and suspension from the then TRS over land encroachment allegations. Eatala subsequently joined the BJP.
“[KCR] acted against the interests of the state and had no sincere, honest and conscientious mind to protect and safeguard the three barrages constructed at a huge cost of thousands of crores of public money,” the report said.
‘Expert committee ignored’
The KCR government constituted a committee of retired engineers in 2015, which concluded that constructing a barrage at Medigadda was not advisable or economical. It recommended building it at Vemanapally on Pranahita river instead of Medigadda.
Yet, KCR and Harish Rao deliberately ignored the expert committee’s report, the Commission found, noting that KCR had claimed in the Assembly that Medigadda had 500 TMC more water compared to Tummidihatti.
It also found that KCR and Harish Rao allowed the sanction of Rs 2,591 crore for the Medigadda barrage without Cabinet approval.
‘Corruption involving agencies’
The Ghose Commission said that the state government agreed to carry out certain works, including cofferdams and guide bunds, which were in the contractor's scope of work, citing verbal instructions from KCR. These works cost the government around Rs 369 crore, which the Commission reportedly called “clinching evidence” of intent to syphon public funds to unduly favour the contract agency.
It found that works were awarded to agencies even before the Detailed Project Report (DPR) by Water and Power Consultancy Services was finalised or vetted by the Central Water Commission (CWC).
Moreover, revised administrative approvals were granted without proper justification, increasing project costs while relaxing contract conditions.
This was done with “malicious intention to unduly favour the agencies" and "wrongfully syphoning the amounts from the public exchequer,” the Commission report said.
Executing agencies L&T, Afcons, and Navayuga worked in collusion with the project authorities, obtaining false completion certificates, based on which bank guarantees were released prematurely, the Commission found. The agencies were also found to have been granted other undue favours, such as unjustified extensions of time (EOTs) and relaxed contract conditions.
Roles of bureaucrats, engineers
The Commission has recommended action against many IAS officers and engineering officials, including then Secretary to Chief Minister Smita Sabharwal, then Chief Secretary SK Joshi, then Engineer-in-Chief (Irrigation) C Muralidhar, then Chief Engineer of Kaleshwaram B Hari Ram and others.
SK Joshi, C Muralidhar, and B Hari Ram suppressed the expert committee report “with malicious intention” to enable KCR and Harish Rao to go ahead with the Medigadda barrage, according to the Ghose Commission. This came at a “cost of huge public money and putting the economy of the state at stake,” the report said, recommending severe action.
Smita Sabharwal was held "negligent and irresponsible in the discharge of her duties" for failing to ensure Business Rules compliance in Cabinet approvals.
Members of the Kaleshwaram Irrigation Project Corporation Limited (KIPCL) Board, established as a Special Purpose Vehicle (SPV) to handle finances and other aspects of the project, were also held liable for their financial decisions.
The Commission also said that some of the officials questioned during the probe gave false statements and suggested that the government take appropriate action against them.
Headed by former judge of the Supreme Court Pinaki Chandra Ghose, the one-man commission submitted its report to the Telangana government on July 31. The government, on August 1, constituted a committee of three IAS officers to thoroughly study the report and prepare a summary, which was presented to the media on August 4.
