New Delhi: More than five years after it issued notices to the Telangana government, Bharat Heavy Electricals Limited (BHEL) and Megha Engineering Infra Limited (MEIL) to respond to allegations in connection with a Rs 35,000 crore ‘scam’ in the Palamuru-Rangareddy Lift Irrigation Scheme (PRRLIS), the Supreme Court has directed the state government and BHEL to produce the original files related to the project.
A bench comprising Chief Justice Sanjiv Khanna and Justice Sanjay Kumar issued the order on 18 December. “The State of Telangana shall produce the original file relating to the preparation of estimates. Bharat Heavy Electricals Limited shall produce the original file relating to the joint venture agreement with respondent number 13 – M/s Megha Engineering Infra Limited (MEIL)” read the order.
Additionally, the bench also ordered BHEL to file an affidavit detailing the equipment it manufactured and supplied, and the payments received for the project.
The court is seized of an appeal filed by former MLA Nagam Janardhan Reddy in which he challenged the state high court order dismissing his public interest litigation (PIL) demanding a probe by the Central Bureau of Investigation into the alleged PRRLIS scam.
The project is designed to lift 90 thousand million cubic (TMC) feet of flood water for 60 days from the foreshore of the Srisailam project reservoir on the river Krishna passing through district Mahbubnagar. It aims to transform 12.3 lakh acres of land into fertile soil. The project, inaugurated on 16 September, 2023, has four stages of pumping stations across 18 packages.
In 2017, when Reddy was part of the Bharatiya Janata Party (BJP), he had moved a PIL in the high court, challenging the contract awarded to a joint venture between BHEL and MEIL. He had alleged that it caused a loss of over Rs 2000 crore to the public exchequer, claiming that the state had “fraudulently revised the value of the equipment to be used in the project from Rs 5,960 crore to Rs 8,386 crore”.
Reddy left the Congress last year to join the Bharat Rashtra Samithi (BRS).
Notably, MEIL recently made headlines as the second-highest donor of electoral bonds, when data on purchases of the instrument to fund political parties was made public following a Supreme Court directive.
The last effective hearing on Reddy’s appeal in the Supreme Court was held on 25 August, 2022, when the respondents raised two preliminary objections relating to its maintainability.
It was claimed that Reddy was pursuing the case in the top court even as his other petitions on the same project were pending in the Telangana High Court. Therefore, the state contended, his petition was barred by the principles of constructive res judicata and accused him of suppressing material facts about his pending petitions in the high court.
Reddy’s counsel Neha Rathi told ThePrint that the court heard the parties at length on 18 December and, after considering their submissions countering the state’s version, ordered the production of the files. Responding to the twin objections. Reddy’s lawyer argued that the other petitions pending in high court, though linked to the PRRLIS project, do not talk about the corruption allegations made in his appeal before the Supreme Court.
The principle of res judicata, it was submitted, does not apply to matters of public interest unless the issues raised have been meaningfully adjudicated—a step yet to be undertaken in this case. Reddy further denied concealing details about his other petitions on the PRRLIS project, pointing out that his Supreme Court appeal included references to those cases.
According to Reddy, the Telangana government issued a government order on the PRRLIS project in 2014 and tasked the Engineering Staff College of India (ESCI) with preparing a detailed project report. In its December 2015 report, the ESCI estimated the cost of E&M equipment for the project’s four stages at Rs 5,960.79 crore.
However, Reddy alleged that this amount was illegally revised to Rs 8,386.86 crore without following proper procedures, causing a loss of Rs 2,426.07 crore. This escalation was allegedly carried out hastily within days of receiving the ESCI estimate, with technical sanction granted shortly thereafter.
“The undue haste and the information received through RTI by the appellant shows that the said escalation of Rs. 2,426 crore was done without any substantial scrutiny,” reads Reddy’s appeal in the Supreme Court, a copy of which has been accessed by ThePrint.
According to him, the state government and department concerned should have called quotations nationally and globally for the required specifications for estimates of E&M equipment instead of “following unscientific method for mechanically fixing the rates”.
Reddy’s petition also highlighted alleged flaws in the joint venture agreement between MEIL and BHEL, claiming it was designed to benefit the private company as it received excess payment compared to the work it was allotted to do.
(Edited by Radifah Kabir)
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BRS (formerly TRS) is an utterly corrupt political party. It led the movement for creation of Telangana and ultimately succeeded. But instead of building rhe newly created state, it gobbled up everything it could lay it’s hands on. It’s contribution to the progress of Telangana is negligible. All it did was promote corruption and maximize personal gain of it’s leaders.
KCR, KTR and K Kavitha – it’s the most corrupt political family in India right now. The only Indian political family which can compete in this regard are the Pawar’s of NCP. Sharad, Supriya and Ajit are just as corrupt.