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Orders fresh probe against BSY, relatives

In a setback to former chief minister B S Yeddyurappa, the Special Lokayukta Court on Saturday rejected the ‘B’ report submitted by the Lokayukta police on January 30, absolving Yeddyurappa of any wrongdoing in the awarding of contracts for the construction works in the Upper Bhadra Project.
In a 66-page judgment, Judge N K Sudhindra Rao, while rejecting the report, directed the police to conduct further investigations not only against Yeddyurappa, but also against Dhavalagiri Properties and Sahyadri Healthcare and Diagnostics Private Limited.

While Dhavalagiri Properties is owned by Yeddyurappa’s sons B Y Vijayendra and B Y Raghavendra and son-in-law R N Sohan Kumar, Sahyadri Diagnostics lists Raghavendra, Vijayendra and Sagar Health Care and Diagnostics (with MLA Hemachandra Sagar as chairman) as shareholders in the company.

More investigations

The judge also ordered more investigations into the affairs of Murudeshwara Power Corporation Limited, a subsidiary of RNS Infrastructure, which supposedly made payments amounting to Rs 16 crore to both Dhavalagiri and Sahyadri. The investigations are to be completed within 21 days and a report is expected on June 18.

The Court ruled that B V Acharya in his capacity as senior counsel had offered legal opinion to RNS Infrastructure, making out a strong case for them to get the contract.
 
However, when Acharya became Advocate General, he was asked by the Lokayukta police to furnish legal opinion about the investigation report and he recommended that the police submit a ‘B’ report. This was improper, the court has ruled.

The Court has also rejected the findings that Yeddyurappa and his sons were legally separated in 2004 and any transactions conducted by one party could not result in the other party being held responsible for them.

The Lokayukta police had submitted the 21,000-page ‘B’ report, following directions from the Court to investigate the matter, after JD(S) leader Y S V Datta lodged a private complaint about irregularities in awarding the contract to a joint venture of RNS Infrastructure and Jyothi Limited to execute the project, even though the price quoted by them was on the higher side.

Speaking to reporters, Datta expressed happiness at the decision of the Court and stated that the ‘B’ report reflected that the investigating officer was predetermined in his approach.

“The report of the expert committee on the tender was not considered and the documents reflecting the transactions between the companies seemed fabricated,” Datta said.

Background

Karnataka Neeravari Nigam Limited had floated a tender for construction, operation and maintenance of Upper Bhadra Lift Irrigation Scheme Package 2 for lifting 21.5 tmc ft of water for irrigation and drinking purposes.

The initial amount for the tender quoted in 2003-04 was Rs 550 crore. The contract was, however, awarded only during 2008-09, when Yeddyurappa was the chief minister.

Only two companies, Kirloskar Brothers Limited and the joint venture company RNS Infrastructure-Jyothi Limited took part in the tender process. Datta has alleged that Yeddyurappa awarded the contract to RNS-Jyothi on September 30, 2008 who had quoted Rs 1,032 crore in an arbitrary manner as Karnataka Power Transmission Corporation Limited (KPTCL) as well as an expert committee had opined that both the bidders were not technically qualified to execute the project.

Murudeshwara Power Corporation Limited subsequently made two payments to two companies - a sum of Rs 6 crore to Sahyadri Health Care and Diagnostic Private Limited and a sum of Rs 10 crore to Dhavalagiri Properties Developers Private Limited.

Later, Murudeshwara signed a Memorandum of Understanding with Dhavalagiri for obtaining a portion of 69 acres of land near Shimoga.