CAG Report No. 11 of 2025 — Implementation of Smart City Mission, Government of Karnataka

Introduction
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1.3 Audit Objectives
The objectives of the Performance Audit were to assess:
➢ Whether planning for the implementation of the scheme was in
convergence with other related Government schemes,
➢ Whether funds released by State Government to Cities/SPVs and
mobilization of funds by Cities/SPVs was efficient and in consideration
with objectives of the scheme,
➢ Whether projects were implemented in accordance with Smart City
Proposals (SCP) and SCM guidelines,
➢ Whether there exists mechanism for monitoring the implementation of
Smart Cities Mission and whether there exists adequate representation of
ULBs in SPVs.
1.4 Audit Criteria
The following criteria were used for evaluation of the audit objectives:
➢ Smart City Mission Guidelines
➢ Advisories issued by the Ministry of Housing and Urban Affairs
➢ Approved Smart City Proposal of the cities
➢ General Financial Rules (GFR) 2005 and 2017
➢ Government order/ OM regarding release of funds and monitoring
utilization of fund
➢ Karnataka Transparency in Public Procurement (KTPP) Act, Rules and
Orders/Circulars issued thereunder by State Governments
➢ Karnataka Public Works Departmental (KPWD) Code
➢ Indian Road Congress (IRC) guidelines
➢ Central Public Health and Environmental Engineering Organisation
(CPHEEO) guidelines
➢ Model Concessionaire Agreement and Request for Proposals (RFP)
1.5 Audit Scope and Methodology
The Performance Audit was conducted (May 2022 to December 2022, July
2023 to September 2023 and May 2024 to July 2024) to review the
implementation of the Mission since inception. It involved examination of
records in Secretariat, Urban Development Department (UDD), KUIDFC and
all the seven smart cities. Audit reviewed implementation of 187 out of 645
projects across seven smart cities through stratified random sampling6
(Appendix-1.1(a) and (b)). The scope of the PA did not include projects taken
up under convergence funding.
6 Selection was done such that 25 per cent of completed projects and 10 per cent of ongoing
projects with at least one project in each smart feature was available in the sample.