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

Implementation of Projects and Monitoring
27
Table 4.3: Delay in awarding the projects
Smart
City
Date of
Incorporation
Projects to
be
launched
by
Total projects taken as
of June 2024
Projects awarded within
stipulated timeline
No. of
projects
Work Order
Cost (₹ in
crore)
No. of
projects
Work Order
Cost (₹ in
crore)
BSCL 11-05-2016 11-11-2017 107 858.11 3 26.57
DSCL 19-05-2016 19-11-2017 108 918.88 1 0.45
BenSCL 03-01-2018 03-07-2019 46 850.26 10 343.77
HDSCL 10-03-2017 10-09-2018 62 930.00 6 16.45
SSCL 07-02-2017 07-08-2018 75 881.00 4 13.95
MSCL 06-04-2017 06-10-2018 59 907.19 5 11.72
TSCL 06-02-2017 06-08-2018 188 926.38 16 7.37
Total 645 6,271.82 45 420.28
Source: Information derived from the data furnished by Smart Cities
The State Government in its reply (April 2025) attributed the delays to the
Project Management Consultant (PMC) and stated that the Special Purpose
Vehicle (SPV) was slow in preparing the Detailed Project Reports (DPRs). This
cautious approach was taken to avoid potential cost overruns due to faulty
designs and drawings. However, as evidenced by the data presented in the table,
only 45 out of the 645 projects were awarded within the stipulated time frame.
This indicates significant delays in the launch of the projects, which resulted in
denial of timely benefits to the citizens who were meant to benefit from these
initiatives. Such delays not only disrupt project timelines but also hinder the
intended positive impact on the community, underscoring the need for improved
efficiency and coordination in project execution.
4.5 Delay in tender evaluation process
The KTPP Act prescribed that the tender evaluation process (from opening a
technical bid to issuing a work order) should be completed within 90 days.
Further, the maximum time gap prescribed between the opening of financial and
technical bids was 60 days. Audit observed delay in completing the tender
evaluation process as detailed below:
• The prescribed timeline for completing the tender evaluation process
was exceeded by seven to 390 days in respect of 19 out of 187 (10 per
cent) test checked works in seven smart cities.
• In respect of six projects in Davanagere, Hubballi-Dharwad and
Mangaluru, the time gap between opening of technical and financial
bids exceeded the stipulated limit of 60 days by three to 54 days.
• Five22 out of seven SPVs issued letter of intent/acceptance (LoA)
manually, though e-procurement portal has relevant provision which
was mandated (August 2018) by Government of Karnataka (GoK).
The State Government attributed the delay towards obtaining the confirmation
of work done by the bidders and appeals of non-responsive bidders. It further
22 BSCL, BenSCL, DSCL, MSCL and HDCL.