BDA signs Rs 11.06-cr deal without board's approval

The Bangalore Development Authority (BDA) has issued a letter of acceptance (LoA) to a firm for providing a software solution without taking the approval of its board, documents show.

The Rs 11.06-crore project pertains to the implementation and maintenance of enterprise resource planning (ERP). The unusual hurry to enter into a contract with the private firm has raised eyebrows.

In February this year, the BDA had floated short-term tenders for the selection of an agency for providing a software solution that aims to create a back-end system for managing the day-to-day activities of the authority. According to the tender document, the BDA had estimated the project cost at 15.28 crore.

Three bidders

The tenders saw the participation of three bidders. While two agencies — Maharashtra-based Soft Tech Engineers Pvt Ltd and Bengaluru-based SRIT — cleared the technical rounds, the technical scrutiny committee disqualified Idea Infinity IT Solution Services for not meeting the tender conditions.

Soft-Tech Engineers, which emerged as the lowest bidder, quoted Rs 11.06 crore, including GST.

While the BDA apparently followed the due process so far, what has raised eyebrows is its letter dated May 31, 2022.

The authority issued the letter of acceptance (LoA) without taking the board’s approval. What’s more, the BDA has also kept its decision under wraps by not issuing the customary “circulation agenda” to the board members in the absence of a board meeting.

The LoA issued to Soft Tech Engineers also promises to issue detailed work orders once the firm completes the contract agreement, non-disclosure agreement and performance bank guarantee. Such assurances are not made upfront as the board is expected to study the tenders and ascertain whether officers made due diligence.

When asked, BDA Commissioner M B Rajesh Gowda said the board’s approval was taken for implementing the project.

"The lowest bidder has quoted less than 27% of the cost estimated by the BDA. Hence, we went ahead with the formalities. The letter of acceptance was issued as no board meeting was held recently. We will ratify it in the next meeting,” he said.

B M Shivakumar, president of Jayaprakash Narayan Vichara Vedike, said the commissioner does not have the authority to issue an LoA without the board’s approval.

“Computerising the BDA’s day-to-day activities is such an important exercise. The private firm can make or break the whole system. What is the urgency to sign a contract just before the board meeting is scheduled?” Shivakumar wondered.