Bengaluru Government Forms Committee to Address Keonics Contractor Payment Backlog
The Karnataka government has established a four-member committee to clear pending payments totaling between Rs 350 and 400 crore to contractors working with Keonics. This move has sparked sharp opposition from vendors who claim they are being unfairly targeted as scapegoats in an alleged scam that dates back to the previous BJP-led administration.
Committee Mandate and Government Statements
Keonics chairman Sharath Bachegowda and IT-BT minister Priyank Kharge explained the committee's role to the media. Operating under the supervision of RDPR secretary Sameer Shukla, the panel will evaluate price discovery at the time tenders were awarded. It will also examine discrepancies such as overpayments or under-delivery of services.
This initiative follows recommendations from the Maheshwar Rao committee, which investigated suspected irregularities in Keonics tendering processes. That committee advised forming a panel with domain experts before releasing any funds to contractors.
Sharath Bachegowda stated clearly that the committee will assess the work of every contractor individually before disbursing dues. He emphasized that payments would be made based on seniority, with no intervention from Keonics or its personnel.
Minister Priyank Kharge clarified that the panel's primary function is to verify the genuineness of claims. He said the committee will not investigate the entire scam but will focus on validating whether hardware or services were actually provided. Files confirming delivery will be cleared, while bills showing mismatches with actual services rendered will be set aside for further action.
Vendor Association Raises Strong Objections
The Keonics Vendor Welfare Association has objected strongly to this exercise, questioning its legal foundation and threatening to release documents alleging internal corruption within the organization.
Vasanth Bangera, president of the association, expressed frustration with the government's approach. He stated that vendors are legally registered entities who bid properly for Keonics tenders, not roadside operators. Bangera argued there is no legal provision allowing the government to conduct price discovery after contracts have been awarded.
He revealed that vendors have been kept in the dark for over two and a half years, accusing the government of showing utter disregard for legal processes. Bangera placed responsibility for any mistakes squarely on Keonics management and officials, not on vendors who fulfilled their contractual obligations.
The association president described how false allegations of corruption have been imposed on vendors while their legitimate dues remain unpaid, making their lives miserable. He warned of escalating the matter, claiming possession of documentary evidence related to ongoing corruption within Keonics.
Bangera threatened to release all these documents within the next two or three days if Keonics proceeds with price discovery and bases payments on that assessment. He also referenced earlier claims that Minister Priyank Kharge and Chairman Sharath Bachegowda were harassing vendors, along with allegations of bribery against a former Keonics managing director.
Political Dimensions and Counter-Allegations
Minister Priyank Kharge countered the vendors' claims by alleging that some contractors collaborated with the previous BJP government to siphon off large sums from the state exchequer. This political dimension adds complexity to an already contentious situation involving substantial public funds.
The committee's work will involve comparing billed prices with prevailing market rates at the time of project execution. Officials explained that in cases of discrepancy, the committee will determine appropriate payment percentages, which could range from 10% to 100% depending on their assessment.
This development highlights ongoing tensions between government accountability measures and contractor rights in Karnataka's technology procurement sector. The outcome will significantly impact both public finances and vendor livelihoods in Bengaluru's business ecosystem.
