Union Minister HD Kumaraswamy has urged motorists to stop paying tolls on Bengaluru’s NICE Road, following a Karnataka High Court judgment that labeled the project a potential scam. The court has highlighted serious issues regarding land acquisition and compensation, creating significant legal and operational uncertainty for the project developer.
Union Minister HD Kumaraswamy has issued a 7 to 10-day ultimatum to the Karnataka government, demanding an immediate halt to toll collection on the Nandi Infrastructure Corridor Enterprises (NICE) Road in Bengaluru. The Minister has urged the public to stop paying tolls, citing the project as the "biggest scam" in the state. This demand follows a critical July 29, 2026, judgment by the Karnataka High Court regarding the Bengaluru-Mysuru Infrastructure Corridor (BMIC) project.
The Karnataka High Court recently described the BMIC project as potentially one of the biggest scams in the state and recommended that the government initiate an independent forensic audit into the project's affairs. The court's observations stem from long-standing disputes concerning the implementation of the Framework Agreement, specifically allegations regarding the diversion of acquired land for commercial use, failure to pay adequate compensation to farmers, and irregularities in toll collection. In its judgment, the division bench upheld a previous order from July 2025, which had quashed certain land acquisition notifications due to the authorities' failure to determine awards or compensate land losers for over two decades.
From a business and regulatory perspective, the situation poses severe operational and legal risks for the project. The court's call for a forensic audit and the quashing of land acquisition notifications create uncertainty regarding the legal validity of the project’s infrastructure assets. The demand from a Union Minister to stop toll payments, if followed by the public, threatens to disrupt the company's primary revenue stream.
It is important for market observers to note that Nandi Infrastructure Corridor Enterprises (NICE) is an unlisted private entity. Consequently, there is no direct impact on the Indian stock exchanges, and the volatility often seen with listed infrastructure companies does not apply here. However, the case serves as a notable example of the regulatory and legal risks inherent in long-term infrastructure concession agreements, particularly those involving land acquisition and multi-decade project timelines.
The immediate future of the project remains tied to the state government's response to the court's recommendations and the pending forensic audit. Investors and stakeholders in the infrastructure sector will likely monitor whether the state government initiates the suggested independent investigation, as this could lead to further legal challenges or changes in the operational structure of the corridor. The key monitorable remains the state government's official action plan regarding the toll plazas and the judicial directives concerning the project's compliance with the original agreements.