The Karnataka High Court upheld an order quashing land acquisition proceedings for construction of Bengaluru-Mysuru Infrastructure Corridor Project (BMICP) observing that there was "nothing nice about the" NICE [Nandi Infrastructure Corridor Enterpris] project except that farmers were robbed of their lands without being compensated. [2026 LiveLaw (Kar) 273]

In doing so the court dismissed appeals filed by Nandi Infrastructure Corridor Enterprise (NICE) and the Karnataka Industrial Areas Development Board (KIADB), challenging the single judge's order.

The Division Bench of Justice D. K Singh and Justice T.M Nadaf said that the project appears to be 'one of the biggest scams'.

“…The facts as disclosed would clearly suggest that there is nothing nice about the NICE project except that the farmers have been robbed of their lands and livelihood of generations without payment of compensation …We have been informed that out of 111 kms Expressway, the NICE has constructed only 5 kilometres Expressway in the last 25-26 years as per the affidavit dated 28.07.2026 filed by…Additional Chief Secretary, PWD. The NICE is sitting over huge land bank of more than 20,000 acres, and the land and the assets have been alienated and capitalized to its benefit…”, the court pointed out in the order.

It also noted that the above factual aspects denote that the project is in violation of Supreme Court's order in Bangalore Mysore Infrastructure Corridor Area Planning Authority v. Nandi Infrastructure Corridor Enterprise Ltd. & Ors (2021) and in violation of the terms of Framework Agreement (FWA) executed between the Karnataka government and the appellant-NICE for implementation of Bengaluru-Mysuru Infrastructure Corridor Project (BMICP) in 1997.

“…It appears that this BMICP may be one of the biggest scam in the State of Karnataka and it demonstrates how a State, which is the trustee of the natural resources on behalf of the citizens, can allow the private interest to flourish in utter violation of the constitutional mandate and the law to the detriment of environment, ecology and against the public interest for questionable considerations…”, the court opined in the order, coming down heavily on the state's actions.

The court held in its order further that on July 29 that no awards were passed 'for 23 years' regarding acquisition of 20,193 acres of land despite the notifications issued between 1998 and 2009.

“…The right to property, though no longer a fundamental right, continues to enjoy the constitutional protection under Article 300A. The power of compulsory acquisition is, therefore, accompanied by a corresponding obligation to ensure that the owner receives just compensation through a fair and expeditious process...”, the court said.

On the contention by State authority and NICE that the absence of a statutory limitation period under the KIAD Act meant no time limit existed the court said:

“…The absence of an express statutory limitation cannot be construed as conferring an unrestricted licence upon the acquiring authority to postpone the passing of the award indefinitely. It is a settled principle of the administrative law that whenever a statute confers power upon a public authority without prescribing any period for its exercise, such power must nevertheless be exercised within a reasonable time. Reasonableness is an inbuilt limitation…”.

BMICP was initiated as an infrastructure project intended to improve connectivity between Bengaluru and Mysuru through the construction of an Expressway of approximately 111 kilometres, a peripheral road of approximately 41 kilometres and a link road of approximately 9.8 kilometres with five self-sustaining townships

The landowners had earlier approached the High Court contending that although their lands had been under acquisition for over 23 years, the acquiring authorities had failed to determine compensation; the Single Judge had quashed the acquisition proceedings.

“…The appellant-NICE seeks to set aside the order passed by the learned Single Judge primarily on the premise that the acquisition formed part of a project conceived in larger public interest. However, the implementation of that very project is accompanied by commercial exploitation of acquired lands, alteration of land utilisation, execution of Joint Development Agreements, sale transactions and capitalisation of project assets…”, the court said.

The Court also pointed out that the project lands were being commercially exploited, with the state being an accomplice to the same. The Court noted that the annual reports of NICE disclosed income from sale of developed land, Joint Development Agreements, and monetisation of project lands as recurring sources of revenue alongside toll collections.

“By constructing the peripheral roads, putting up toll plazas and collecting huge tolls, increasing the toll without prior approval of the State in violation of the Framework Agreement etc., the NICE is earning huge profits without fulfilling the obligations under the FW…The State cannot be a party in concentrating wealth in a private person, by exercising eminent domain at the cost of the innocent citizens/farmers, as the same goes against the Rule of law. The lakes, water bodies, waterbed liners have been transferred to the NICE damaging the environment, ecology and in detriment to the water supply chain of Bengaluru particularly, and the neighbouring areas…”, the court said.

Though such scenarios warranted an investigation as per the court, it also expressed doubt about the feasibility of such an exercise, the state being an accomplice:

“…We have doubt that such an exercise will ever be taken up as the State itself is accomplice in allowing the project proponents to earn huge profits illegally by diverting the lands against the FWA, capitalizing the assets, drying up the lakes, collecting huge toll in violation of the FWA and sitting over the huge land bank without payment of compensation etc”, it said.

It said that there was excess land transfer to the tune of 554 acres to NICE, as admitted earlier by the state before the Supreme Court. Moreover, 110 acres of land acquired were transacted with private developers through JDAs and sale deeds, the court said. Even the company NICE had disclosed revenue from sale of developed lands during 2014-15, the court added.

“…Vesting answers the question of title. It does not answer the question whether the State can indefinitely postpone payment of compensation….The admitted failure on the part of the authorities to pass the awards for more than two decades coupled with the absence of any satisfactory explanation for such an inordinate delay renders the acquisition proceedings unsustainable...”, it said.

The appeals were dismissed.

Case Title: Nandi Infrastructure Corridor Enterprise Ltd. & Ors. v. M/s AMR Housing Development Corporation & Ors.

Case No.: WA No. 1214/2025 & Connected Matters

Citation: 2026 LiveLaw (Kar) 273

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