The Lokayukta on Tuesday took serious note of the government’s efforts to finalise the bid on lease of Bhavani island, near Vijayawada, to the consortium of M/s Pratyusha Associates Shipping Pvt Ltd in violation of rules.

Investments and infrastructure minister Ganta Srinivasa Rao owns the company.

With a total area of 130 acres, Bhavani island is located in the middle of Krishna river and is a popular spot for picnics and other occasions.

Government Order (GO) 148 of the revenue department (dated February 27, 2011) stipulates that no permanent structures can be raised on the island. It allows only temporary structures built with country wood and bamboo sticks.

But flouting this order, the Andhra Pradesh Tourism Department proposed to permit the bidder to make permanent structures on areas not exceeding 20 per cent of the land, which translates to about 26 acres.

On Tuesday, Lokayukta Justice S. Ananda Reddy directed the Andhra Pradesh Tourism Development Corpor-ation vice-chairman and MD to appear before him on February 28 to clarify the issue. The Lokayukta had earlier directed the tourism department to file a detailed report following a complaint by Mr Sai Krishna Azad, an advocate.

After receiving the report on Tuesday, the Lokayukta directed him to appear in person and file all relevant GOs.

Though eight firms bought the bid documents, only three took part in the auction. According to the complainant, the Lokayukta observed that two of the three firms appear to be nominal bidders, going by the bids quoted.

Pratyusha Associates Shipping Pvt Ltd quoted Rs 289.87 crore whereas M/s LEPL Project Ltd, Vijayawada, quoted Rs 33.21 crore and M/s Delta Paper Mills Pvt Ltd quoted only Rs 25.52 crore. Justice Ananda Reddy also questioned how Suchir India Hotels Pvt Ltd could be allowed with Pratyusha Associates when the MoU was between the government and Pratyusha.