The Supreme Court on Friday directed the CBI to investigate the linkage between illegal mining in Bellary, Karnataka and Obulapuram, Andhra Pradesh allegedly involving firms including that of Reddy brothers.
The forest bench of the apex court headed by the Chief Justice Mr S H Kapadia accepted the Central Empowered Committee (CEC) report and said it was prima facie satisfied with the linkage as shown in the report.
The court issued notice to the CBI saying the agency must satisfy it about the said linkage. “We also prima facie find that material extracted by the two companies – Associated Mining Company (AMC) and Deccan Mining Syndicate (DMS) – is being routed through Obulapuram.”
Noting that there could be more companies involved in this routing, the Court told the CBI to inform it about the status of its investigation which it had undertaken in respect of Obulapuram Mining Company (OMC) in Andhra Pradesh. OMC and AMC are owned by the Reddy brothers including Mr G Janaradan Reddy (former Karnataka Minister arrested recently by the CBI).
It is alleged that these firms have illegally mined iron ore in lease areas of state-owned NMDC in Bellary, Karnataka and showed it on paper as being legally produced, transported from the other mining leases in Andhra Pradesh. These are then allegedly exported from ports in Andhra Pradesh. Bellary district is bordering Andhra Pradesh. The Court wants CBI to find out how illegally mined ore is routed from Karnataka to Andhra Pradesh, and how much material was siphoned off through that route.
The court observed that the CEC report indicated illegal mining being carried out by DMS and AMC. It added that AMC is involved in serious irregularities as per the report. Issuing notice to the CBI on both these issues, the court asked the Attorney General to accept the notice. The report alleges that illegal mining was being done in the lease area of NMDC by third parties.
The CEC report pertains to the survey, demarcation, e-auction of 25 million tonnes of iron ore stock in Karnataka and related issues regarding the mining leases in Bellary, Chitradurga and Tumkur districts in the state.
The court said it was happy to note that the procedure of e-auction has benefited the economy of the state (Karnataka) as indicated in the report. “We are of the view that the e-auction suggested by the monitoring committee should continue so that the best possible price is obtained,” it said.
The court said the public sector NMDC is permitted to continue mining operations in two mining leases in Bellary subject to the condition that the entire iron ore production from these two leases will be sold only through e-auction by the monitoring committee. The monitoring committee will dispose of 80 per cent of the sale proceeds to NMDC.
The court also sought details of companies involved in manganese and iron ore mining legally. This would help it to consider allowing mining of manganese ore.