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CBI gathers crucial evidences of illegal mining

The CBI, investigating into the alleged illegal mining and selling of ore by the Associated Mining Company (AMC), owned by former minister Gali Janardhana Reddy and his wife, has gathered crucial evidence to apparently prove that Reddy had exported and sold within India 80 lakh tonne of illegal ore gaining a gross profit of approximately Rs 2,800 crore.

Illegal mining had taken place across various sites in Bellary and the illegal ore was sold through as many as 30 registered sellers to reach many industries.

Reddy and his associates, operating “cleverly”, had even attempted to get a stamp of legality on their illegal activity at every step and had taken sufficient care to see that no information is leaked from the time of mining till the time of the ore reaching the industries.

Sources in the CBI said Reddy used two modus operandis to carry out mining illegally. One, he mined more than what the licences permitted, and two, he mined in forest areas where mining was restricted.

Reddy had also created fake “legal” documents for selling of ore through registered sellers. The money deposited by the buyers was shared between the sellers and Reddy after deducting costs incurred for mining, transporting and other expenses.

Profit from selling ore under the name of defunct mines would be shared in the ratio of 75 per cent and 25 per cent, with 75 pc going to Reddy and the remaining would reach mine owners who “co-operated.”

Reddy took 90 per cent of the profit when the sale of ore was made through registered sellers. During this time, the estimated cost of iron ore was Rs 10,000 per tonne.

Thereby, AMC had made over Rs 8,000 crore by selling 80 lakh tonne and after deducting all the costs the profit per tonne stood at Rs 3,500. The CBI has gathered evidence to prove this.

The money deposited into the accounts of the registered sellers and defunct mine owners would reach the accounts of Reddy and his wife after passing through several accounts and they would withdraw the money only through cheques.

Several banks in Bellary and Hospet, including Axis Bank, Vikas Souhardha Co-operative Bank and Lakshmi Vilas Bank branches had seen transactions by Reddy.

The CBI has been able to make this progress after getting their hands on Reddy’s close associate and personal assistant Mehfuz Ali Khan.